At this point I would say I have reached another financial peak and plateau, at which I get to look out and enjoy the view ahead. The first time this happened was when I initially cut out some of the real crap from my costs. Now it is more about streamlining and calibrating. I initially thought trying to save more money would be a dehydrated, untenable exercise, like being on a painful diet. But it’s actually cleansing and liberating like achieving a higher level of fitness and enjoying your stronger body.
In roughly chronological order:
- Embraced the emergency: cut out Netflix
- Said goodbye to the gym
- Bought the car already
- Beer budget
- Focus on debt goals
- Coffee to instant coffee to tea
#1: Netflix. The very first thing I did was go through and cut out anything not required. It was only $12/month, but I figured I did not even deserve to watch a movie while I am still in debt.
#2: Gym. I enjoy fitness, and went probably 20-25 days per month. But I was spending a pretty significant $50/month on this. The choice was made easier by a smaller but free gym provided by my workplace. Funny though… I work out basically all outdoors now. Running in the winter outdoors in New England gives you character.
#3: Car. Due to another life circumstance, I was required to save and deposit large sums of money which were eventually returned to me. So while amassing a sweet $14k emergency fund felt amazing, I went ahead and dumped $11k into paying off the car. That’s $330/month in the bank.
#4: Beer. Ah the beer budget – I am still working on this. Beer was also important to the blue collar lifestyle I was developing for myself. But guess what? I drink a little less beer, and now I don’t have to hit the liquor store as often. There are also fewer bottles lying around and crowding up the recycling bin. And good for the waistline I hear.
#5: Goals. As a result of all of this financial muscle-building, I started to flex the muscle. I started setting aggressive and meaningful debt goals (“with a $1400 payment this month, the loan will go down below $10k and that will be awesome”). When you are focused on something concrete and important, new shoes will just have to wait until next paycheck. And then the one after that.
#6: Tea. Over time I wound up with this pretty pronounced workplace cafeteria coffee habit. About $1.50/day, which I told myself was way better than Starbucks at $3.70/day. Then I decided that was weak, and switched to Nescafe instant coffee that I would prepare at work. About $0.15/serving. Then I figured as long as I am going “alternative” with things, I should try to be healthier and drink tea. Also $0.15/serving. Now even a single cafeteria coffee feels decadent and for chumps at $1.50 when I could make an antioxidant-packed tea for a tenth of that! At a $1.35/day overall savings, this move keeps $27 in the bank every month.
So just with the above, I have cut a concrete $419 from my monthly spending, which is then put to loans. Not to mention paying off the loans liberates my whole bank account. I am curious what concrete steps others have taken to streamline their finances…