Anybody who says they have THE answer to how people can make and maintain big life changes is probably selling a big, hot, steaming pile of crap. The same goes for those who say they know THE answer to why people engage in, or are able to stop, self-destructive behavior like overspending. I can say what’s working for me, though.
In the last two months, I’ve been on this Fishtailing Joyride in the Opposite Direction. I’ve made a ton of changes in a short time in an effort to work my way to financial freedom. Mainly my focus is on cutting my family’s monthly spending by more than half and using the savings to pay off debt. I suppose the jury is still out on whether the changes will stick, but it’s hard to see myself turning back.
It all started when I happened upon the blog I keep talking about, Mr. Money Mustasche: Financial Freedom Through Badassity (MMM herein). MMM and his partner lived frugally on $25k a year regardless of income, saved and invested the rest of their earnings, and retired at age 30, when their investment dividends were enough to cover their expenses (and, happily for them, when they became parents).*
I’d come across this blog once before. It was years ago on a search for ideas to save more money. Unfortunately, the merits of frugal living didn’t sink in for me then. I felt our spending was already frugal enough. We were following all the Dave Ramsey and Suze Orman advice on stuff like saving 15% of our income. Cutting spending much further felt like more sacrifice than we were prepared to make. I’m pretty sure I just cancelled our newspaper subscription as a feeble gesture toward saving some cash and moved on.
What made change so easy now?
This time the idea I could improve my life through frugality not only hit home; it changed my mindset toward money practically overnight. In a world where most New Year’s resolutions apparently fail, how in the heck could I pull off such a gigantic shift, and so quickly to boot?
I’m just a sample size of one here, but I’m pretty sure what made this change possible was this combo:
- a life-changing event (having kids) and
- a compelling, detailed story about how other people live frugally with a wonderful quality of life (that’s MMM’s blog).
Here’s why having kids was a game-changer: my goal this time wasn’t saving money. It was setting a good example for the kids I now had and living with integrity—actually being who I say I am. If saving money was the goal, I might simply go to coffee shops less often. But I wanted my spending to reflect what’s important to me.
It didn’t. My spending habits were rooted in convenience and distraction. I might scan Amazon in a moment of boredom and order a few dozen rubber duckies because they’d be a great decoration at my sister-in-law’s baby shower. Or a new book I wanted to read. Or a cool toy our kids would love. Then there were the aforementioned coffee shops and restaurants. And our $181k in debt, even if it was mostly “good,” reflected having spent more than we had earned. Making wasteful, impulsive purchases and spending beyond my means are not practices I aspire to or identify with. That’s not me. But wait: if I’m doing those things, then aren’t they part of who I am? Ouch.
Here’s what I really think is important: a safe place for my family to live, enough food for us to eat well, quality relationships with people I care about, and fulfilling work. That’s it. If frugality is a way to focus in on these important things, I won’t just cut down on coffee shops; I’ll drop them altogether. I can make my own effing coffee and shouldn’t be paying people to make coffee for me when I’m in debt. Saving money is almost an afterthought in this scenario (a very nice one, of course).
Finally, here’s how the compelling story was a game-changer: doing a deeper dive into MMM’s blog showed me possibilities I’d never heard of for how my family could live. Saving 50-75% of income is the foundation of MMM’s story, but it’s hardly a mainstream household budget idea. Without a concrete and detailed account, I wouldn’t have thought that type of savings rate possible for anyone making any semblance of a normal salary. Lifestyle changes I made now stemmed from different thinking, thanks to this new (to me) narrative. This made even deeply ingrained habits like coffee shops and eating out easy to break.
Life already feels more relaxed, satisfying, and peaceful. My actions are so much closer to how I see myself and what I think is important. I owe MMM a debt of gratitude for all this—and unlike a car loan or mortgage, that’s a satisfying type of debt to have.
* I won’t get into the details of how early retirement can work. That’s MMM’s bailiwick. If you want to read more, start here: Early Retirement Can’t Work or I’d Have Heard of It Before.