*** I wrote this post on Sep 26, 2014. Shortly afterwards, the roommate I talk about in this article (who was actually my childhood best friend) was killed in a horrible car accident. I hadn’t seen her in 14 years, something I now deeply regret. While this article is probably a rehash of many things you already know, I thought I would publish today. I haven’t written in a long time as I had a very difficult time with my friend’s death and I also started working on an Etsy shop, which I will write about another day. ***
In 1993, as a new University student, I made plenty of money sacrifices. I had $800 per month to spend. The first $354 went to my portion of rent, the rest went to school supplies, utilities, clothing, and food. My bank account was often down to $1 by the end of the month. The only strategic money move I made was to get an account with the bank whose bank machines could disburse $5 bills.
My roommate, who was the Queen of Bargains, would buy Tomato Soup in bulk. We would sprinkle on a little dried basil, toast up some bread, and have this fabulous feast for dinner in our fancy 2-bedroom apartment. On Friday nights, we’d trade clothes and get ourselves prettied up in our tiny bathroom for a night on the town. With $20, our IDs, and a bus pass in our jeans pocket, we’d take the 30 minute bus ride downtown arriving early to cash in on the $2 bottles of Molson Golden. Three drinks later, we’d be dancing the night away, making sure to keep an eye on our watches so we didn’t miss the last bus home at midnight. Later I’d crash into bed with at least $10 still tucked safely away in my back pocket.
I’m sure you have similar stories from your youth. Fun times with very little money. But you wouldn’t want to keep living this way with a $40,000 per year income, would you? Now that you’re an adult, you deserve more. Much more. You deserve a life with zero sacrifices.
The first question everyone asks me when I meet them is: “Who instigated this lifestyle, was it you or your husband?” When I respond with “My husband”, the next question is: “How hard was it to make all those sacrifices?” My answer is: “Not hard at all”. And here’s why.
These sacrifices are not sacrifices at all. They are in fact Life Enhancers. I went from doing what everyone else was doing and thinking it was making me happy, to having real experiences that were making me much happier.
Let’s start with two easy, often talked about, examples:
Your Daily Latte Fix
Everyone talks about the latte. Some say it’s too expensive and you should cut it out. Others say: “You should spend money on what you love!” I say, you can do both. I’m not about to give up my latte unless I have to, but there’s more to a latte than just a quick coffee fix. There’s more to it than idling in a lineup of car clowns, dishing out $4 a pop (I had to look this up), taking sips from you paper cup while driving to the office, and then finishing up your cold cup of coffee while sitting at your desk in front of the computer. Your experience can be much richer.
A latte (or any kind of coffee or tea) is best enjoyed in a ceramic mug while sitting undisturbed in a quiet room with the sun beaming down on you. Or, it is best enjoyed (still in a ceramic mug) while sitting and chatting with a good friend. This is a sit down and enjoy slowly kind of event. This is how I have my latte every morning. After the hustle and bustle of getting our son ready for school, I sit quietly on the couch in a sunbeam and think about my day. Sometimes I pick up a pen and write a few things down. I also occasionally enjoy a second (gasp!) afternoon latte with MMM – we sip and nibble on a cheese and veggie platter while talking about fun stuff.
Now, would it make any sense to interrupt all this by having to get into a car and drive to a latte making factory to purchase said latte? NO! In fact, it would be absolutely ridiculous.
That’s why we make our lattes at home. You can do it too. It’s much cheaper. Or, you can try your employer’s free coffee, if it’s available. You might even be able to talk your employer into getting an inexpensive espresso machine for the office. “Think of the morale boost!”, you might say.
MMM recently calculated that each big mug of fancy latte that we make at home costs $0.34 (our machine is a $50 Mr. Coffee espresso machine, similar to this one, which has worked just fine for many years).
One gallon (128 oz) of local natural whole milk costs us $3.75. We use 6 oz for 1 latte, so that $0.18 for the milk.
We use 26 grams of coffee per batch, but that’s for 2 of us, so 13 grams each. A 2.5 lb bag of fair trade, organic, dark roast coffee beans at Costco runs $14. That works out to $0.0124 per gram of coffee, so the coffee costs $0.16.
