“The thing to do is to make so much money that you don’t have to work after the age of twenty-seven. In case this is impracticable, stop work at the earliest possible moment, even if it is at a quarter past eleven on the morning of the day when you find you do have enough money.”-Robert Benchley
Dreaming of Early Retirement
While I won’t retire by the time I’m 27(I’m 36), I’m hoping to retire before I’m 45. I’m getting more and more antsy at work. I pretty much daydream about early retirement whenever there’s downtime.
Even though I’m not retired yet, the following list are things that I have done or currently do to help me reach early retirement as fast as possible. If you follow this list, or do only some of the items on the list, it should help you reach early retirement as well!
Max Out Your 401k and IRA if Possible
Look, I know it’s really hard to save that much money. Start small! It was only 4 years ago that I was putting in 3% every paycheck. 3% was the amount I needed to contribute to get the match. I wanted to pay down my debts before I really started investing.
Once I was debt free I slowly started contributing more and more until I was comfortable contributing the max amount. I’m pretty sure I changed my contribution amount like four times in one year!
Pay Off Debt
Some people suggest paying off all debt before investing anything. When I was in debt, I saved enough to get the 401k match and then focused on paying off my debts. Making sure that my emergency fund was fully funded when I was paying off my debt was also a high priority for me.
I kept a fully funded emergency fund because I had been laid off before at a time when I wasn’t in a secure financial situation and IT SUCKED! Thanks to parental help, I made it through, but it’s a situation that I never wanted to be in again. Continue reading “If You Want to Retire Early, Start Doing These 12 Things Right Now”
Happy November everyone!
Who’s ready for winter??
Not me. I know I could move from the wonderfully freezing cold state of Minnesota, but my family is here. So here I stay.
I wanted to take a break from my usual Net Worth posts and focus on something a little more fun.
I consider myself a fairly frugal person. I have a pretty ambitious goal of retiring in 10-15 years and this frugal lifestyle of mine is slowly getting me there. With that being said, I know there are things that I could cut out of my life to reach my goal that much faster. Alcohol, driving to work, traveling, and organic foods come to mind. However, I really like all of those things and am willing to work a little longer so I can enjoy my life now.
The following list includes things that don’t really make sense to me. While I don’t see the value in these things, other people might value them greatly. To each their own.
So, in no particular order…
Buying Cars With a Car Loan.
According to the article “How Long Should My Car Loan Be” by Ronald Montoya of Edmunds.com, most car loans today have terms of 60 months. 20% of car loans are even longer than that. That is crazy! Even when I was young and dumb and had car loans, they were not that long! Plus, every car that I had a car loan on was paid off way earlier.
Which brings me to the next item that doesn’t make sense to me…
Not Paying Off Loans.
A little anecdote for you- I work with a younger gentleman in his mid-twenties who has around $40,000 of school loans. They’re in his name and he refuses to pay them. Why? Because according to him, his parents pretty much made him go to college, so they should be the ones to pay the loans off. I have a feeling his school loans are going to be attached to him for a looong time.
Another dear, close friend of mine has about the same amount of school loans to her name, but had deferred them because of her income. Yet, she somehow found the money to fly around the U.S. to see concerts performed by her favorite band. Doh!
Paying For Books, Movies, and CDs.
When I was a younger, every time my parents and I went to the mall I bought a book. Sometimes two. While I’m extremely grateful to my parents for letting me indulge in my love of books, I now understand how much money they spent on me. Especially when they could have just as easily brought me to the public library. I love the public library!
I get a happy feeling, a peaceful feeling whenever I’m browsing the rows and rows of books looking for the perfect title to check out. It’s my happy place.
Between the library and Netflix, I will probably never buy a movie again. Netflix is the one monthly service that I subscribe to and I’m pretty happy with it. I pay for the DVD subscription and Mr. Frugal Turtle pays for the streaming service. While I’ve thought about canceling Netflix and just checking out movies from the library, there is this thing called waiting lists. Sometimes I just don’t want to wait weeks and weeks to see a desired movie.
As far as music goes, Pandora fits me perfectly. Free music any time I want it with barely any commercials? Heck yeah! And I don’t have to buy cd cases or racks? Awesome!
Paying For Cable or Satellite
What a waste! I remember when I first started dating Mr. Frugal Turtle he had Direct TV. He said he never watched it, but yet he kept paying something like $75 a month for the service. Eventually he did cancel it. Now we mainly catch shows that air on Netflix. I don’t think either one of us misses network tv.
