Ok. Here we are. Our first full month under our belt since committing to doing what it takes to reach financial freedom on our terms and in our timeline. I started the month with a few days of refining my budget, and trying to be as real about it as I could. Since then, we’ve been trying to get ourselves to think of our finances differently and to reverse-brainwash ourselves into savings and investing wizardry. But with all that diversion from the real numbers, the real goals can fade from focus. So I’d like to take this chance to check in and see how things are going and to make sure we’re practicing what we preach, or at least learning from our shortcomings.
- Reduced spending – tracking my spending daily really did help me reduce it. In total, I spent a little over $1700, which is over budget but considering a few unexpected expenses that came up, it’s definitely an improvement. I feel like I can build spending $0 in a day into a small but real reward, and that over time that can replace impulse spending urges and helps me to identify places where I can tighten up my budget still. Also, by having my electronic and cash transactions all summarized in one place, it’s easier to see what I’m really spending.
Room for Improvement
- Impulse spending is a habit we all have at some point to some extent. For me, after so much time in isolated and rural places, sometimes when I get to the City for a day or two in transit, it becomes easier to justify unnecessary costs. This is when it’s most important to practice that persistent mindfulness about our budget and bring our attention to the game of $0 spending.
- My Budget could still use some fine-tuning – the nice thing about having my budget and spending all in one place in front of me is I can’t hide from my inaction. For instance, I was going to cancel my no-longer-necessary $39.95 Life Insurance policy last month but after a frustrating experience on the phone with their customer service agent and then getting disconnected mysteriously, I ha to move on to work tasks and haven’t since tried again. I would like to do the same with my phone bill, as I am paying far too much for a phone I use once or twice a month while in transit between Mexico and work. As mentioned in an earlier post, I need to capture things that are paid annually better in my budget as well so that there are less surprises overall.
- Spending journal – just by adding the total amount of money spent yesterday to my preexisting journal routine, and by transcribing that information to my spending spreadsheet, I have been able to get much more real about my spending and in touch with my electronically-paid regular expenses.
- Savings journal – I haven’t totally implemented this for myself yet, but I described how it may work here, and I think it’s a useful tool for those wanting to get started on keeping to a tight budget. I think it eases the pain (perceived sacrifice/losses) and increases the pleasure (rewards/gains) of budgeting.
- Avocado/Tuna/Lime/Cilantro/Chilies/Salt – while trying to be particularly thrifty with food spending in September, I (re-)discovered a few simple healthy recipe ideas that cost very little and keep me going when my days are full of surfing and siestas and I don’t feel like taking the time to cook more time-consuming meals. As a matter of fact, Anything/Lime/Cilantro/Chillies/Salt is a great snack recipe that I’ve learned during my time there to make quick, healthy snacks such as marinated cucumber or jicama. With the tuna mix, I put it on a Tostada (giant nacho) or something similar and maybe along with a fat and protein-rich smoothie (hint: avocado instead of banana), call it lunch.
What I’ve Learned
- It’s not easy. I’ve set a really tight budget and sticking to it means very little room for error. This of course requires constant mindfulness practice about your plan. Little by little, you are always moving forward towards your own financial freedom, but only if you can stick to the plan.
- The smaller your budget, the more you one expense or savings can impact it. This can be nice when you save on something or avoid a cost altogether, but it can also be frustrating when one unforeseen thing can totally blow your budget by 50%. This means it’s important to always re-visit your budget and make sure everything that can be accounted for, is. It also means that you are going to feel the pain of each expense more which, in the long run, should help as well. Every dollar you spend is a dollar that will not be working for you in the future. Feel that loss.
- I have expensive goals – I’ve recently been revisiting the idea of becoming an airplane Pilot in my ‘retirement’. I almost did this when I was younger but went down a different path instead. At this point, it would be a medium to long-term goal, and something I would probably pursue moderately rather than full-bore, but damn do I feel lucky that it might actually be a possibility if I actually choose to go through with it in the end. If not, that money will be put to work for me in some other way and should be available to me in the future to use to enrich my life and challenge myself with new skills in my long and fruitful ‘retirement’.
- You can save shopping on line. If you’re absolutely certain you need to make a moderate to large purchase, think about doing it online. I found some great deals with access to stores I wouldn’t have had access to if I had gone to town to shop. And, they’re going to deliver, so I save a lot of time and even some gas money. It’s easy to can spend too, especially if you browse, so be careful. You still need to be mindful. Don’t go online shopping to kill time just like you shouldn’t go to the mall to kill time. Whatever you are buying, identify it, find the deal that works for you, complete the transaction and get out of there. You don’t need all of the associated accessories that you didn’t even know existed until you went to get your new item.