Saving isn’t my strong suit. I am a spender by nature and always have been. I remember when I was in high school and not doing too well my mother telling me she was concerned about my grades in a strong way. “You know if you don’t do well in school you won’t have very much money, and I know how much you like to spend money.” More on my strange relationship with money in a future blog.
As you can see I have was a spender from a young age. Every dollar had a plan and I was looking at the next great thing to spend it on. This resulted in some pretty hefty credit card debt right after high school.
I didn’t go to college but instead got a job right after graduation. I also moved out of my parents house as soon as I could. Affording an apartment on a part time grocery stockers wage was not easy and I filled the void with debt. I was still in the spending mind set, still set on having the next nice thing and getting that dopamine hit.
This spending habit lasted into adulthood. Honestly it lasted until a few months ago. As my career grew and I made more money so grew my spending habit. We call this life style inflation. Every penny went to increasing our life style.
The pattern was to rack up credit card debt until a bonus would come along at work and could be used to pay down the debt. I could try and calculate how much money was spent on this horrible cycle but it would be depressing, so I won’t.
All that changed when I rediscovered the FIRE community.
The wife and I full bought in and committed. We started tracking our expenses on Personal Capital and really looking at where our money went. A few things were obvious but others took some digging.
The biggest cut we were able to make was around our trips to the hardware store. We had purchased an old 1922 house and it needed lots of repairs. In our first 3 years in the house we had thrown tens of thousands of dollars at the place. Going to the hardware store was a weekly occurrence. While it was fun building my tool collection, learning new skills and not paying a contractor it built our credit card bills also. We have committed to cutting our home remodels for the rest of the year.
The next big line item was our grocery bill. We were spending well over $1,500 a month on groceries for a family of four. Don’t ask me how we did it but we managed to buy every nice high end food we could get our hands on. Costco became our new home for grocery shopping and this last month we got our food budget under $1,000 for the first time. We still have some room to grown here but it was a big improvement.
Amazon was the next place to take a hit. No longer did we shop to fill time and to have something to look at when bored.
There were many other ways that we made small reductions but needless to say it has had a huge impact. 50% saving rate isn’t the largest in the FIRE community but it is respectable and is moving us in the direction we are looking for.
60% saving here we come.