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pagliaci
Junior Member
USA
90 Posts |
 Posted - Nov 26 2008 : 4:23:06 PM
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Hi, gang, I wanted to start a thread where FIers could post tricks they've learned along the way. We can all read and comment on each others and hopefully learn!
Do you have a tip? trick? pearl? Hard lesson you learned?
POST IT UP!
Acceptance.
My first is acceptance of my values. For a long time I tried to deny some things fundamentally important to me.
I like nice clothes. This is not a "Gazingus pin" as I don't have a ton of them and I don't need/want to shop very often. WHen I do shop I do so at outlet malls and buy only a couple of pieces. The right piece of two make all the difference...I don't need a closet full of 50 items!
For a long time I didn't shop at all tyring to save money and retire sooner. I got furstrated. Something was said at work. So I went shopping. BOY did I go shopping. I bought to many clothes (More than I had before) almost like a person who skips lunch and then over eats at a buffet.
Well, I was able to return some of the clothes and I came away with an important lesson. Your values are your values. Accept them. That is a big part of FI. Not just retire early but alligning your money with your values.
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Taking the next step along the path of simplicity...
Jason |
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pagliaci
Junior Member
USA
90 Posts |
Posted - Jan 04 2009 : 05:38:25 AM
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Next lesson. I need to keep a closer track of my money. I never really did step 3.5 where I would balance everything. I felt it was to much of a pain. Well, I just did some calculations and realized I have about 100 bucks I can't account for over the past few months. OK. Time to keep a closer track and start balancing!
Has anyone else learned any tips they'd like to offer to those along the path? An expirience that made you wiser? POST IT UP!
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Taking the next step along the path of simplicity...
Jason |
Edited by - pagliaci on Jan 07 2009 8:51:01 PM |
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Crystal
Moderator
10755 Posts |
Posted - Jan 04 2009 : 05:44:52 AM
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I haven't read the new book yet, but I would say tracking daily, spreadsheets monthly, and asking myself the values and fulfillment questions has been important to my success. The wall chart has also had a huge value to me. When I was paying off debt, I kept it right above my bed and it was large -- about 3' x 4'. Now I have no debt and just chart income, expenses and savings, so it's just a little chart on the wall by my computer -- but still important feedback.
Crystal |
Our vision is for a friendly online simple living community. |
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mackpal
New Member
Australia
40 Posts |
Posted - Jan 07 2009 : 1:32:18 PM
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| Somewhere in the book it says something like, "start, then keep going". I've had trouble being consistent with my tracking, but I'm hanging in there and have enough data to knock up a patchy two year wallchart. I've found it easy to become disillusioned the more aware I become of just how long I have until retirement, even on the program. Just plodding along unconsciously is the easy alternative, even if it means retirement is much further away. Anyway, my point is, just keep going and don't be put off if you drop out now and then. |
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jrb3
Moderator
USA
2118 Posts |
Posted - Jan 08 2009 : 07:20:07 AM
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I think one lesson I'd like to pass on is that, for much of the journey towards debt-free (or financial independence, or whatever your financial goal is), it's bog-standard government-issue BORING. Nothing to write home about. Or almost even think about. Just another step up the cliff-face. Once in a blue moon, something exciting (or terrifying, or disgusting) happens which visibly pulls you forward or pulls you back. These disruptive events do change how soon you'll arrive; it's the steady slog which determines *whether* you'll arrive at all.
So far, I've had a few major ups and downs on my trip towards financial independence. Big gains came from selling our homes in California, buying our residence with cash after moving to Georgia, and stumbling across (and taking) higher-paying jobs. Our biggest setback to date has been going too slowly in getting money into our preferred investments -- had I been on top of it, we'd have $100K more in good-yield municipal bonds, before the US financial brou-ha-ha, and be five years closer to retirement.
But underneath it has been the steady rise in our net worth, our capital in particular, which comes only from living below our means and using our money wisely. The household remains healthy, hearty, and happy. Retirement itself is a matter of when (not if), relying on how well I can harvest the wins or contain the losses from the funny spurts, and how well we can keep the steady upward slog going. All else being equal, the girls will be off to college and my wife and I will both retire from needing paid employment in our late fifties.
Joseph |
Joseph Beckenbach
From each *voluntarily* according to their ability, to each *unimposed-upon* according to their need.
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Danny
Advanced Member
Canada
8753 Posts |
Posted - Jan 08 2009 : 08:28:36 AM
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Pearls could include;
* the shift in thinking that needs to take place and happens at a different pace to different people with different values to guide them.
* the sense that there is a map to follow that will lead to success but it takes a determined denial of instant gratification and instead take aim for long-term results.
* plan for recreation that is affordable.
