Dec 10, 2014 594 comments

Case Study: Average Everyday Complainypants Seeks Redemption

Average consumer’s daily commute vehicles

Today’s case study is a classic, because it addresses a problem suffered by tens of millions of families: the chronic time shortage caused by a double income, double commute, kid-raising lifestyle. While some practitioners of this game do it by choice, many other would rather have more free time … if only they could afford it.

Dear Mr. Money Mustache,

I am new to your blog but have been seriously enjoying this new found financial porn on a daily basis. I think I have the basic principles down. Bike good; car bad. Mindful spending good; mindless consumer orgy bad. Early retirement good; endless wage-slavery bad.

Instead of sitting in my beige 8×12 government cubicle daydreaming about how cute I would look with a new red Guess bag and tall leather boots from the mall across the street…I am now in my beige cubicle fantasizing about a simpler life with a smaller home, more time at home with my tiny humans and more time to read.

At the risk of being labelled a complainypants, I genuinely do not understand how to move from this wageslavery to being a Mustachian. It seems to me to be bit of a chicken and egg conundrum. How do I live on 50% or less of my income while still being stuck in said cubicle with all the expenses that it incurs?

The Basic Stats:

I am a fellow Canadian and as such am exceedingly polite
I live in one of the coldest winter cities in the world (temperatures in January and February routinely dip to -40 degrees)
Aside from the extreme temperatures in which I live, I am otherwise average in virtually every way.
Average height, average weight, average number of kids (2)
Average home (1200 sq feet), average mortgage (260K, worth about 420K in today’s market)
Average income (75K/year, 165K/year household…although according to you…I have already made it big)
Average cars (2 –one 2006 Honda Odyssey mini van and one…wait for it…2011 Ford F-150 Eco-boost Extended cab truck)you saw that coming from a mile away didn’t
you?…but amazingly both are paid off)
Average commute time (20 minutes direct, 45 minutes if you include the kids daycare/school drop time. My husband works 15 km in the opposite direction so we can’t even car pool.)
And last but not least, average amount of consumer debt ($12000 on a line of credit).
We have an average amount of savings (120 000 in RRSPs and $12 000 in a few different savings places)
And best of all I am in 15 years into a 30 years sentence with Her Majesty the Queen to be given my golden hand shake at the age of 55 (ie 70% of my income for the rest of my life…or if I cashed it in today 280K)…which as you might guess, I am starting to think isn’t worth the next 18 years of my life.

A basic sampling of our current overall monthly budget is below:

Take-Home Pay	$7500
Savings:
Retirement accounts, emergency fund, etc	$500
Debt Paydowns	$500
Spending
Mortgage	$1400
Property Tax	$325
Home Improvement /maintenance	$300
Utilities	$325
Daycare	$1200
Groceries and Personal care	$1200
Insurance (home, life, van, truck)	$475
Gasoline	$500
Parking	$95
Charity	$150
Kids' sports (hockey/swimming)	$100 (we're Canadian - hockey is a fixed expense)
TV/phones/Internet	$100
Miscellaneous (birthday parties, lunches out, hair cuts, gifts, golf, hobbies, entertaining)	$330
Total Spending	$6500

My days and nights consist of rushing around like a chicken with its head cut off. How do I get from here to retirement and more time enjoying life with tiny humans?

Interestingly my husband is a structural engineer, who does carpentry and custom wood working on the side, which is his passion that he would like to make his career, he is not interested in ‘retirement’ he would just like a career change.

Sincerely,
Whiny in Winnipeg

Mr. Money Mustache Responds:

Dear WW,

While your situation sounds horrific to me, it is of course the standard situation for most two-jobs-plus-kids families. Let’s begin with the end in mind: getting you some freedom ASAP.

Right now, you earn $75,000 before tax or 45% of your family’s gross pay. Since you listed take-home pay at $7500, let’s assume you are bringing in $3400 of it.

Out of that, the following monthly costs might be byproducts of your job:

Gas and direct/indirect car costs for almost 2000km/month of driving around in a van: $1,000
Parking: $95
Daycare: $1200
Convenience foods and services that show up in your grocery and miscellaneous bills: $200

Total: $2495

This leaves only about $1000 per month of “profit” from your job. So, including commuting and shuttling kids around to child care, are spending about 250 hours a month to earn $1,000 – or four bucks an hour. If you can think of better things to do than working for well under half of Manitoba’s minimum wage, you should quit immediately. Since this is what you wanted anyway, congratulations!!!

But it gets even better than that. Since it sounds like properties increase in price as you move towards your job downtown, they might well decrease as you move towards your husband’s job. If so, you could find a new place close to his work, and eliminate his commute as well – potentially saving the $600 per month he is currently burning up commuting in the opposite direction.

The savings from owning a less expensive house might free up an additional $200 per month in interest, since the equity from your current house would easily wipe your debts and you’d also have a lower mortgage payment.

So far we have only addressed basic strategy – the simple choice of where to live and work. There’s even more wealth on tap as soon as you activate a bit of Mustachian frugality.

For starters, since this is the MMM blog we’ll need to fix your insane choice of vehicles.

You have two kids, and yet you drive around in a BRAND NEW GAS GUZZLING LUXURY RACING BUS. The 2006 Honda Odyssey is not a vehicle for an indebted mother to use to drop the kids off and then head downtown. It is something a hopelessly spendy multimillionaire might use to shuttle around six pampered passengers on a cross-country roadtrip while hauling a giant trailer full of supplies. For two kids, you use a Toyota Yaris or similar. That will cut your gas bill down by 50%.

Your husband appears to be driving alone and not even a multimillionaire himself, and yet he has a TWIN-TURBO SIX PASSENGER RACING FARM TRUCK!!! Holy shit, brother, how many heads of cattle and pigs are you hauling on that roundtrip, while simultaneously carrying international heads of state in the stately cabin? That is a fucking ridiculous vehicle for ANYONE to drive except the rarest breed of Farmer/Diplomat, and I’m betting none of them also hold jobs as Structural Engineers.

So you’ll be selling that, and walking to work. For those rare times you drive, you can ask to borrow the wife’s manual transmission Yaris hatchback. You are also permitted to buy a used mountain bike, and if you’re REALLY getting serious with the carpentry, a 2001 Ford Ranger pickup, 2 wheel drive 4 cylinder manual longbed. You may weld a 12-foot lumber rack to it in order to outperform your current clown truck.

The savings on depreciation, fuel, and insurance will compound an additional $86,000 per decade into your family’s wealth.

Once you have these big wins in place, you’ll have much more time and energy to go after the medium-sized ones: your grocery bill can easily be cut in half, according to most Canadian Mustachian 4-person families. Restaurants and other takeout frivolities may drop as well, depending on your priorities. Another $1000 per month is possible in this area, which will go directly to your financial independence fund.

When you add in Mrs. WW’s outstanding windfall of a $280,000 early pension payout, all my calculations indicate that you will be further ahead than you are today, even after ditching the government job. In fact, after a year of making these changes, Mr. WW may even start getting the itch to scale down his own job and do exactly as he sees fit as well. And that would be nothing to whine about at all.

Best of luck!

Do YOU see any parallels to your own life? It is almost always possible to avoid the two-commute family with kids if you make it a priority.

Previous Post: All Wheel Drive Does Not Make You Safer Next Post: It’s Winter… Get Out and Enjoy it!

Want More?

Another Complainypants December 10, 2014, 4:03 pm

Hi Mr. MM,

I’m another average complainypants, except I have some twists to add to the above scenario. I have a special needs child. Said special needs child averages four hospital stays a year, has various therapies at various inconvenient locations throughout the Denver metro area, requires various expensive items to help encourage development or to assist with mobility and independence, etc. She is now on Medicaid so we are no longer bleeding profusely from the substantial cost of hospital stays, but we racked up an obscene amount of credit card debt paying for gas and groceries while trying to pay hospitals, doctors, therapists, etc. Although we are no longer bleeding money, we have had significant losses and it is nearly impossible to recover. We rarely eat out (and when we do it’s fast food), we don’t go to movies or shop or live extravagant lifestyles. We net approximately $1000 per month after expenses if we have good paychecks.

So, good Mustachio, do you have any advice for us? How do we recover from the losses and expenses of raising our sweet, worth-all-the-heartache special needs child?

Thank you for your help. Have a great day.

Reply
- Three Wolf Moon December 10, 2014, 8:55 pm
  
  It’s basically the same advice – cut costs to the minimum where you can – in your case apply the savings to those credit card debts as they are usually the most insane. If you’d like more detailed suggestions, click on the “Forum” link at the top, go to the “Ask A Mustachian” topic, and post specific details about your situation.
  
  Reply
- MJB December 11, 2014, 12:30 pm
  
  We, as a society, certainly can and should do better when it comes to supporting families with special needs children. That’s a given.
  
  To be fair, and i’m not trying to speak for the author, this blog is about reducing consumption, and is aimed mainly at people with wealth to spare but whom can’t seem to escape the hamster wheel of: buy-buy-buy /// work-work-work /// discard-destroy planet /// buy-more /// pay taxes, add to debt /// rinse-repeat /// croak.
  
  Reply
- Another Complainypants December 12, 2014, 2:20 pm
  
  Thank you for your help.
  My mom taught me the benefit of frugality, and we live by many of the tenets of MMM’s philosophy, but when you’re buried scalp-deep in debt there isn’t much to do to hasten the debts’ demise. We will keep muddling through. Best wishes to you both – thank you for responding.
  
  Reply
- Tree99 December 14, 2014, 11:42 am
  
  Hi,
  
  This comment is late but I just got around to reading this post. I know how expensive anything to do with the medical system can be and the added expense and time of going to appointments. If you feel comfortable, I would encourage you to go over your expenses and debts either on the forums or with someone knowledgeable with the unique circumstance of a special needs child. There may be more resources available that you haven’t heard about. It sounds like you are frugal but have debt.
  
  I am not sure what to suggest not knowing your income level but you could be eligible for assistance through organizations such as Jewish Family Service (although obviously they cannot help everyone but even if they cannot help you, they can provide information on other resources in the community). Catholic Charities of Denver will help with rent and utilities. These are just some examples of the help that is out there.
  
  Have you contacted the social worker at your child’s hospital? I would contact them now to see if there is any assistance available. I know that in Denver, “There With Care” assists children with oncology, blood disorders and head injuries. They provide meals, diapers, clothes, babysitting etc. It doesn’t sound like that is your situation but there might be another organization. And then I would contact the social worker any time that your child is admitted for further assistance.
  
  Are you part of a faith community? I would reach out to them for help. I think most people would like to help their neighbor but don’t even know that someone might need an extra set of hands for an afternoon or a few meals or help with house maintenance etc. If you are not, I would not hesitate to contact your local church or synagogue.
  
  None of this will wipe out your debt but some help and support might help you to marshall more of you money and resources to tackle the debt. And put in place support for future expenses.
  
  There also might be a case for working on a settlement with the credit card company. Again, hard to know since I don’t know the particulars.
  
  It sounds like you are a wonderful family with an amazing little girl. I may be off base with these suggestions but wanted to send you my encouragement. These are but a few ideas and I am sure other folks might have ideas if they knew a bit more. But I completely understand if you do not want to post your personal details on the forums here.
  
