Pocketing Away Tax-Deductible Money at the End of the Year

It’s December, which means that the 2010’s are almost over! What else is almost over? This year’s chance of lowering your taxable income by taking advantage of pre-tax investments. Personally, I’ve been crunching my numbers to see where I can throw an extra hundy or two. Here are some places that I’m trying to stash away some more pre-tax money before the end of the 2019 calendar year.

Homer knows what’s up.

Please note that I am 100% not an accountant or tax adviser and that you 100% should do your own research and double-checking before you do any of these things. In other words, take this advice as being worth a grain of salt. I’m not an expert. Don’t listen to me. Don’t do as I do or say.

A Traditional IRA

A Traditional IRA is a retirement account that allows you to deposit pre-tax money. You’re not taxed on what goes in, but you’re taxed on what comes out. Generally, a Traditional IRA is a good choice if you anticipate being in a lower tax bracket when you retire. For the 2019 tax year, individuals are able to contribute up to $6,000 if you’re under the age of 50 and up to $7,000 if you’re 50 or older. 

All your contributions to a Traditional IRA can be tax-deductible, if you meet the eligibility requirements. If you’re filing single and have a retirement plan at work, for 2019, you can only deduct the full amount of contributions to your Traditional IRA if your adjusted gross income is $64,000 or less. Once you hit $64,000, your deductions start to fade out, and they disappear completely if you earn $74,000. 

This is the category I fall into. If I’ve calculated correctly, my adjusted gross income should fall somewhere within the $62k range for the year (although I may have not calculated correctly, ha ha). As such, I anticipate being able to deduct all my contributions. However, I have not deposited my maximum $6k into my Traditional IRA; I won’t be able to meet that much money, but I’m going to try and squirrel away another $1k before it’s all said and done. Additionally, you have until April of the next year to make contributions that count toward the previous year’s taxes. 

One should keep in mind that any withdrawals made before the age of 59 ½ are subject to tax and early withdrawal penalties. You should be comfortable with essentially saying goodbye to these contributions until you reach that age.

And, please note that, in order to deduct your contributions, you must be making them into a Traditional IRA. Roth IRA contributions cannot be deducted from your taxes (instead, you won’t have to pay taxes when you withdraw from this account in retirement).

Student Loan Interest

Oh, student loans, how I loathe you, let me count the ways… about 42k. There are about 42k tiny green ways I loathe you.

It me.

As I’ve mentioned before (and will continue to mention until the universe puts me out of my misery or I sell a kidney to pay them off), I have about $42k in student loans. This was to pay for a degree to get a job in a field I genuinely enjoy (and has given me a small pay bump). I only kind of regret this degree, although I 100% regret not trying to first get a job at a school that offers this degree so I can go for free (THAT’S A SPICY HOT GRAD SCHOOL TIP RIGHT THERE, Y’ALL)

Fortunately for me, student loan interest payments can be deducted from one’s taxes provided they meet the eligibility requirements. For 2019, the maximum amount that can be deducted from taxes for student loan interest is $2,500. Please note that it doesn’t matter if you’re filing as single or married–$2,500 is the maximum for a return, even if you and your spouse both have student loans (Luckily, I’m still living in sin, so I can keep all the benefits to myself.). 

Student loan interest payment deductions have income requirements as well. Like the IRA deduction, student loan interest payments can only be deducted if an individual has an adjusted gross income of $65,000 a year or less. There are also a few other restrictions regarding who took the loan out, whether or not someone can claim you as a dependent, etc.–check to ensure your eligibility! 

By the time this post hits the internet, I’ll have made $2,500 worth of interest payments for the year, which I should be able to deduct from my taxes. Hooray!

HSA

As I’ve explained before on the blog, a Health Savings Account (HSA) is an account that allows you to pay for medical expenses with pre-tax dollars. These accounts are associated with insurance plans that have a high deductible–the idea is that you pay lower premiums in exchange for a higher deductible, but you have the opportunity to save money to meet that deductible. When you contribute money to an HSA, you lower your taxable income.

Unfortunately, I don’t have an HSA–long story short, for the plans my employer offers, the monthly premiums and high deductible more than negate any potential tax-offset I would get from having the HSA plan. As such, I’m sticking with my HMO (although in my opinion all monthly health premiums should be tax deductible, BUT I DIGRESS). 

However, if you have the option of setting up an HSA, you should consider doing it. As stated above, money contributed to an HSA is pre-federal-tax, which lowers your total taxable income for the year. Depending on your state, it may be taxed at the state level (thanks for nothing, California). Optum Bank has a list of states in which HSA contributions and/or earnings are taxed. So, while not available for everyone, HSAs provide one more option for lowering your taxable income. 

Be Amazon

Or you could just be a multibillion dollar corporation/”job creator” (*coughcough* *eyeroll* *finger-in-mouth-to-simulate-throwing-up*) and never pay federal taxes again. If you’re not comfortable being Amazon, harbinger of all our dooms, then consider being pretty much any other super large corporation. Either way, you’ll have enough politicians in your pocket to avoid paying taxes, but you’ll also get to do fun things like take away health insurance from part-time workers

Your Mileage May Vary

Naturally, these tips aren’t for everyone. No student loans? No interest deduction. Already maxed out a Traditional IRA? I’m very proud of you. Already CEO of Amazon? For the love of god, give part-time Whole Foods employees their health insurance back. 

What do you do at the end of the year (and throughout) to reduce your taxable income? Please feel free to put your plan (or suggestions for clarifications!) in the comments. 

As I said in the intro, this is not advice and you shouldn’t do as I say or do. Consult with your own tax genius to find the best ways of making your money work for you.

Open Grocery November 2019

It’s the first Tuesday of the month, and you know what that means–it’s time for the monthly Open Grocery post! What’s Open Grocery? Open Grocery is a series of posts that include detailed information about all of my grocery purchases for the month. The spreadsheet I’ve included has a dated and itemized list of all my grocery purchases, down to the poundage. 

The November numbers have been crunched, and out of my total budgeted $200, I spent: $198.51.

Hooray! I’m in budget for the month!

Hooray for me, indeed.

This is great, because last month I went $18.84 over and spend a total of $218.84. It’s good to see that I’m moving back in the right direction. This month’s total is much closer to September’s, when I spent $196.12.

(I should note that at the end of last month’s post, I put that I had a goal of $175 for November. I then promptly forgot about that goal. Let’s put it on the docket for January 2020, shall we?) 

For a full breakdown of everything I bought, when, and where, please check out the Open Grocery 2019 Google Sheet

So, what changed in the last month?

For one, I bought more alcohol. What can I say? It’s the holiday season. While last month I spent $13.28 on alcohol for the month (from a grocery store, anyway), this month I spent $31.97. 

One major purchase accounted for this change–on 11/26, I bought a box of wine. It was on sale for $18.99 compared to the usual $24.99, and supposedly it contains three full bottles of wine. Now, I enjoy a glass of wine every now and then; however, since I live alone and don’t like to have people over, my problem was that I would buy a bottle and then feel obligated to drink the whole thing before it went bad. The magic of boxed wine is that it can last much longer after being opened than bottled wine. According to the Black Box website, their wines stay fresh up to six weeks after opening. This means I don’t have to chug a glass and a half every evening for three nights straight (more than I want to drink anyway) just to avoid the guilt of throwing away what didn’t get finished. 

