Saturday, December 5, 2015
The Origin Story (Or Why I'm So Damn Interested in Financial Independence)
This blog came out of a desire to do things differently. This was not a sudden change, but one that has been building for quite a while. After graduating from college, I pretty quickly realized some big financial mistakes that I had made pretty early on in my adulthood life, that while somebody (my parents) may have tried to tell me, I was not in a place to listen (ahhem, stubborn). I choose to attend an expensive private college, instead of one of Wisconsin's several public university's with national recognition. I choose a degree that was financially not a good decision and while that would have been okay had it been a long-time passion of mine, realized towards the end of my four years in college that this was not the realm for me. At the time it led to a real crisis of conscious about what and who I wanted to be when I grew up! So, what's a lady to do, with no real job prospects and a looming college graduation? Keep going to school of course! I went on to get my Master's in a field I was truly passionate about- social work and was even able to have my degree, fully-funded.
Even with this I graduated with a lot of student loan debt, and while it wasn't as high as the national average it still felt like a large (ie. soul-crushing) amount. I realized immediately upon graduation that I was going to have to pay back those funds (gasp!) on my small social worker salary (double gasp!). I also learned that I hated the feeling of debt. Being raised by very financially open and responsible parents, who hadn't been in debt since I could remember, any debt felt like 'bad' debt. While I started paying on my student loans immediately, and quickly began paying over the minimum, following graduation I experienced a condition all to common to new college grads and Americans in general- Inflated Lifestyle Syndrome. It's a very serious condition effecting millions every year.
In all seriousness, the idea of increasing your spending as your income goes up is a real concern. All of a sudden with increased wealth (aka higher paychecks), people perceive increased needs (wants!) and their spending goes up.
I found this happening to me pretty quickly. I moved in with my long-time partner (now husband, referred to hence-forth as, Mr. Frugal Rock) and we had not 1, but 2 incomes to play around with. We purchased a new car, had a lot of toys (2 cars, 2 motorcycles) went on vacations, spent over $1000 a month on a nice, large apartment near the lakefront with two bedrooms, a garage and didn't think to much about the future. While no one else thought we were being irresponsible, and we certainly weren't buying brand new porsche's on our income, we weren't saving as much as we should have been. Things began to change when we began looking at houses. We began to ask ourselves, 'how much space do we really need'? And choose to live small rather than live large. We decided to get hitched and asked why does the average American need to spend $20,000+ on a wedding? We spent under $5,000.
While neither of us make huge incomes, (together we pull in about 100,000 a year) we find that we live comfortably and didn't miss the things that we were supposedly giving up by our choices to 'live small'. We found that we could put away 20% of our income into retirement easily without feeling the pinch- automated accounts helped as we never saw the funds (never missed them!).
Now we've been asking ourselves additional questions- Why do we need to work until we are 65-70? Why do we need to work full-time, 9-5? Why, ON EARTH, would anyone want to pay a mortgage for 30 years? What should we being doing with all this extra money we are saving? How can we 'live large' while also living small? Can you be eat healthy, while also trying to save? I hope you keep coming back to visit, as I try to answer some of those question.
Leave a comment! Are there any financial questions that seem 'normal' to everyone else but strike you as odd or unusal? What are your favorite frugal financial tips?