  And if you do not have the time or emotional space to deal with one more organization then maybe a relative or friend could call on your behalf (even if they are in another state).
  
  Reply
WageSlave December 10, 2014, 4:20 pm

I can’t help but feel that this stuff is much easier to execute *before* kids. IIRC, MMM didn’t have Junior until he was at least 3/4 the way to FIRE. A lot of us didn’t even know what “FIRE” meant until AFTER having offspring.

I have the same fundamental whine as WW, it just never feels like there is enough time—and my wife is a SAHM! With one kid under four and one under two, any non-work or non-sleeping time is kid time. So, for example, all this DIY stuff that is championed is time away from kids or sleep. The “chicken and egg” analogy resonates with me.

But looking towards the future: when both kids are in school full-time, that opens up a whole day for domestic chores and errands. At some point they’ll be old enough to help troubleshoot the water heater or furnace. They’ll be able to eat without special plates and silverware. They’ll be able to dress themselves and get out of bed/get ready for bed on their own.

Don’t get my wrong, I love my kids; but I can’t see how anyone with multiple very young kids isn’t “time poor”, unless they’re already FIRE’ed.

Reply
- Mr. FC December 10, 2014, 11:44 pm
  
  Kiddos are the ultimate “lock-in”, huh :)
  
  We’re in the same bucket here at FC Central – 2 kiddos under 4 and discovered we wanted to FIRE ourselves about 2 years ago. We are so time poor (even with a SAHM holding down the fort and doing an awesome job at it) that it’s silly. We are a 2-car, suburban living, major commute sporting massive volcano of wastefulness…for today. The goal is to start making progress on that as much as we can where we can, and keep working at it each and every day.
  
  Yes, we could move someplace where cost of living is lower. That would make a huge difference. As would living closer to work. Maybe even selling the 2nd car and toting the kiddos around on a bike. If we pulled a full-on Brave New Life makeover (www.bravenewlife.com) we could probably hit FIRE in like 2-3 years. Maybe less.
  
  What keeps us here is our family and my work. My industry is based here, and our families – all of them – are here as well. There are magical things called airplanes that take you from low cost of living locales to more expensive ones, I know, but we see the family so often and enjoy seeing them that it would be really, really tough to give up being able to do that at the drop of a hat. It’s a tradeoff that we’re making, knowingly, today. Maybe it’ll change tomorrow. Tough to say.
  
  SO…we cut it down to the minimum, don’t make asinine decisions about spending (often) and really take a lot of what MMM offers to heart. We are very lucky in that my income will allow us to get FIREd relatively quickly even if we stay put, so our situation is rather specific. If I were making $10 / hour at a fast food job, I’d be looking to get out of this area in a heartbeat and working like a dog to improve our situation every waking second. It’s like anything else – you start where you are, and make progress every day toward the goal, taking everything into account.
  
  And FWIW, while the tiny humans are learning to feed themselves and get dressed on your own, you’ll still be making steady upward progress as the demands on your time from the kiddos goes down, accelerating the process.
  
  I know that doesn’t exactly make us orthodox Mustachians…maybe more like reformed Mustachians?
  
  Reply
  - Andy December 11, 2014, 8:37 am
    
    This, to me, was a great comment. I think your thinking is spot on. In my mind, mustachianism (and personal finance in general) isn’t about doing absolutely everything you can to achieve financial independence or whatever other end result you’re pursuing. It’s more about being aware of the actions you’re taking, what the alternatives are, and what sort of tradeoffs and consequences there are for you actions. You might be retiring later, but you’ve made a conscious choice that being near family right now is important and you’ve assessed the impact of that. If we can get more people to that level of thinking, we’ll see a lot less complainypants and drowning in debt and we’ll see a lot more happiness.
    
    Reply
    - Mr. FC December 11, 2014, 11:06 am
      
      Thanks much! That’s exactly it. The hard part isn’t so much cutting back the spending, it’s really making sure your actions line up with your priorities. Everything else follows from there.
      
      Things that have helped me greatly – the concept of starting where you are and being present with yourself and grateful for what life has to offer you (I got this most directly personally from yoga but this concept is everywhere if you look for it), and reading, lots and lots of reading. Awesome book to read – “How Will You Measure Your Life?” by Clayton Christensen. No rocket science in there, but lays things out in a way that made a lot of sense to me.
      
      Reply
- TomTX December 12, 2014, 6:52 am
  
  Kids are often more capable than modern parents realize. My son has been using regular silverware (far from expertly, of course) since 12 months. Okay, he uses salad forks instead of the biggest, but that’s the main concession. He prefers the metal to the plastic. Still remains the biggest time sink ever. ;)
  
  Reply
Earl Wallace December 10, 2014, 4:49 pm

I have followed the MMM web site for 2 months now. My wife is on social security and I work part time 32 hours a week for 13 dollars and hour. We are below the poverty line but have no debt and own our home. I put a grand into Betterment and am trying to put at least $200 a month in it. Staying out of the black has been thin running for years now but just applying some of the finance advice and some other general guidelines so far are moving us into the “more money in than going out” lifestyle. We will continue on the MMM path and other readers comments are helpful also.
Earl Wallace

Reply
Ryan Schaap December 10, 2014, 5:33 pm

I do not know anything about the Canadian tax system, but the net income calculations would be even worse for WW in the US. In the US, her $75K would be on top of her husband’s $90K, and therefore taxed at significantly higher rates than if you simply allocate all of the income taxes by percentage to their respective share of the household’s income. Although the incomes in this case study are not significantly different, the taxes become even more of an issue if say one spouse earns $200K and the other earns $50K. The household will net so little off the extra $50K it is probably not worth the effort if any significant expenses are associated with keeping the job. You may choose to work for other reasons, but it is certainly not the money. Good luck WW.

Reply
- plam December 10, 2014, 9:55 pm
  
  Nope. Canadian taxes don’t work that way. There are some tax credits for dependents, but in general the people in a couple will pay taxes independently.
  
  Reply
LeisureFreak Tommy December 10, 2014, 8:33 pm

I look forward to your I.I. article. As someone who grew up low income and when we had our 3 small kids made far less income than the case study subjects I can tell you early retirement and financial independence is still possible. It took me until until age 51 but that is still far earlier than over 95% of the masses. You handed them a decent plan and they can choose to do all of it or most of it. I will say that the kids grow up and things tip in their favor as that occurs so if they thought your advise was too extreme for them they still could make it doing some of it but reach their goal just a little later than your full plan would provide. She is aware of a better way to live (ahead of most people) so anything done now will obviously be something in the right direction. It is all about choices and trade offs depending on what FI and time-freedom is worth to you.

Reply
Hunniebun December 10, 2014, 8:55 pm

It is Whiny in Winnipeg here. My sincerest thanks to Mr. MMM for reading, considering and providing such valuable (and humorous) commentary on our horrific situation. I couldn’t agree more. The advice and comments and general face punching is clearly much needed (and appreciated). I wanted to add a few comments and answer a few questions that arose. Mr. MMM kindly left out my age, which is 37. My tiny humans are 5 and 2. The 5 year old in in kindergarten and 2 year old is at a separate day care center. The distance is not far from home, but it is time consuming doing the pick ups and drop offs. We actually live beside the school so walk our son there and home and in a few years when the school legally permits it they can both walk together. Next year when he moved to grade 1, there would be a daycare cost savings of 300$ per month. I LOVE the free range kids ideas…sadly it is actually illegal to leave your kids alone until they are 10 in this province and a local hockey mom is actually on 6 months of probation with child and family services for leaving her 6 year old in the car for less than 5 minutes while running in a store for milk. These are the times we live in.
MMM assessment of our vehicle situation is BANG on. It is a complete gong show. Up until 2 years ago, we owned a 2000 Chevy silverado and a 2005 Toyota Matrix. Then came baby number two and in a hormone induced fit of rage after a disastrous trip to the grocery store with two kids and double stroller that took up the entire hatch of the matrix where I literally had to pack the groceries around the crying children to make them fit, I literally sold the car to my neighbour on the spot and bought into the American ‘dream’ of the minvan and completed my transformation to quintessential hockey mom. At almost the same time, the truck floor boards rusted through completely…enter obscene vehicle number 2.
“…holyshit, brother, how many heads of cattle and pigs are you hauling…” – I was actually crying from laughing so hard. No one can give a face punch like Mr. MMM. And isn’t that why I’m here? I know it is not going to help my case AT ALL, but the truck while gross, does serve some important hauling purposes…we need something to haul our camper (…yes…I know MMM how you feel about campers) boat, canoe and/or trailer with 2 snow mobiles. I have also been informed that the F-150 with an after factory tune from my gear head hubby achieves 27MPG! Nearly 10 MPG more than my mini bus…er…I mean van.
As for the very logical assessment of possibly moving closer to my hubby’s slave encampment, I mean office. This is something we have considered. Sadly, his firm is in a bedroom community outside the city with real estate values 2 to 3 times that of the city. What can I say…people want country estates to store their 4X4’s, ATVs, snowmobiles and boats :) But moving is something we are looking in the next 5 years to try to get the most out of this insane housing boom.
I will take @TuxedoEagles up on his offer to post in the forum with our plans moving forward because the status quo can and will not continue. But some of the quick things in the very short term that we are looking at are 1) cutting the grocery/personal care bill by half with some better planning and potty training 2)Selling the van and getting a ford hybrid, I found a 2005 with 180K on it for 4800$. I am hoping to look at it this week-end or next 3) Paying off the 12 K in debt by July 1st. We are selling a camper for 7 K but there is not exactly a hot market for campers in the dead of winter, a decent Christmas bonus is expected and ever spare saved penny between now and July 1st will be used to pay it off. 4) I am planning take 6 weeks off this summer and to reduce my work week to 3 days a week in September 2015. That will reduce my clown-car headless chicken dance a fair amount and will give me more time to be organized, focused and intentional in all things. Working 60% will still allow me to have a salary of 49K, not to mention the health and dental benefits and growing pension, which is more than enough to keep saving with the goal FIRE in 7-10 years. Quitting today is tempting to be sure and may well be worth further consideration, because working for 4$ per hour is pretty depressing.
A man might wish with all his heart to fly, but he will never be a bird no matter how hard he tries. But he can study and learn to become a pilot and achieve the hearts desire….just like a clown-car driving, headless 37 year old chicken, with 2 kids, 2 snowmobiles, and 3 bathrooms to clean will never really truly be a mustashian, BUT I can sure work hard, learn a lot and achieve my version of the dream. Thanks again.
P.S. @ Brett and Mike S. you are my commuting hero’s. Anyone who can commute by bike year round in these conditions is BADASS. That is all. Be Safe :)

Reply
- Jason December 11, 2014, 10:43 am
  
  Someone else commented that they’d love to see follow-ups and I absolutely love seeing this reaction to MMM’s dissection of your situation.
  
  “camper, boat, canoe and/or trailer with 2 snow mobile” – ah necessities! :)
  
  Reply
- Rina December 11, 2014, 11:37 am
  
  Omg! Sell the camper, boat, canoe, snowmobiles immediately! Then you won’t need the truck to haul around expensive deadweights!
  
