Financial Hot Buttons

The other day, Mr. ThreeYear and I were driving the boys to meet my sister and her family at our local bowling alley. It was during the hurricane rains, and we were trying to get everyone out of the house for a bit. Junior ThreeYear innocently mentioned that he was hungry, and Mr. ThreeYear said, “Don’t worry; they have snacks there.” I quickly replied, “I packed snacks for us to eat” and told Mr. ThreeYear, “I’ve budgeted $50 for this outing. I don’t want to go over.” (Bowling at this alley costs like $35 without a coupon and then there were the arcade games!).

Financial Hot Buttons www.thethreeyearexperiment.com

Mr. ThreeYear got very angry and told me that if he wanted to buy snacks at the bowling alley, he would. That I couldn’t nit-pick small purchases like that, and I needed to stop talking about how much we were spending immediately.

Uh-oh. I had inadvertently pushed one of Mr. ThreeYear’s financial hot buttons.

What are hot buttons? Well, seems to me that hot buttons are anything that you say or do that causes someone else to immediately get red hot angry. A hot button reaction is usually not commensurate in strength with the statement or action that precedes it. In other words, someone can say or do something relatively benign, but because those things cause emotional triggers, you’re going to have a big reaction.

We all have hot button issues, and we all respond to them in different ways.

First, Mr. ThreeYear’s hot button.

When he was growing up, Mr. ThreeYear’s family was very poor. He grew up in Pinochet-era Chile, when there was a dictator and curfews each night. The economy was stable but not booming. Chile was solidly in the category of third world countries.

His dad had a job at a bank and then left to work with a colleague. That didn’t pan out, and he had no job, so he opened a small convenience store at the front of their house. My mother-in-law worked as a teacher at the time, but they didn’t have enough money to adequately fund even the basic necessities, like a higher-than-normal electric bill. My mother-in-law washed her dishes in cold water out of necessity, because washing in hot water cost too much. Continue reading “Financial Hot Buttons”

August Net Worth Update

Happy Labor Day! In the US, this is the day that normally signals the true end of summer. School started for our family last week, and my parents are here celebrating the long weekend.

August Net Worth Update www.thethreeyearexperiment.com

The month of August has been awesome. Weather-wise, it’s the worst month of the year in North Carolina, but I keep telling myself that if I can run in this heat and humidity, I’m set because it’ll just get cooler from here on out. We’ve enjoyed the pool, had Junior ThreeYear go to his first-ever overnight camp in New Hampshire, had two sets of visitors (our friends from NH who now live in TX and my parents), and started school. Mr. ThreeYear and I have been walking the boys to the bus stop each morning, along with Lucy, and it’s been so fun to make friends with our neighbors and see our kids off to school each day.

If you’re just joining, our family of four is on a three-year journey to double our net worth and become location independent. Since we’ve achieved the latter goal, we’ll be primarily focused on the former in each of these reports going forward. Each month, I record our progress on our net worth and our spending. Last year, we increased our net worth by 32% over the year before. This year, we’re trying to increase it by more than 65% from where we started in December 2016. Given our move and the market, I’m not sure it’s doable. But we’re going to try. Continue reading “August Net Worth Update”

We Got a 15-Year Mortgage. Here’s Why You Should, Too.

I am a big fan of fifteen-year mortgages. When we bought our first property in Chile, we actually took out a fifteen-year mortgage, and then paid it off a year-and-a-half early last December. But for some reason (money), we did not take out a fifteen-year mortgage with our first house in Atlanta. We did the slick 5% down, 30-year on that house, and lost our shirts with that deal when it was time to sell (well, technically, just our down payment, 4 years’ equity, and $20,000).