I plan on nursing this box for as long as possible and not buying any alcohol for my time at home in December. Uh, we’ll see how well this plan works out…

The biggest victory this month came from avoiding coupon errors! In September, I lost $14.06 to coupon errors. In October, I lost a whopping $27.25 to coupon errors. I count this as “lost” money because most of these products–October and the disastrous carrot cake ingredients in particular–would not have been purchased without the coupons. This month, I avoided this problem by (a) avoiding a lot of coupon-required purchases altogether and (b) reading the coupons more closely to understand if only specific sizes or flavors were covered. 

Me and you, Honey Boo Boo. Only I think you’re referring to success, and I’m just referring to avoiding failure.

Additionally, for the two months I stayed in budget, I made one less trip to the grocery store. In September and November, I made seven trips to the store (which seems like a lot, but in my defense, I eat a lot of fresh veggies!), while in October I made eight. I’m trying to make a conscious effort to ask myself–can I go just one more day?–before running off to the store. I’m trying especially hard to do this for December, since I’ll be out of my apartment for twelve days (and as such need to eat anything that may expire during that time!). 

What can we expect for next month? Well, the budget will need to be adjusted–I will be traveling from December 19th to the 30th, so I’ve calculated a monthly grocery budget of approximately $130 dollars (the usual $200 divided by 31, multiplied by the 19 full days and two half-days I will be home, and rounded up to look better). I’m also trying to purchase zero alcohol and concentrate on mainly buying fruits, vegetables, and yogurt, while eating up all the rest of the food in my house.

That’s all for this month! Shorter than the previous two posts, but honestly, I just don’t have that much to say. They’re groceries, y’all. December will be a lighter month, and then hopefully in 2020 I can discipline myself down to $175/month!

A Month of Expenses in a HCOL Area (on a Non-Engineer’s Salary)

As I’ve mentioned about a million trillion times on this blog, I live in a high cost of living (HCOL) area. This area, the San Francisco South Bay, is known for Silicon Valley, computer engineers, and start-ups that make a shit-ton of money. I go to the gym with people who work for companies like Apple, Google, and Facebook (and Z-berg himself showed up on Sunday). The parking lot is full of Teslas, and I recently overheard a guy who couldn’t have been more than 23 talking about buying a house for his mom (which–that’s really nice–but also–23??? Dang!). Lots of people move to this area to take high-paying jobs at these companies. 

I am not one of those people. 

I work in education. And while I get paid more than the average public school teacher* in the United States ($60,483), I don’t make the type of money a Google person does ($112,849 average, as per payscale.com). I thought it would be fun to do a breakdown of what life can be like here on $72k/year.

RENT – $1351/month or $16,212/year (EXTREMELY LOW for this area)

I am very lucky in that I was able to get an apartment in a building owned by my employer.

Although this has come with a number of problems (for example, lying about available parking, having a July 1st lease start date but not actually getting into the apartment until August 8th because the unit was being renovated and no one bothered to double-check the unit # with the new leases, showing up on a Friday afternoon after being assured I would have keys and then waiting to try and hunt down someone who could help us find temporary housing, finally being told we could move in and then being given the WRONG KEYS, having the toilet installed incorrectly–BUT I DIGRESS), the savings in rent more than make up for the parade of problems I had just trying to move in.

I currently pay $1351 a month for a 417 sq ft studio that is walking distance from my workplace (1.3 miles or about 25 minutes depending on traffic lights). The average monthly rent of a studio or one-bedroom within a reasonable walking distance of my job (reasonable = less than 1.5 miles) is currently hovering around $1800 on craigslist. As such, I’m paying about 75% of what I would have to pay if I wanted to move somewhere not owned by my organization

And to be clear, that $1800 would be going to a real piece of work, if you get my drift. I’ve heard horror stories from others who live in the area about what basically sound like dorms owned by slum lords. My unit has at least been newly-renovated, even if I did have to wait five weeks for it to finish. 

This sweet living situation does come with some caveats, though–because of my rank, I’m only technically eligible to have this apartment for one year. Although some of my neighbors in the building who are of a similar rank have been able to stay from three to four years, it’s not something that’s guaranteed. I hope because of the very small size–studio–that not many other new hires will be interested. There are three open units in the same building, and I think they all have at least one bedroom. Because of this, I’m keeping my fingers crossed that I’ll get to keep my apartment for one more year. I should know for sure by June, but I’m making sure I have enough money stashed away to cover moving expenses, just in case. 

If I lose the unit? Well, that just further cements my decision to limit myself to about two years in my present position before moving on to somewhere else. 

Why two years? That’s how long it takes to be fully vested in the organization’s retirement program. If I stay for two years, I get my ten percent–that’s ten percent free money, not even a match, that I walk away with if I stay here for that long. But if I leave before those two years are up? Zero. Zilch. Nada.

I also got paid a moving reimbursement to bring myself over here. And by reimbursement, I mean they took out payroll taxes as if it were a bonus (which, had I known, I would have overestimated–nothing like paying payroll taxes on purchases I paid sales tax on that were bought with money I already paid payroll taxes on!).

Additionally, the phrasing of the moving reimbursement document was something about how I may have to pay back the moving reimbursement if I leave my job before two years are up. I’m choosing to interpret that may as a will.

TRANSPORTATION – ~$1160/year including two oil changes but not including major service or tires

Last month I had the joy of switching over my license and registration to the great state of California. This whole process, from smog check to license fees to registration fees, cost a total of $368. Luckily I won’t have to do this every year, but it was quite a bit more than the $100 it cost me in Colorado. 

Gas is also much more expensive here–according to AAA Colorado, as of last week, gas was going for about $2.73/gallon in Denver (although, since I’m not actually there, I can’t confirm this). Gas at the cheapest gas station in the area here in CA is around $3.90 a gallon. So, it costs $1.17 more per gallon, or about $14 more per tank, for gas. And while I can walk to work, a lot of other places–the gym, for example–require driving. 

I’d love to take the bus more here, but unfortunately none of the routes are very convenient. It would take me an hour and a half with two transfers to get from my work to the gym, but it’s only a 20 minute drive. So, in that instance, driving wins. 

HEALTH INSURANCE – $52/month or $624/year

I get health insurance from my work. I went with an HMO plan, so my options of where to receive care are a little limited. However, one of their super complexes is within a 15 minute drive from my apartment, so making plans to receive care has been relatively painless. This is the second-most expensive plan my organization offers, and I chose it because it has no deductible. 

 Why don’t I have an account that offers an HSA, as many personal finance gurus suggest for healthy individuals? To explain, a Health Savings Account (HSA) is an account that allows you to pay for medical expenses with pre-tax dollars. These accounts are associated with insurance plans that have a high deductible–the idea is that you pay lower premiums in exchange for a higher deductible, but you have the opportunity to save money to meet that deductible. When you contribute money to an HSA, you lower your taxable income.

Unfortunately, only one insurance plan through my workplace offers a high deductible with an HSA option. INTERESTINGLY, it’s a PPO plan–you choose your own doctor, as long as they’re in-network–which are always more expensive. So, in order to have an HSA, I’d been spending twice as much on insurance premiums per month in exchange for a higher deductible, all for the sake of being able to lower taxes. 

I’ll take my half-cost premium with no deductible and $1500 out-of-pocket maximum, thanks. 

And to be fair, I’ve been totally happy with my HMO so far. I’ve had four visits for various reasons, and I’ve paid a total of $20. 

GROCERIES – $200/month or $2400/year

I was surprised at how expensive groceries are here. I remember the first time my partner and I went to the grocery store and being shocked that there were no boxes of cereal that cost less than $4.00. Food and cleaning supplies are significantly more expensive here than they were in Denver. 