  Reply
  - Hunniebun December 11, 2014, 1:08 pm
    
    The camper and boat will be up for sale when the season is right. The canoe will be staying as will the snowmobiles. As a family, we enjoy camping, canoeing and snowmobiling. Happiness and enjoyment can be found in a variety of recreational pursuits and I don’t think we want to trade absolutely everything we enjoy in life for the sake of earlier retirement.
    
    Reply
    - SoCold December 11, 2014, 2:23 pm
      
      Beyond finances, just take a deep breath and realize that you’re in the most challenging, time-sucking phase of life right now, and it will get better! Sometimes I can’t believe how relaxed and fun daily life is now that both my kids are school-age. I almost lost my mind when I had two under five.
      
      Reply
- Rob in Munich December 12, 2014, 2:52 am
  
  mentioned this elsewhere but why doesn’t your husband quit and you work, you for sure have the better job plus you don’t give up all the perks of being a civil servant. From what I read he wants to switch careers anyways.
  
  I also think it’s unrealistic for you (and most readers) to want to achieve MMMs job free life style
  
  Reply
SwordGuy December 10, 2014, 10:29 pm

In what imaginary universe does this person live in? She thinks they have an “average” income? Her family income appears to be about 2 1/2 times the median Canadian family income. 2 1/2 times! That’s not average, that’s awesome!
It’s in the top 5% of income in Canada!

And they’re in “average credit card debt”? They make more than 95% of the other families in Canada and can’t make ends meet? Average Canadian credit card debt is less than $3800! So they make more than 95% of Canadians and owe 3 times as much in credit card debt.

I think MMM was much too nice and let too many comments like that slide.

PS – That home value was higher than the Canadian median home price, too.

PPS – Can’t wait to see MMM take on Income Inequality and the philosophy of “I can’t do better because somewhere, somehow, somebody would have a hard time doing better, even though those circumstances don’t apply to me”: syndrome.

Reply
- Hunniebun December 11, 2014, 1:22 pm
  
  Fair points. Well made SwordGuy. We are very fortunate to be so well compensated for our monkey-work. And I just googled and we do make more than 2x the average in Canada! I guess it just feels ‘average’ in our peer group, but overall we are extremely blessed. I would disagree on the debt front. CBC tells me that the average Canadian had 28853.00 of debt on average in December of 2013. Our 12K of debt would be below average and not that it really matters, but it is not credit card debt…it is a line of credit and was to put a new roof on our house, we could roll it into the mortgage but opted to pay it off as per my previous comment. As for average Canadian housing prices CBC tells me that the average house is 419K and Manitoba’s average for 2014 is 300+, so I’d say we are pretty average on that front.
  http://www.cbc.ca/news/business/canada-s-average-house-price-rises-7-to-419-699-1.2835066
  I am not trying to dismiss the valid points you have made. I welcome them wholeheartedly. We make an obscene amount of money and have been living like Kardashian’s which is gross because have not yet bought our freedom. We are work in progress :)
  
  Reply
  - SwordGuy December 11, 2014, 8:30 pm
    
    Well said! I’m glad you realize what a huge cash cow of income your family is currently milking.
    
    I saw several articles that covered Canadian non-mortgage debt, but those numbers (similar in amount to what youquoted) included things like cars. It took a bit more digging to find some stats on just CC debt.
    
    I estimate that we’re in the top 6% of family income in the US so I know how easy it is to turn our situation around compared to those making median family incomes, much less lower incomes. (We used to live on 1/3 the median family income so we have experience on that end of the income spectrum too.)
    
    It’s important to know that your situation isn’t average. If nothing else, you won’t alienate your friends who actually do make median family income or less… :)
    
    Reply
Adam December 10, 2014, 10:55 pm

Thanks for this case study MMM. I see many similarities to my own situation and it makes me think about my life plan. Over time, you start seeing your situation as fixed and miss some of the big levers. Once pointed out they seem obvious.

Cheers,
Adam

Reply
Ken L December 10, 2014, 11:17 pm

Wow! MMM just deconstructed the typical young couples lifestyle, Mustachian style. Much like Uma Thurman did to Lucy Liu’s Gang, at the end of Kill Bill vol 1.
But seriously, this is real life, drastic change, reality, on the streets stuff, paradigm shit shift stuff!
This is why I like this blog!
Good times!

Reply
- SwordGuy December 11, 2014, 4:54 am
  
  They aren’t a typical young couple. They are in the top 5% of income earners. That’s not typical at all. Making a workable budget starting with that level of financial incompetence is stupendously easy.
  
  Reply
Dutch dude December 11, 2014, 3:07 am

I always like the comments from MMM, but are the comments related to the cars not a little bit short-sighted? I mean, they live in Manitoba with harsh winter conditions and the recommendation is to sell both cars and take a Toyota Yaris instead. Just for your information, we owned a Yaris for 3 years and never had any problems with it, but… I live in the Netherlands and we don’t have harsh winter conditions over here, but I can imagine that you would want to have a bigger car then a Yaris when there are icy conditions for over 4 months a year. A Yaris just wouldn’t cut it for me personally. In a previous post of MMM he talks about 4WD and its necessity. I can imagine there is a necessity for 4WD when you live in Manitoba with icy roads and also a lot of roads with gravel instead of tarmac

Your thoughts?

Reply
- Mr. Money Mustache December 11, 2014, 10:16 am
  
  I guess if your income depends on winning acceleration races on icy roads, the 4WD/AWD might help you in Manitoba. Otherwise, it’s all in the tires just as that earlier post said.
  
  Reply
  - Dutch dude December 11, 2014, 1:20 pm
    
    Not completely true, it is not only tires, elevation plays a major role in this as well. 4wd makes a big difference in getting up icy uphill roads. But that wouldn’t be a big problem when I look at the elevation map of Manitoba, it is almost as flat as the Netherlands.
    
    Reply
- PCSnaps December 11, 2014, 2:07 pm
  
  Proud 10+ yr. Corolla owner and Manitoban (Winnipeg is the capital) here. There are maybe 5 days a year where my truck driving friends laugh at me, but with winter tires and a $0.25/km cost, I do the majority of the laughing.
  
  Reply
- Cheryl December 17, 2014, 12:06 pm
  
  Erg, seen so many comments like this. “But cars are a complete necessity for winter! In fact, it’s completely unreasonably not to own some form of tank if you live near ice!” Absolutely correct! That’s why we only colonized the northern regions in the last several decades. It is because of these miracles of modern engineering that humans are finally able to spread beyond the oppressive boundaries of-
  
  Wait, what?
  
  What do you MEAN humans have been there a long time!?
  
  Okay, fine, but those were barbarians. They wore animal skins and probably lost about 90% of their population each winter to slipping on ice. We’re talking about modern civilization, with CARS. CARS couldn’t be used this far north until we invented the SUV!
  
  So really, you hippies should feel ridiculous even suggestion someone drive a small car.
  
  Reply
insourcelife December 11, 2014, 8:40 am

As much as I enjoy reading these case studies what really sucks with this format is that there is never a follow up. What happens after all the comment dust settles? Do these people make any changes? How are they doing a year after a face punch? Two years? A quick search returned over 20 reader case studies going back to 2011 and not one follow up since then :(

Reply
- Jonathan December 12, 2014, 9:23 am
  
  I agree. Follow ups, both failure and success stories would make for great articles! A two year time frame seems like plenty of time to see how things are progressing.
  
  Reply
Crass Cash December 11, 2014, 8:54 am

The $12,000 shortfall “profit” could pretty easily be made up with the $280,000 payout from the Queen. You’re only talking about a 4.2% return every year in order to make up for it. If you can get an average 7.2% return from a diversified stock market (international is paying 3.3% dividend) then she wouldn’t even have to touch the principle. Let it grow!

Reply
- Rob in Munich December 12, 2014, 2:07 am
  
  I agree but I would be very very cautious about quitting a job with a defined benefit pension plan. Sure 280 grand is a lot of money, that is till you lose half it in some bad investment. Personally I think it makes more sense for the husband to stay at home and the wife to keep working and plan for government sponsored early retirement
  
  Reply
JB December 11, 2014, 8:55 am

If you are maximizing your retirement, I have no problem paying off the house. It’s debt. Stuff happens. You can’t be foreclosed on by the bank if your house is paid off. I get the liquidity factor and having 100% equity money can’t be spent, but peace of mind is worth something when the market is volatile. You pay the greatest amount of interest in the beginning so unless you start paying early from the beginning, you arean’t saving much more in interest costs. You lose the deduction pretty quick.
We paid our house off in 8 years, mortgage was about $1,400 a month, we invest all the extra money. We have $2.6M in retirement and savings with a net worth of $3.5? We save 170K a year and we plan to retire in our 50’s and spend summers in Europe and other places around the country. I want a portfolio of $4M so that is why we keep working. Wife has the job that pays 4x what I make. We don’t have kids. If we did, I would be the one staying at home. Plenty of men are the househusband at her firm. There are more women in the executive levels than men. Yes, we could sell our house and live on $60K a year, but we are saving now so we can travel the world and not have to stay in hostels. Even at $3K a month for rent in Portland or a European city, I want a travel budget of at least $30K-$0K a year. At $4M with a 4% withdrawal rate I think we will be just fine. We will sell the house and downsize into my mom’s condo once she no longer lives in it. That will be a net gain of about $450K-$500K in wealth. We still travel and eat out and have everything we need. My wife still grows food and cooks at home. We don’t fly first class or stay in suites at hotels. But I am going to Munich for Oktoberfest for my 50th birthday.

Reply
- Huck December 11, 2014, 8:58 am
  
  You SAVE more per year than me and my wife make! So, good for you, but you choices are not really applicable to most people.
  
  Reply
  - JB December 11, 2014, 9:09 am
    
    Agreed, but we could have a boat, a vacation home, $80K BMWs, but we don’t. My wife drives a 14 year old SUV and I had a 12 year old car. yes, we have a 1% type income, but we aren’t blowing it all like an athlete. BUT if you make saving money a priority, you learn to do with less because the money saved is in a place you can’t touch. Many things we buy are wants not needs. I see friends with kids and the toys just dominate the house and the amount of video games they play is insane.
    
    Reply
    - Ken L December 11, 2014, 5:31 pm
      
      Wow what is your job?
      
      Reply
      - JB December 12, 2014, 7:51 am
        
        Not my job. I work for the County. My wife is a Tax Director for a Big 4 accounting firm. She is very smart, has huge technical knowledge of complex tax situations. She went to an mid level at the time University and came from East Texas. Not dirt poor, but maybe low middle class/high poor. Her dad left her mom when she was young. She saw the need to leave the small town and go to a large city where the opportunities are. She has busted her ass and there was no “luck” involved, just hard work. FYI, for those of you that have kids that like accounting, you can make well over six figures in accounting with the right job. Working for the big 4 requires long hours for the first 4-6 years, but if you are good enough to make Director/Partner level, you can make over $500K a year. Now, those jobs aren’t just laying around for everyone. But accounting isn’t the hardest degree in the world to get either. You don’t need a private school, but a school where the Big 4 recruit at. Many work for the big 4 end up at the client if they are good enough and don’t think they can make the partner track. This has been the wife’s only job since 1990. Very few people can or want to stick with a job for 25 years. But since we save 40% of our income, we can retire in our early 50’s. I might have to stick it out a bit longer since I do have some decent retirement benefits, but nothing I can’t give up if we have a big enough portfolio.
        
