How do you live?

[Pablo]

We bought the cheapest house in the hood.

We live in a relatively safe area.

We buy decent cars new.

We keep cars forever.

We spend a lot of money for good groceries.

We eat well and stay healthy.

I work my arse off, I have a lot of stress. I have two businesses now, plus a regular job.

My wife doesn't have to work.

I save over 25% of my income.

I was stupid when I started my 401K years ago, in that I thought 6-8% savings was good enough.

One kid kicked out of the house.

Other kid writes book reports for fun during the summer.

Two dogs, one cat, one g. pig

Lawn a bit unkempt

Need to read my IBD and sign off now.

 

[VeeDubb]

Exactly. It was more curiosity than offense. Fowway you are very unusual so excuse me for not taking it at face value. This is the Internet after all. But more power to you that you are able to pull it off. I wish more people can do what you do and I mean that sincerely.

 

[FowVay]

Well, looking at things from a distance I can see how it appears like a affluent lifestyle. It really is not. The money I earn on my savings (about $550 a month) pays nearly all of my utility bills. I do work for a airline so my round trip first class seats to Munich cost me only $93 dollars for both myself and my wife (these are landing fees that my company has to pay to the airports). I generally get a favorable rate on all of the hotels I stay at but I only splurge about five times a year. This doesn't happen on a weekly basis but I have lived a incredible life.

I try to make wise decisions. I bought my wife a simple and basic 3 series BMW new in 1999. She still drives it and we will own it for five more years before we buy a new one. My VW Jetta is a 2009 model and was only purchased because my previous TDI Golf was totalled in a crash. I walked in, negotiated the price and wrote the check for $22,000. I won't have to do it again for five more years hopefully (to get my wife a new car). When the time comes I won't bat a eye at writing another check. It's just that simple.

I know I could save more and invest more wisely and squeeze every penny for investments but honestly I believe that staying away from the greed-driven decisions is what has allowed me to prosper. When all of my buddys were selling houses every year and cashing out their equity I was just stuffing money in the bank. Today their houses are worth half of what they paid for them and they still owe 25 years on the mortgage. I'm paid for, have a emergency fund, have a nice retirement portfolio which I hope to double before I need it at age 65, and I am thankful for every opportunity I've ever had. Could I have a fancier house? Sure. But I don't want one. I am a simple blue-collar worker married to a grocery store clerk. I've been at my company for 20 years and my wife has been at the grocery store for 22 years. Together we earn a very comfortable middle-class wage. I fear that the media in this country has led people to believe that unless you hit the lottery or inherit a fortune that you're doomed to live in poverty. This just isn't true. Hard work, sweat, and a strong mind will still prove that this country is the land of opportunity. Too many folks think they're fighting a losing battle. It's just not so. Unfortunately too many people start out in debt and it's tough to get out once you're burried. The key is to never get into it. I went into the service with thousands of dollars worth of savings bonds that I bought with my lawn mowing money. Four years in the Army gave me the chance to save about $15,000 more. When I left the Army I was looking at a $35,000 G.I.Bill asset which I used to put myself through school so I could get my job. I was recruited from my school and I moved to Atlanta without a single penny in education loans thanks to the Army. The first thing I did at my new job was to re-enroll in a avionics program at a local community college where my company paid the full tuition and I was still able to draw $845 each month from my remainder of my G.I. Bill money. This was a very nice tax-free second income which I just stuffed in the bank. I lived in a apartment for nearly two years in which time I had my house built for me. By the time the house was ready I had the cash to buy it. Sure,, I was absolutely broke after that purchase and I lived out of a ice chest and had to buy ice from the convenience store for a month before I could afford to get a refrigerator,, but I loved it,, and it was mine!!!

It's doable.. you just have to do it.

