How is your personal economy?

We are happy and hopeful. As a salon owner, I recently broke into a new tax bracket. However with over head, the accepting of credit cards, and taxes, I now only keep a little over a quarter on what I make in a month. Boooo! Now I am changing my perspective on life, and with the help of you fine people, I have changed how I opperate my lifestyle. Today alone I made a list of item to sell so I could build a shed and get a new used computer. Selling all my basement furniture, patio furniture, tv, and stereo system, and my 3rd car! I don't use any of these item, and need to purchase things I will use more frequently. Before I would have been stressed out and adding to an already high credit card balance, just to buy a NEW computer. Now, virtually debt free, I'm making healthier choice with my personal finances, and can say my personal economy is doing well.

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Originally Posted by Simplemind

I figured my health and getting out early was worth more than a few hundred more a month. I am not scoffing at a few hundred a month I am just saying that I really felt getting my life in a healthy direction was much more important. We shall see how the economy goes but I don't see having to dip into that deferred comp account for many years. I have more there than I did in my pension and that pays $2300 net a month. It does feel weird to not be saving anymore but honestly................. enough is enough and I just have to learn how to sit back and enjoy after years of being an ant instead of a grasshopper. I am blessed with a husband who saw it even before I did and has supported me in letting go and taking care of myself for a change.

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Simplemind, I could have written almost exactly those words! Lots of people where I used to work thought I had retired instead of just quit. Yeah, another couple of years would have let us sock some more money into the 401(k). But that was assuming I could make it another couple of years, and that was no sure thing. Since I've quit, my health and my mental outlook has improved greatly, and everyone who has seen me "before" and "after" comments on how much better I look now. I could have spent those extra savings on makeup and medications ... :~) It's also become a lot easier to be frugal because now I have the time to cook more at home, watch the finances, do more house chores/repairs (instead of hiring it out), and "stuff" is no longer the compensation for busy-ness.

What we've encountered on the road to simplicity likely is not anything new to the folks who've been here a while. But we've been quite surprised at how well we've been doing financially so far. It's nice to take a breath. Or two.

I was thinking the same thing this morning. Being "retired" is much easier than I thought. I'm one of those people who at 47, realized it's cheaper just to stay home. I check my bank balances on line everyday, and I transfer money from the savings account at the end of the month to set up the budget for next month. I think that people are manipulated into fearing retirement, but it's really easy. For me, it's a relief. Lots of chores and organization. I sat down this morning at looked wrote our a new budget, implementing my cut backs. Wow! If I really had to, I could live on $10,000. a year! When I was working, I thought I needed $24,000-$30,000. a year. (That's without a mortgage.) My hobbies are much cheaper, I exercise in my living room, and my therapy is knitting. My neighbor was staring at me the other day, because I was up on the roof, sweeiping off the debris. If I can do it myself, I do. I guess I look kind of peculiar. Next, I think I might paint the exterior of the house!

We've definitely been spending more in the last few years, unfortunately. Our family grew by one in 2011, and our DD#2 is able to use much of what DD#1 used, but life is just busier. We eat out more, our rent went up. We are spending about 40K/year, and I want to be able to live on much less. In 2009 it was more like 26K/year. But we could swing it in a tiny (399 sqft for a family of 3!) apartment back then, and rent is over double what it once was. Still, that is only 8K of the increase or so. It's hard to believe so much is getting frittered away, but I honestly haven't taken a good look at spending in a long time. Still tracking it decently, but not looking at it or doing anything about it. I'm hoping to turn things around soon.

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Originally Posted by awakenedsoul

I sat down this morning at looked wrote our a new budget, implementing my cut backs. Wow! If I really had to, I could live on $10,000. a year! When I was working, I thought I needed $24,000-$30,000. a year. (That's without a mortgage.) My hobbies are much cheaper, I exercise in my living room, and my therapy is knitting. My neighbor was staring at me the other day, because I was up on the roof, sweeiping off the debris. If I can do it myself, I do. I guess I look kind of peculiar. Next, I think I might paint the exterior of the house!

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We do something similar. We have a master budget and I keep trying to whack away at the recurring expenses so our basic run rate is as low as possible. We were able to cut off about a third to start when my husband quit work just through having time for more DIY work, no commute costs, less to pay in taxes, etc. I started shopping at pack it yourself warehouse store that has prices about 30% lower than the regular grocery store. So with a family of four adults that was several thousand dollars in savings right there. Cutting back on restaurant meals, fast food and work lunches cut a few thousand more. If we live another 40 years, every $10 a month we cut is a savings of almost $5K in after tax money. So $10 a month here and there really reduces the total amount of money we will need saved in order to fully retire.