* it is work but with wonderful rewards. |
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Hogan
Member
USA
261 Posts |
Posted - Jan 18 2009 : 1:05:45 PM
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One tip I can suggest, that has worked very well for me, is to pay close attention to the "life energy expenditure" equation when I contemplate making a purchase. Calculating my own real hourly wage, it is a simple matter to ask myself, when contemplating a purchase, "would I be willing to work X hours in exchange for this thing? Would that be a fair trade?"
Putting myself in both the position of buyer and seller, I have on many occasions found myself trying rip myself off! When I then refuse to get myself into an unfair exchange, I always feel calmer, happier and with a LOT more self-respect. I have grown to think that this internal paradigm shift is even more valuable than the inevitable financial gains, but having both are terrific!
The trick is to SLOW DOWN and not be afraid to really think: think long, think hard, think deeply, and think lovingly. The truth really will set you free. |
Hogan
www.lanamcglasson.com |
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BohoBelle
Junior Member
Australia
89 Posts |
Posted - Jan 20 2009 : 1:20:38 PM
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quote:
Originally posted by pagliaci
Do you have a tip? trick? pearl? Hard lesson you learned?
Thanks pagliaci, this is a great post. :) |
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pagliaci
Junior Member
USA
90 Posts |
Posted - Feb 11 2009 : 6:57:30 PM
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Notes from January.
Well, it was a good month. Savings rate dipped to 49.1% of take home pay. Its been just over 50% these past few months and it seems my range will be roughly 49-54#.
I did switch almost entirely to a cash economy. MY car battery died and I had only 52 bucks on me. The new battery was 57(Under warranty). So I used plastic. No biggie (I pay them off monthly so no big deal.)
Spending was really great and I'm starting to feel pretty dialed in when I do my month end. Not to many suprises and all my spending is concious.
Several of my expenses were great. I spend 93 bucks on leisure and enjoyed every penny. I just wished I'd had more good options so the number could have been higher.
Interestingly a few nights ago a friend and I went to a movie. She had free passes. So I bought the refreshments...like 15 bucks. UGH. Oh well. No biggie. If I'd bought my ticket around 10 so not that big a deal. I probably should have just bought the popcorn . Hurm. Interestingly the only was to learn good spending it to see what is NOT good and then adjust!
Anyway, I've paid my 2008 property tax (They are due in 2009 in my community) and my annual car insurance recently. My home owners is paid up for a while. So I'm in good shape for a bit and hsould be able to do some real open field running. I'm going to maximally fund my 2008 roth prior to april 15! Whoo hooo.
Anyway, I'll update this probably in a month or when something interesting happens. |
Taking the next step along the path of simplicity...
Jason |
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flowerqueen
New Member
37 Posts |
Posted - Feb 12 2009 : 03:48:42 AM
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Generosity.
If you hold your money too close you miss out on a lot of joy.
In these tough times there are many people who are suffering. Is it more worth it to me to save an extra $5 a week or to buy items on sale with coupons for a food pantry? A friend has some big medical bills even with insurance. Is the $10 I spent on a big pot of nutritious soup and some homemade bread worth it so her and her kids could eat for a couple of days? You bet.
When you get in the habit of tracking all of your cash it is very interesting. Very few people who have done this for an extended period of time are not shocked at the outflow in some areas. Eating out, clothes, the cups of coffee and scratch off tickets, books.. it goes on and on. |
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sweetana3
Advanced Member
3954 Posts |
Posted - Feb 15 2009 : 04:10:22 AM
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To avoid temptation, avoid advertising. The message is structured to make everyone think that spending will make you happy. We all feel the need for happiness at times and we follow the message. So avoid advertising, including magazines, as much as possible.
It has worked for me. I have almost no desire to run out and shop, redecorate, change my look, or otherwise spend my money on unnecessary items. |
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ellied
New Member
3 Posts |
Posted - Mar 10 2009 : 06:51:34 AM
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| I found that the most difficult time I had with following YMOYL was the guilt I felt when I realized how much money I had wasted through the years on unnecessary expenditures such as clothes and shoes. I didn't like looking in my closet and seeing all the unnecessary stuff. I think the best tip I can offer is to be kind to yourself and realize that at one point you were caught up in the consumer culture and that this awareness is painful. However, if you keep a hopeful attitude and change your direction, at some point the guilt and other painful emotions will pass. |
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crunchycon
Advanced Member
1131 Posts |
Posted - Mar 10 2009 : 07:50:30 AM
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quote:
Originally posted by ellied
I found that the most difficult time I had with following YMOYL was the guilt I felt when I realized how much money I had wasted through the years on unnecessary expenditures such as clothes and shoes. I didn't like looking in my closet and seeing all the unnecessary stuff. I think the best tip I can offer is to be kind to yourself and realize that at one point you were caught up in the consumer culture and that this awareness is painful. However, if you keep a hopeful attitude and change your direction, at some point the guilt and other painful emotions will pass.