 

[robshelton]

Wow FovWay, 3k/month to invest? That's great! I've never made that much to begin with! Makes me feel like the pee-on I am! Ha Ha Haven't had a steady check for the past 5 years and spent my savings trying to pay for health insurance...I didn't feel broke till now...At least I still have a small investment account and left over 401k; like everyone else both are now valued about 50% of what they were.

I used to think I was doing well investing 20% pretax and 20% post tax but I was making about 20k back then. Seems those were the good old days! Tight times, but at least I had a position, low as it was. I'm 43 and would take a 25k job with health insurance if I could find one. BTW, put myself thru college 3.6+ gpa. If you are wondering, I had a bad auto accident when I was 18 and got convicted of Involuntary Manslaughter - Felony and that has eliminated many chances for good jobs. I've had several good career positions offered and retracted upon discovery of that. Including the USAF that wanted me to work on jets. Didn't go for the A&P but probably should have. Maybe things would have been different.

But back to the frugality idea. I like being frugal but I do spend when I feel it's the right thing to do. We seldom cook and go out to eat frequently at reasonable restaurants where we over-tip by a couple of bucks. That's pretty much the limit of my spending these days.

 

[FowVay]

I think I'm just a very blessed person. Even when I was a high school kid working in a motorcycle shop earing $3.35 per hour I was able to save money. I remember my first ever investment other than my blue chip passbook savings acct. Commercial Credit was offering a Certificate of Deposit paying 18% interest (this was 1980 remember). I had a few thousand dollars so I took it down and got my first CD. I could have gotten that dirt bike I liked,, but heck, the shop owner let me use any of the used bikes I wanted so it really didn't matter. I could have gotten a fancy stereo for my car,, but my $69 Clarion sounded fine to me. My first car was a 1980 VW Scirocco S,,, quite possibly the coolest car at my high school. Of course,, I never had to worry about wasting my money on girls.. I didn't have much luck in that department,, haha.

Sorry,, i've carried this thread wayyy off topic. Good night guys!

 

[L_Sludger]

I live in Southern California (one of the most expensive places in the world) and make less than $25,000 per year. You can figure out the rest. I have to live very cheaply.

 

[L_Sludger]

Originally Posted By: FowVay

I work as a mechanic for a airline.

... most likely not a GSE mechanic, LOL. Enjoy those travel bennies while Anderson allows it.

I had a great time visiting Munchen. A drive through the countryside to Prahahaha was also amazing. You should try it!

 

[crinkles]

I'm 28, no debt whatsoever, and savings of about a year's income, and have had 3 kids in the last 4 years. I rent though.

 

[Patman]

We are finally at the point now where we are able to keep up with our bills without outside help (my parents gave us a lot of money to keep us afloat over the past ten years) but it has been a struggle. Admittedly we spent money frivolously for a while (spending $70 or $80 per week going out to dinner every Saturday night for instance) but when I got laid off from my $54,000 a year job in February 2009 it was a huge wake up call. I was lucky to get six months severance pay, and I ended up being off work for six months as well. But during that time we cut back on all of our excess spending. So even though I only make $16 per hour now, we're making that money go further than when I made $54k per year. I guess the saying is true, the more you make the more you spend!

I guess I should also mention that two other things helped us out big time, one was winning almost $7000 in a contest this April (we put the entire amount to pay down our $39,000 line of credit!) and the second thing was my stepson turning 18 and finishing high school (and moving back with us from his dad's) so we no longer pay the $300/mo child support anymore.

Now moving forward, as we get raises, we'll be able to put even more towards paying off our line of credit faster, and once that is done then we'll be able to pay more towards our mortgage and hopefully it'll be paid off much sooner than the current 13 years left on it. Of course this long term plan is all assuming that my wife doesn't leave me, if that happens we'll have to sell the house and we'll end up with enough cash to pay off all our debts but we'll only walk away with maybe $10-15k each, we'll both be debt free, but with almost no chance of ever being able to own our own home ever again.