After being here a few months, I’ve started discovering the best ways of tracking down my grocery deals. Trader Joe’s is good for packaged items like my coffee, English muffins, and vegan butter, although they never really have sales. Sprouts is good for produce, but only when it’s on sale; if it’s not on sale, but is something I have to buy a full pack of at TJ’s (for example, carrots or mushrooms), it’s also best to buy at Sprouts. Safeway is only good when I have digital coupons. 

One argument against piecemeal shopping like this is that it wastes more gas; however, Safeway is next to my work, Sprouts is on the way home from my gym, and I only go to TJ’s once or twice a month. The savings more than make up for any extra gas or time spent. 

UTILITIES – $30/month for gas and ????/month for electric

My house is heated by gas, and since my apartment has no insulation, I run the gas heater for about 30 minutes on weekday mornings so I don’t freeze to death when getting dressed (I run cold, and my apartment is usually in the low 60s when I wake up. Not exactly Antarctica, but too cold for me!). In the summer, heat was only $9 a month; last month, it was $20. This month I’ve budgeted $30, since I’m using the heater more. 

Electricity is the real question mark. I live in a city where the electric is municipal–this has been great, because we were not subject to the same blackouts that others in CA recently underwent. However, since it is a government agency, things aren’t always quick to happen. I called and set up my account in August; I am still waiting for my first bill. I’ve called twice, and both times I was assured that everything is fine, and that I would “receive a bill soon” that would be “higher than usual” because it would “reflect the cost of service since starting.” This was about three months ago; I’m hoping to get this bill sooner rather than later, because I honestly have no idea how much my electric is going to cost me. I don’t have a lot of appliances, but still…

OVERALL

Overall, the biggest asterisk to my budget is my rent. Because I receive such a large discount, I know my experience in the south bay is drastically different than most others (including most of my coworkers). With my partner overseas, living by myself in this area is a huge luxury. However, it’s a luxury that is not guaranteed to last; as such, I’m trying to keep my budget low enough to cover what rent will be if I get kicked out of my unit. Right now, that budgeted money is going to student loans and retirement; I have the option of re-routing next summer if I need to.

While I’m doing OK, this area is not all it’s cracked up to be. I make $72k/year, but that’s not what the job started at; originally, they were advertising my position as low as $60k (to which I said–there’s no way I could take this job for that money). That’s also the starting rate for a very similar position that my organization is currently trying to hire for.

If someone is moving here without a partner, I honestly don’t know how they could comfortably support themselves on that salary. They’d either have to live with at least three roommates or have a two hour commute everyday, I guess (both things are true of my coworkers). That’s combined with the fact that my workplace wants someone with a master’s–so there’s the issues of student loans as well.  

I know I’m lucky to be able to have this job and live in this area making the amount that I do. However, it’s only possible because of this discount on rent. If I hadn’t been eligible for employee housing and received a pay bump, I would not have taken this job. The cost of living would have just been too damn high.

* I am not a public school teacher, but I have mad respect for those of you who are. I worked in a public elementary school running a tutoring center from Jan through May, and that was more than enough for me!

Open Grocery October 2019

Last month I made the first post in a series called Open Grocery. Every month, I will share a spreadsheet with all of my grocery purchases–dated, itemized, and notated. 

Not my groceries! Photo from pexels.com.

Why am I doing this? 

For one thing, I think it’s interesting to see patterns in my own spending. Is there something I’m spending an inordinate amount on that’s unnecessary? Are certain items flukes? Am I buying too much processed food and not enough fresh food?

Also, lists and spreadsheets are fun. And it’s nice to have some cold hard statistics through this blog, which often explores topics that Gaby Dunn referred to in Season 2 Episode 1 of her podcast Bad with Money as “Finances and Feelings.” 

If you’d like to get into the cold hard numbers, they’re available on this Open Grocery 2019 Google Sheet

Here are some fun facts from the last two months:

I spent an almost identical amount on fake meat products in October as I did in September.

In September, I spent $12.67 on various meat substitutes (LightLife burgers, hi-protein veggie burgers from TJ’s). In October, I spent $12.96 on meat substitutes (more hi-protein veggie burgers, tofurkey lunch slices). Because fake meat is generally more expensive than natural vegan proteins like tofu or beans, this was something I was planning on cutting out in the future; however, $13 is doable (especially when I get 26 grams of protein from one $1.75 veggie patty). 

I spent more money on alcohol in October than I did in September.

This one doesn’t surprise me. My partner left Germany at the end of August, and I just ended up not really drinking after he left. I figured it would just make me sad. Now that I’m used to the life of a lonely spinster (ha ha ha), I’ve started drinking a teensy bit more. In September I bought a bottle of wine; in October I bought a six-pack of beer and one can of sparkling wine (WOOO). Like the fake meat, this amount isn’t so large that I feel the need to cut back. 

I discovered that Safeway digital coupons don’t always depict the correct products. 

One of my downfalls from last month were coupon errors. As in the case of the Chocolove bars, sometimes the coupon shows an item, and we think we understand what it’s for, but the fine print indicates otherwise. This also happened with my Outshine fruit bars–the coupon was for only the regular fruit bars, not the chocolate-dipped ones (even though they’re the same price, you just get one less bar). I had this happen with a yogurt too (I think it was only for one specific flavor). Anyway, I did save myself from one coupon mistake this month–for cereal. For the past few weeks, I was eating Safeway Signature Select Raisin Bran (or Raisin Granola Clusters, or whatever the hell they call it). I got a digital coupon for a Signature Select cereal, and the cereal I usually ate was on the picture. Yay! However, after reading the fine print on the coupon, I saw it was only for cereals from 11.3 to 13 oz. But my Raisin Bran was over 14 oz. And they don’t make it in any other sizes. So the picture didn’t actually match the coupon. 

IT WAS A RUSE! A CLEVER ATTEMPT TO TRICK ME!

So now I’ve learned to read the fine print on every coupon at Safeway and never take anything at face value (sigh). Also, I eat oatmeal now. 

I spent more money overall in October than I did in September.

In September, I spent a total of $196.12 out of a budgeted $200. In October, I spent a total of $218.84, which is $18.84 over what I anticipated spending. There are two things that stick out in my budget that I think caused this over spending–pea protein and carrot cake supplies.

I recently had an appointment with a Registered Dietician (yet another perk HR gives us in exchange for not paying everyone a decent living wage in the HCOL south bay). After spieling off my laundry list of dietary issues (egg intolerance, possible soy intolerance, IBS, vegetarian), she suggested pea protein. Trader Joe’s had it the cheapest at 16.5 oz for $11.99. So, that’s $12 outside of what I usually eat. If I weren’t an athlete, I wouldn’t care; however, if I ever want to send V7 (climbing grade), I need to make sure I’m fueling myself properly.

Additionally, I wanted to make carrot cake. I had some coupons for supplies at Sprouts, but I ended up not being able to access them. Like many grocery stores, Sprouts has a rewards program/coupon situation. However, unlike many grocery stores, you can’t just type in your phone number on the keypad; you have to open the Sprouts app and scan a barcode in order to access your coupons. While I was in line, the app logged out. Then the app froze, and I couldn’t log back in. There were only two cashiers and I started to get really flustered because the line was really long, so I just gave up and paid full price for everything. THANKS, SOCIAL ANXIETY!

(Also, Sprouts, seriously, just let me put in my damn phone number.) 

(Also, if you’re still reading this, the vegan coconut-based frosting was super gross. Next time I’ll just get confectioner’s sugar, vanilla, and earth balance.)

So yeah, my grand plan of trying to get my grocery budget down to $175 for the month did not go well. 

