On Questioning Expenses

05/26/15

So, two or three sources have pointed me to Mr. Money Moustache at various points in the past, and so I've finally started to sit down and read them.

Before even reading them, though, the basic idea of saving 50% to 75% of my income is an enticing one. The idea of one year of work equating to one-to-three years of retirement is a very powerful way to look at things.

Frugality is also something I found appealing. Lifestyle inflation is certainly something I want to avoid. And I really do understand that a less expensive life can be just as satisfying as an expensive one.

Removing expenses from my life has already been a significant goal. And I've been quite successful. I'm living without a car and loving it. And that also saves me a couple hundred a month, at least. I pay about $40 on a bus pass, and I could be biking instead, but I do stuff like write this blog on the bus, so I consider it probably worth it. It is, however, something I'm considering messing with to see if I can juggle my actions and get more-or-less the same output at a lower cost.

For example, I could make biking my main means of exercise, and instead of taking a half-hour break to run during my work-day, I could take the same time to blog. Quite possibly very worth trying, and there's a time-period between when my bus pass expires and when I go on vacation where I think getting a bus pass would be a waste (won't be using it for a week), so maybe I could try the bike idea.

I just need to fix up my bike. Or use up my bike card to get it fixed up proper by a bike technician (should more-or-less be free).

Now, $42 isn't much, but according to Mr. Money Mustache, that racks up to 42*173=$7266 over ten years. Now, again, now too painful, but if I can make that much without it measurably hurting me, why wouldn't I?

But that's one of my more minor, more easily testable without much repurcussions (financial or otherwise). What really got my attention as I considered expenses was my largest one.

My mortgage.

My mortgage currently takes up about 25% of my income (after taxes). Now, ideally I would like to live on about 25% of my income, and for that to be possible I need to make more money, or decrease my mortgage.

Up until recently, I kinda took my mortgage for granted. Well, as long as I lived in Tucson, and I had no plans to leave. But I don't have to keep the house I'm currently paying off. I can sell it. Very minor research even suggests it has increased in value. I could perhaps switch to paying off a house that's as little as half the price of my current home.

Don't get me wrong, I love my house, but it's bigger than I need and my most major single expense. If I switched to something two-thirds the price, my mortgage would be halved. Half the price? Less than the third the monthly cost.

Again, with minor research, there are plenty of nice houses that are in that price range. I would also need to do neighborhood research, but it seems if I'm patient I could easily find something worthwhile.

That would put my mortgage to around 10% my income, and be about tied with food food for biggest expense per month. Mortgage, food, and bills may fit neatly into that 25%, and I could work towards having interest on my savings pay for the fun I want to have, or something.

This is definitely worth more than minor research.