This weekend we’re at the beach for three days for my cousin’s wedding (taking the boys out of school for the first time as we practice our ability to be location independent–just for a day!).
It’s amazing how nice it is to leave routine and embrace the ability to go hang out at the ocean for awhile. Lucy the Puppy is in heaven. We run her around on the leash-free part of the beach in the morning, and she sleeps for most of the afternoon. And the sun and sand has been good for all of us, giving us some time to unplug from our new school routines and enjoy nature.
This weekend has also given me a chance to reflect on how going slower impacts our financial lives.
I raced through the first part of my life at break-neck speed, as if to cram everything possible into my day so I couldn’t possibly miss anything. I sucked hard from the orange of life and had the juice running down my chin to prove it.
As the years have passed and I have become an older human being, I’ve slowed down. I don’t, frankly, have as much energy. No one is more shocked and dismayed by this than I, because who knew that stuff ran out? But the truth is, slowing down is inevitable, and because I have more limited energy, I want to spend that energy on the things that matter, not the things that don’t.
Since we’ve moved to North Carolina, I’ve been making a concerted effort to do less:
- less work
- less activities for the kids
- less “to-do” lists
The more I read about crafting the simple life, the more I realize that it requires margin: chunks of time that are deliberately left unscheduled to make room for the sweet stuff of life. This slower pace really does make everyone in my family feel better. Continue reading “The Financial Benefits of Going Slower”
If you (like me) have trouble saving, may I recommend a psychological trick that may help you save a little more? Sometimes, when you feel like you spend more than the people around you, it can get discouraging, and you can start thinking self-defeating thoughts. While some people are incredible at saving in all areas of their lives, I’ve noticed that many people have gotten really good at saving in one particular area. They’ve found their personal savings superpower.
For Mr. Tako, it’s eating out. While his family are super low spenders in general (especially taking out their mortgage and day care expenses), they just. don’t. eat. out. Ever.
They’ve saved hundreds of dollars per month and thousands of dollars per year, compounded over time because they’ve mastered the art of eating in (and I do mean “mastered.” Check out this post and this post on the delicious food Mr. Tako prepares at home).
Liz and Nate at Frugalwoods have arguably mastered everything, but they love seltzer, so they’ve optimized the price they pay for making bubbly water. They’ve figured out the hacks and tricks to pay as little as possible for their favorite beverage.
Now, eating all your meals in or making your own seltzer may sound awesome to you, or something out of the third level of hell. But, picking your one spending habit to improve does more than just save you money in this area. It actually psychologically sets you up for more success.
If you can identify one area that you’d like to master, spending-wise, then you can become the savings expert there. Maybe it’s keeping your gas costs low even though you drive a lot. You might keep your grocery spending at $300 or less for three people (like Lily!). It could be your entertainment budget. Continue reading “Finding Your Personal Savings Superpower”
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Is it possible to increase your net worth through optimism and hope? Last week, I was listening to this episode of the Australian All in the Mind podcast featuring American positive psychologist Martin Seligman, speaking on the power of positive psychology and optimism in changing our outcomes.
One of the reasons I was drawn to this podcast was because Seligman is an academician. He’s interested in quantifiable research in neuroscience that psychologists can use to improve people’s outcomes, that is, their happiness levels. Seligman is the Director of the Penn Positive Psychology Center at the University of Pennsylvania and is widely known as the founder of positive psychology (here’s a TED talk he did from 2004).
In the podcast, Seligman shares how early on in his career, he realized that his colleagues were focused on the alleviation of misery and suffering, but he was interested in how to increase happiness: “I said, look, when you lie in bed at night you are generally not thinking about how to go from -8 to -5, you’re thinking about how to go from +3 to +6 in life. Psychologists have never worked on this, we’ve never worked on happiness, well-being, the stuff that is above zero.”
It became his mission to figure out how to teach optimism. Continue reading “Can Optimism and Hope Increase Your Wealth?”
