Marco Banks wrote:These are my people. This is why I love this forum.
Do you all realize how completely counter-cultural this kind of thinking is? Weirdos. All of you -- weirdos. And I count it an honor to be a counter-cultural weirdo too.
These are the attributes that will make you all wealthy.
David Huang wrote:I certainly agree with all you both wrote Travis and Marco! Most of my life I've really focused on reducing my cost of living. Of the two approaches to increasing your savings rate it is the most powerful one as I noted in the blog post. I'm also completely with you Marco on shifting to other forms of capital that bypass the whole tax system such as the living capital of edible plants. I touched briefly on that in the post too, trying to explore how the gap might related to these other forms of capital.
What I'm thinking I wasn't clear enough about in my synopsis post here is that I'm thinking there can be a benefit to shifting the mindset from focusing on either reducing spending or increasing earning to instead focus directly on increasing ones savings rate. In terms of achieving financial independence/early retirement it's all about the savings rate, not how little you spend or how much you earn. Focusing on the saving rate is harder to do I think because it's a bit more abstract, needing to be calculated from the data sets of how much you spend and earn over a period of time. I guess I was wondering if there are others here who have tried shifting their mindset to directly focus on the percentage of their income they save rather than just looking at one side or the other of the equation?
I don't hugely keep track of spending but my husband realized he was spending a lot of money on energy drinks. He decided that every time he wanted and energy drink he would put the same money into a stock account. He ended up with enough money there to pay for a certification he wanted to get.
David Huang wrote:. If you were able to maintain that awesome 90% savings rate and invested the extra money then in under 3 years you could be financially independent, able to retire and live the same lifestyle off the interest from the investments.
David Huang wrote:
Does anyone else here track their numbers? How did things go for you this past year?
I would like to suggest that rather than calculate based on "removing" that cost, that you do what all businesses are expected to do - "depreciate" a large purchase that has value for a period of time. So if that battery bank can fairly assuredly last 7 years, that's 84 months. So I would divide the cost of the batteries by 84 to see how that affects your "monthly" spending.
However, a large portion of that was a major cost replacing the battery bank in my off-grid solar system. That investment should last me another 7 to 10 years. If I remove that cost I was at $753 a month.
I read a bunch of stuff about the concept of "minimum livable income" that's been in our news a lot recently. One of the points used to support the concept is that it's been shown that people spend what money they have on healthier choices if they feel they have "potential for a good future". Unfortunately, more than that sometimes just tips people into the "I deserve to have everything my neighbor has" mentality, which is easy to have happen with all the advertising bombarding one wherever they go!
Can I do better this year? We shall see. It looks like I'm averaging slightly less so far, but only slightly. So this may end up being my "enough" figure.
Jotham Bessey wrote:
I tell everybody that I'm not poor, I just don't have much money!
"If she would just be content, instead of trying to build a house on land they do not even own, they should buckle down and make do with their living arrangment for a few more years, pay off their land so they have a clear deed to it, and THEN build their home. It is bad enough to build a home using a traditional mortgage because a person is then indebted to the lender, but at least there is some consumer protections there. With owner financing there is NONE for neither the buyer or seller."
I'd add the warning that before you quit, try to make a list of 20 or so things you'd like to learn/build/experiment on etc. I know too many people who just coasted through their life without ever tackling a challenge and that was before we had TV, computers and social media to suck you in and eat 3 hours before you know it.
One warning I might have for someone about to drop out/cut the hours back in the job rat race...
When I first went into my own biz from just working jobs it was scary because I had been so heavily programmed to mindlessly grind it out 40 or more hours a week as a 20 some year habit habit that it was EXTREMELY uncomfortable to not be doing that.