Was this a huge problem? No. The $200/month is a limit I set for myself in order to help maximize the amount of money I put toward things like savings and student loans. I am very fortunate in even having the option of overspending on groceries; many people (my family in my childhood, for instance) don’t have that option. However, I am still committed to getting my grocery bill down (which honestly, if I just ate all the crap in my cupboards, I would probably spend like $10 on other groceries).  

Can I meet my $175 goal in November? LET’S FIND OUT!

Know Your Spending Triggers

Y’all, it’s been a spendy month, and it’s not even over until Thursday.

I had a lot of expenses pop up this month. Some planned, some unplanned. And the biggest one is yet to come–on Wednesday, I have an appointment at the DMV to register my car and switch my license over. I’ve used the online calculator on the DMV website, and it’s going to cost a pretty penny. Or about 30,000 pretty pennies. 

I’ve gone over on my grocery budget for this month as well. Last month, I was officially diagnosed with IBS, so I’ve been trying to live that low-FODMAP life. I’m a vegetarian, and protein has always been a challenge for me; now, however, it’s even worse, because I’ve discovered my triggers include beans and soy (and eggs, which I already knew about). So, this month I’ve been investing in more yogurt and pea protein powders, protein bars, etc. than I usually would consume, in an effort to meet my protein goals while also not feeling like my stomach is going to explode (fun!). 

I also got my first haircut in about two years, which put me back about $108*. I got my hair cut at the mall–which was a BIG MISTAKE. BIG. HUGE.

Julia Roberts calling me out for getting my hair cut at the mall.

I’ve been needing a couple new sweaters for work, so I figured I’d just pop into a few places to see if I could find any I liked. Well, I needed socks too (I told myself), so I got a pair of those. And I don’t really go to the mall that much (or, really, ever), so I guess I might as well stop by Sephora while I was in the neighborhood and get a new eyebrow pencil. My eyeliner is a little low as well, so I might as well pick up some more of that too…

You can see where this is going. Please, learn from my mistakes.

If we want to save money, it’s important for us to know our own triggers. 

I have two main triggers that I’m aware of. The first is plunking down a large chunk of money at once, especially at the beginning of the day or month. The second is ‘being in the neighborhood.’

Let’s address the first one. If I spend a lot of money at once, it’s like a switch gets flipped in my brain. I’ve already been bad by spending more money than I had intended; so, at that point, I might as well be as bad as I want to. After spending $108 on a haircut, what’s the matter with throwing $12 at an eyebrow pencil? Additionally, knowing that I’m going to have a big expense at some point in the month–for example, a cool $350 for everything associated with getting my car registered–seems to throw me off the savings track as well. Instead of keeping me ‘good’ for the rest of the month, my brain has gone into ‘fuck it’ mode. ‘Well, fuck it, I’m already spending more than I want to this month, I might as well get X, Y, Z.’ 

Being ‘in the neighborhood’ is also an excuse that I’ve used to much recently. I go through stages of being a hermit locked up in my apartment spending all my time watching Netflix, followed by highly productive phases of going out on long hikes, visiting friends, getting errands done, etc. When I’m in my hermit mode (which is probably default mode, if I’m being totally honest), I’ll start my day or weekend with the best of intentions of hitting up the grocery store after work or finally going to get an oil change. However, by the time work is over or I’m done at the gym, I usually want to go home. I’ll put it off for another day, I say to myself, and weeks go by without me going anywhere unless I have an appointment. I’ve been needing a new eyebrow pencil for a couple weeks now; I haven’t purchased one because I would have to make a special trip for it. However, because I was in the neighborhood, I went ahead and bought one. But then I thought to myself, when will I really be at the mall again? I’m in the neighborhood, so I might as well pick up x, y, z…

Me vs. Sephora, on a bad day.

That’s when whims turn into losses. I’m definitely an advocate of combining errands to save time, money, and fuel, but not when those ‘errands’ turn into ‘grazing,’ a behavior which comes out in full force when I don’t make a list. 

Being in the neighborhood also causes problems in my more extroverted phases. If I’m out and about and find myself close to Trader Joe’s (which is across town from me), I’ll just pop in because I like their english muffins and cheap coffee. I did this the other day, when I was getting my smog check. However, I didn’t really need to buy groceries. I would have been perfectly fine if I had waited until my regular weekend shopping trip. But I was thinking of a mindset of time scarcity–well, I don’t know if I’ll have time to go later, so if I’m in the neighborhood, I can get these things now. Even if I didn’t need english muffins, because I still had half a loaf of bread at home. 

These are just a few examples of my spending triggers. By identifying my issues, I can be more mindful of them in the future. 

In the instance of my car, if I know I’m going to have to spend that much money on such a purchase, perhaps I should consider putting it in a separate account and saving up over time instead of taking it all at once. If I know I’m going to have to make one major purchase in a month, I should consider scheduling other major purchases for the next month. And if I find myself just in the neighborhood, I should reflect on my purchases–do I really need more english muffins, or am I just buying them because I’m feeling a false moment of scarcity provided by locational opportunity? This is where sticking with a list, and with set grocery shopping days, comes in handy.

So how bad was this month, really? Although I haven’t registered the car yet, according to my calculations, I should still technically be in the black for the month, and I’ve already made my trifecta payments. However, if I want to save more for my future, I need to get my spending (and my reactions to my triggers!) under control. 

What are your spending triggers, and how do you avoid them? Feel free to let me know in the comments!

* I just want to say that this was totally worth it, though. The lady who cut my hair did a lovely job, and I’m really glad I don’t have the hair of a neglected third-grader anymore. 

Reallocating, or, Changing Your Spending Plan Categories

When you first start reading about personal finance, there are several big pieces of advice that you’re given to follow: pay off high-interest consumer debt, create an emergency fund, and invest in your 401k (especially if it comes with an employer match–free money, baby!). 

But what do we do when our financial reality changes, and it seems that we’ve possibly met some of our goals already? How do we choose how to change our spending plans?

Much like this chimp, I have some thinking to do. Image from pexels.com.

I recently took a look at my spending plan to tweak my in-case-of-emergency expense totals. In the event that I am laid off, how much money would I need to support myself, and what expenses would be sacrificed first?

There are some obvious ones–goodbye, climbing gym membership and Netflix–but there are some other expenses that aren’t as straightforward. For example, my housing is tied to my job. The organization I work for owns the building in which I live, which means I get to live in a studio in a HCOL area that costs about 2/3 of what rent would be if I paid market rental rates. This works for me as long as I keep this job. However, if I get laid off or choose to leave this job, I have 30 days to move. 

My current emergency account is calculated based off of keeping this apartment. However, if I were laid off from my current job, I know I wouldn’t want to look for another one in this area. No offense to all of you who absolutely love the south bay, but I haven’t exactly fallen in love with the area–I miss the Rocky Mountains, and snow, and not having to take more than one flight to see my family. None of my family lives in the area, and I have no “deep connections” to anyone or anything here–as such, if I lose this job, I would just move somewhere cheaper. 

At my current rent, I have 4.93 months of expenses covered. But is my monthly rate even accurate, if I would move anyway? Do I need to calculate at my current rental rate, or could I calculate at a lower one? 

More importantly, what would I do if I lost my job right now?

That’s pretty easy. I already have a ticket to Germany for December; I’d probably max the 30 days in my apartment here while putting in as many job applications as possible, throw all our furniture into monthly storage, and then fly out to the east coast to hang out with my family* for a month before heading to Germany to see my partner. And if I didn’t have a job by then–either back to mom’s to help her prepare her house to sell, or maybe spend some time job hunting while traveling in some low-cost locations.