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In the months leading up to putting our house on the market, we spent a lot of time fixing the broken areas in our house. Our kitchen sink had been leaking for months and we finally hired a plumber to install a new faucet. There were two plastered spots in the bathroom where we’d removed a towel rack and we painted over them. For the entire time that we’d lived in the house, we’d had a light fixture in the bathroom that we’d removed, because we were scared it wasn’t water safe, and had put a metallic plate over. We finally got a water safe light installed.
These fixes cost money, but not near as much as I thought they would. Once I found a handyman and an electrician who’d fix everything, I think we ended up spending around $350 to: Continue reading “How Fixing What’s Broken Helps Your Financial Life”
Continuous improvement is an idea that comes from the business world. After World War II, Japanese manufacturers invited W. Edwards Deming, an American engineer, professor, and management consultant, to their country to help them improve their manufacturing and production processes.
Before the war, Japan was synonymous with cheap goods and shoddy craftsmanship. Deming taught leaders that improving the quality of their products would reduce expenses while increasing productivity and market share.
“It’s simple. You just take something, and then you do something to it. Then you do something else to it. And then something else. Keep this up and pretty soon you’ve got something.”
-Jasper Johns, Twentieth century American artist (who, incidentally, grew up near my hometown)
In 1982, Deming published a book, Out of the Crisis, outlining his philosophy. “Long-term commitment to new learning and new philosophy is required of any management that seeks transformation. The timid and the fainthearted, and the people that expect quick results, are doomed to disappointment.” Continue reading “On Continuous Improvement”
Have you ever made a change in your life–maybe a huge one, like getting out of debt, or maybe a small one, like deciding not to buy takeout coffee–that in turn, caused benefits that you never imagined?
Maybe getting out of debt made you realize that your house was too big, so you decided to move into something smaller. Maybe not buying takeout coffee helped you realize you could save in other small areas, and after a few months, you ended up with enough to go on a trip to Florida.
This is the financial domino effect, and it happened to me.
Like a chain of dominoes, where one tile makes the whole line fall down, one seemingly small change in your life creates scenarios that make it more likely you’ll create other small changes.
One action that is, on the surface, completely unrelated to another action, causes the start of a wave of behaviors that can ultimately change your financial life. Continue reading “The Financial Domino Effect”
Happy New Year! As this post is being published, it is now 2018. I hope you’re having a great year so far!
Just under a year ago, I started writing this blog in earnest. I published a few posts in the fall of 2016, but had done absolutely nothing to promote them. In January of 2017, though, I began commenting under others’ posts and listing my website. Mrs. Frugalwoods, who lives close to me, graciously met with me, and she filled me with inspiration and practical ideas, as she is wont to do. I went home from that meeting with a lot of ideas percolating, one of which was to start blogging about the habits that could help me in achieving our family’s goal of doubling our net worth and becoming location independent in three years, which I dubbed “A Year of Good Habits.”
The idea came in part from Charless Duhigg’s infinitely practical book The Power of Habit: Why We Do What We Do in Life and Business. Duhigg is great at telling stories, and one of the stories he told really stuck with me: there was a young woman named Lisa who was overweight and a smoker. She was in debt and had never held a job for longer than a year. Her husband had just announced he was going to divorce her, so she took a spur-of-the-moment trip to Cairo, because she hadn’t yet maxed out her credit cards and had always wanted to see Egypt. One morning on her trip, after feeling helpless about the life she faced back home, she got in a cab and rode by the Pyramids. She decided, as she saw The Sphinx and the Pyramids of Giza, that the only way to change her life was to set a goal to work toward. So she decided to come back to Egypt in a year and trek the desert.