 

[Schmoe]

Fow....don't apologize for JACK!!! Your doing well, and that's great. If you read my post on the first page, when the wife was working, we were racking in well over 100K a year, that's how I got all that stuff I mentioned paid off. Our income got cut about 35%, but we still have the vehicles below, nice house and still keep our "toys." We're working at getting back to where we were before she got laid off and then we're going to be doing stuff. My daughter wants to go to disneyland, wife wants a kitchen remodel, we need a new home AC, we also want to put in a swimming pool in the backyard. Believe me, when we get back to making some money, it's going to happen and I ain't looking back!

 

[Kestas]

My whole life, I've always spent less than I have. I've never lived month-to-month. Not even as a student.

My house is paid off. It has a two-car garage where I can work on my cars and save even more money.

I have no debt.

My cars are old. The newest one is my 95 Mercedes E320.

I do all my own house repair. I even redid the roof myself. The exercise was a side benefit. The only thing I ever contracted was $6000 to have someone dig down 14 feet in my backyard to replace 75 feet of drain.

I'm also lucky enough to still have a good-paying job.

 

[SteveSRT8]

we have faced significant shrinkage in our combined income. This has led to fewer nights out and reduced spending.

But the only debt we have ever allowed was House debt. We own all our vehicles free and clear, and have no credit card balances we do not pay off as received.

Things will come back in my biz, they always do. Just have to be patient.

 

[IndyIan]

Patman, I bet your car stands out on the lot at work, I imagine cars like mine are more common there.

FowVay, you have had a very good career path, and have made the most of it. I probably should have done something similar, I got a B.S. in geography and got a GIS job right after graduating but its all office work, pays OK for my area, but GIS eventually turns into database and programming work which I don't really care for.

Back on topic, we live pretty well with 2 incomes and try to avoid or minimize monthly costs as much as possible. So no cell phones, basic $28/month satellite tv, try to keep the hydro bill down with no AC or central heating(I like doing firewood, no gym membership!). We rarely eat out as my wife enjoys cooking, and to get something that would be as good is $30-40+ each...
Right now insurance of all types and property taxes seem to be the most annoying bills we can't get rid of. 2 cheap cars, 1 modest house, 1 old slow snowmobile, and 1 old slow atv, seems to add up to way too much. And property tax is increasing at about 10%/year for us... We really need to get farm status to slash property taxes to 1/4 of what we pay now.
We have no credit card debt, and we should have the house/land paid off in 5 years which will be nice. We had our house partially built for us and we are doing alot of it ourselves which really helped avoid the big mortgage trap. In some places its unavoidable with middle class incomes but here its was very optional by building a modest home.

 

[Drew99GT]

Originally Posted By: robshelton

I'd like to quote a wealthy friend of mine who lives in a 1920's $45k home..."Don't let anyone kid you, I got it by not spending it."


Darn straight! That is how most long term upper middle class people get that way towards retirement.

I'm with most of ya'll - actually, I problem am more frugal then most. I simply don't spend money unless I have to. PERIOD. Well, I do splurge and spend on the few activities and hobbies that make me happy, but luckily they don't require too much expense.

I bought a flipped house fairly cheap and am working my tail to pay it off. I save roughly 30% of my income and I really don't make that much money compared to most of you guys. However, barring a complete economic breakdown, I hope to have a wad of savings when I get into my 60s.

I drive a 1994 Corolla, my computer is a beat up 2002 model Dell, my TV is about 15 years old, my cell phone is 5 years old etc. etc. etc. HAAA, I don't even have a DVD player or a stereo. I cook a lot on my own. Got most of my furniture from a thrift store.

What I don't understand is why the people I know ALWAYS go out and buy the newest and greatest useless piece of [censored] electronic gizmos and furniture on credit. Guy I know has well over a hundred grand in credit card debt from doing that and no way to pay it off and is just now starting to worry about it. He's been more concerned when the ladies walk into his house that is nicely furnished and a prime example of the neo-American lifestyle and dream. What is is, is an illusion. I keep telling him sell it all - get rid of it - he couldn't afford to take one of his lady friends on a road trip across Kansas.