Long story short, I had several numbers in my head. The first was six months of living expenses at my current rate. The second, which was higher, was $15,000. Why 15k? It covers a little over six months of my expenses, is enough to buy a new-to-me car if my 2007 Yaris decides to finally call it quits, and, frankly, it just seems like a nice big round number. But is that excessive, and is there a better way in which I could be using my paychecks? I’m currently throwing all this into a high-yield savings account, but at 1.8%, it’s not exactly the ideal place to make my money work for me. Additionally, I’m already on track to max out my IRA contributions for the year. So where should it go?

The way I see it, I have three main choices: put this money toward student loans, retirement, or invest. 

Student loans seems like it should be the obvious choice. I have over $40k of student loan debt at an average interest rate of 6.3%. As many financial advice books say, paying off student loans early is a guaranteed return–I won’t be losing any money, and I’ll have to pay these off eventually. At the current interest rate, though, it’s hard to decide–is my rate low enough to make me comfortable paying through the full 10 years, because the gains I would make in my other accounts would be more? Or would the money I lose to interest eat up anything I would make elsewhere? 

But there’s the psychological effect too–this $42k is hanging over my head, dragging me down and making me feel like I am in a financial panic, even though I know, logically, that I am not. As I’ve mentioned before, I’m pretty high strung, so maybe the sense of relief that would come with removing this debt faster would be worth the potential losses in other accounts. 

Another place my money could go is into retirement. I currently have a 401(a) retirement account with my employer. I do not receive any matching; they just give me 10% of each paycheck into that account. As long as I stay for two years, all that money is mine. I do, however, have the option of also starting a 403(b) account. This would use pretax money, so not only would I save for retirement, I would also lower my taxable income (which would be great, because, as I’m discovering, CA has a shit-ton of taxes–the highest income tax in the nation, to be exact). I just have to be comfortable knowing I can’t touch this money for about 27 years–although retirement savings is a long game, is it not?

Finally, this money could go into a non-retirement investment account. I would love to FIRE or FIOR, and an account like this would let me withdraw money before 59.5 without any penalties. As such, I could invest and know that I could access this money at any time. However, with that freedom also comes responsibility–namely, things like tax-loss harvesting and capital gains tax and a bunch of other shit that I have no idea what it is. Even though I keep trying to read more books, I still have no idea what I’m doing. So the thought of investing in an account like this still seems very overwhelming. I’ll get to that point… one day. But right now, I have a lot of other things on my plate to deal with. 

Besides, I have my Roth IRA. And though I know I shouldn’t touch that money until 59.5, knowing that I can access the deposits I’ve put into it, in case of emergency, does make me feel a little better. 

So what should I do? Loans, retirement, or non-retirement investments? 

I’m going to open a 403(b) for half of my emergency fund money, and put the other half toward student loans. I guess I just want to have my cake and eat it, too.

Realistically, though–with my interest rate, it’s hard to make a confident call. And although paying off my student loans early would give me some sort of psychological comfort, I would also have to face the reality that I put my retirement savings on hold, so when my loans are paid off, I wouldn’t have anything left to show for it. 

I currently have $500 going toward my emergency fund–I still plan on funneling $100/month toward it, but $200 will now go to a 403(b) and the other $200 will go to my student loans. This $200, plus my 401(a) money, plus my IRA, puts me at retirement savings of about 29% of my take-home pay. And $200 added to my current student loan spending plan amount is about $750, or about 150% of my estimated required payment**. I’ll be able to make a payment and a half each month. 

The whole point of this post is realizing that your financial goals may change–and that’s ok! Checking all your accounts every day might not be the healthiest thing to do, but every once in a while, you should look at your accounts, look at your numbers, and ask yourself: What would I do if I got fired this instant? 

See how you answer that question, and adjust your financial goals accordingly. 

* I recognize that the ability to just say I would go hang out with my mom is definitely a privilege–a lot of people don’t have that as a viable option, either because they don’t have any living family, or they have a bad relationship with their family, or their family simply couldn’t help support them. However, not only would my mom be absolutely thrilled to have me back for a little bit, but she would also get a bunch of labor from me in regards to cleaning and fixing the garage, painting, helping put down new carpet, etc. etc. etc. 

** This payment is estimated because my loans are still in their grace period. I graduated in June but won’t be required to make payments until January. However, I’ve used some calculators to estimate what my payment will be and have already budgeted for it/started paying these loans back. Once January rolls around, I’ll know the actually payment amount, and maybe consider refinancing with a lower interest rate.

No More Using the ‘B’ Word, or, Changing the Language Around My Spending Plan

For the past two years, I’ve kept a budget.

And by budget, I mean a breakdown of all my monthly expenses, their estimated costs, and lists of every single purchase I’ve made. These lists include information such as date of purchase, whether it was paid for via credit or debit, and whether or not it was in the budget. I also keep a tally of how much money I put each month toward student loans, savings, retirement plans, groceries, and gas, and recently have started listing every single grocery item I buy. If you asked me what I bought on July 11, 2018, how much it cost, and how I paid for it, I could tell you (shitty toll for when I accidentally missed my exit and the highway turned into a toll road, $8.30, credit card)

However, I’ve recently been thinking that the word “budget” just feels too… restrictive. Not restrictive enough to make me stop spending money sometimes (some consumer goods transcend issues of semantics, apparently), but restrictive enough to make me feel like I’ve done something wrong if I spend money outside of my planned monthly bills. 

Some personal finance gurus would say that I have, in fact, done something wrong. Every dollar should be accounted for, and each one of these “little green men” should be put to work. The work could be in a savings account gaining 1.80% interest (thanks for lowering the rate again, Ally) or being used to decrease my student loan debt. The reality is I have hobbies, and I like to spend money on them. I can be interested in personal finance AND make art, damn it!

In the words of Walt Whitman, I am large! I contain multitudes!!!

Does this count as a hobby? Image from pexels.com.

If I want to spend $20 on some new paints and brushes, I shouldn’t have to beat myself up for it. After all, if I don’t cultivate my hobbies now, what the hell am I going to do when I hit my FIRE goal? An article in the Wall Street Journal from earlier this year describes how not having a solid out-of-work life can affect workers when they retire: “Without the purpose of fulfilling work, retirees can feel adrift and become depressed. Without the camaraderie of their co-workers, retirees risk becoming socially isolated. Without the intellectual stimulation that work can provide, retirement can accelerate cognitive decline,” (Although I have to point out this article is from the Wall Street Journal, who probably has a vested interest in squeezing every last drop out of worker bees as possible…).

I think there’s a point between being financial savvy and completely losing your sense of self. 

And if keeping my sense of self requires supplies so I can make art, then I am damn well going to spend that $20. Besides, I’m investing in hours of entertainment and pleasure. 

And I’m not throwing myself completely out the window financially, either. I have my savings accounted for in this spending plan. My trifecta–$500 to my IRA, $500 to savings, and $550 to student loans–is automatically taken out at the beginning of every month. These amounts, combined with the $1351 I spend on rent for my 400 sq ft studio, account for 66.5% of my take-home pay. And that $500 in savings doesn’t include the $100/month I’ve planned to cover any travel expenses; I bookmark this money to go into a special account every month, so when I want to take a trip, I don’t have to feel guilty about using it.

(Although I just bought an $1850 ticket to Germany to visit my partner over Christmas, and having the money in a separate fund didn’t make me feel less anxious about it. Now that the initial band-aid has been ripped off, though, it’s not so bad.) 

