Finding the right balance between saving for retirement and enjoying life now
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| Outer Banks Scenic Byway, North Carolina |
Warren Buffett: “Do not save what is left after spending, but spend what is left after saving.”
Since our early retirement in August 2020, my wife and I (and Toby, our Pomeranian) have spent just about 8 months out of the year slow traveling, that is staying at a place for a month or longer. The remaining 4 months have been spent with our family back in New York City area.
The journey to become financial independent and to retire early is a delicate balancing act, as you’re trying to save up as much as you can for the future, but also trying to enjoy your life NOW.
There were struggles wondering why we couldn’t go on a European vacation like our friends. There were times when we felt deprived of tasty food at expensive restaurants. We wanted to be more spontaneous and do a weekender to a city somewhere, just because...
If you ask me now if all these struggles and sacrifices were worth it, then I would say ABSOLUTELY!
I would trade my current, retired life for my past life in a heartbeat. I no longer have a home or an apartment rental to worry about. This means no mortgage or rental each month on the 1st of each and every month. There are no more sewer bills ($25 per month to use my toilet!), no more electricity/gas/water bills, and no more property/school/county/community college/emergency services taxes!
No ‘home’ means no mulching twice a year, no sprucing up the yard, painting around the house, fixing things that constantly break, replacing water heaters that die as soon as warranty expires, and fixing the windows that don’t open or stay open...
These days the only things I have to worry about are my AirBNB/Vrbo monthly rental (which include electricity, gas, water, WiFi, heat/air conditioning), groceries, gas for my car, health insurance, and car payment/car insurance/car tolls. When I’m not staying at an AirBNB, my bills are even less, as my family lets us stay at their place in exchange for us treating them to short trips and/or food.
My mom mentions she enjoys us staying at her place from time to time. She says she feels safer when we’re around...
On top of that, we no longer need to work or prepare for work. Work equals 40 hours per week plus time spent preparing for work, including commute time, grooming time, buying work clothes time, meal prepping for the week, etc.
You’d be amazed how much time you have when you’re not working. These days, hours are spent visiting local places, reading more books, writing this blog, uploading my YouTube videos, taking afternoon naps, exercising, and listening to music.
All these are possible because we CHOSE to balance between saving for retirement and enjoying our life while we were saving up for the future.
These are some of the things we did to reach that balance:
- We did not go on expensive international vacations or even weekenders but instead chose day trips to state parks or other nature areas or refuges.
- We cut out expensive restaurants where an entree would cost around $20-$30, for cheaper takeout food. Bills for expensive restaurants would be upwards of $100 with tips and drinks. We cut these out for much cheaper takeouts which would be around half of that, but which we would eat 2 or 3 meals out of that...On special occasions, like when my parents were visiting, we would splurge, but these were the exception and not the norm.
- We cut out grocery bills in almost half by cutting out drinks and most sweet stuff, but treated ourselves once in awhile so we don’t feel deprived. Many of my colleagues know that I cut sugar out of my diet few years back as I don’t have the best teeth. Out went cookies, candies, ice cream, cakes, and sweet cereal. Sodas, Snapple iced teas, water mixers were cut as well. We would buy beers (Sam Adams, of course) once in awhile and sodas sometimes, but not usually. This saved us about $20-$40 per shopping trip. We brewed iced tea or green iced tea from home (or drank water).
- We stopped shopping for clothes around 2019 completely. Strangely, we don’t feel deprived because of this anymore...The only thing I purchased was a pair of socks for a dollar. My wife purchased a coverall for $20 since 2019.
- My wife stopped buying expensive cosmetics since about 2014 and instead use more homeopathic ingredients for skincare like using glycerin, coconut oil, etc. which are so much cheaper. During Christmas, we would spend close to $800-$900 on her cosmetics plus my mom’s and her mom’s cosmetics. We’ve stopped this madness...
- We shopped for different car/home insurance company after we realized premiums kept going up. We saved about $250 per year after changing the insurance company.
- We refinanced our home twice. First from a 30 year mortgage with interest rate of 6.75% to a 20 year refinance with 5% rate. We then went to a 15 year refinance with 3.5% rate. All in all, this saved us both years left and in interest paid.
- We paid extra into our mortgage as much as we can. Some months would be a $200 additional payment towards the principal, while other months would be a $1000 additional payment.
- We constantly communicated our thoughts, goals, and current financial situation. As a couple, money matters must be dealt with by both parties. You have to be on the same page, otherwise, you cannot achieve your financial goals...Communication is the key between partners.
- You can still enjoy life by going to parks to hike / walk. You don’t need to go on a latest hot vacation spot because someone said it’s cool. Don’t underestimate the power of exercise! You’ll feel so much better hiking / walking in a wooded setting and spending quality time with your pack.
- You can reduce your grocery bills by simply brewing your own iced tea or drinking water, for example. You’ll be amazed at how your body adapts after awhile. I don’t miss sugar much after going without it for few years...
- Indulge in expensive restaurants on special occasions and not every weekend. Try takeout most of the times. I always believed if you’re disciplined 70% of the times, then you can indulge 30% of the times. You can’t expect to be perfect in life. Make small changes to get better at something, and eventually it’ll get easier...
- Look for ways to cut out / reduce spending as well as looking at refinancing your mortgage to a shorter term. It’ll feel tougher to shorten the time of your refinance, but you’ll be saving so much money on interest. Same goes for your home/car insurance...
- Always communicate with each other. Discuss your current financial situation, plan your future together, and see where you see yourself in 3, 5, 10 years. If you don’t write down your goals, then you won’t achieve them...
- Lastly...Don’t cut out everything you enjoy now for your future. This exercise will become futile real quick. Enjoy your life, but plan for it. Budget for it. Put aside x number of dollars to do what it is you love to do.
I hope someone reading this post can try some of these recommendations and better their financial lives. Thank you all for reading!
Jake
Wandering Money Pig
If you missed the post ‘What’s it like to hand in your resignation...’, please click here.
If you missed the post ‘Not caring too much equals happiness…’, please click here. Please check out our YouTube channel ‘Wandering Money Pig’ showcasing our travels and our Pomeranian dog! https://www.youtube.com/channel/UC3kl9f4W9sfNG5h1l-x6nHw