"No blame, no shame" is easier said than done, but it's a worthwhile concept to keep in mind. |
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pagliaci
Junior Member
USA
90 Posts |
Posted - Mar 10 2009 : 5:23:54 PM
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So, I did well from a spending persepcttive in February. I saved 51% which is good. I realized that my take home income has fallen due to some tax changes ( I could explain but sort of meaningless. Related to 401K deduction).
I have been carrying more cash. Around 100 bucks so that those 50-100 dollar expenses (Co-pays. Car batteries, etc) can be that way rather than credit, which has been nice.
My fixed expenses now consume the vast majority of expenditures. Car insurance, mortgate/PITI, debt service (Yes, I know, I'll be debt free except mortgage by years end!).
IN fact PITI, Car insurance, student loan payment and basic service on one deb took up 75% of my expenditures. Meaning that the other stuff (Which includes gas and electric takes up the vast minority of my expenditure! YAY. I'm definetely not overspending!
The bad news is net worth went DOWN based on my investments in stocks. Oh well. On ward and hopefully upward soon!
Ultimately, I will be faced with some large decisions in the coming months. Do I want to continue my current (very satisfying)lifestyle or try something else. Major options at this point are get a room mate or start working some weekends! Both would increase my income and decrease my time to FI. I need to run some numbers on how much. I may try both for a bit, although long term we'll see.
I do not see myself living in this house along at FI. To much overhead and to little need for the house given that it is just me. But working now, it is nice to come home to a quiet place.
We shall see.
As always, comments welcome.
MOD: OK. Of my rough total expenditure (Excluding taxes and health insuraces) My PITI is roughly 40% of expenditure. Debt service (Student loan and 401K loan) is 20% "Fixed" expenses of phone bill, power bill, gas, car insurance ( No car payment), healthcare (IE a deduction from my paycheck) make up about 15-18%. Meaning over the last few months my other exependitures (Dog, leisure, food, restaurants, etc) has only been 20-25% of expenditures! I'm really happy with that.
I'll do the math formally when I get a bit of time. |
Taking the next step along the path of simplicity...
Jason |
Edited by - pagliaci on Mar 10 2009 6:18:01 PM |
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jrb3
Moderator
USA
2118 Posts |
Posted - Mar 11 2009 : 04:57:10 AM
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Nice, Jason, nice! Once you've got your mortgage paid down to 80% of appraised value, you can arrange to lose the insurance your lender requires, and take back responsibility for anything else you might be putting through escrow. That'll accelerate progress a bit.
Any sense of how much longer until debt-free? Check FI too: if I calculate correctly, saving 60% of take-home and investing it into 5% after-tax return investments (in-state muni-bonds for example) means FI will be eleven years after debt-free given starting from absolute scratch and with no change to expenses. (Not 14 years, since your investment is compounding.)
The newcomer can appreciate how reducing expenses and raising income accelerates this. If savings rate jumps to 67% FI comes in eight years; at 75%, six years. (5 years needs 79%, 3 years 85%, 2 years 91%, 1 year 95.5%).
Reducing expenses and raising income calls for gloriously satisfying creativity. I've known of people in Jason's shoes who downsized by building their own houses, designing in passive and active solar features, growing and making some of their own food, and so on. Others lived out of RVs, or (like Vicki Robin) got housemates.
Joseph |
Joseph Beckenbach
From each *voluntarily* according to their ability, to each *unimposed-upon* according to their need.
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pagliaci
Junior Member
USA
90 Posts |
Posted - Apr 10 2009 : 4:57:41 PM
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Ok, gang, I'm going to use this thread as something of a journal. I'll post monthly or so. Please comment and share any thoughts, etc...it will be appreciated!
As for March, it was an OK month. Savings rate of about 46% due to a single unconcious expenditure and house repair (I spent two-three days trying to do it myself. Eventually I wanted the sewage out of my tub!). I also had my parents give me a bit of cash toward my upcoming trip to Africa.
Ah, yes. Booked my ticket today. I go every year to volunteer. It is one of my very best expenditures.
Anyway, good news is I contributed maximally to Roth for 2008...I mailed the check a few days ago!!! I had previously maximally funded a 401k...so I'm moving along.
I'm well on path to be debt free except mortgage by the end of the year...which is my next big milestone.
I'm also doing some weekend work for additional pay. I'm not sure how long this will last but my hourly rate is much better than my weekly rate (Its not time and a half, but close enough.)
I'm really really pleased about the ROTH and being on page to be in better shape by the end of the year. |
Taking the next step along the path of simplicity...
Jason |
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YMOYL tips, tricks and pearls