In order to do that, she knew she would have to quit smoking. So she went back to the US, gave up cigarettes, and started jogging. Replacing that one bad habit with a good one led to a series of new habits that changed how she ate, slept, exercised, worked, and organized her day. She eventually started running half marathons, then marathons, then went back to school to get her masters, bought a house, and got engaged. Continue reading “A Year of Good Habits: End of Year Reflections”
After getting up today, for the second day in a row, at 5am (okay, it was 5:09; I pushed the Snooze button once), I’m reminded of why habits are so important in my life. When life gets busy, I can fall back on my habits to help me cope. And life has gotten really busy. We are racing toward the finish line with our to-do list to get ready for our trip to Chile. It feels like every second of my day is booked with something to do.
So getting up at 5am, which I’ve been moderately successful at over the last month, has given me time and space that is unscheduled. I can write, think, make goals for next year, and all that nerdy financial stuff my family rolls their eyes at.
It’s amazing that this is the last month of my A Year of Good Habits year-long experiment within our larger three-year experiment. Focusing on a different habit each month has brought me awareness of how important these rituals are to my short- and long-term happiness. I’ve undertaken eleven habits so far, some for the whole year and some for just a time, but they have all helped me realize how my life has improved by changing my behavior.
I’ve also undertaken a few habits I haven’t written about in my Year of Good Habits, for one reason or another, mainly because I thought they wouldn’t apply to a wider population of readers. I stopped drinking alcohol at the end of June and started intermittent fasting at the beginning of August. I had been having some health problems, and changing what (and how much) I eat and drink has radically changed my health for the better–plus I’ve lost fourteen pounds! The health problems, including my stomach and lower back pain, have virtually disappeared. I’ll write about both topics in future posts, because they’ve contributed to our Three Year Experiment in major ways.
Inspired by Amy at Life Zimplified, I’m going to make it a habit to Continue reading “A Year of Good Habits: Laugh”
My family has launched a three-year endeavor to double our net worth and become location independent. This is the first year of our plan. This year, in an effort to help myself develop good habits to keep us saving and investing, and generally developing efficient uses of our money, time, and energy, I’ve taken on one habit for each month of the year (if you want to read them all, starting from January, click here).
I’m down to the final two months, and two habits, of the year. Some have been successful, some have been abysmal failures; all have taught me something about myself. I learned that making your bed everyday really is a key ingredient to starting the day successfully. I also learned that writing down the top three things I’m going to tackle in a day doesn’t work for me–I tend to plan and think along weekly, rather than daily, lines.
So what habits should I undertake for November and December? Sometimes, getting back to the basics is key, and for November, I decided to resurrect a key habit that brings contentment and completion to my days.
The ThreeYears are reacquainting ourselves with electricity after not having any for several days. A wind storm took out the power for most of the residents in our town, and crews from Maine and Massachusetts usually deployed to help us out during power outages were busy getting lines up in their states. Continue reading “A Year of Good Habits: Get Up at 5am”
We have officially completed the first quarter of the year! We’re calling this year, which is Year One of our family’s plan to reach location independence, the Year of Good Habits. Each month, I focus on improving or developing one new habit. Sometimes the habits are directly related to personal finance and sometimes they’re related to general self-improvement. At the end of each month, I have been continuing the last month’s habit (or trying to) and adding a new habit in. (But, just for totally transparency, I would not recommend starting so many new habits in one year for the average person. This is more an experiment for the blog. In real life, I try to add in one or two new habits a year).
In his book Happier, Dr. Tal Ben-Shahar talks about creating rituals. He takes an idea from The Power of Full Engagement and recommends that “instead of focusing on self-discipline as a key to change,” we should instead develop rituals. Developing rituals involves “defining very precise behaviors and performing them at very specific times, motivated by deeply held values.” For example, brushing your teeth is a ritual and doesn’t take any special self-discipline to complete. Hygiene is a deeply held value for many of us, so brushing our teeth is something we do each day. Making an activity part of your daily life and making it value based, rather than discipline based, is an excellent way to create a lifelong habit. Continue reading “A Year of Good Habits: Quarter Three Update”