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How to Live Off of Minimum Wage


With the economy still struggling to recover from a debilitating recession, salaries have taken a hit. Gone are middle-income salaries, replaced by low-wage positions. Many of those who are just joining the workforce, or lost their jobs in the recession, may find themselves in a minimum wage position. Millions of people who labor in food, retail, and other service industries only earn minimum wage, and need to support themselves and their families with their paychecks. This begs the question, is minimum wage enough for one person to survive? For a family to survive?


The US minimum wage is $7.25 an hour and hasn’t increased since July 2009, though states can set their own minimum wages, as long as it is above the federal government’s bottom line. For example, Washington State’s minimum wage is $9.19 an hour and is the highest in the nation. As of 2012, 3.6 million making minimum wage or less (1.6 million of that number were making the minimum), which means that their annual salary of $14,500 (at federal rates) was under the poverty level for a family of two.


US places 7th behind Australia ($16.88), France ($12.09), New Zealand ($11.18), United Kingdom ($9.83), Canada ($9.75), and Japan ($8.17) for minimum wage requirements—though a number of countries in the European Union use collective bargaining to set minimum wages, so there those countries don’t have a government mandated minimum.

The federal government’s minimum wage is set to increase by $0.50 on September 30, 2015. However, certain states already have signed into law increases that will occur before the federal government’s planned increase takes effect. For example, California’s minimum wage will increase by $2 over the next three years, putting the state on track to having the highest minimum wages in the nation. The first increase will happen on July 2014, increasing the state’s minimum wage from $8 to $9; the next increase will happen on January 2016, bringing the minimum wage up to $10 an hour, for a net change of $4,000 a year. While these hikes will hopefully deter debt, at least there are services available to assist and consult those in financial disarray.

Many families that live on minimum wage struggle to acquire the basics. Some minimum wage workers living in high cost-of-living cities are living paycheck-to-paycheck. Workers being paid the minimum are often unable to afford their company’s health care, and rely on government-provided healthcare programs like Medicare. Families that rely on minimum wage incomes often also rely on government assistance to pay for some necessities, like food stamps or Section 8 housing.

However, it is possible for an individual, or even a couple, to live on minimum wage in relatively comfortable means. Many of the little luxuries that modern society takes for granted many need to be given up, but minimum wage can cover the basics. Here are some ways where minimum wagers are able to keep afloat.

Use public transportation or walking and biking. Car payments, gas, maintenance, and insurance are luxuries that don’t fit into a minimum wage budget. Transportation is limited to public transport like buses, trains, or subways, depending on whether or not the city offers these services. Buying a metro card or a bus pass can also help save on individual transport costs.

Biking and walking are free and the ideal way to get to and from work or school.

Pare down your food budget and/or grown your own. Save money by growing your own food—the cost of seed, dirt, fertilizer may be more initial overhead, but will be less per item than if you bought them from grocery stores or farmers’ markets. Growing your own food may be more of a challenge for people living in an apartment, but its not impossible. Hydroponic wall gardens allow you to grow plenty of leafy greens and herbs without the hassle and mess of dirt.

When grocery shopping, buy produce that’s in season and other products that are on sale. Use coupons in concert with store specials for major savings of up to 80 percent off the original total.

Changing up your diet can also help save money at the grocery store. Instead of focusing on meat-heavy dishes, switch to meals focused around eggs and legumes to cut grocery bill costs.

Reduce utility costs. Instead of paying for cable, which averages about $70 to $100 a month, opt for subscription services like Netflix, Hulu or Amazon Instant Video, which costs less than $20 a month.

Try not to use your heat or air conditioning or electricity during prime hours—instead of turning on the heat, add an extra coat or blanket; go outside for a brisk walk instead of lounging in front of the TV. Practice energy-saving behaviors to help reduce utility bills.

Shopping for clothing and other basics. Second-hand stores are filled with perfectly useable (and sometimes very stylish) goods at amazing prices. Pick up housewares and clothing, and even furniture, at places like Goodwill and Salvation Army thrift stores at a fraction of the full retail price.

For toiletries, toilet paper, and other dry or paper goods, consider 99 Cents Only stores or Smart and Final or other discount stores that sell name brand products at steeply reduced prices.

While living on minimum wage is doable for the individual or couple, it becomes a much greater challenge for the family. And depending on the state, the minimum may not increase any time soon. People will have to continue to find ways to make do, or rely on government assistance, with the current minimum wage.

by Dave Landry Jr.
on 10/09/2013



Dave Landry Jr. is a small business owner and economist who has recently begun blogging to share his thoughts and expertise. He hopes you enjoy this article, and wishes you luck in managing your money during these harsh economic times.

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