        Reply
        
        deepseafalcon December 14, 2014, 2:46 pm
        
        not that any of this is really my business, but since you shared so much info:
        Your fundamentals make me wonder. You said you are saving about 170k p.a., and that this is about 40% of you income. That means you spend around 250k p.a.
        … while you say your 450k house us paid off (so neither mortgage nor taxes can be that high), drive two old cars and have no kids.
        ==> how do you accomplish to spend that much? can’t all be eating out??
        Even if the 170k (net) savings would represent “just” 40% of your gross income, it would still mean you “blow” about 80…100k p.a. depending on your taxes … without house, car or tuition payments.
        just curious, if you allow
        
        JB December 14, 2014, 5:56 pm
        
        TOTAL INCOME 458,000
        Total wage Taxes 128,000
        Disposable Income 330,000
        
        TOTAL EXPENSES 95,000
        
        TO 401K (17,500)
        TO Profit Share (39,121)
        TO Wells Fargo HSA (2,800)
        TO Voya Retirement (14,000)
        TO Pension (5,011)
        TO Vanguard MMarket (147,091)
        Total Savings (225,524)
        
        Spending to Income 29%
        Saving to Income 49%
        
        I didn’t see the other post so I shortened this.
- alistair December 11, 2014, 4:14 pm
  
  you seem pretty sorted!
  
  my only advice would be to be careful not to over-hype oktoberfest. there are better times of year to drink in munich and better places to drink in germany at all times of the year.
  
  but if it’s a bucket-list kind of thing, then have a stien for the rest of us!
  
  Reply
  - JB December 12, 2014, 10:21 am
    
    We have been to Munich before and it is a bucket list type thing. We are only going to be in the tents one day. The rest of the time will be spent going to Prague, Salzburg and other touristy things. I have 20 friends that are coming as well.
    
    Reply
    - Alistair December 14, 2014, 6:59 am
      
      Sounds awesome, have fun
      
      Reply
Kallie December 11, 2014, 9:19 am

Would love it if you could give some advice for people/couples/families earning less than $26,000/year. We’re avid bikers, we walk to work, we don’t eat out/buy coffee, don’t go shopping/buy stuff (when we need something we go to Goodwill). By the time we pay our healthcare, mortgage, and utilities- and despite the fact of having no debt, we barely have enough to buy groceries (we eat REAL food, no processed stuff, no meat) and pet food. We don’t qualify/receive any social assistance. We’re living simply by choice but also out of necessity. I don’t know how it’s possible for people like us to ever think of retiring early.

Reply
- Mr. Money Mustache December 11, 2014, 10:32 am
  
  That’s amazing – you get by with two people on $26k and even have a house, a pet, health insurance and good food? I think you’d be an inspiration to many people and are living way more efficiently than my family.
  
  The math would insist that you’d either need to earn more or spend less to accelerate the wealth process. Since you’re on the lower side of the income scale right now, that would probably be the most efficient thing to pursue initially.
  
  But it’s not strictly necessary to get more money to live a perfectly good life, so there should be no guilt over living well on a lowish income either way.
  
  Reply
- EcoCatLady December 11, 2014, 12:15 pm
  
  Hard to offer specific advice without knowing more about your situation, but I’m inclined to agree with MMM, you have an earning problem. 2 people working minimum wage full time (assuming federal minimum of $7.25/hr) = $29K/year.
  
  You mentioned that you receive no assistance, I’m assuming you’re not including health care subsidies? At that income level your insurance costs should be negligible – and if you’re not taking advantage of that for some reason then you’re beyond help!
  
  Seriously though, you can look at cutting costs – but at your income level you’re gonna be squeezing blood from a turnip, and you’re at the point where most cost savings approaches will require more of your time. If it were me (once again, hard to offer specific advice without knowing more) I’d try to look for some non-employment ways to earn a bit of extra money. At your income level it will be difficult to save enough to live from investment income, so working toward developing some non-employment income streams is probably your best bet.
  
  Reply
  - alistair December 11, 2014, 4:03 pm
    
    The OP may not be working with 2 incomes, it may be a single income family…. though the answer may be the same, the article does show that in some areas childcare is often not worth the cost.
    
    but even then, being a bit ruthless and focused on the income for a few years might be the answer. Ask for the raise, look for the other job, take the job that is maybe less comfrotable but pays more
    
    Reply
    - EcoCatLady December 11, 2014, 4:25 pm
      
      True regarding childcare – hard to give good advice without knowing more. My approach would be to try to earn some extra dough through a home-based business.
      
      p.s. for THE best advice/inspiration on feeding a family on a budget, check out creativesavv.com – it’s work, but the numbers are downright unbelievable.
      
      Reply
      - Kallie December 17, 2014, 4:03 pm
        
        Thanks all. My husband works full time, I’m starting my own photography business, so hopefully I’ll be bringing in an income someday, but starting a business takes some time before I’ll be able to pay myself. If photography doesn’t work out, I’ve considered getting a degree abroad (in a country like Germany that doesn’t charge tuition), so I can get a job with where I can earn a live able wage.
        
        Reply
- Kelly December 12, 2014, 12:04 pm
  
  There’s a book called “Hard Core Poor – a book on serious thrift” that might help you find a few more spots to wiggle a buck loose from your budget.
  
  Reply
Bobbi D. December 11, 2014, 9:20 am

I like the idea of downsizing the vehicles to smaller, more efficient ones, but have one piece of advice: if you live in a snowy area, do not go with the Toyota Yaris. I have one, and while I love its gas mileage, it’s pretty much useless to me for about half the year here in the snowy northeast U.S. I’m frequently trapped in my house, only leaving when I get a ride from my husband in his 4-wheel-drive pickup truck. I’ve found that it’s a challenge to find a vehicle that’s good on gas yet also practical in a region that gets lots of winter weather.

Reply
- Mr. Money Mustache December 11, 2014, 10:29 am
  
  What type of snow tires are you using on each vehicle, and with what number of miles on them?
  
  Reply
  - mbl December 11, 2014, 11:59 am
    
    Even with snows, sometimes these smaller vehicles are difficult to navigate.
    Especially for those of use that have a long, inclined driveway and unpaved local roads.
    It can be done, but sometimes presents more of a challenge.
    But overall, P = mv….no matter what you’re driving, you gotta slow down.
    I’d love to ride my horse to work but don’t think they’d appreciate her output in the parking lot. :)
    
    Reply
    - Alistair The Architect December 11, 2014, 3:57 pm
      
      I find it pretty telling that in the world rally championship, which is about driving round tight twisty snowy wet roads, stopping a lot and accelerating a lot, and occasionally crashing into things
      
      they use small lightweight cars like this years champion, the VW polo, and citreon saxos, peugot 206s etc
      
      they use skinny tires and they don’t do it to save fuel, they do it because it is better and fast.
      
      Reply
  - Bobbi D. December 11, 2014, 4:57 pm
    
    I’m using Goodyear snow tires, I believe they’re called Ultra Grip. Just got them not long ago so they have less than 5k miles on them. The tires are fine under normal conditions and slight winter weather. However, in more than a few inches of snow (such as the 12+ we have right now) the car struggles. It just doesn’t seem to have the power – and perhaps the weight – needed to get out and around in the snow. Not to mention, it’s fairly low to the ground so it often gets hung up on snow piles. We live on a unpaved dirt road that doesn’t get plowed, though, so for people who mainly use plowed and treated roads it might not be such an issue. Many of my friends have Subarus and swear by them but I’m not sure how they rate as far as gas mileage.
    
    Reply
- Patrick December 11, 2014, 2:22 pm
  
  Thankfully where I live we have things called snow plows that clear the roads during every snowfall and even spray the main roads with salt so that it’s no different than driving in rain.
  
  Reply
Jason December 11, 2014, 9:23 am

hahaha… I like your site but come on… Yaris? That thing is a tin can death trap. You would be putting your life at risk every time you get on the freeway. I run a remote company but still drive a car. Walking is nice but it gets real cold, and real rainy here. Plus, I just enjoy driving. :) Vroooooom.

Rather than live like a pauper cant people figure out a way to leverage their time and abilities to make substantially more than it costs to live? If it costs $100k to live well figure out a way to make $200k. It’s not that tough with the internet. You only live once my friend.

Reply
- Mr. Money Mustache December 11, 2014, 9:28 am
  
  Welcome new reader! I hope you stick around long enough to learn more of what we’re talking about here.
  The Yaris is a fancyass luxury car – quite a bit newer and sleeker than what I drive, even though I have quite a bit more cash/income than most BMW and Mercedes Drivers..
  
  Reply
- Eldred December 11, 2014, 9:45 am
  
  “Not that tough?” Hell, I’d be happy making even *$100k*, but I haven’t figured out how to do that without getting a degree that I currently can’t afford. Although if I save up for two classes per year, I suppose I could get a Bachelors by the time I’m 60 in 9 years. :-)
  
  Reply
  - Brad December 11, 2014, 11:34 am
    
    Save time and money; here’s your math / science / economics and programming classes for free: https://www.khanacademy.org/
    
    / not affiliated
    
    Reply
    - Eldred December 11, 2014, 9:37 pm
      
      Thanks! I’ll check it out…
      
      Reply
- Mr. FC December 11, 2014, 10:19 am
  
  YOLO?? FUCK!!!!!!! Get my broker on the phone!!! Sell my investments, liquidate the kids’ college funds, get a second and a third mortgage up on the house and get me to the Bentley dealer STAT! Honey – you’re finally getting your boat!!
  
  Holy hell.
  
  Reply
- Juan December 11, 2014, 2:36 pm
  
  Actually, you only die once. You have to live every day, with the decisions you made yesterday, and that’s what WW is finding out.
  
  Reply
  - Frugal Bazooka December 15, 2014, 12:14 am
    
    YODO – lmao! Millennials are funny with their YOLO.
    I remember living with that attitude – YOLO – as a kid and then, when I actually lived past 25 I was fucked for several years trying to dig myself out of DEBT. Assuming you live past 25 you’re going to wish to hell you were smarter with you money. One of my friends was a punk rock drummer from a moderately successful band. While all of us idiots were living the YOLO life style he was learning how to be a tax accountant and saving his money. Guess who retired first?
    
    Reply
    - Juan December 18, 2014, 3:34 pm
      
      YOLO just seems to be a mechanism people use, to justify spending money they don’t have, to buy things they don’t need to impress people they don’t like. YODO FTW!!!
      
      Reply
      - Mathieu December 19, 2014, 9:39 am
        
        Very well said!
        