We Got a 15-Year Mortgage. Here's Why You Should, Too. www.thethreeyearexperiment.com

Why is a fifteen-year mortgage so great? We can argue all day about paying down debt versus investing (which I’ve done here) and the math behind it. But the truth is, a fifteen-year mortgage only increases your monthly mortgage payment by a little bit and helps you build up equity so much faster than a thirty-year mortgage. Yes, you can take out a thirty-year mortgage and pay it off early. But the beauty of a fifteen-year mortgage is that in fifteen years, it’s paid off, guaranteed. My girl Chief Mom Officer wrote a great post about the same topic with her actual mortgage numbers that I encourage you to read.  Continue reading “We Got a 15-Year Mortgage. Here’s Why You Should, Too.”

Budgeting a Month Ahead

I know there are many people who don’t budget, but for me, it’s been a lifesaver. I am a natural spender, not a saver, so putting artificial boundaries around my money is important. Over the years, I’ve trained myself not to touch some of it, to keep it off limits, and giving myself artificial boundaries around eating out and entertainment has helped us spend less over time.

Budgeting a Month Ahead www.thethreeyearexperiment.com

One thing I’ve never been able to do (and I say “I” because Mr. ThreeYear has pretty bad money anxiety and doesn’t look at the budget) is get a month ahead in our budgeting.

We’ve been budgeting for ten years this month, and it’s the first month I’ve gotten a month ahead in the budget. Previously, I’d budget one paycheck at a time, so I wouldn’t fully find my budget categories at the beginning of the month (I have a habit of throwing any extra money we get into investment accounts). It worked, but I was never budgeting all at once. With budgeting one month ahead, you use this month’s income to fund next month. So you need to have a full month’s income saved, in addition to what you need to pay your bills for the current month.

Part of the reason I never got one month ahead was that I didn’t see the benefit. As long as our budget was working, why fix it? Sure, it was a little awkward to fund our essential expenses and then later fund our nonessential expenses (using our 50/50 budget) but it had worked for years, and we always had investing, saving, or debt payoff goals that seemed more important than getting a month ahead with our budget. Continue reading “Budgeting a Month Ahead”

A Year of Good Food: Easy Meals

Hello from sunny (very, very sunny) North Carolina! Our family has moved and is now living in the charming town of Davidson, North Carolina. We’re enjoying our new air conditioning, as the heat here is intense in July.

A Year of Good Food: Easy Meals www.thethreeyearexperiment.com

This year, our family is challenging ourselves to spend less on food so we can save and travel more. Last year, I adopted one habit a month that would translate into better money moves for our family. You can read all about our A Year of Good Habits here.

That experiment worked so well that we tried a new one this year. In 2018, we are challenging ourselves to do better at our food spending. Last year our family spent over $12,000 in groceries, or $966 per month.

This year, our goal is to spend 20% less on groceries. That may not sound like a lot, but it’s almost $200 per month in food savings. The extra $200 per month is going into a travel savings fund, so we can see the results of our hard work in spending less on food.

We could have adopted a radical goal to keep our spending under $500 or something like that. But we know better. We thought it made much more sense to consistently hit our modest target, month after month, for an entire year, to show ourselves we could do it, than to maybe hit the $500 goal once or twice and then face plant with more $1000+ grocery bills.

And if we consistently hit sub-$772 spending, then perhaps we’ll challenge ourselves next year to shave off more.

Each month, we’re trying out a new way to save money at the grocery store. Last month, we focused on staying in budget while moving houses. We kept our expectations low–I knew I wouldn’t be able to consistently meal plan or regularly grocery shop, so the idea was to do as well as we could despite the chaos.

June

I feel like I’ve been writing the same report for months now, but June felt absolutely crazy-pants chaotic. I had to take it one day at a time. We had the end of school, the boys’ birthdays, the start of a new graduate class for my master’s, good-bye parties, a big work conference Mr. ThreeYear and I both needed to attend the week of the move, plus all the regular packing and moving details involved with a move. We spent $691.78 for the month, well under budget, in nineteen separate trips to the store. We tried to eat up all the food in our fridge this month, but did a lot of eating out as well.

Yard sale-www.thethreeyearexperiment.com
Our spectacularly unsuccessful yard sale in late June (small towns aren’t great for yard sales, we learned).