All in all, I’m not doing that bad. My spending plan is comprehensive enough that it covers all my bills, including the ones that vary from month-to-month. And I have a tendency to grossly overestimate those, too. For example, it currently costs about $35 to fill up my 2007 Yaris here in CA. I have budgeted $70/month, or two tanks, for gas. However, since I walk to work, I use very little gas. Most of my driving involves going to the gym, a park to hike, or to Oakland to visit my best friend; as such, I very rarely meet that $70. 

However, if I lowered it to the true average–$35–but spent more than that, I would feel as though I had committed some horrible crime against myself. I would be something that I find inexcusable–an irresponsible person

I may be irresponsible in some aspects of my life, but finance is not one of them.

(At least not now, anyway, since I’ve learned how to handle money.) 

And some expenses that would have been labeled as “Out of Budget” on my previous spending plan are actually expenses that (a) I can afford and (b) genuinely make my life, and the lives of others, better. For example, I recently got accepted as a volunteer at a large animal nonprofit in my area. And by large, I mean there’s a volunteer force of over 1000 people. These volunteers all need training (and t-shirts) in order to volunteer with this organization. As such, volunteers are requested to pay $40 when they undergo training. I very happily paid this $40 (plus an extra $10 donation), because I want to help with this organization and I’ll have my time occupied doing something I enjoy for three hours a week for at least the next six months. And if I want to continue my tenure, I can do so without being re-trained. For me, this $40 is an investment that will greatly enrich my life (not to mention allow me to finally love on some animals without violating the terms of my lease). 

This may not have been budgeted, but it does not break my budget. 

So, in sum, I’m changing my budget-based vocabulary to one that frames my money situation as a spending plan

This is how I plan to spend the majority of my money. And as long as I utilize my money in accordance with my spending plan, then I can do whatever the hell I want to with the rest. And what does that look like?
Some months it might all go into savings or student loans. Some months, like this month, it will go toward car registration and a dang haircut. And some months I might spend an extra $20 on fucking paint, because my sanity and joy is worth it. And that’s totally OK.

Ignoring Common Money-Saving Tips, or Things I’m Not Willing to Compromise On

A big part of the FI movement is streamlining your expenses and finding ways to increase your savings rate by either (a) increasing your income or (b) drastically reducing the amount of money you spend*. You should locate all the fat in your budget and trim it, leaving only the absolute essentials and squirreling away the rest into your FIRE fund. Common tips for doing this include things like cancelling monthly subscriptions, splitting rent costs, moving, getting side hustles, etc. Could I be incorporating some of those things into my life? Yes. Am I willing to consider some of those things? Honestly, no. 

Fancy gym memberships should be the first to go. BUT I JUST CAN’T QUIT YOU. Image from pexels.com.

Here are three things I’m not willing to compromise in order to achieve FI faster: 

Living without Roommates

Right now, I live alone, and I intend to keep it that way. I do have a serious romantic/life partner, but he is currently out of the country living his dreams, etc., which means he is not available to live with me and, erego, split my rent in half. Eventually, two will become one again, and rent will be easier to pay. As it is, I am living on my own.

I am not willing to compromise on that.

Here’s the thing: I have IBS. And what that means is that I use the bathroom a lot. Sometimes I have to use the bathroom very suddenly. And if someone strolls into the bathroom to take a nice long shower and get ready for their big night out, it can create a very uncomfortable situation for me. And while I (apparently) don’t mind explaining my embarrassing situations to strangers on the internet, I’m not looking to go into roommate interviews and having to reveal all the secrets of my bowels just to have people choose another roommate anyway because my bodily functions gross them out. 

Maybe if there was a situation in which I could have my own bathroom, I would consider getting a roommate. However, I also hate people and love quiet and cleanliness, so as far as keeping stress levels low, it’s not ideal. And while I live in a HCOL area, my current apartment is subsidized by my employer, which means I am essentially saving nearly the same amount as what I would save if I had a roommate, give or take a hundred bucks a month.

To me, the extra hundo is worth the peace of mind.

Once my lease runs out, and if I don’t get a renewal, I might be singing a different tune. But I have until June to worry about that. 

My Gym Membership

My gym membership is approximately $100/month, which I know may seem like an astronomically frivolous expense to a lot of people. However, it’s a specialty gym–a climbing gym. Climbing is one of my favorite hobbies, and other than hiking (which is difficult to fit in after a full eight to nine hour day at work), is pretty much the only real ‘active’ activity that I do to stay in shape. Gym memberships are often listed as one of the first things that should be axed when slimming down your budget (and, indeed, if I lost my job, would be something I would consider taking off), and it’s usually accompanied with such reasoning as (a) you can work out anywhere, (b) running is free, (c) there’s probably a park or somewhere with pull-up bars that you can just hop on and get in shape, and (d) you’re not really going that much anyway.

While those are all valid points, they don’t translate well to climbing. The only way to truly get better at climbing is to climb. There are definitely a lot of add-on and cross-training activities that can be accomplished–hang-boarding, pull-ups, etc.–but to be active in the sport, one needs to either have enough free time to go outdoors several times a week or keep their muscles moving indoors on plastic rocks. 

Additionally, I don’t really love basic workouts. I get bored. I have to watch a movie on the elliptical, because if I don’t, I just keep counting down every second until I can stop. And if I haven’t had fun climbing first, I’m not motivated to just go into the gym and hop on the treadmill or do my pull-ups. Climbing provides me with a mental puzzle to solve in order to successfully complete the exercise. And because I’m vain and want to solve all these puzzles**, I’ll try really hard to do it. 

What it boils down to is this:

  1. Climbing is fun
  2. I will not work out unless it is fun
  3. Erego, if I do not have the opportunity to do some climbing, I will probably not be very motivated to work out

One way to view the gym membership is as an investment–I’m making an investment in my current and future health, which will hopefully pay off by reducing the chance of any major medical issues that can be prevented by keeping myself in shape.***

Moving to a LCOL Area

Another way which is touted as a route to FIRE is moving to a LCOL area. However, this is not possible with all jobs–and my job in particular. I work in an education-adjacent not-for-profit sector, and jobs that pay as well as my current one are few and far between. If I moved to a low cost of living area, I would possibly be able to accomplish the same savings rate by percentage, but I would have far less money to save. My partner’s job is also relatively location-dependent–he’s studying language and cultural/refugee issues, and if he would like to actively pursue employment related to those fields, we’ll probably end up back in NY or DC (although he says he doesn’t mind going back to teaching, but once again, teachers make very different salaries in different places). If we moved before July 2021, I’d also lose my 10% retirement from my employer (it’s not even a match–they just give me 10% once I meet two years, back-dated to my first pay period. They just give it to me!!!!) and I’d have to pay back the $4,000 in moving money they reimbursed me. So, a move would currently cost us about $19,000 before we even shipped a single chair. 

I also have big expenses that I don’t want to compromise on–for example, my student loans. Once my grace period ends in January , I will have to start paying around $500/month to pay these off (although I’m making estimated monthly payments now). If I move to a LCOL area and make less money, I could change my repayment plan to be income-based, but I don’t want to spend 20 years paying off what could be paid off in nine. Additionally, while my debt amount feels high to me, it’s not high enough to grant me the freedom-after-twenty-years-of-payment perks that income-based repayment plans (IBRP) offer, nor am I confident that Public Service Loan Forgiveness will exist in ten years (nor do I want to limit myself to only working at nonprofits for a decade in the hope that one day the government will forgive my loans). 