 

[Patman]

Originally Posted By: IndyIan
Patman, I bet your car stands out on the lot at work, I imagine cars like mine are more common there.



It definitely stands out! Even the owners of the company don't have fancy cars like this, although they do drive expensive trucks though (like the brand new fully loaded King Ranch Edition F150 one of the owners has) Even though my car has 118k on it and is 12 years old, it looks a lot newer, people don't realize that most of the brand new econoboxes in the lot actually cost more than my Corvette is worth now (I paid $33,000 for it back in 2004, but if I were to put it on the used car market here right now it would only fetch about $15,000).

But I'm very good friends with just about everyone at work, I have no enemies, and nobody seems to resent the fact that I have such a nice car. Most of them know my situation, that I made more money before coming to this place otherwise I never would've been able to afford this car and my townhouse.

I know I could save a lot of money every month if I sold this car and bought something better on gas, but to me it's worth the extra cost.

 

[IndyIan]

Originally Posted By: Patman
Originally Posted By: IndyIan
Patman, I bet your car stands out on the lot at work, I imagine cars like mine are more common there.



It definitely stands out! Even the owners of the company don't have fancy cars like this, although they do drive expensive trucks though (like the brand new fully loaded King Ranch Edition F150 one of the owners has) Even though my car has 118k on it and is 12 years old, it looks a lot newer, people don't realize that most of the brand new econoboxes in the lot actually cost more than my Corvette is worth now (I paid $33,000 for it back in 2004, but if I were to put it on the used car market here right now it would only fetch about $15,000).

But I'm very good friends with just about everyone at work, I have no enemies, and nobody seems to resent the fact that I have such a nice car. Most of them know my situation, that I made more money before coming to this place otherwise I never would've been able to afford this car and my townhouse.

I know I could save a lot of money every month if I sold this car and bought something better on gas, but to me it's worth the extra cost.

Do you do alot of work on it yourself? Finding someone who knows what they are doing and still charges a reasonable rate must be a bit of a challenge. I guess an econobox would save you some money but if your car isn't getting 20mpg, I doubt a corolla or civic would get much over 30mpg on the same drive. My commute costs me between $5-6 a day on gas at 35-38mpg so getting something with better mileage would save some money but the car would have to be very cheap to pay off in gas savings.

 

[VNTS]

I dont doubt you, only question I have is where did you live prior to buying your house cash, ie when you were saving for it.

I live like you, pay cash for everything and dont pi$$ away your paycheck on stupid frivelous [censored]. I bag my lunch, pay cash for my cars, I have 7 cars, dont get suckered on the lastest stupid gadget, I have a cell phone but my work pays for it and I rarely use it, have cheap DSL 18$ a month, basic cable. Paid off the house 3 years ago and have the 401K's cranking and large cash position.

It helps that I do most everything myseld including 90% of the car maintenance, house repairs etc. I rarely take a vacation and when I have time off I stay home and do some local day trips.

I compare myself and wife to my in laws who over the last 20 years have dug themselves a nice pile of debt. My BIL owes 400K on mortgages but he has two homes and takes lots of vactions. I would too since I would be so stressed. It is really nice being debt free. It is funny listening to them talk about all the [censored] they but and all the credit card debt. THeir kids are useless and lazy and rude. Go to holiday and spend all the time texting their friends [censored]?
I dont have kids but the cell phone would get the heave ho.


Originally Posted By: FowVay
haha,, Wow.. all of this doubting. It's all really quite simple and has been stated on this thread numerous times. You simply live within your means.

Here's exactly how I do it:

Stick $1500 per pay check into my money market acct. I get paid twice a month so that's only $3,000 per month savings. Over the years it adds up.