Continue reading “A Year of Good Food: Easy Meals”

June Net Worth Update

Hi! I missed you last week. First, we had a joint work conference for Mr. ThreeYear, then we spent one day loading the moving truck, then one day cleaning the house, two days traveling from New Hampshire to North Carolina, and one day prepping for our close. By the time you’re reading this, we’ll be homeowners once again, this time in North Carolina.

June Net Worth Update www.thethreeyearexperiment.com

I wanted to blog so much but it wasn’t happening.

I’ve never been so tired. Maybe after having the kids. Definitely after having the kids. But man, this is a close second. Moving is hard. Of course, we know it will be amazing once we get moved in and settled down, but for now, not knowing where my pjs are, or Mr. ThreeYear’s iPad, or pretty much anything, is disconcerting. Throw a mandatory joint work conference, an 8-year-old birthday party, and a graduate class with tons of work into the mix, and I was fried.

Charlotte sign www.thethreeyearexperiment.com
Seeing that sign after two full days in a car felt very good.

Also, yesterday, my sister thought she’d speed up my transition into North Carolina living, by taking me to a yoga class on someone’s back porch in 88 degree weather. Ten minutes into class, there was a puddle of sweat on my mat. And I think (ok, I know!) I belong in the beginner yoga class. These ladies were popping up into headstands on a dime. It’s a really good thing there’s no picture of that.

If you’re just joining, our family of four is on a three-year journey to double our net worth and become location independent. Since we’ve achieved the latter goal, we’ll be primarily focused on the former in each of these reports going forward. Each month, I record our progress on our net worth and our spending. Last year, we increased our net worth by 32% over the year before. This year, we’re trying to increase it by more than 65% from where we started in December 2016. Given the wild ride the market’s likely to take us on this year, I’m not sure it’s doable. But we’re going to try.

This month’s net worth report will be a little strange. It will take into account the (massive) loss of equity in our net worth from the move. We paid for realtors’ fees, closing costs, repairs, the move itself, attorneys’ fees, hotel stays, eating out, and the other myriad costs to move. Was it worth it? 100%! We’re living our dream of location independence (very firmly in one location, but hey, that’s what we want). It is a little hard to write down in black and white, though. Continue reading “June Net Worth Update”

A Year of Good Food: Survive the Move

June is here and with it, summer weather and summer eating! We love the beginning of fresh fruits and vegetables and the lighter meals we tend to eat during the summer months. There’s no air conditioning in most places in New Hampshire, our house included, so keeping our house cool is important. That means limited time using the stove and oven.

A Year of Good Food: Survive the Move www.thethreeyearexperiment.com

This year, our family is challenging ourselves to spend less on food so we can save and travel more. Last year, I adopted one habit a month that would translate into better money moves for our family. You can read all about our A Year of Good Habits here.

That experiment worked so well that we tried a new one this year. In 2018, we are challenging ourselves to do better at our food spending. Last year our family spent over $12,000 in groceries, or $966 per month.

This year, our goal is to spend 20% less on groceries. That may not sound like a lot, but it’s almost $200 per month in food savings. The extra $200 per month is going into a travel savings fund, so we can see the results of our hard work in spending less on food.

We could have adopted a radical goal to keep our spending under $500 or something like that. But we know better. We thought it made much more sense to consistently hit our modest target, month after month, for an entire year, to show ourselves we could do it, than to maybe hit the $500 goal once or twice and then face plant with more $1000+ grocery bills.

And if we consistently hit sub-$772 spending, then perhaps we’ll challenge ourselves next year to shave off more.

Each month, we’re trying out a new way to save money at the grocery store. Last month, we focused on shopping the perimeter of the store only. It meant we ate healthier. You may have read the news that we’re moving at the end of the month. That’s right; our dream of location independence is coming true.