        Reply
Steve December 11, 2014, 9:27 am

2 year reader who found your website and interestingly enough discovered a voice for the way I have lived my entire life. Retired prior to finding the blog but all the tenets fall in line with the way I have approached things. Just want to let you know that I am laughing reading your responses and the common sense behind them. I am not as extreme in many ways as yourself…..and I am not sure if that leaves something more for me to learn or if I am just satisfied with similarity without having to live up to a standard. We will see as life goes on.

Very nicely done and consistently enjoyed. Thank you.

Reply
Vawt December 11, 2014, 10:40 am

I think another solution would be to switch out the cars, but keep her job. If they can eliminate some of that other spending, her per hour contribution would be significantly higher than now. Plus the kids won’t need daycare all that much longer. In a couple of years they may be ready for early retirement. With a better budget and some planning I think they could reach that financial independence level sooner on the two incomes, but she may prefer to go a little slower and gain some sanity.

Reply
Ddub925 December 11, 2014, 12:35 pm

Hi, new reader here, looking to grow a stash. How can I submit my situation and let you tear me apart? My household brings in nearly $200k, has a negative net worth, and still living “modestly” check to check here in the SF Bay Area. Also, can you point me to any posts discussing how your stash was effected and recovered from 2008? Thanks for the awesomeness!

Reply
- JB December 11, 2014, 12:52 pm
  
  Most MMMs would have kept investing in the market no matter what and would now have that money doubled. If you sold in a panic and didn’t get back in, there isn’t much anyone can do to help.
  
  Reply
  - Ddub925 December 11, 2014, 3:40 pm
    
    Thanks JB, thats exactly why Im interested in seeing it. But Im under the impression that if your investments dropped 50% from 07-08, then they would have had to increase 400% to “Double your money”. That also assumes leaving it alone and not continuing to fund it. One area of concern for me that I see in the blog comments is to encourage debt (keeping a mortgage) to play the market, even though MMM admits to eliminating this risk.
    
    Reply
    - JB December 11, 2014, 3:49 pm
      
      Agreed, If you don’t have debt, have a years worth of emergency funds in cash, you can probably ride out a few years of a down market. Congress pass a loophole so that people didn’t have to take money from their IRAs at the end of 2009 or something like that. The market will go up and it will go down. It has never or rarely gone down 50% in one year. Even the peak of 14,000 was only for a week and yes, the market went down 50% over two years, but it came back in 5. So, plan for a downturn and if it doesn’t happen, you will be fine. If you are debt free, you can ride out some downturns. Even if you have to eat into a bit of the $500K, you should be fine if properly invested. if the market goes from 10,000 to 5,000, then it would have to go back up 100% to get back to 10,000, but then would be at 20,000 if it went up 400%. we might have another recession in the next 4-6 years and we could have another bull market that takes the market to 40,000. There is no place to make more than 8% except to be in the market. If you can average 6% and take out 3-4%, you are fine. If you are living off $40,000, a major medical issue or a major market correction won’t protect you 100%. Nothing will. There is no perfect scenario unless you can have 5 years worth of savings that isn’t in the market.
      
      Reply
      - Rob in Munich December 12, 2014, 1:59 am
        
        I would recommend Andrew Hallman Millionaire Teacher, great easy to read investing book
        
        Reply
        
        JB December 12, 2014, 7:42 am
        
        We are coming to Munich next year for Oktoberfest. Looking forward to it. We area going to go to Prague and Salzburg. I assume you have been even though it is full of tourists, what are the best tents to hang out with locals or the least touristy tent? Thanks.
        
        Jason G December 12, 2014, 10:27 am
        
        The best tent is the tent that has available seats. Find one tent and stick with it, because you can’t exactly tent hop and find seats easily.
        
        We got up from our table to find a different experience only to find that we couldn’t find a table for the rest of the day. I recommend doing research on the different beer companies and then doing a tasting in the States to determine which tent you want to go to. Let the beer guide you!
        
        JB December 12, 2014, 10:32 am
        
        We are going to reserve seats in a tent for Thursday afternoon. There is going to be about 20 of us so we want to be together. We just want to be in a good tent, not one with too many 21 year olds and not too many “old” people. I prefer one with more locals to hang out with.
      - LaPriel January 30, 2015, 7:16 pm
        
        Go to Jdavidstein.com and check out his articles and pod casts about money, how it works, how to invest it etc.
        
        Reply
- MarciaB December 12, 2014, 10:35 am
  
  Write up a case study and submit it to the Ask a Mustachian section on the forum. Tons of great help will be forthcoming! There’s also a “how to” on that forum thread to help you structure your stuff.
  
  Reply
  - Ddub925 December 12, 2014, 11:51 am
    
    Thanks Marcia! Not looking forward to the face punches but I desperately need them,! The big challenge will be convincing my wife to take action.
    
    Reply
alistair December 11, 2014, 3:31 pm

Even jeremy “more power” clarckson of top gear hates the f150

https://www.youtube.com/watch?v=0klZpwlgwOw

Reply
- Hunniebun December 11, 2014, 8:29 pm
  
  That was good for a chuckle :) I lived in jolly ol’ England for a year and I can verify that I never saw a single F-150. It also made me laugh that our does – in fact have attachable gun rack – because hunting is also a leisure time activity made possible via this enormous farm vehicle. Sadly, the amount of wild game actually harvested doesn’t balance out the asinine amount of money spent. We purchased our truck used, but the owners were very organized and had everything from the original sale, including the receipt. The grand total new for this truck was over 54K. We purchased it 3 years old with only 11000 Km on it for a price of 25K (they never drove it because it was too big to park…that should have been our first hint). Again, not trying to justify this clown-tractor. Just sharing some facts and back ground on how we got here. It SEEMED like a deal at the time.
  
  Reply
  - SwordGuy December 11, 2014, 8:36 pm
    
    The important thing is that you’ve learned that lesson and it doesn’t sound like you’ll make that mistake (or a big one similar to it) again.
    
    Reply
  - JB December 14, 2014, 5:21 pm
    
    A) You guys don’t have F-150s cuz the roads are pretty small and with gas being $7-$8 a gallon, it is expensive. I doubt most could park it in an English garage.
    
    Reply
Lisajram December 11, 2014, 4:45 pm

I have two friends who have been my close friends for years… since high school. We’re now 40. One friend has declared bankruptcy within the last 5 years. They lost everything including their home. The other owns 3 homes. They started with their regular home, and then bought a cottage. Then my friend spotted a bigger cottage for sale on the same lake, so they bought it and put the smaller one up for sale. It hasn’t sold. It’s been 6 months. She also has a 1 hour per day round-trip commute to her full time job.

We used to get together once a week to have a drink and talk. They can’t find the time to get together anymore. Their kids are in tons of activities, and they have church obligations, and they work, and their lives are filled with all these “have-to’s”… it’s just ridiculous. It actually makes me sad they have so little time to kick back, relax, spend some time with a friend. Scratch that. They have NO time to spend a couple hours with a friend. I try to tell them to slow down, but I think they think their way is the normal way. At times they HATE how much they are running around, but they do NOTHING to change it.

Was it always this way? It doesn’t seem like it. All three of us had stay-at-home moms growing up. Both of my friends grew up on farms. All these sports and “enrichment” activities weren’t even offered. We just hung out and played with the neighborhood kids.

I think they think my husband makes a lot of money, which is why I’m able to stay home with my kids. He does make a decent living, but we’re not rolling in it. We just live a lot simpler. And it is so nice!

Reply
- Hunniebun December 11, 2014, 8:39 pm
  
  I wish we lived in the same city, because I would hang out with you! LOL! I would not say we are over – scheduled and spend most evenings at home enjoying leisure time (skating, snowmobiling, library, visiting, reading, movies in winter and biking, parks, beaches, campfires, paddling, fishing etc. in Summer). My son plays hockey in Winter and does swimming lessons in the spring and fall…so there is only ever one activity. My little one is too small, but when she is 5 she will get to pick one activity too. It is a fine line between wanting your kids to participate in a team/organized sport and getting over committed. I also have many friends who have at least one activity every night and sometimes two. Some girls play hockey and do dance classes, plus swimming, add that to school activities and there is zero free family time. We like to do things together (hence all the toys), but it is when the mood strikes rather than being constantly committed and it is often with family and friends.
  
  Reply
- MoreWithLess December 12, 2014, 3:36 pm
  
  It is pretty amazing what people in some parts of the US have programmed themselves to accept as a “must” in their lives, or just accept as simply the norm– commuting an hour each way is the norm, putting kids in daycare at the going rate on the east coast of $1500+ month is the norm, putting the kids into loads of expensive activities is the norm, paying unbelievably high prices to buy a house in a high-tax neighborhood so your kid goes to the right school is the norm (never mind that on top of the $500K they just spent for the house that needs renovations despite the price, they will also be paying thousands of dollars a year in property/school taxes).
  
  I once asked someone who commuted 90 minutes each way to work why he did it. His answer was: “That’s what I had to do.” I couldn’t help but think– this country is massive, filled with countless cities and towns, his job could have been found in many other more affordable places…why did he limit himself in that way and lose a significant percentage of his life on earth to the bus and train?
  
  Reply
  - Eldred December 14, 2014, 12:01 pm
    
    What was his profession? I remember attending a conference in 2003 at Stanford University. One of the guys we shared the commuter train had something like an hour commute. That was because while he made good money in Palo Alto, he didn’t make enough to afford to LIVE there. That happens a lot… I don’t make enough to live in the city my job is in either. My commute is only about 20-30 minutes, though. Then there’s the flip side – people who work in a city like Detroit, but don’t want to live there because of crime and poor city services. So they live in the suburbs and again, may have a long commute.
    
    Reply
Bee December 11, 2014, 10:49 pm

Great article. Love the way you come up with an simple answer when most people would accept that this is a normal way people are spending.
I have been reading your blog now for a couple of months and you have convinced me that when my husband and I have kids I will be a stay at home mum. My husbands work is very close to home and he drives a company car. So many of our friends have spending habits just like this lady and her family. Both partners working, 2 or more kids in daycare everyday (7am- 5pm!), long commutes to work. I think it is ridiculous spending and I would not want to miss out on spending time with my little kids. Childcare rates are about $90-$100 a day here and you get about half of that back from the Gov.
I definitely agree with your opinions about cars in America, they are too big and too expensive! As an Aussie who has visited the US twice (Vegas,LA, New York) I cannot believe the size of the cars (trucks) that people cart around in. My jaw dropped they first time I visited LA. I hired a Subaru 4wd from the car hire place, thinking the car was probably far too big for what I needed. As a drive out, cars are passing me that have a ceiling height almost a metre higher than mine! The majority of Aussies drive a 4 door sedan.

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Jim December 11, 2014, 11:22 pm

Hi Mr Moustache I haven’t read Geithner’s book largely because I was put off by sarcastic reviews of it here in the UK but I’ll now put it on my list. I have read quite a few books on the financial crisis (the best being Whoops! by John Lanchester) although I can’t say it’s done me much good! It’s a massively complex issue and there are very few innocent parties, including Joe Blow who eventually picked up the tab. The more complex a situation, however, the more simple the answer needs to be, and your blog is the simple answer to the problem. Be financially astute, you don’t need to be a quant. Save money and invest wisely. Spend even more wisely. Think hard about your fellow man and the planet we live on, and try to serve them well. Don’t be greedy and stop trying to keep up with Jones’s. To paraphrase The Beatles, the best things in life are free, go out and enjoy the birds and bees. Amen to that.