Additionally, moving to a LCOL area generally involves some sort of compromise in regards to public transit and walkability. Right now, I can walk to work, to the grocery store, to a movie theater and mall (not that I go to the mall that often, but whatever), several bars and restaurants, etc. This means I use my car much less. Even though gas in California is currently over $4.00/gallon, I only spent $35 on it last month. I drive to the gym and to go hiking. That’s about it. And that’s something I would have to compromise if I moved. 

For now, staying put is worth it.  The benefits described above–the solace that comes with living alone, the health benefits (physical and mental!) gained from my gym membership, and the salary and perks of my current job–outweigh the potential benefits by compromising on these three issues. While I believe its important to plan for my future, I know that it shouldn’t come at a sacrifice to my current mental health.

How about you? Are there certain measures that may make you reach your FIRE number quicker, but would seriously compromise your quality of life? Feel free to share in the comments.

*A combination of both is usually advocated, but one is usually easier to accomplish than the other.

**And there’s definitely some self-esteem issues combined with wanting to smash the patriarchy and gender norms in here, etc. etc. etc. I AM SMART AND STRONG AND I CAN DO IT, SO GET OUT OF MY WAAAYYY!!!!
***Please note that this is a very able-bodied viewpoint. Not everyone has the ability to work-out, sign up for a gym, etc., and not going to the gym is a totally valid lifestyle, etc. etc. etc. For a much better/more eloquent exploration of the intersection between FIRE, personal finance, perceived health issues, and fat-shaming/fat-phobia, please view this excellent post on Owning the Stars titled ‘The FIRE Movement’s Fatphobia Problem.

Open Grocery – September 2019

Welcome to the first post in a series titled Open Grocery!

I love this photo because it was described as ‘Cabbage, Up Close.’ Image from pexels.com.

Once a month, near the beginning of the month, I will post my entire grocery bill from the previous month–including a breakdown of every grocery food purchase I made during the month and whether or not it was on sale and/or I had a coupon. There are two main reasons why I want to do this.

I want to keep myself accountable in regards to budget. Currently, I have a budget of $200/month for my own grocery needs. In theory, this amount should be more than enough to cover my diet. However, sometimes I have a tendency to slip novelty items into my cart–for example, fruit bars or cookies–that don’t directly correlate to a healthy diet. I don’t feel like I need to cut these items out entirely (everyone should have a cookie now and then!), but I think it would be interesting to see just how much I’m spending on them. This budgetary concern also includes accidentally buying damaged products–but more on that later.

Additionally, I thought it would be a great exercise in seeing how much it actually costs to feed a single human being* in a month. Frankly, the $200/month I have budgeted is probably excessive, given my actual nutritional needs. It would be an interesting experience to see how low I can get my bill while still meeting all my dietary concerns. Also, as of February 2019, the maximum monthly allotment for SNAP for a household of one is $194–I think it would be a useful exercise to see just how you can stretch that amount.

For the sake of transparency, here are some things that may make my bill different than yours:

  1. I don’t have high caloric requirements. I am currently about 112 pounds and about five feet four inches in height. Even though I am athletic and go to the gym several times a week, I’m not a bodybuilder or currently trying to put on more muscle mass. As such, the amount of calories I require each day may be much lower or higher than others, depending on their nutritional needs and fitness goals.
  2. I have gastrointestinal issues. My doctor thinks I have IBS; as such, there are certain foods that I can and cannot eat if I want to be comfortable. This means I can’t always pick the cheapest foods at the grocery store or only eat what is on-sale. Beans are thrown around a lot as an affordable protein option–unfortunately, if I eat too many, my bowels riot, so I have to find other sources of protein as well.
  3. I try to eat a plant-based diet (with some cheese thrown in on occasion). I don’t purchase meat, eggs, milk, or butter. I do purchase hard and/or goat cheese sometimes. While I should stick with getting protein from pulses, my IBS makes it difficult to eat more than small amounts of things like beans and lentils. This leads to a tendency to rely too heavily on expensive protein-added products as opposed to more ‘natural’ sources of protein. 

So let’s get started!

If you’re interested, you can view my September 2019 groceries in this google sheet

Overall, I spent around $196 for groceries in September 2019 (I lost $0.90 somewhere between the receipts and the totals, but whatever).

Several things affected this amount: (1) not paying attention to coupons and whether or not they were applied correctly; (2) accidentally purchasing damaged products; (3) vegan meat substitutes; and (4) alcohol.

  1. Coupons. Some of the products I purchased should have had coupons applied to them. The biggest store that I had problems with coupons at was Safeway. On the website, shoppers can download digital coupons to their accounts and, when they type in their phone number on the credit card key pad, they get those coupons taken off. For some reason, for several of my products, the coupons were not applied. On one particular visit, there was an especially long line and the cashier was in a hurry to get me rung up. I didn’t notice that the coupons hadn’t worked correctly until I got home. Next time I go, I will ensure that the coupons ring up correctly–regardless of how fast they’re trying to push me through. I also had issues with coupons at Sprouts, although these issues were my fault–for example, on my first visit, I didn’t know that you had to download the app in order to have your coupons applied; I thought I could just enter in my phone number to get my coupons (you know, like at pretty much every other grocery store in the US). Nope! As such, a couple items I had coupons for rang up at full price. The other coupon I had issues with was a BOGO Chocolove coupon; apparently it was only for one specific flavor. I have now learned a lesson in checking the text of every coupon I intend to use.
  2. Damaged Products. Out of everything I purchased this month, I had issues with two products. The first was a pack of tempeh I purchased at Sprouts. I didn’t look at it properly until a few days later when I was going to eat it; however, there was a paper-thin slash across the front of the package. I’m guessing that it was the first layer in the box, and when someone used a box-cutter to open the box, they accidentally slashed the first layer of tempeh and either didn’t notice it or didn’t care. Regardless, $3.29 down the drain, because lord only knows how long that package had been open. The second damaged product was a Silk yogurt I bought at Safeway that was three weeks past the sell-by date. I didn’t take this off the grocery bill because I accidentally ate it before I saw the date (although I didn’t get sick, so I learned something?). This was slightly hilarious to me because I usually check the date on every refrigerated item I buy. So, in essence, what should I remember?–CONSTANT VIGILANCE.
  3. Vegan Meat Substitutes. I go back and forth on this one. Mostly, my downfall in this category this month was purchasing two packages of Lightlife Plant-Based Burger Patties. I’ve been a vegetarian for over four and a half years now, but gosh do I remember what burgers taste like. This new frontier of plant-based burger-y burgers has rocked my world. However, at $2 to $4 for a single patty**, it’s not a cost-effective way of eating, although in some instances I cut the patty in half and spread it over two meals. I also purchased a four-pack of soysage, but I feel less bad about that because I usually stretch those out over eight meals. As long as they’re on sale and I am mindful of the cost per meal, I’m willing to forgive this a little bit.
  4. Alcohol. I bought a bottle of wine for like $10. I include it in my grocery bill because I consume it and I buy it at the grocery store, but alcohol is not a necessity. In fact, now that my partner is gone, I don’t even really enjoy having a drink that much anymore. And if I buy an entire bottle of wine, I feel pressured to drink it all before it goes bad, and since I’m such a lightweight, this just leads to headaches and lethargy the next day. So, I think I’ve pretty much decided that, at least until my partner gets back, I’m probably just a social drinker as opposed to an enjoy-a-glass-at-the-end-of-a-long-day type of gal. 

So there we have it! A month’s worth of groceries for a single human and my lessons learned. The goal for next month: maybe get it down to $175? We’ll see!

(But no pressure though.)

* In the US — California — South Bay area.

** Not to mention the saturated fat. THIS IS NOT A HEALTH FOOD, Y’ALL.

The Thing About Money, Part 6: Reflection, or, So now what?