May

Because of the move, there was zero planning for May’s food shopping. We went to the store when we could, didn’t use lists, didn’t meal plan, and generally just pieced our meals together as best we could. Despite the chaos, I’m happy to report that we spent $775.95 in May. Yes, I know that figure goes over our budget, but it only goes over $3.95, and believe me, we were spending left and right with no plan. Our house was on the market and we sold it this month. Plus, we had one visitor during the month of May and took two quick weekend trips, meaning our routine was even further skewed. So the fact that we were able to keep the spending down even while not really thinking about it makes me feel like we’re changing our underlying spending habits around groceries.

Continue reading “A Year of Good Food: Survive the Move”

What Our Cars Really Cost

On Wednesday I wrote a post about all of the cars Mr. ThreeYear and I have owned in our time together (it was actually about most of the cars we’ve owned. There were a lot!).

What Our Cars Really Cost

Today I thought I’d delve into the financials of those cars, or as much as I can remember and piece together, and see what the total operational costs of our cars have been over time.

I predict that I will be shocked and disgusted by how much we’ve spent on transportation. A keystone to Mr. Money Mustache’s low spending is his reliance on bikes. Operating cars is one of the big three expenses that we’ve worked on reducing. But I suspect we’ve still spent a lot.

Let’s dive in: Continue reading “What Our Cars Really Cost”

I Spend a Lot. So How Do I Save?

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I have always loved to spend money. Over the years, I’ve had to teach myself to save despite my spendthrift ways. It’s been a lot of trial and error and sometimes I do better than others.

This month, with the advent of Spring after such a long, harsh winter, my inner Spendthrift has broken free.

I Spend a Lot. So How Do I Save? www.thethreeyearexperiment.com

Some people, Mr. ThreeYear included, can’t understand this behavior. He grew up in a household where frugality wasn’t just a good idea, it was a way of life. Spend too much on electricity? Not enough for food. It was kind of that simple. So he grew up with such anxiety around spending that it’s hard for him to spend now, even when he wants to.

I had no such constraints. I have found that especially during times of upheaval, or during season changes, or Christmas, my impulse is to spend more. What does that look like?

  • Not being as careful at the grocery store. Buying without having a meal plan or list.
  • Buying clothes I don’t need
  • Going out to eat because I don’t feel like cooking
  • Making a convenient choice rather than the slightly-more-difficult-but-much-cheaper choice
  • Impulse travel

Continue reading “I Spend a Lot. So How Do I Save?”

April Net Worth Update

Happy May! How are things going for you? We finally have no snow on the ground as of yesterday, and that is not an exaggeration. Winter definitely held on as long as it’s ever held on this year, which is my eighth winter in New Hampshire. For the past seven winters, we’ve had all snow melted by April 23rd (even if we’ve gotten a freak snow storm in May afterwards) but this year, we had snow cover for a whole extra week (lucky us!).

April Net Worth Update www.thethreeyearexperiment.com

We did get some beautiful 70-degree days at the tail end of this month, which made everything feel hopeful and Springy. Our crocuses have bloomed (all 2 of them) and our daffodils are pushing up, as well as our alliums and the dahlias. We spent this month doing a variety of activities, some of which I’ll be revealing down the road (hint hint!). It’s been a busy month. Over Spring Break, Mr. ThreeYear and I took a fun trip to Portland, Oregon, while my mom flew up from sunny South Carolina to watch the boys. She had horrible snowy, icy, weather, so we appreciate her sacrifice even more!

If you’re just joining, our family of four is on a three-year journey to double our net worth and become location independent. Each month, I record our progress on our net worth and our spending. Last year, we increased our net worth by 32% over the year before. This year, we’re trying to increase it by more than 65% from where we started in December 2016. Given the wild ride the market’s likely to take us on this year, I’m not sure it’s doable. But we’re going to try.

Last month, even though we enjoyed more lackluster results from the stock market, we got a huge jump in net worth since Mr. ThreeYear’s annual stock gift was given out. Each December, his privately-owned company, which is 100% employee-owned, invites outside auditors to set the stock price. Given the wild surge the stock prices took in December, his company’s stock was given a much higher valuation than the year before. That meant all of the stock we currently hold in the company rose substantially, and we received more stock (valued at more money).

Continue reading “April Net Worth Update”