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ConfusedbutTrying December 12, 2014, 3:19 am

Hello, Mustachians!

Love this blog, love Mr MM and Mrs MM, and all the contributors in the forum. I’ve noticed quite a few comments from people in foreign countries trying to live this way under the constraints of different tax systems and income structures.

But wondering if there are any Mustachians who are in the somewhat unique position of being an American living abroad (as in, a middle class person, not someone with loads of wealth).

It is an incredibly challenging and confusing situation to be in given the US’ worldwide tax net on US citizens, which adds the burden of having to file US taxes every year despite paying taxes in the foreign country of residence, and having to report all foreign bank accounts. The complex taxation situation for American expats makes investing nothing short of insanely complicated and confusing, especially thanks to FATCA rules. Effectively, there is little Americans living abroad can invest in (in the US or in their foreign country of residence) without running into road blocks and/or tax nightmares down the road.

Are there any Mustachians who are in this situation and can provide some advice, specifically about what investments you have and what the tax reporting and payment requirements are, with regard to:

1. investing in foreign investments (stocks, mutual funds, index funds) relative to US tax filing
-AND-
2. with regard to investing in the US relative to the foreign country income reporting requirement

Ideally, an American living in the UK would be most helpful!

There are some wealth management companies that are dual certified to advise and manage US expats living abroad, but these are for people who are already very rich with extensive portfolios. There are few resources for those of us who are not yet wealthy.

I’m a saver by nature and very frugal, so I’ve got that part down, but only earning average UK wages with a small savings pot that I’m slowly building month by month, but nothing enormous yet (saved a load during my first job after college in the US, but then spent four years traveling; wish so badly MMM’s blog existed then and I would have invested a chunk of that cash in index funds!).

My goal is to DIY invest (to save on brokerage costs), but very unclear as to what I’m allowed to do and how it will affect me down the road. Have heard horror stories of Americans being turned away from banks/brokerages and losing LOTS of money thanks to FATCA regulations and a plethora of confusing tax implications.

Apparently, though, there are some “approved investments” that Americans can access, but it’s very limited. Does anyone know what these are and how are they treated tax-wise in both the US and UK?

One important note that I’ve been told is potentially advantageous to my situation: I am married to an Irish citizen, who has no US tax filing obligations (has never lived there, so no green card, etc).

Any advice anyone has would be much appreciated! Thank you!

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- JB December 15, 2014, 10:41 am
  
  Why not just google your question. since MMM hasn’t lived in Europe, he won’t be an expert. I a pretty sure there are a few blogs about living overseas.
  
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- Jessica December 15, 2014, 10:14 pm
  
  Unless you are a British Citizen, you can only invest in American funds (money laundering laws are very strict around this). It is complicated and please do a google search, all of this is on the internet and takes some time to weed through to your specific situation. Taxes on capital gains are VERY high in the UK. I’m not sure how your earned income from US investments would be taxed in the UK. Seek an accountant to get a briefing.
  
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  - lorenlaurenlorraine December 20, 2014, 9:20 pm
    
    I don’t think that is quite true. Americans can invest in non-american funds.. just make sure you are filing your U.S. taxes every year and for god’s sake file your FBAR every year. I’m an American living in Canada with an RRSP. I have to report the RRSP value on an FBAR even though I’m not paying taxes on it yet.
    
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Kooper December 12, 2014, 6:32 am

While I love MMM’s brand of vanilla mustachianism, sometimes I think there are more tradeoffs than MMM concedes. For example, when we moved to Minnesnowta from the PNW, all of my wife’s colleagues urged her to get AWD. She works at a hospital, so she has to show up to work regardless of weather. While I gave the Mustachian argument that FWD with snow tires would be enough (unless she had a reallllllllly big hill on her commute, and this being a flat state, I thought that unlikely). We found a really big hill on her commute, and I let her have her way for the AWD CR-V over my choice of the manual Focus hatch. On her first day of work, her new colleagues said that they hoped she had AWD. My wife not being enough of a car person to see that the mustachian view was obviously correct, this was an instance in which I thought it more Mustachian to keep the marriage happy than to go the vanilla mustachian route of the FWD manual hatch with snow tires. Call it strawberry mustachianism.

That said, one difference between us and the above commenters is that my wife and I love our jobs and spend less than we save. If you do not love your job, or are not saving as much as you want, then MMM is dead on with his regarding pickup trucks and minivans. While I would not go so far as Yaris or else, even a NEW Civic would likely cut the costs/km in half. Cars are really not that special to force you to work at a job you don’t enjoy just to have a bigger car.

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Bob Werner December 12, 2014, 8:05 am

Dear Frozen Writer,

You life sucks! Once you understand that you can move on. So you have 160K in home equity and 300K in cash out and savings. That is $460K. Many Mustachians retire nicely on that.

Here’s a thought — Cash out, become a US citizen, move to my nice Midwestern Neighborhood where a 1200 sq ft house can be had for 110K with a mortgage payment of $500 per month and $100 per month in utilities. Ditch one car (I’m definitely keeping the van as you will be hauling lots of friends) and cut your food bill to $400. Add phone, clothes and car ins/gas for $200 and your monthly nut is $1,200 or 15K annual.

Your 460K in investments will yield 18K at 4%. Bamm, you and the hubby are both retired and much warmer. 40 below! That is freaking crazy!

I assume your husband is employable for 35K per year if he likes. So the 35 K will all be gravy and you’ll have free health insurances (although shitty).

If you wanted to go hardcore (and why not since it would be harder to have much of a suckier life) you could move to one of the small towns around here. (Buffalo MO?) There you could purchase a 1200 sq ft home for 40K and there would be no need for any car if you so desired.

So yeah, you are handcuffed to a desk all day when you could be reading stories to your kids by the wood stove and drinking cocoa. Go figure?

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FruggalNoggin December 12, 2014, 1:27 pm

Just want to say that I’m pretty uncomfortable with a lot of the frankly quite hateful and ignorant things being said about poor people in this thread. I would think that folks on their way to full mustachian freedom could afford to have a bit more generosity of spirit. It makes me feel a bit queasy about identifying with this community to see stuff like that.

Also, one point for MMM: Maybe this was hashed out off-line on your correspondence with this woman, but why is the assumption that she will quit and move the family closer to his job, rather than at least considering the alternative? Given that their salaries are pretty close and he has a potentially income-generating passion, it might actually be more profitable for him to quit.

Otherwise, great article!

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Ryan December 12, 2014, 3:21 pm

I have nothing to add here, just that whenever you get to talking about oversized cars, it cracks me up. Oh I just love it, it’s so true.

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Catie December 12, 2014, 7:01 pm

MMM, can you elaborate on the $1000/month of driving related costs? I have read the article on commuting, but would appreciate seeing her real mileage, gas bills, and maintenance since this seems so high. I have a longer commute timewise but even using a round $0.50 per mile for my ~10k yearly driving I come out with $400/month. In reality my commute expenses are less. I also found myself trying to calculate their financial situation 1 year, 5 years down the road with the different phases of change. Could you please add more numbers for the voyeurs and add to the article above?

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- Jason G December 12, 2014, 10:45 pm
  
  $1000 of monthly driving costs does seem high. I imagine that car depreciation is at least a couple thousand per car each year. Repairs and general maintenance should be under $200 for most new cars, can be over a $1,000 a year for older cars. Either way I don’t think $1,000 a month is typical.
  
  I am considering ditching my Chrysler V8 2006 in the near future, but I have recently became hesitant. My overall commute will be 60 miles per week once I start my new job. My gas costs will probably be $80 a month and my insurance for two cars”girlfriends ford fusion” is $47 a month. A couple thousand in depreciation will make my total yearly driving costs under 4k with the registration, oil changes, etc. However since my bluebook is about 10k I don’t see saving to much money choosing a fuel efficient car, because depreciation, registration will be similar. My guess is I could save a few hundred a year if I switch vehicles in gas. Maybe another $1,000 in depreciation if I get a clunker. I am thinking about holding on to the Chrysler until its blue book is in the 5k range and make the switch.
  
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- Hunniebun December 14, 2014, 5:59 pm
  
  I am not 100% sure on how the calculations was arrived at, because I am now mathematician! So I just take his work for it, since this isn’t his first case-study rodeo! I know direct gas costs are 500$/month (but that is more than just commuting to work…it is everything), insurance on both vehicles is 225/month, so that brings us to 725$ per month just in direct costs. I assume the remainder is a combo between averaged maintenance costs and the per/km depreciation. I have never tracked how many km I drive each month (but you can bet your bottom dollar that I have started now!), but I would guess about 2500 to 3000 (we have a lot of a family out of town that we visit regularly too, which adds up!)
  
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Hilde December 12, 2014, 10:46 pm

I drive a tiny Lancia Y, which in the US probably wouldn´t considered to be a car at all. I am always amazed about the big trucks and vans you are driving over there! Are you all farmers? Don´t you have roads and highways? Here in Germany, we have many BMWs and Mercedes, but they are small in comparison to your big gas-guzzlers. When I see one of the very few big American trucks in the street, I always feel a mixture of anger and fear – and sometimes pity for someone who thinks he needs such a car in order to feel safe, important – whatever feeling it gives.

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VS December 13, 2014, 4:44 am

I see a lot of comments here about poverty, inequality and “solutions” for them. I had my own opinions about these things until I came across this book on sociology by Allan G. Johnson “Human Arrangements: An Introduction to Sociology.” This book really opened my eyes as to how the world works and gave me peace in the sense that it answered so many of my questions regarding the world and life in general. By the way, I look forward to MMM’s “Income Inequality” post as well.

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Tyler December 13, 2014, 4:32 pm

I felt a bit convicted reading about the “twin turbo farm truck!” I drive a similar vehicle and now fully realize the ridiculousness of it. Thing is, I don’t really want to get rid of it. I like having a truck available to haul the occasional appliance or furniture piece I pick up. I suppose a compromise may be to get a more fuel efficient vehicle for ferrying kids to school and myself to work. Park that farm truck for now!

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- Mr. Money Mustache December 14, 2014, 10:22 am
  
  You got it Tyler – it’s often better to have separate hauler and commuter vehicles if you have space for them. But you don’t need 300 horsepower to haul a fridge (I can even do that with my bike and large trailer) or even a trailer full of horses. So you get an old longbed truck (no need for king cab because trucks aren’t for family transport) and a newer 5-passenger hatchback car.
  
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  - phred December 18, 2014, 7:55 am
    
    You don’t even need the old longbed. Just get a good “bumper” hitch and a utility trailer
    
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Michelle December 14, 2014, 11:28 am

To Mrs. WW (aka Winnipeg)

I don’t know if I would leave my job entirely when you have such benefits as working only a certain amount of the time (unless you hate it) Here is why,
kids grow so fast. I worked part time when my kids were small (before school-age) and went back fulltime when my son entered Grade 2. Fast forward and they are in Grade 6 and 7. even at this age they are more independent, and although they need you, you are not their only focus. I have seen some Moms who left work, or never worked, and they are behind in the fact for reentering the workforce. I say this because I like working, if you don’t, or it doesn’t work for your family, by all means leave.