(This is the sixth and final post in a six-post series titled The Thing About Money. Click to read The Thing About Money, Part I.)

The last few weeks have been an exploration of my attitudes toward money (Part I), how they were formed (Part 2), the debt issues I am currently facing (Part 3), my fear of being forced to eat cat food in my old age (Part 4), and how tracking my daily spending helped control my money anxiety (Part 5). So what have I learned about myself over the past few weeks?

  • Wanting money makes me feel like a phoney because…
  • I view money as an evil that just makes people emotional/feel bad because…
  • I grew up in a household where money caused people to be upset.
  • I am afraid that my student debt will never be paid off and…
  • I will be poor in retirement because I don’t have enough saved up but…
  • Tracking all of my spending and income kind of makes me feel better, because the situation is not as dire as it seems.

Whew. 

Those are my truths. So where do we go from here? 

Is life really all about the Benjamins???? Image from pexels.com.

I recently stumbled across the FIRE movement, which, if any of you are into personal finance blogs, you will know as standing for Financial Independence, Retire Early. The idea behind the FIRE movement is that you save as much as possible until you have 25 to 40 times your annual salary worth of assets, and then you can RE — retire early — make your grand exit from the world of your nine-to-five, if you so choose. There are several variations of FIRE — fatFIRE, for instance, is for people who want to retire but still live a life of comparable luxury; leanFIRE is for those looking to retire at a lower income; baristaFI is for those who will supplement their income with a part-time job (usually the plan is to “work part-time in a coffee shop,” hence the name) after retiring from a career; etc. 

What particularly interests me is FIOR–Financial Independence, Optional Retirement. This mindset involves saving enough money so that if you wanted to step away from working, you could; but that doesn’t mean you have to. Some people have a weird vision of FIRE–if you do any type of work at all (blogging, building things, selling art, etc.), you haven’t actually ‘retired,’ and you’re somehow lying about your life experience by claiming about being retired (*insert extreme eye roll here*). To me, being ‘retired’ just means that you aren’t chained to a desk/warehouse/counter and unable to make any life-changing decisions because you fear dying in the street of starvation. 

I would like to FIOR, and I can certainly tell you I wouldn’t just put my feet up, sit on some imaginary porch with a glass of lemonade, and watch the world go by*. What I want from FIOR is the freedom to do whatever the hell I want, whenever the hell I want, and it just so happens that what I want to do involves things like volunteering at causes I care about,  enjoying and preserving nature, working on my art and writing, and spending time with people I love. 

What FIRE, FIOR, and all those other acronyms buy is time. Time to not only make the world a better place by serving others, but also by serving ourselves. For instance, I recently went to a volunteer information session about working at a local adoption center for my region’s humane society. I’ve submitted the application and am waiting to hear back on whether or not I’ll get an interview** for a three-hour-a-week shift. In the past, I’ve volunteered at museums and historic cemeteries–all worthy causes that I care about. If I pursue FIOR, I’ll have more time to dedicate to these causes without having to worry about whether or not I can feed myself. 

I would also have time to increase my relationship with nature and move toward a more sustainable lifestyle. I’ve mentioned previously on this blog about how the earth is dying; I’d like to do my part to prevent that. I love hiking, camping, and rock climbing; I love just being in nature and letting its awe and beauty wash over me. I love breathing and drinking without dying. These things–trees, fresh air, the ocean, birds–are worth conserving. FIOR would give me time (and money, depending on how I budget) to help lessen my own impact on the earth (i.e. growing my own food or having time to go to local farmers’ markets, as opposed to going to a grocery store which has had produce shipped in from elsewhere, wasting fossil fuels; stop purchasing/consuming clothes whose only value is to make myself look ‘presentable’ at a job, etc.) and volunteer for causes that help the earth.  

I would be able to pursue my own artistic interests, many of which I have had to stifle due to a lack of resources–both time and money. This may seem like a selfish reason; however, I’m a firm believer in self-care, especially when it results in the self having a more positive and kinder outlook. If you haven’t discovered already, I can get pretty, uh, wound up, which results in what I view as some not-as-kind-as-I-could-be behavior. Right now, after work, I feel so drained that when I come home, I just end up cooking dinner and watching netflix or youtube until it’s time to pass out and start the next day afresh, repeating the same cycle until the weekend. I feel that I have projects bubbling away inside me, but I don’t have the emotional energy to do anything with them (oh, the joys of working in a service-centered profession…).

And finally, I would have more time to spend with my family. I have a small family–my partner, and my mom and her husband***. Not working would let me spend more time hanging out with and supporting these people whom I love. I would have the freedom to move across the country to wherever my partner wanted to work without worrying about the geographic constraints of my own career; I could visit my mom when she goes to her doctors’ appointments. I’ve spent a lot of time in my life using work as the reason I can’t visit (I can’t get the time off, I can’t afford it, etc.). I know that time is going to run out before I know it, and I want to spend that time with my family. 

There are still some hard truths to swallow. For instance, I struggle with the issue of wanting more money when I know that it causes so many problems in the world. This is what I like to refer to as ‘crust-punk syndrome’–I claim that I want to live ‘outside the system’ of work/general economics, but if I’m investing in ‘evil corporations,’ I am still just as dependent on the system as before, but in a different way. Doesn’t this just make me a hypocrite? Is it better to be a hypocrite that can support herself than a hypocrite who relies on the support of others? Is the only effective way to change the system to work from within–for example, investing in ethical companies whenever possible and not spending my consumer dollars on fast fashion and gas guzzlers? Does taking the money I make off of them and using it for good cancel out how it was created in the first place? 

What this all boils down to is the existential dread of living an inauthentic life. I work anywhere from eight to ten hours a day in a traditional job that, while providing essential services to those we work with, also perpetuates a highly inefficient work culture. There’s a lack of innovation and challenging of the status quo in ways that could radically alter how we disseminate our services. Additionally, without being too specific, I am working for an institution that doesn’t reflect my personal values. There are ‘values’ that this organization claims to have, but there are a lot of different viewpoints and incidents that have happened in this climate that I don’t feel reflect my own ideas of what is ‘right’ or ‘just’ (although, to be fair, it’s certainly nothing like, say, an oil company or hedge fund). This, combined with the negative health effects of working a job that is heavily cubical-based, makes me desirous of a bit more freedom, including the opportunity to be able to work part-time in this field****. 

I still have a lot of unanswered questions. Perhaps it’s just my family-ingrained Catholic guilt speaking up; perhaps it’s a fear of being exposed as some sort of fraud. I don’t know, and I don’t know if I ever will know. But what I do know is that money would give me the time and resources to work on projects I care about and would give me the option of not working those that I don’t

So I guess the budget’s worth it. 

* But there’s absolutely nothing wrong with that, and if that’s your dream, more power to you. I just know I would go bonkers with restlessness. 

** This particular organization gets a high level of volunteer interest, so the application process is pretty… intense. 

*** I have a brother and grandparents and aunts and uncles and a biological father and an ex-stepdad as well, but with all of those people, things are… complicated, and I haven’t spoken to any of them in years.

**** I actually quite like the job itself and the field I am working in; it’s just the incessant bureaucracy that really grinds my gears. 

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Thank you for reading this series, titled The Thing About Money. What’s your deal with money? Are you working towards FIRE? Do you feel that you are trapped in the capitalist machine with no real options about how to lead an authentic life? Are you just trying to free yourself from the grip of THE MAN? Or are you able to emotionally distance yourself from money? Feel free to tell me in the comments.