Mrs. 1500 here!
When Mr. 1500 first talked to me about the concept of retiring early, I was intrigued. Having already “retired” myself (to stay at home with the little 1500’s) I thought it was a good idea. He told me about some blogs he had been reading (Mr. Money Mustache, Retire by 40, Brave New Life, etc.) so I started reading them to see what they suggested. (I am not going to eat beans and rice every day for the rest of my life just to retire early.)
I have to warn you, this is a LOOOOOOONG post. Sorry, but I really feel these things need to be said. If you can get one money-saving idea out of this, I will feel accomplished.
While obviously we have embraced the idea, I felt like these guys (Mr. 1500 included) had an unfair advantage over the rest of us worker bees. They all are highly-paid computer guys (or were before retiring) and therefore can easily afford to do this. In my working past, I didn’t make a lot of money. I topped out around $38K/year. Easy for you guys to say retire early, you make three times as much as I do.
But then I really started thinking about my life pre-marriage. I bought a condo because I couldn’t stand to pay rent, giving that money away and not having anything to show for it at the end of the year. The mortgage on that 2-bedroom condo was $425 per month, $15 more than my 1-bedroom apartment cost me to rent. And it was mine! I drove a very old, but extremely reliable Toyota. I brought my lunch to work and ate breakfast and dinner at home (most of the time.)
I still had fun. I went to parties at equally poor or frugal friend’s houses (where I eventually met Mr. 1500), went to inexpensive plays downtown, and attended school. (Here is a bit of advice, DON’T major in Fashion Design.)
I had two jobs up until I was just about married. This was really beneficial to my finances in two ways. First, the obvious, it brought money in. But second, and equally important, when I was working, I wasn’t spending money. I wasn’t out drinking, I was serving those drinks. I wasn’t eating at a fancy restaurant or shopping with friends, buying $400 purses.
After a while, my friends started making more money, and their cars became nicer, their clothes more expensive, their credit card debt more massive. I got married, sold that condo (for a 50% profit!) and moved in to Mr. 1500’s 3-bedroom house. The rest is history.
Now, all that said, there were still things I could have done differently. Here is a list of things you can do to save money, even if you aren’t raking it in.
Rent out your spare room. I had a 2-bedroom condo, and for a while, my brother was living with me in the second bedroom. But after he left, I could have rented out that second room, for at least my condo payment. (This is made even more easy for you now, with Craigslist.org and airbnb.com.) If you can’t afford a separate rental house, buy the most-bedroomed-house you can afford. Buy in a decent neighborhood, and rent out those extra rooms. Make sure you can afford the whole payment by yourself, and save up for those months when you don’t have renters, but if the rent payments total more than your mortgage payment, you are getting someone else to buy you a house. How sweet is that? (Another quick bit of advice, background-check the heck out of your potential renters. Better to have an empty room for a month than try to evict someone for non-payment of rent.)
Take care of your car. I did have the inexpensive car, and kept up with the small, maintenance things on the car like oil changes. (If you don’t know anything about cars, ask your sister’s best friend’s boyfriend’s brother to tell you what you need to do to keep it in top running order. Find a good mechanic who isn’t going to take advantage of you. Car Talk has an impressive list of mechanics that their listeners have vouched for here.) My car was ugly, but it got me from Point A to Point B, which is all a car needs to do.
Learn to cook. If you can read, you can cook. The library has a lot of great cookbooks, and Sandra Lee has an awesome series of recipes that use pre-made ingredients that you doctor up to make it homemade. She calls it semi-homemade, and I have yet to make one of her recipes that isn’t good. Anyone can stir things together in a bowl. Take a day to make up a bunch of breakfast sandwiches and put them in the freezer so you don’t have to stop at the drive-thru on the way to work because you woke up late. Get a slow cooker and dinner will be ready when you get home.
Find a beauty school and get your hair cut/colored there. Those people are learning how to cut hair, but the ones cutting your hair are almost finished with school, and are heavily supervised by professionals. You won’t leave the salon looking bad, and you will get it at a fraction of the cost. Hair stylists recommend getting your hair cut every 6 weeks. I go about every 6 months. I use nothing in my hair, and have a style that allows me to go this long without a cut. I cut Mr. 1500’s hair myself, as he likes to wear it in a very short style, and I can cut it with clippers. (He is pretty no-fuss.) I know several women who get their hair cut/colored every 3-4 weeks, and pay $150 each time! No Thanks!