My kids walk to school every day, (we live in Calgary, so not as cold as Winnipeg most of the time) I walk with them as I currently have a home office ( although I work 40hours per week). I do have a car, and my kids are in some activities (although they are not overscheduled).

House is paid for, cars are paid for, allowable RSP, RESP, etc max. My husband has always been a super saver, I have learned over time, although I am not completely Mustachian. My husband loves his job, and would not retire yet.

As far as poor people. If someone is truly poor, they may not have the cognitive means to know what it takes to get ahead. If someone has not had proper nutrition growing up they may not have the same decision making ability, etc as other people have. It is a vicious cycle.

As far as the ‘close your legs comment’ Totally offensive……….really, that’s your solution,

pathetic.

Love reading the blog and comments,

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- Hunniebun December 14, 2014, 5:51 pm
  
  The more I think about it, the more inclined I am to keep the job…but work part time. I don’t actually hate my job, it has amazing perks like all expenses paid travel to amazing locations, like this summer I got to boat down the Yukon River for a few days and got paid for it and I have been to Montreal, Quebec City, Vancouver, Victoria, Churchill, Saskatoon, Toronto, Ottawa, Banff, Jasper, Calgary, Edmonton, Fort McMurray, Canmore, all without spending a dime of my own (A HUGE thank you to the tax payers of Canada for this…I work really hard for you 99% of the time…I promise!) Although post-kids I have cut my travel back drastically to one or two trips a years. Some of the work in the office is boring though! The part I find most difficult is getting too and from work…the double kid drop off and pick up is a complete time vampire, but as so many people have pointed out…this is not forever. In two short years, they will be in the same school. It has been so interesting hearing peoples point of view and suggestions and making me realize the huge variety of possibilities that are open to me, and that where we go from here is really up to us!
  
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  - Doug December 15, 2014, 9:33 am
    
    You’re so lucky having a job like that. If I had a job where I got to travel at someone elses expense, I would never have retired!
    
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Gtim Himel December 14, 2014, 7:20 pm

I strongly suspect that I live in the same city as the person that is the subject of this article – i.e., the coldest city in the world with more than 500,000 inhabitants.

A big problem in this city is the weather and the lack of bike paths. We are a one-income family and I am lucky enough to be able to walk to work, but even with our single ten-year old VW, I just tallied up the expenditures this year and they total $6,500 already (this is based on a fully depreciated car, with no further allocation for depreciation and no payments). That is am exceedingly annoying retirement killer. Add the high housing cost in this city, and I longingly look at the numbers from other cities bandied about on this board. Our grocery bill, too, is $1,000 a month, and we exclusively shop at Superstore and avoid Safeway like the plague.

However, OP, if it makes you feel better, I would gladly take that government job with a DB pension and retirement at 55. While I make about 2.5 times what I would make in government, I probably worked about 3,000 hours last year (including most weekends) and sometimes feel like slapping government colleagues with their oh-so-perfect work life balance and no need to network or drum up business.

What I never understood as a younger person is how much the private sector requires you to over-save. In government, pensions are actuarially determined. In the private sector, I have to assume that I live until 90 even if I will probably die long before that. Try getting a $50,000/yr annuity starting at age 55 to last until age 90 – it will probably be around $2 million. And so I keep working my butt off and socking away $100K per year to have the same lifestyle I probably could have had with a 40-hour workweek in government.

The grass is always greener on the other side…

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- Mr. Frugal Toque December 16, 2014, 7:48 am
  
  I could have sworn I’ve seen your name around here, but this comment seems a little out of place.
  You are already saving a lot of car money by being close to work. Who is doing all that driving that your car costs $500+ a month?
  How many people are you feeding on that $1000/month? A family of six? Are they all hockey playing teenagers? It may be that your family is larger than mine, or has a higher calorie, marathon running lifestyle, but I can’t tell from here.
  And, in order to survive in perpetuity, if you really think you need $50k (and you probably don’t as a retired couple) you would only need $1.25m in indexed funds, which would give you what you want under the 4% rule. Mrs. Toque and I need well less than $40k to live on, so we don’t even need $1m socked away.
  On the other hand, I do agree with you: running your own business is a much larger responsibility both in terms of hours and stress levels. It’s not for everyone, but kudos to you for making a living at it.
  
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  - Readerof the Rockies December 16, 2014, 10:07 am
    
    +1 With the annuity, you are compensating the insurance company for taking the longevity risk (and even the inflation risk depending on the policy), plus the profit they take on top of that. Then you have to hope that this company will stay in business for the next 50 years or so. Hence the much lower cost of investing in index funds. Plus you know the entire stock market won’t go out of business. I second Mr. FrugalToque on this one.
    
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  - Gotim Himel December 16, 2014, 4:54 pm
    
    It is not so much the number of kilometres being driven but the fixed costs and maintenance. This includes insurance ($1300/yr), a set of winter tires this year after five years of winging it ($1,250), new gaskets, timing belt… you get the picture. Repair is still less than depreciation on a new car, but not insignificant. But to be frank, driving is on the up. Preschool for one and kindergarten for the other are in different neighbourhoods (an issue that will fix itself next year when both kids will be in the same school in walking distance from home). and terminally ill parents in different areas of the city mean constant shuttling and driving. The plan to minimize car use tends to fall apart pretty quickly in those cases. And as a bike commuter for many years in another city, I can advise that winter bike commuting in a place like Winnipeg is definitely not easy.
    
    With respect to groceries, we have a family of four, a preschooler and a kindergartener. The grocery budget was gradually upped from $200/yr four years ago (before the kids really ate solid food) to $250/yr this year, and to my shock and horror I discovered that as of mid-December we are barely under that amount. I will readily acknowledge that the main culprit appears to be dairy products – milk, cheese, yoghurt, and butter for baking. I respect anyone in Canada that manages to keep the grocery budget significantly below $1,000/month. That takes serious planning for frugal meals, which I have not done to date. And my wife is currently too overwhelmed with our “sandwich generation” responsibilities to significantly pre-plan grocery purchases.
    
    Regarding required income, I operate on a $50,000 assumption, but I am not even optimistic that this is enough. We have tracked our expenses since 2007, and last year total family expenditures (excluding savings such as RRSP contributions and mortgage principal repayment) were $54,000 without any vacation whatsoever and no allotment for home maintenance or furnishings, including our 32-year old couch. This year, they were $66,000, largely as a result of an international trip to my (former) home country. This is much lower than what most “middle class” couples we know spend (most of whom are in debt despite household incomes of around $160k), but still a far way from the frugality seen on these boards. I would not be comfortable without a sufficient margin of safety. At this rate, with $2M in investable assets I would definitely consider cashing out, but I am still a far, far cry from that amount.
    
    The thing I have always wondered is whether the only reason I am running these calculations is because I work the long hours. When I look at people who have two-day weekends and leave the office at 4:30 on weekdays, that already seems like a very relaxing lifestyle. From that perspective, I am surprised when I see government workers badly wanting out.
    
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- Ellen December 18, 2014, 3:29 pm
  
  You are right that in the private sector everyone must assume a long lifespan for their retirement savings because there is no risk pool. Assuming an average lifespan for savings would be for pensions with required participation so the risk pool is large enough.
  
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cdiggs December 16, 2014, 9:52 am

Is MMM’s math wrong? I am a fan of this site and many of the ideas presented within it, but I didn’t come to the same number crunching results that MMM did. Here are two problems “I see” in MMM’s math. (Walk me through the analysis and math if I’m wrong and he’s right).

Problem 1:
In her monthly budget for her and her husband, WW lists out $500 for gasoline and $475 for all insurance (home, life, van, truck). WW doesn’t say how much of the $475 in insurance is spent on her vehicle, but I’d think it very likely it falls in the range of $40-$100 depending on amount of coverage, driving history, etc. WW doesn’t say how much of the $500 for gasoline is spent commuting to her work either. Looking at the mpg for both vehicles (2011 Ford F-150 Eco-boost Extended Cab and 2006 Honda Odyssey), they both are low and are potentially getting around 20 mpg combined city/hwy each. If half of the $500 for gas is spent commuting to her job ($250) and $100 is spent insuring her van, that still only brings her car costs to $350/mo. MMM however, calculated “Gas and direct/indirect car costs for almost 2000km/month of driving around in a van: $1,000.” That’s a $650/mo difference and I can’t see where that $1000/mo number came from. WW states that both vehicles are paid off, so it’s not a $650 car payment. Maintenance averaged out over a year wouldn’t account for the $650 either. So where did that $1000/mo for gas and indirect car costs of the van come from?

Problem 2:
In MMM’s response, he states that “you could find a new place close to his work, and eliminate his commute as well – potentially saving the $600 per month he is currently burning up commuting in the opposite direction.” I don’t see how the husband is spending $600 per month commuting. If he spends half of their $500 gas money each month, that’s $250. He has no car payment. Even if he spends $100 per month in car insurance, that’s only $350. Again annual maintenance average out over a year doesn’t equal the missing $250 in this case.

These are big monthly dollar differences that I’m not coming to the same conclusions on. MMM can you elaborate on your analysis and math please? I’ll slap myself if I’m wrong.

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- Mr. Money Mustache December 16, 2014, 12:20 pm
  
  Hi Cdiggs – I answered this in an earlier comment response, but the biggest part of a car’s cost is wear and tear – the amount of the car you “use up” with each mile you drive. Ignore gas, and maintenance, tires and oil changes for a moment. If you buy a $40,000 vehicle (like the truck) and it has a service life of 200,000 miles, each of those miles costs you 20 cents.
  
  It’s even worse than that, because the money tied up in the vehicles could be invested and generating passive returns for you, but to keep things simple, just assume that all driving costs you at least 50 cents per mile. Just as the IRS does in their allowable mileage deduction.
  
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phred December 18, 2014, 7:51 am

With all those F-150s on the road, a Toyota Yaris doesn’t have enough impact resistance

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AJ December 18, 2014, 11:40 am

These suggestions assume a happy and healthy marriage. It may be wise for WW to think about part-time work from home as an insurance policy.

I enjoy all of MMM posts and have implemented many of the suggestions. I did have a moment of pause at the suggestion that WW quit her job. While it makes sense from an economic and happiness standpoint, it may have unintended consequences if her situation changes through divorce, death or illness.

I experienced this as a child when my father developed M.S. and was no longer able to work at age 43. My mother had stayed home with the kids and had to quickly re-tool her education to return to work as a teacher. In my own case, it wasn’t financially viable to work when a pregnancy resulted in twins with significant health issues. I stayed at home for 15 years, managed the finances and all other aspects of our lives, and was then divorced.

Having adopted MMM-esque principles for many years, I have a comfortable cushion, but need to return to work for at least 5 years to secure my retirement. Despite blue-chip education and work experience in my 20s, I have been unable to secure professional level work because I am deemed ‘over-qualified’ or ‘inexperienced’. I am working to update skills, network, intern, etc… but do wish I had not divided the household responsibilities in such a way that my ex-spouse was the only wage earner.

