$2,000 monthly budget

$2,000 Monthly Budget

Could you live on a $2,000 monthly budget if you had to?

Regardless of your circumstances, could you do it? That’s $24,000/year or $500/week.

Let’s run a few sample scenarios with a $2,000 monthly budget. With all of these we’re going to assume that you have a full-time job as a healthcare professional. This means that you have:

  • health insurance
  • disability
  • malpractice
  • life insurance
  • access to the internet and a computer
  • likely a work provided cell phone

We’re going to assume that as a healthcare professional you are earning in the top tier of your profession. If you’re a family doctor then you’re earning $300k gross.
If you are a PA you are earning $150,000.
If you are a pharmacist you are earning $100k/year and so forth.

I know that housing and debt will be the biggest points of contention so let me squash those right now.

You can buy a 1,300 sqft home in Rancho Palos Verdes, Ca for $1.5 million or you can buy a 2,000 sqft home in Ely, NV for $90,000.

The debt you owe isn’t really part of your monthly budget much like your taxes aren’t accounted for. Sure, if you are paid as a 1099 then you set taxes aside. And if you are planning on demolishing your debt then you’ll be aggressively budgeting for it. Still, your debt isn’t part of your budgeting unless you’re planning on accumulating more debt in the future. In which case it becomes your normal overhead and should be accounted for.

 

Budget #1:

  • Housing $950/month
  • Groceries $600/month
  • Transportation $150/month
  • Utilities $100/month
  • Personal $50/month
  • Entertainment $50/month
  • Clothing $20/month
  • Health/Dental care $50/month
  • Travel $30/month

 

Budget #2:

  • Housing $1,300/month
  • Groceries $420/month
  • Transportation $50/month
  • Utilities $50/month
  • Personal $30/month
  • Entertainment $50/month
  • Clothing $20/month
  • Health/Dental care $30/month
  • Travel $50/month

 

Budget #3:

  • Housing $400/month
  • Groceries $800/month
  • Transportation $300/month
  • Utilities $100/month
  • Personal $30/month
  • Entertainment $140/month
  • Clothing $50/month
  • Health/Dental care $30/month
  • Travel $150/month

 

Budget #4:

  • Housing $1,500/month
  • Groceries $300/month
  • Transportation $0/month
  • Utilities $50/month
  • Personal $20/month
  • Entertainment $50/month
  • Clothing $20/month
  • Health/Dental care $30/month
  • Travel $30/month

Budget #5:

  • Housing $0/month
  • Groceries $800/month
  • Transportation $250/month
  • Utilities $150/month
  • Personal $50/month
  • Entertainment $300/month
  • Clothing $100/month
  • Health/Dental care $50/month
  • Travel $300/month

 

Why even discuss spending $2,000 a month – a $24,000-budget when a healthcare professional has way more than that at their disposal?

The main reason is that it gives a household options. And everyone will have plenty of reasons and many excuses as to why they have to be in a particular home, in a particular State, or in a particular part of town.

One fact remains undisputed by most economists, the minimum lifestyle enjoyed by many residents of the US is far above and beyond what others get in other parts of the world.

Should a household want to make a drastic change in their lifestyle or living condition then they can choose to pare down their monthly budget. Any disposable income that’s left over could be put towards debt, towards buying a home, or whatever else one desires.

Maybe you want to work less.

Maybe you’d rather spend less so that you can focus your extra energy on other projects.

Maybe you want to take on a job and want to take a future pay cut.

 

One Final Budget

I saved budget #6 for last. It’s the one that one of my acquaintances and his family recently took advantage of by accepting a locums position in Alaska doing remote medical work. As an internal medicine doc he earned $350,000/year and his wife did some online teaching and earned $30,000/year.

PS: Alaska has zero State income tax.

 

Budget #6:

  • Housing $0/month
  • Groceries $800/month
  • Transportation $0/month
  • Utilities $200/month
  • Personal $50/month
  • Entertainment $100/month
  • Clothing $50/month
  • Health/Dental care $0/month
  • Travel $0/month

» Total: $1,200/month

 

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