Don’t stand up in weddings for people you don’t believe will stay together. I remember the first wedding my sister stood up in. The bride had been caught cheating before the wedding and somehow convinced the groom to go ahead with the ceremony. My sister spent $250 on the dress, $35 on shoes, $50 on a shower gift, $75 on the bachelorette party, and $50 on a wedding gift. (And these are prices from 20 years ago!) All for a marriage that lasted less than one year. I am going to amend this statement. Don’t attend weddings for people you don’t believe will stay together. After my cousin’s second wedding (they went on the honeymoon and then came back and immediately got a divorce) I have vowed not to attend any more weddings where I don’t truly believe the couple will be together forever. I just went to my first wedding since my cousin’s disaster, almost 3 years after. I was very happy to attend that wedding, and know they will be together until death parts them.
Delay having children until you can afford them. Now I understand surprises happen, but there are ways to avoid these surprises. Take precautions, because kids are a lot of work, and a lot of money. We were married for 5 years before we had a baby, and we planned our pregnancy so we would have enough in our bank accounts so I could stay home with the baby. We don’t pay for child care, and I get to raise my kids. Again, surprises happen, but if you take steps to avoid those surprises, you can get that much further ahead.
Shop the sales and use coupons. Coupons aren’t just for food anymore. There are daily deal sites all over the internet that offer deep discounts for restaurants, services such as haircuts, even alcohol. There are coupons in the paper for department stores, sometimes offering percentages-off for full priced items, but also at the end of the season you can find percentages-off coupons for already reduced items. Use coupons at the grocery store. Matching them up to sales can net you big savings, and if you are going to buy it anyway, why pay more?
Find a way to make extra money using what you know. I snowboard, and know a bit about snowboards. Having just moved to an obscenely wealthy part of Colorado, there are a lot of last-year’s-model snowboards at the thrift store. During the winter months, I don’t buy them, because they are hundreds of dollars. But over the summer, I bought 4 boards for $25 each. Name-brand boards, some with bindings, for $25 each. I will sell them for at least $75 each, and I just made $200 for taking a few pictures and storing a few snowboards in my basement for 6 months. I’ll take that!
Can’t beat the high paid computer people? Join them! Go back to school on the Internet and learn for free or very cheap. Stanford University publishes lectures through the App Store (iTunesU). Go to school at MIT for free. Codecademy has all kinds of great classes and so does Treehouse. Worried about lack of experience? Code a killer iPhone app or website and people will be clamoring to hire you.
Make your coffee at home. Starbucks is a great treat, but every day gets expensive real quick. The one by my house routinely has a line of at least 10 cars in the drive-thru every morning at any given time. Let’s say each car takes 2 minutes to get their drink. That is at least a 20-minute wait just for your caffeine. And not to mention all the gas being wasted, all the fumes being emitted, etc. All because you didn’t wake up in time to make your own coffee?
Shop at the thrift store for everything but underpants. Do you need new clothes? Hey, the Goodwill or Salvation Army has just what you are looking for. Maybe. But they do have something that will fit your bill. They also have sales! Need a new pair of black pants? Why pay $20 or more at a retail store, when you can buy a pair that looks brand new, for less than $6 (usually)? One thing to remember when thrifting, check everything carefully. Some thrift stores don’t allow returns, and some do. Make sure you realize that zipper is broken, before you buy it at a thrift store that doesn’t allow returns. They sell almost everything, and you just have to have time to really look. And even if the zipper is broken, as long as they fit, that can be fixed. Find a good dry cleaner or tailor and have them fix it. Or better yet, learn to sew. (Zippers are an advanced sewing skill, so better to let the pros do it until you learn how.)
See the matinee. Or better yet, wait until it comes out at Redbox ($1 movies? Yes, please!) or on Netflix, or at your local library. I still go to the movie theatre, but only for a kids movie treat for the girls or a movie I really, really want to see in the theatre.
Share babysitting. I have a friend who has two daughters. Her oldest is the same age as my youngest, and they get along very well. My oldest loves spending time with her youngest, so we can swap babysitting. She watches my girls while the 1500’s go out on a date, and then I watch her girls while she and her husband go out on a date. Plus, I know she is a great mom, and is good with my girls.
Don’t buy books (except anything that I publish, then buy 12 copies. They make great gifts!) Your local library is knowledge central. Want to learn to cook (see above)? Borrow a cookbook from the library. Want to learn to sew? Library can help you there, too. How about teaching yourself computer programming to earn more money? Ding ding ding, you guessed it, the library can help you there, too. Most libraries are part of a library system and can borrow books from other branches. Ask your helpful librarian to show you how to navigate their website.