I stopped buying new books and now borrow them from the library or buy them for $3 a bag at the library book sales. I am building up an inexpensive reference library of DIY and simple living books this way. Every month we try to find some more recurring costs to chop, make recurring income from work or find some way to manage our 401Ks better to eek a little higher return out of them while reducing risk as much as possible. We have quite a long list of projects to go to try to keep cutting our expenses more.

I really think about how much money we spend on everything and is it worth the cost. I bought some discount tickets to Cirque du Soleil a few months ago, but even with the discount by the time I added in mileage parking and service charges on the tickets for me it just wasn't worth it. I had more fun working at our archery club since that involved exercise in a scenic, social, outdoor setting with a free lunch or spending the afternoon at an art museum with a free library pass and a sack lunch.

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Originally Posted by Float On

Right now it's really bad. DH got laid off from his day job he took last year. We just finished a big art project but that money won't last longer than a few months. I only work part-time. Not sure what is next for us but I wish it would get here quickly.

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Just got better. DH got a new job - better pay, actual benefits, vacations, holidays, retirement plan, etc. He'll still have time to work on orders as they come in but we have decided that we are done traveling to art shows (at least for 3 years until the boys are done with high school). I think I'm going to try and talk him into selling our booth display and tent. Those are both expensive items that just taking up room in the storage addition to our studio. Time to clean house (studio).

Yay! That's great news Float On! What a big sigh of relief for you all!

Fantastic news, FloatOn! Congratulations. That was quick. Good luck selling your equipment. I did that with my dance studio floor, and it was a huge relief. I'm sure if you cut out the traveling, that will free up some money, too.

try2bfrugal,

I know what you mean. I just looked at places I wasted money last year.
Argentine Tango lessons: I bought the shoes, spent $1,000. on private lessons, drove 30 miles each way to dances twice a week, and hated it! I thought I was going to learn a new skill and start teaching it out here. Ballroom teachers make excellent money. Wrong...

I bought some antiques at the Salvation Army, but they were excellent deals. They are solid furniture that won't have to be replaced. No more lamps, though. I have enough. (Those are my weakness.)

I stay off EBay, and make myself wait to make purchases. For example, I almost bought a Smeg refridgerator. I rationalized that I needed to replace the old one, since I've had it for 15 years. I did some research, and it got horrible reviews. Instead, I fixed the old one. It will probably last another 5 years.

Right now we're doing just fine. Both retired; I have small federal annuity and social security, and DH has federal annuity (he never paid into SS so doesn't get any). No debt at all. Well, we do charge a lot on our credit card, which is linked to Amazon, and we get "points", but it's paid in full every month. So while it actually IS debt, I don't count it as debt. However, our spending is not under control, and that worries me. Monthly, together, we bring home about $4,000. I "gave" DH my small annuity to spend as he wishes on his "toys" -- so I don't feel like I'm his mother and controling his spending. His hobbies seem be fairly expensive -- geocaching, woodworking tools and supplies, latest tech gadgets -- but that's his spending $$ and if he can afford it he can do what he wants and leaves me alone. (I have a small personal allowance as well.) But beyond that we seem to spend money at the drop of a hat. Not on expensive things -- just "things". We donate to a lot of worthy causes that are important to us. We support small local businesses and that usually costs more than big-box stores. We subscribe to magazines that we seldom read. But we're never in the hole, never worrying about how we're going to pay for our necessary expenses. We have "enough". But I feel a bit uneasy all the time -- and for that reason we're signed up to take Dave Ramsey's course offered at our local church. We're in no financial difficulty at all, but we just need to be more conscious about our money. If things go belly-up and we "lose everything" we have no way, at our age, to recoup our losses. My parents were Depression "Grapes of Wrath" folks, and I worry. I want to pull all our money out of investments/bank and put it all in a box under our bed! OK ... got all that off my chest ... whew ... :confused:

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Originally Posted by awakenedsoul

I just looked at places I wasted money last year.
Argentine Tango lessons: I bought the shoes, spent $1,000. on private lessons, drove 30 miles each way to dances twice a week, and hated it!

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Gee, I've been dying to take Argentine Tango lessons!! Thanks for the hint that maybe it wouldn't be as great as I'm imagining it.

I'm enjoying listening to all the stories for inspiration.