While I will occasionally go out for coffee with a friend, when I do, I make sure that the experience is worthwhile. The place I go to is locally owned and the shop owner is usually around chatting to people. I often bump into folks I know from my community, and I have a really nice experience. The coffee place is also just around the corner from the library, which brings me to the next easy way to save…
Before: driving to the coffee shop, sitting in line, paying $4.00, hurriedly sipping coffee in cardboard cup, finishing cold coffee at your desk, throwing out your empty cup and wishing for more.
After: making coffee at home, silently cradling your warm ceramic latte bowl while sitting in a sunbeam, enjoying every sip of your coffee while reflecting on your day, start your day rested and invigorated, have an afternoon latte as well… why not? It’s only $0.34.
Cost benefit: assuming you buy 5 days a week, that’s $1040 vs $88.40 per year without even counting interest on savings or other coffee shop purchases like the occasional chocolate croissant. Also see MMM’s article The Coffee Machine that can pay for a University Education.
Reading Your Way Broke
Besides good coffee, my other weakness is books. Looking at my Amazon order history (which is really fun to do, by the way), I can see that I bought $280 worth of books in 2001, over $500 in 2002, $180 in 2003, and $136 in 2004 (ironically, one of the books was “Affluenza: The All-Consuming Epidemic”). That’s just on Amazon. I have no idea what my spending was at bookstores those years. Sometime in 2004, MMM and I sat down and had “The Talk” about accelerating our savings rate to reach Retirement faster and it shows in my Amazon Order History. My book spending went down to $0 in 2005. In fact, I only bought 2 things on Amazon that entire year.
How was I able to cut my book spending down to zero and not make any sacrifices? The answer is obvious: The Library, a magical place where you can get all the books you want for free! While the answer is obvious, it wasn’t to me. The library was a place of my youth where I peered over books to look at boys, passed notes to my friends, and tried to write my research papers without copying anything from all those books.
In fact, it turns out that the answers to spending problems are often found by looking back to our youth. For MMM, going to the library was an obvious thing, but I had never even thought of it. So, we got a library card and started going and I was hooked right from the beginning.
Libraries are fantastic places, often full of history, beautiful architecture, and neverending rows of books to browse. Even if your library is small, there is usually plenty of fun stuff around: areas for kids, community events, CDs, DVDs, free e-books, magazines, etc. While some might feel libraries are a thing of the past, I think they are our future. Just as some congregate on Sundays for various religious events to feel part of a community, I congregate at the library and get the same result. I see people I know, check out the latest in historical fiction, and watch my son meticulously pick out books. It’s not unusual for me to practically fall off my bike on the way home from the library due to the excessive number of books I’ve checked out. At our library you can check out 40 books at a time. Imagine picking up 40 random books for free and keeping them for 6 weeks. Six weeks is a long time, friends. One time we wrapped up library books for Christmas just for fun and after 6 weeks we would have been done with them anyway. Then you return them and you can take out 40 more! It’s a kind of abundance that is anything but sacrifice.
On top of all this, our library has an excess of books, so they often have books for sale. At $0.50 per paperback and $1.00 per hardcover, it’s close to the cheapest used bookstore you will find.
You’ll never look at those glossy bookstores the same way again. It’s like a fake paradise with a coffee shop attached. You want the real thing, the history, the community, the abundance of free books. You want to hang out for hours and talk to people, librarians that have a passion for books, organizers of community events, let your kid try out the educational computer games. There’s no comparison. You will be a convert for life.
Before: driving to the bookstore full of frantic shoppers you don’t know, being upsold on things like journals, pens, and coffee, finally choosing a hardcover for $20 + tax, going home and reading the whole thing in one sitting, putting the book on your shelf to collect dust forever.
After: biking to the local library, read the notice board and find out about a street party this weekend, pick up your book on hold, check out the kids section and grab 5 promising titles, browse the do-it-yourself section and pick up a few books on home renovations, pick up a few new science fiction novels for yourself, self check-out, browse the used books for sale and pick up a $0.50 classic for a friend’s upcoming birthday, bike home feeling like you hit the jackpot.
Cost Benefit: depending on how much of a bookaholic you are, this single much more pleasant experience, can save you thousands of dollars per year. I do pay the occasional small late fee at my library (due to my own negligence, as they automatically e-mail me when my books are due), but I think of it as a donation to my library.
We’re just getting started here. Stay tuned for more.