Stop giving gifts! I have everything I need. You have everything you need. Just because we know each other, somehow we are obligated to purchase SOMETHING for each other at Christmas time. I can’t tell you how many times I bought something, SOMETHING for someone just because I felt the obligation. Hmmm, this scarf is soft, and here, and she lives in a cold-weather state, so I am sure she needs one. No, she really doesn’t need one. She already has one. I received a gift card for Victoria’s Secret this Christmas. I went in to their stores to look for undergarments, and was surprised to find they don’t carry anything larger than a Large (which looked really teeny-tiny to me) in their stores. They carry Extra Large on their website. When I went online, I discovered their least-expensive undies are 5 for $28. !?! I closed their website, and have regifted that card to my sister. Shh, don’t tell her. I didn’t need that card, and I didn’t really want it. It was purchased for me because the giver felt obligated to give me SOMETHING. I am all for gifts that remind you of the recipient. I found an ice cube tray that makes octopus-shaped ice cubes. My sister-in-law loves all things octopus. $2. I am happy to give this gift, because she will be happy to receive it.
If it isn’t broke, you don’t need a new one. Just because you have had that thing forever, doesn’t mean you need a new one. My coffee pot is old. Really old. The clip that holds the lid down broke a long time ago. It won’t make coffee if the lid isn’t down, but rather than throw it out, I got a piece of wood that is heavy enough to hold it down, and voila, my coffee gets made. I paid $40 for this coffee maker probably 9 years ago. Still makes good coffee. No need to get another one. Same goes for your purse, shoes, car, house, etc.
Stop before you buy. Think about your purchase before you make it. Do you really need that? Is that the best price you can find? Is it an impulse purchase? Go home and think about it. Think for a day, or a week, or even a month, if it is a big purchase. Some things you need right away (anyone ever run out of toilet paper?) and you can’t look around at prices because beggars can’t be choosers. So try not to be a beggar.
And last, but most certainly NOT least, choose your life partner wisely. This is the absolute most important decision you will ever make, so take your time and do it right. If you want to live a frugal life, dating someone who wants to stand around and look slick all day isn’t a good choice. Don’t fall for a beautiful face or a hot body (note from Mr. 1500: I’m proofreading and have some questions now for Mrs. 1500!). Look at their decisions and see if they are something you can live with. If not, cut your losses early and move on. Don’t settle for less than what you want. They won’t change unless they want to change. Divorce is expensive. If you have children with the wrong person, it is even more expensive. Choose wisely and be happy.
Mr. Money Mustache, Brave New Life and Mr. 1500 all have (had) high-paying computer jobs. Good for them. However, income is only a part of the equation. Mr. 1500 has a friend who makes $150,000/year and STILL lives paycheck to paycheck and is in a ton of debt. You can make $40K/year and retire when you’re 50. You can also make $120K/year and still have to work when you’re 75. Its all about choices. Choose wisely.
Great post! I also drool when I read about MMM and other’s 6 figure salaries, and sometimes even get a little discouraged that Mr. Herb and I are far from that. But as you said, you can still retire early on a much lower salary!
I found myself nodding and saying, “Yeah Mrs. 1500!” to many of these.
“Hair stylists recommend getting your hair cut every 6 weeks. I go about every 6 months.” -This is totally me. 2 haircuts a year!
“If it isn’t broke, you don’t need a new one.” Amen to this. My little cell phone (it’s a dumb phone, but I still like it!) will be 4 years old this summer! I get a lot of flack over it. Someone recently said, “Wow, that phone is SO old!” And I have people say all the time, “I don’t know how you go without a smartphone. I couldn’t LIVE without mine!”
Also, my poor old laptop will be 7 years old (SEVEN!) this summer! It’s still trucking along! I got it when I started college – it was “given” to all freshmen. The only thing I’ve had to do was get a new battery (replaced by the school my senior year of college!) and add some memory to it 🙂
Loving your all’s site and posts. I’m enjoying following your journey. We’re working toward a similar path. Mr. Herb and I just got married, so we’re just beginning! But hoping for me to be able to work part-time or not at all once we start having babies in a few years!
Nice; it sounds like you’re doing all the right things and don’t need my help!
“Also, my poor old laptop will be 7 years old (SEVEN!) this summer! It’s still trucking along!”
I like this. It seems like an awful lot of folks think they need to trade up for new consumer electronics every year or so. No need if the old one is still doing fine.
I look forward to trying your recipes; Mr. 1500 is pushing hard for the cookie dip!