I live very efficiently. I DO turn off the lights when I leave a room. I NEVER leave a TV set on if nobody is using it. I keep the A/C set up in summer and low in winter to save energy.

I pay ZERO in interest to anyone. This is huge.

And finally,, I have no children.

But I have to admit that I'm quite disappointed in the responses from you guys. You all preach the 'live within your means' dialog but when you meet someone who has done this their whole life you act offended and distrusting. Do the simple math.. saving $30,000 per year for 10 years gives you a nice savings. Investing your $15,000 per year ($30,000 per year total including wife in 401k) over the years adds up.

Every person I know dribbles out countless thousands of dollars a year on expenditures they have nothing to show for. One hundred fifty for phone and internet each month, $200 for all the cable stations, spending the extra five on a mocha java latte late night... it goes on and on.

I probably should have not even commented in this thread. When I mentioned renting the Porsche on my last trip to Germany I was scoffed at. When I mentioned driving Stelvio pass in Italy I was literally called a liar on here. It was my mistake to think a group of adult men could understand the rewards of hard work in a world that caters to the FICO score and the good old debt payment.

Sorry,, I'd delete my previous comment if I could. I didn't mean to offend you all. Just let me share this bit of knowledge for those who think financial freedom is out of their reach: $250,000 dollars is a lot of money if you don't have it. It really isn't much if you do.

And just to verify, I am 46 years old, been married for nearly 20 of those.

 

[Patman]

Originally Posted By: IndyIan
Do you do alot of work on it yourself? Finding someone who knows what they are doing and still charges a reasonable rate must be a bit of a challenge. I guess an econobox would save you some money but if your car isn't getting 20mpg, I doubt a corolla or civic would get much over 30mpg on the same drive. My commute costs me between $5-6 a day on gas at 35-38mpg so getting something with better mileage would save some money but the car would have to be very cheap to pay off in gas savings.

Believe it or not the Corvette has been very reliable, not needing very much work at all in the past six years I've owned it. I do have a mechanic that is very reasonable, for instance when the starter went on me a few months ago it only cost me $250 (parts and labor!) I try to do as much myself as I can, such as oil changes, spark plug changes, etc. The battery died on me last week but I changed it myself. So I can do the simple stuff.

The Corvette does get pretty decent gas mileage, around 21 MPG in my 40 mile round trip to work. If I were to drive my wife's 2000 Civic on that same commute it gets about 30. But it also doesn't need premium fuel. Up here, premium is 14 cents per liter higher, so it adds up fast.

 

[bigmike]

I'm married. Our bills include: Electric, Water/Sewage, Mortgage+Ins, Auto Ins, and 1 car payment. We don't owe any other money.

I do without Internet access, cable/satellite, landline phones, and several other "OMG" amenities.

OMG amenities are things that, when told to someone else, they say "Oh my God, you don't have [insert amenity here]!?"

We debate over spending $1.07 for a DVD rental. My wife came from a frugal home so she appreciates pretty much anything I do for her (or purchase). I watched my parents blow through money and they still can't figure out finances. I guess that's why I ended up on the opposite side of the spectrum.

I want to say this. I believe most people that excessively spend money and have little savings, knowing they have children and other heirs, are somewhat selfish. Personally, I want to leave money and other assets to my children. I don't want them to grow up poor like I did, but I do want them to understand how to handle their finances responsibly. Sometimes I think it takes someone with this outlook to change the trend of generational monetary decline.

Most of the posts here are sensible and are of sound advice. Consider the "later" and not the "now." It would be wise of some of the younger crowd to take this wisdom and run with it.

 

[demarpaint]

I live well within my means, have perfect credit, and no debt to speak of. It is all helping in these tough times.

I've lived by this simple rule and it helped. "If I can't afford it I don't buy it". Pretty simple actually and if more people thought that way they wouldn't be a financial mess. Credit card companies and banks hate me.