Whenever I’m at my parents and they have the tv on, I’m always super annoyed by all the commercials. Especially with it being an election year! I really don’t miss those commercials.
Buying Junk Food
Okay, okay. I don’t eat clean food for every single meal and snack throughout the day. But I try! I am definitely not someone who wastes money and only buys microwave meals, chips, candy, and pop. I love cooking! I honestly can’t remember the last time I took a microwaveable meal to work for lunch. They’re so bland! Seriously, I need to add at least two salt packets to it to make it taste good. And that is really not healthy! I’ve worked at my current employer for almost six years, and I proudly tell people I have never bought anything from the vending machines there. I see other people buy their entire lunch from those machines and then on a later break, go buy from the vending machines again. That is so much money tossed away. It makes me sad.
Buying Drinks at a Bar
This should really be titled “Buying (most of your) drinks at a bar.”
Drinking at bars has become really expensive. If I feel like I want to live it up downtown I prefer the pregame method. Get a good buzz going at home beforehand! This is way cheaper than spending $$$ at a bar trying to get drunk.
I’ll admit, those days are pretty much over. Nowadays I prefer to drink at home and avoid bars completely. My favorite weekends are spent around a fire pit with Mr. Frugal Turtle enjoying a relaxing evening together.
Eating Out More Than Once a Week
Looking at my Net Worth reports and taking a peek at my expenses shows how little I eat out. I count getting fast food eating out because it rarely happens! I probably eat out on average once a month. Our favorite restaurant is a cute little Indian place that serves the best Indian food I’ve ever eaten. The servings are huge and the prices are very reasonable.
Eating at a restaurant more than once a week would lose its appeal very quickly for me. For one, it’s really expensive! Two, by the end of the meal I’m usually thinking that I could have just as easily made the same meal at home for a lot cheaper. The exception being that Indian restaurant. For the life of me I can’t make food like they can. Believe me I’ve tried.
Keeping a Credit Card Balance
Looking back at who I used to be, I realize that I was not very frugal. It pains me to think about how much money I wasted when I was younger.
Up until about eight years ago I had credit card debt. Right around $7,000 to be exact. My parents borrowed me the money to pay everything off, and I can proudly say that since then, I have not paid a single cent in interest. I didn’t touch credit cards for a year or two because I was so scared I was going to go back in credit card debt.
Once I felt comfortable I slowly started to use them again. At first it was for very small amounts that I could easily pay off. Now, I use my credit cards for almost everything. Every payday, I sit down and pay off the balance on my two credit cards.
Not Using Things Up ( Use It Up, Wear It Out, Make It Do, Or Do Without)
I love that saying. One of my favorite sweatshirts is 25 years old. My parents bought it for me when they went on a trip to Washington D.C. It has thumb holes that weren’t originally there. I love it!
I wear a lot of my clothes until I can’t wear them anymore. It’s almost a game to see exactly how full of holes an item of clothing can get before I make it in to a rag. Those clothes are strictly for wearing around the house or camping. I do have nice clothes for wearing in public!
Cars are another example of things that I wear out. Most of the cars I’ve owned I’ve needed a tow to the car dealership for a trade-in. I don’t think I’ve ever received more than $500 for a trade-in. Usually the repair is way more than I’m willing to spend when the car is pretty old with a ton of miles. I currently own a 2001 Grand Prix with over 188,000 miles on it. I’m hoping to go a couple more years before I need a new car.
Not Saving Money Where You Can.
Comparison shopping! I hate it, but I do it. I research the crap out of everything before I buy it. I hem and haw and take hours to make a decision and only after sleeping on it will I usually purchase a higher priced item. A higher priced item to me is anything over $100. For example, take the pair of shoes that I bought for work back in September. If my memory is correct I looked for the best pair of shoes for the cheapest price for a couple of nights in a row. It probably totaled about 5 hours. I then slept on it and ordered them the next night. For shoes!
At the grocery store I’m constantly looking at the price per unit. For most items I don’t care if I buy generic. If it’s cheaper than the brand name, in the cart it goes! For stores that don’t have the price per unit on the shelving label I turn to Mr. Frugal Turtle. He’s my calculator! Poor guy.
So there you have it! These are the top ten things that don’t make sense to a frugal person like me.
Did I miss anything? As a frugal person, what does not make sense to you?