It sometimes does get frustrating with all of these $$ computer people. My husband and I are a teacher/construction worker couple and our pay combined doesn’t even get close to six figs. However, we live frugally enough that we paid over 50% down payment on our home and had a bunch leftover to fix it up. We are saving like crazy for early retirement. Plus, although my husband doesn’t have a high paying job or a job with typical benefits, it does have some unseen benefits. Most of the lights/fans in our home are ones that my husband got from jobsites (not stealing- they were going to be thrown out). We have a whole set of nice white kitchen cabinets that are in our garage and laundry room for storage and for my husband’s make shift shop that were free from a job. He takes the aluminum, copper, and steel and gets it recycled and keeps the cash. His company would have just thrown it away. This is just the tip of the iceberg for stuff that he has brought home (kitchen faucets, sinkerators, you name it). Finally, he has connections like you wouldn’t believe with other people in the industry. This means that when we found out that the house that we were buying had not been properly winterized and that the pipes leaked like a sieve, we weren’t that worried because we could call one of his buddies who does some plumbing on the side and they could work together to get it fixed for a fraction of the cost. Who needs to call a handy man when you are married to him?! My message for other middle-low income earners is focus on the positives of your job and look to learn new skills. This summer I am hoping to learn a bit of android/iphone app coding so that I can make free apps that I know other teachers would use and see if I can get some advertisers. Maybe that could be a sidestream of $$, who knows?
Hi Laura-
I like and can relate to what you said about your husband. My dad was an electrician, so he would do the exact same thing you mentioned. At any given time, we’d have coils of copper in the garage that my dad had rescued from the dumpster just waiting to be recycled.
One thing you didn’t mention that my dad did was side jobs. At any given time, he always had lots of other gigs going on. Sometimes, it was as simple as installing a ceiling fan. Other times, he was wiring complete houses on the weekends. Your husband may want to try advertising on Craigslist if he wants to do the same thing.
I’m a mobile developer (mostly iPhone for now) and I like your ambition! Mobile development is a high growth field and if you got good at it, you could make a lot of money doing this alone. A couple quick tips. Its free to try developing (with either iPhone or Android); you just have to pay when you want to formally publish your app. IF you go the iPhone route, you’ll need a Apple computer. Android can be anything. For iPhone, there is a great course here (free!): https://itunes.apple.com/us/itunes-u/ipad-iphone-application-development/id473757255?mt=10
Let me know if you have questions about it!
So happy I have come across your blog! I am one of those who made a ton of money and was broke. No more. Not sure early retirement is for me, but downsizing and cutting expenses to the max is. Here’s to smart living!
Hi Tony-
I like this. Early retirement may or may not be right for everyone, but by living the right way (downsizing and cutting expenses as you said), you have the freedom to choose. Contrast this with folks who must get up every day to go to a job for the next 30-40 years to support a ridiculous lifestyle.
I’m not even sure what retirement will mean to me. I’ll probably keep doing what I do now (software development), but work on my own ideas instead of someone else’s.
I look forward to reading through all of your posts!
We’re 30 now and are being inspired by your success so far! If you don’t mind my asking, how did you save up/invest to make $500, 000 before you started your 1500 days? I’d like to retire by 45 and right now only have $105,000 in the bank. Wondering what’s best to do with all of it.
zoe @ my unhoardED life recently posted…You haven’t seen my desk in a long time. Then again, neither have I.
This is a great question! First, we always maxed out our 401ks. Second, we flipped houses. We would buy outdated homes, preferably of 70s vintage and rehap them. We’d tear out all of the pink and green fixtures and make them beautiful. We’d like in the house for 2 years, so we didn’t have to pay capital gains. We don’t do this anymore since we have kids. Third, I made some savvy stock purchases including Google at IPO ($85) and Apple back in 2007 (~$90). Fourth, after completing college with a useless degree (Biology), I took a computer class. I then got a job and worked my ass off (80 hours/week). Through that hard work, I was able to bring my pay up quickly. Again, working like a madman is now impossible with kids.
I’ll do a post where I elaborate on this soon.
Commenting rather late, but I thought I’d weigh in on gifts.
Me, I couldn’t care less about receiving gifts, even for my birthday. However, I know others are rather fond of them.
I enjoy giving consumables. If it’s something that can be used up, chances are the user will need more in the future. I love a good fruit basket or a box of cookies. A gift doesn’t have to be edible. I gave an author friend of mine (who prints out lots of manuscripts) a ream of paper because I knew she’d love it. I’ve given another friend a gift card to a petrol station (yes, she drives a car).
I know these are gifts that will be used and appreciated.