Dear Friends & Neighbors,

Frugality (photographed by Hanspeter Klasser, presented by Windermere Sun)

Money Tin (photographed by m s, presented by Windermere Sun)

Recycle (by michael lorenzo, presented by Windermere Sun)

Solarpower if beautiful (photographed by Johan Bolhuis, presented by Windermere Sun)

bicycle, bike more often (photographed by Dora Mitsonia, presented by Windermere Sun)

Saving money by compact flouresent bulb (photographed by Claudio Jule, presented by Windermere Sun)

bike with flower (photographed by Nat Arnatt, presented by Windermere Sun)

(Please click on red links & note magenta)

I overheard an interesting conversation the other night at a coffee shop. Apparently two high school buddies reunited after 20+ years of  being apart. “A” dressed in expensive designer clothes with a BMW but looked  older and heavier than B while “B” was in T-shirt and jeans, parked his bike right outside of the coffee shop. The discussion followed inspired me to write this post, hoping to inspire others to understand and appreciate Frugality May Lead To Earlier Financial Freedom.

As it turned out, A and B were of the same age, with similar background and graduated from the same high school the same year and both with one child. Apparently A has been in a high paying profession with 6 figure income while B’s profession has been making $40,000-$70,000 during his career of 20+ years.  But upon their meeting, B is contemplating retirement and world travel while A is still seriously in debt. How did this happen….you might wonder. Well, this is how:

I. Think of choosing profession or education as a form of investment: A’s profession required many more years of training, education, and tuition, leading to much more debt before A even began earning anything. With much of the requirements for licensing, there was no guarantee during the training period whether A’s investment would pay off. Compounded by compound interest effect, when A actually began working in the field, A was already carrying more than a third of $million in debt. Those training period must have been stressful years and it showed. B on the other hand, started working in his chosen field right after graduating with a bachelor degree, without any debt because he worked part-time throughout his teenage and college years, with full time jobs during summers. His demeanor was much more relaxed and jovial.

II. Avoid Debt: Fundamentally, A and B have very different way  of managing their lives. Soon after A completed the training and started working in the field, he purchased a nice house and car and continued to upgrade these big ticket items every 4-5 years, every time carrying a mortgage higher than the one before. His justification: his salary was on an upward trajectory and he should be seen with “nicer stuff” in order to be able to be presentable among his peers. Keep in mind that he still has not finished paying off his more than a third of million dollars debt. B, on the other hand, rented for about a decade after graduating and working in his field. He had purposely delayed purchasing a car, using mostly his bike and legs, choosing to live near his job. He bought his first car with cash when his wife was pregnant with their baby. His first house was a Tiny House that saved a bundle. He upgraded to a normal size house after his child is grown and only after he was able to purchase the house with cash. So he has always been mortgage free and debt free. Loans and debts have interests associated with them. Often time delaying purchasing these big ticket items would help to save a great deal in the long run, if one considers the impact of compound interest effect.

III. Frugality is more likely to be generated from a less stressful life: since B has a less time pressure job, he has developed a lot of habits over the years that are both healthy and money-saving:

• biking or walking to work instead of driving-conserving on fuel cost, auto insurance or maintenance cost or gym membership cost
• owning a deep freezer and buying meat in bulk and slicing the ham himself-this dramatically reduced the cost of purchase. Consider eating less meat.
• optimizing the use of Amazon-with a $90 annual prime membership fee, one can obtain free shipping for items to be delivered within 2 days (same day service is also available with additional charge). B has been purchasing bulky items such as toilet paper or heavy items such as can goods and even the over-the-counter meds via Amazon, saving much on fuel or time cost.
• picking your own food-during growing seasons, B’s family would have outings at local farms that allow B’s family  to pick their own food/produce to help reduce the cost of produce. Check out this pickyourown.org for some of your local farms.
• avoiding late fees-B’s family has a second bank account for their bills. They’d have their bills paid asap to avoid any expensive late fees.
• eating at home more often to save more-check out this 100 frugal meal ideas from FrugalityGal . Eating healthily and avoiding junk food all together also helps to save money. They also brown bag it to work.
• when eating out, look for saving opportunities-check many tips in this post.
• switching to solar-B’s family has switched to using solar panels to heat their home and energy use, saving tremendously.
• observing home energy efficiency/saving measures–Tips From Alliance To Save Energy
• recycling items around the house-clothing or items no longer in use around the house were taken to local resale stores, online resale stores, or local Salvation Army. They would also prefer purchasing used item if available.
• low cost family entertainments-there are many ways to obtain family fun, without spending an arm or an leg: from free movies and concerts in the parks, various festivals with no admission charge, or movie rental from local libraries, to free museum days, or an afternoon of fishing or picking blueberries and strawberries at a local farm
• online continuing education opportunities-B’s family take advantage of much of the online educational platforms such as coursera.org (where free courses are taught by , free Stanford online courses, free Harvard online courses, free MIT online courses,  or low cost udemy online courses, etc.
• less costly entertainment-check out Netflix or Hulu instead of using Cable.
• owning fewer and smaller and electric car(s)-B’s family only owns one car mainly for emergency purpose or family outing. Although both he and his wife worked, they would use one car and bike or walk and uber/lyft to avoid the cost of owning two car.
• avoiding impulse purchase-B’s family would routinely shop with a list.
• avoid bad habits-B’s family members do not drink, smoke cigarettes, or eat much sweets.
• decrease magazine subscriptions-seriously reconsider and check if comparable free online sources would be available.
• consider telecommute to work-this would definitely save on time, fuel cost, and even clothing expenditure.
• DIY (do it yourself projects)-this may come in the form of gifts for family and friends during holidays, yard work, or cutting hair for a family member.

In essence, B’s family had been operating on a state of mind that is mindful with careful planning.

If you have any other tips on living on less, please feel free to share with us via [email protected] . I promise I will periodically update the list above.

Remember, it is not how much one makes but how much one saves will ultimately determine how soon one would be truly able to obtain that financial freedom.

Any comments, suggestions, concerns regarding this post will be welcomed at [email protected]

We Need Fair Value of Solar

~Let’s Help One Another~

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