I’ve slacked off a bit from my initial enthusiasm for frugality. Part of this lapse can be explained by the excitement of romance, summer weather, and the summer social fervor; but part is just letting my guard down. So in the last week or so I’ve started to get nervous again. I made a first stab at running my budget numbers afternoon to try to ease my anxiety with some facts.
My goal is to get to a sustainable point where my income meets my expenses and yet is below the tax line.
Right now my regular monthly expenses (rent, utilities, food, etc.) are something like $1050/month. Of this, there’s maybe $250 that I could trim from without having to move out of my apartment (for instance, Spanish lessons could go, I could quit drinking coffee and drop my New Yorker subscription) and there’s going to be another cost coming up if I ever manage to get health insurance.
Then I’ve got one-time expenses: finger-stitching, my Guatemala trip, hosting fees for sniggle.net, and the ever-popular “unexpected.”
After putting money into an IRA and some educational expenses (which I need to do for tax reasons), my remaining disposable income for will be something like $17,000 and change. I won’t be taxed on this, so I’m in the clear there. Part of my secret relies on $3,000 in capital losses, which aren’t a sustainable solution, so to make this a long-term project, I’d probably have to bring the disposable income down around $15,000 or so.
That would just cover my monthly and currently known one-time expenses (not including finger-stitching, for instance, since I haven’t seen the bill yet).
As it is, I’ve got capital losses to last me a few years (unless my old company bounces back) and I’ve got some savings nest-egged-up that gives me a cushion so I’m not going to go into the red for a good while unless disaster strikes.
But, it looks like at my current burn rate, I can’t do this sustainably.
What I’d like to do is be able to live a full and fun life (one that doesn’t look like dismal renunciation and sacrifice), live within my budget, and still stay under the tax line. Then I’ll be in a good position to recommend this approach to other folks looking to pull away their support from the gov’t. Until then it’s just an eccentricity.
I’m spending some time checking out the experiences of other people who are living on less for advice. There’s a lot of pointers for frugal living available on-line (for instance here and here). I think there’s enough slack in my expenses so that I can pull things in quite a bit with a little attentiveness and fresh ideas, but without quasi-monastic renunciation.