Friday, August 1, 2014

Today It Gets Real

I would say that I am a frugal person, but sometimes that frugality ebbs and flows. For the past couple of years our frugality has been a mixed bag. There were a lot of major purchases made, some necessary, some not (keep in mind that what we consider necessary you might not, and visa versa). There were meals out (but not as many as some years), books and music purchased rather than borrowed, lots of little indulgences, and more.

But today we are turning a new leaf, and returning to our more extreme frugal ways. Extreme for us, anyway. Extreme for people in our culture, in our social circle, in our neighborhood, at our income level.

It isn't always going to look frugal to someone else, and that is one reason I call it Voluntary Frugality. If we were hit with something that made our frugality a necessity, then I would be looking for a job, not blogging. We'd have to give up competitive biking and the travel associated with it. I wouldn't be contemplating whether or not buying an XYZ would save money in the long run, because I wouldn't be able to afford an XYZ.

I know that we are starting from a good place. Our mortgage is at 2.875%, we have no second mortgage or home equity line, and our only consumer debt is 8 more payments on our truck, at 0% interest. Our credit card debt and student loans are long ago paid. We have an acceptable savings account for emergencies and annual expenses, and have contributed to a retirement account for 20 years now. Papa earns a decent income.

We're also embarking on this journey with many skills and tools that can make frugal living easier. I can bake and cook, I can knit and crochet, and I have some sewing skills. I have a fully equipped kitchen, we have basic tools in the garage, and we have frugal basics such as drying racks, a programmable thermostat, energy efficient lighting, and a chest freezer. I am a fantastic budgeter (when I actually do it) and very good with money after spending several years in banking.

As I said, today it gets real. We have an August 1st to December 31st goal to live on half of our take home pay (or less). This is the trial run; we'll tweak as we go, with the goal to be to lower our expenses as far as we can (without giving up competitive biking) so that over the next 15 years we can fully cover college costs, pay off our mortgage, and have Papa retire just a little early.

No doubt, this is a lofty goal and will take sacrifice from all of us. I know plenty of people who would tell me that there is now ay that they could live on half their income, and I believe that to be true. Being able to attempt such a challenge is based on many things, though, not just the income number.

We refinanced several times to get that low interest rate. We paid off our credit card debt a long time ago, when we were both working. The student loans were paid off before we had children. We eat a plant based diet so we don't include expensive meat and dairy in the grocery budget. I am skilled at baking and cooking from scratch; we don't buy expensive processed foods. We're well established in our household and already own most of the things we need and want.

So really, it isn't going to be terribly hard. We'll call it good practice for retirement or the next recession :)

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