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DPT December 18, 2014, 1:28 pm

Not having kids can get you to FI faster. But I know, that is a choice and I’m sure most people would prefer to have little me’s. But hey, WW could definitely use your advice MMM!

I’m new here and glad to have found this site. I have subscribed! Reading some of the old articles now which resonates a lot to me.

I/we are on our road to FI. It is easier for us because we do not have kids. We have a very low monthly cost, which usually shocks most people when they learn about it. We do not have debts. We could have lived a very luxurious lifestyle but we’re not doing it because of FI dream. The only thing I spend is my travels, because I figured out that this cannot wait until I am 55 or 65 (I am 44). However, the travel spending is very little compared to my income and the savings that go in yearly into the bank. It’s just a pity that interest rates here in NL are an all-time low, plus the government squeezes you more additional tax, aka wealth tax at the end of the year.

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Gerard December 19, 2014, 7:00 am

I don’t own a car, so car discussions are fascinating to me (in an intro-anthropology kind of way). Today I’m amazed by how many people seem to choose their cars based on the assumption that they’re going to be in a fatal crash. Imagine how odd life would be if we bought plane tickets that way, or chose houses based on an expected asteroid collision.

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Kayla December 19, 2014, 9:33 am

I know that’s the nature of this blog, but golly some of that “advice” seems damn extreme. I get it that they need to make some extreme and immediate changes if they want to accomplish these goals anytime soon, but I guess I’m just not to that level of job hatred.

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- Kristine - CA December 20, 2014, 9:45 am
  
  IMO one of the GREAT things about the advice given by MMM is that there is always the option…..to not to take it. I like the extreme nature of the “advice” given in these threads. Once you are aware of as many options and consequences as possible, you can choose to act on it or not act on it. Consciousness of what we are doing, and why, is very powerful. The OP has already stated in this thread that, indeed, she doesn’t actually hate her job that much. If she doesn’t quit, or goes part time, she comes out ahead by having a fuller awareness of the trade-offs, financial and otherwise. This is one of MMM’s many gifts….to go all the way with a topic.
  
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- Merdox December 21, 2014, 6:19 pm
  
  As you note, I think a lot of it depends on 1. how content you are with your job, and 2. how important the concept of freedom is to you. Most people are probably not as content with their jobs as you. And, speaking for myself, just the idea that I *have* to work ruins it for me; maybe it’s just the way I’m built, but it’s very hard for me to enjoy things without a sense of genuine freedom and independence from them, i.e., things are only meaningful to me when I do them purely out of choice, not necessity. But if you love your job and you don’t feel that same tension, more power to you!
  
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Frugal Buckeye December 19, 2014, 1:46 pm

Another great case study, and reading this one felt very similar to reading about my own situation and some of the changes I have made and need to make. The spending dollars are probably similar to my own of about a year ago before reading MMM and re-evaluating some things, and the income dollars are pretty close as well. We’ve made a couple of good changes to our spending and saving habits and have some bigger ones coming soon too.

I will be getting rid of my car soon so we will be going down to a “only own 1 of our cars” family, as I will get a company car for moving into a sales position. Although I’ll be driving a bit more, this job will allow my family to move closer to extended family and hopefully use our main family vehicle a lot less.

Thanks MMM for creating this blog, and keep churning out the interesting articles.

I was wondering if you were planning on trying out your own aquaponics setup and blogging about the setup? I am looking to invest in one once we make the upcoming move.

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jazt December 20, 2014, 11:56 am

Dear MMM,
This post is hilarious! The part about “how many heads of cattle and pigs are you hauling on that roundtrip, while simultaneously carrying international heads of state in the stately cabin? That is a fucking ridiculous vehicle for ANYONE to drive except the rarest breed of Farmer/Diplomat, and I’m betting none of them also hold jobs as Structural Engineers.” And then “So you’ll be selling that, …”. That was pure gold. While I usually find you quite funny, that was over the top and made me laugh so hard. I’ve never written a comment before, but just had to tell you that. Keep typing shit into the computer, please!

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Merdox December 21, 2014, 6:14 pm

MMM,

Thank you for single-handedly clearing away the black clouds of despair that were looming over me and giving me tangible, defined hope for freedom in literally half a day. Freedom has always been essential to my basic ability to feel joy, and, despite my being ridiculously privileged and having no objectively justifiable cause for complaint, I have been feeling trapped by the implicit assumption that I would have to work for the next 30-40 years.

I’m 30 and thankfully make a very high income. In addition, despite being raised by two rich, generous spendthrifts who have spent all of their incomes for decades, I personally was always more focused on spirituality and never let my mind be hijacked by materialism; as a result, I have been saving nearly all of my income. However, knowing absolutely nothing about investing, I was letting my savings burn away in the bank, and I assumed I would still have to work into my 60s like everyone else. Being someone for whom freedom and independence are requisites to basic happiness, the thought that I would *need* to work forever has been causing me profound anxiety in the present. Then, around Thanksgiving, I stumbled upon your blog, and the light went off. I binged for hours, walked outside, took a breath, and exhaled with great relief, deeply grateful that I had been given the answers I so desperately wanted.

I thought you deserved an expression of that gratitude. Thanks so much for sharing your invaluable insights, and please know that you are adding meaningfully to the quotient of happiness in the world.

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JMitchell December 21, 2014, 7:43 pm

Hello MMM,

I’m a fellow Canadian and new to your blog. I’ve binge read a number of posts and am very excited about my future frugality and wealth! Truth be told, I’m already in line with some of what you recommend – I walk to work (regardless of weather), I drive a used 2002 VW Jetta that I bought in 2007, I very recently paid off my $60,000 student debt in 2 years because I made it my highest priority, and I have saved $20,000 in a savings account (ideally the start of a down payment on a house). I do not currently own a home, but hope to in the next couple of years.

Here’s my question: I make a good wage ($125,o00 before taxes) and want to start investing. You talk a fair bit about investing in index thingies and I’m wondering if there is an equivalent in Canada? Or, maybe a better question would be: What would you suggest I do to accelerate my savings and retirement?

I’m so excited to have found your blog – I share your values and think saving money is pretty fun, especially since I feel like I’m living a pretty great life with plenty of (frugal) luxury.

Hope you and your family have a great Christmas.

Jayna

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John Peter Paul December 22, 2014, 1:50 pm

This post hit home (so I’ll actually post).

I, too, seek redemption.

My budget is massive. My bank adds up all my bank and credit card expenses for me, and that number crosses the 6 figure mark. It made me sick. It’s not that different than the OP’s budget, maybe $8500/mo but the difference is, we only have one car. I bike to the train station for my commute (plus $3000/year) and we live in an older townhouse (in the GTA). We’ve taken trips to Europe (every 2-3 years) but the money just flies away every month. So much that I was convinced thieves were using it without my authorization… somehow.

Turns out I was right! Someone online spent $0.30 and another $6.86 in France so the card was frozen/cancelled. Oh sure, the purchases were 99.9% ours BUT it meant all new purchases found their way onto our debit cards instead. Online purchases were more difficult. Oddly even with an oversized Xmas budget in December, we’re way under budget. By just introducing slightly more friction (debit cards are *real* money vs credit cards) it’s had a significant impact.

In hindsight, we’ve been lucky (or not) to have access to an easy, massive, low interest, unsecured line of credit that was recently paid off, not by discipline or patience, but by recent job raises and luck. For the first time since 2006, I’m debt free (ignoring the mortgage).

Yet the honest truth is, I’ll probably have the line of credit up again in no time. MBNA is couriering new cards over to me as we speak. My wife & I are considering buying a used Sienna (for camping) to pull the tent trailer on twice yearly camping excursions.

When I look at my budget the words that come to mind are overwhelming, mind boggling and/or unfathomable. As long as the jobs keep paying, I’m good. But it seems so *wasteful* to spend so much money and have little to show for it.

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- Loren January 2, 2015, 10:22 am
  
  One thing at a time, that’s what we are doing as well. My husband makes a LOT of money yearly, but we don’t have the savings that one would think. Even though my car is 13 yrs old and long paid for.. my husband drives a high-end car to get to his office, which is 5 minutes away.. granted it is a paid-for car.. which doesn’t mean much here lol. I personally live very frugally, but am trying to change the wasteful habits of our family unit. The little things we have done: Changed all of our bulbs to LED, changed my cell-phone plan to the basics, reduced our Telus bill, being more conscious about our grocery spending, driving less. These things will help, but given that we travel enormously.. this is really where we blow piles of money. I make good money too, and save probably half of it, but I’ve only been doing that in the last 2 years. I’m in my mid 40s and he’s in his early 50s so we don’t have the luxury of time. I’m almost in a panic state now that I’ve been reading this website.
  
  Reply
mmw December 22, 2014, 4:46 pm

Why does this site keep raising the numbers of comments when in fact no new comments have come in?

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- OhYongHao December 22, 2014, 5:03 pm
  
  Because there is a Next Comments -> link at the bottom of the comments section.
  
  Reply
- Monica December 22, 2014, 5:08 pm
  
  And…. the new comments are often embedded as responses to prior responses… ala the “reply” feature available for each individual comment/thread. To see new comments, you need to browse through all the prior threads… You can note the date and time that they were each posted.
  
  If you click on the “notify of follow-up comments via e-mail” underneath the submit button, you’ll get each new comment via email….
  
  Reply
Rick Ortiz December 30, 2014, 9:12 am

Just found your blog and loved this article for the way it shows in real terms using real math how simple it is to replace the things we think we “need” with invaluable time and sanity. How the hell did we ever get sucked in to this ridiculous game anyway?

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LoonieITGuy December 30, 2014, 1:20 pm

While not a parallel, my wife’s friend was in a situation like this, only reverse.

She just had a baby and was wondering if she should be a stay at home mom or go to work. She got a few interviews and someone offered her a job. She did the calculations and factored in costs like day care, transit pass, etc.

Turns out their family would have been in a worse situation financially (net loss). They did more math, factoring in taxes and the like, and they estimated they would have needed a job that offered $25,000 more than the current offer to make everything worthwhile.

With that in mind, she’s been a stay at home mom for 3 years now.

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Tanja December 31, 2014, 6:26 am

I’m driving Mustachian muscle car – manual, hatchback Toyota Yaris. Thanks to an “engine light” that just went off on our Routan (and 14 miles/galon gas guzzle), we took a 1000 mile (unscheduled) trip – 2 adults, 3 elementary school age kids – in my little Yaris. We may have taken a couple of extra breaks for kids to stretch their legs but other than that our ride was perfectly fine and we saved tons of $$ on gas.

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David December 31, 2014, 9:42 am

Omg, I was just gasping when I saw the choice of vehicles made by this family. Talk about finding a way to burn $2000 per month in a firepit. Yet, sadly, I would say this is the norm for people who are “struggling” to make ends meet. All their extra money is consumed in poor vehicle choices.

Do any of you read the weekly reports in the paper about how middle class incomes are declining? Yet just about every middle class family has not one but two huge truck-like vehicles parked in their driveway. The physical facts do not point to declining incomes at all but rather to increased and unecessary spending. I wish more reporters noticed this fact.

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