This post may contain affiliate links at no additional cost to you.
I’ve honestly wondered about this. Let’s do the whole math and find out!
Our brand of frugality is pretty typical (to a little extra strength) in the accumulation phase. My general belief is if you optimize and cultivated self-introspection so that your inner lives and inner mind are rich then whatever is on the outside matters less and less. I have always tried to pride myself on trying to be resilient and that’s because I cultivated within because my reality was bleak for a long time. If you grew up like me then you will understand that one of the “perks” of that is learning how to entertain yourself and developing a very rich inner life by closing your eyes.
Related: What The Hell Are Deep Life Goals?
The rainbow bridge of frugality varies a lot to different degrees. Our brand works for us but not for others, and there ain’t nothing wrong with that.
Not everyone is going to understand saving or intentional frugality because a good sum of people grew up accustomed to the middle-class comfort and set that as a baseline.
Being foreign-born, I was put in a different reality. It kind of reminds me of that saying, “What is normal for the spider, is chaos for the fly.”
Our Brand of Frugality
How we live our life is what I define as our brand of frugality, everyone has their own because everyone has their own comfort zone.
For us specifically, you can check out all of our monthly budget expense and financial report here.
They say a penny saved is a penny earned, but so is a penny not spent. Then the other saying…” saving a dollar is worth more than a dollar earned.”
’cause eeek, TAXES! Especially if you’re higher on the income totem pole.
So I went back and did the rough AGI figures too which is about overall 25% for us. That represents the more realistic numbers I’m going to summarize. It is absolutely necessary to calculate the pre-tax number because…dude, there is no way anyone could fully escape the Tax Man.
Not sure if Slender Man is scarier or the Tax Man?
…well, one of them we know is definitely real so… 🙂
Moving onto the numbers, I went fairly conservative with my figures. I’m thinking of a good to fair case scenario using the national averages of what I can find.
Notice the first 3 highest and most flexible expenses are housing, transportation, and food. We are going to do the top down budget route!
Highest expenses first and smaller expenses for dessert, now let’s start hacking!
Our mortgage, home insurance, and extra utilities come in at about $25,000 a year. Since we host on Airbnb full-time that means we technically live for free and earn some extra money along the way too. Because we make a surplus on Airbnb from just long-term rentals, conservatively we are making more profit and covering more than mortgage etc. Like about $34,000 is the projection. That’s the most likely estimate I’m getting this year so far. But let’s just use $23,000 for simplicity sake and work from there. As a business owner with tax perks but also more taxes because I’m covering for my own FICA, SSI etc. It gets confusing fast.
It’s not all about the money, of course, we met some really cool people who love animals and Grace (our fearful dog) is much better with people now than being scared to death of them before from her crappy puppyhood.
One lovely multi-level house in picturesque Seattle pimped out to some of the friendliest people I’ve ever met from all around this blue planet:
Amount Saved = $23,000
Amount Needed to Earn = $28,750
We don’t own a car.
My husband gets free public transit subsidies from his employer so it currently cost him zero dollars to go to work. He doesn’t have to sit in rush hour traffic and instead he’s using that time to read about the FX market or taking a nap.
There are 2 rental car companies within a 15-minute walk from our house which gives us ample wiggle room to choose from when we do need a car for a day trip. We pay a one-time $50 fee when we need it once a month. Everything else we need is nearby within walkable distance.
Every time I tell strangers that most people think it’s because we’re ultimately broke.
Pffft hahaha, hiding ‘broke’ in America is probably the easiest thing to do right now. People don’t see how damn cheap credit is these days. I’ve consistently wondered how banks keep giving people credit so irresponsibly.
No sweat off me, I’m not anyone’s financial fairy godmother.
I digress, I’ve done the car math ten times over. Too bad not enough people do! If we get a car “justifiable” to our income then we can get an electric car like Tesla for $90,000 that is cheaper to run and lower maintenance too.
But then there is also Washington’s high auto tax for luxury purchases like Tesla. Property and auto tax is pretty high in Washington because we don’t have state tax so our property and auto make up for it.
OH, then there’s parking!! Parking space is essentially an empty space of ground with 2 adjacent verticle lines…it’s highly coveted for off-shooting reasons. Finding parking close by work is preferred because it’s safer from the break-ins that are becoming more common as you move away from clustered parking centers. That comes with an optional price tag of about $200 a month.
Then there’s the question if I needed a car myself too…is it fair that hubby gets one and I’m sitting at home with nothing but all the liabilities of pets and an elderly person? What if there was a medical emergency with my dog or my dad?
But let’s say we’re frugal even when it comes to cars and buy just one used second-hand car. Include the purchase cost of a single, used, cheap, smaller sedan gasoline car in Seattle will cost us $600+ a month for 60 months going fair on the maintenance factor, not too $$$ car, and getting the cheap gas at Costco.
The scenario of one single cheap used car with a $200 monthly parking permit and lukewarm insurance bundled with the home because that’s how they like to sell to the masses:
Amount Saved = $9,600
Amount Needed to Earn = $12,000
Hahaha, work in progress. Dining out is not something I’m uber frugal about when I know it’s possible to live off $300 and not dine out very much if at all. Groceries we have nailed under $200 but that’s because we have a biggggg budget for dining out.
Unlike many other things, I can understand how to rack up $1,000 in monthly dining out. We’ve probably done it before in our Pre-FIRE days. Sushi $65, three times a week and some pho here and chicken fried steak there…and poof the budgets gone.
If we were instructed to spend without revealing any price tags attached, trust you and me, I can pig out to double that very easily if you just let me unhinge my jaws.
Our dining out bill averages $350 a month which is not super frugal. We can make an effort to NOT dine out at all (ie. that month we lived on $300) except we don’t because it’s not worth it. The redeemable thing is we are financially sound.
I’ve made that decision before and I still stand by it fully understanding this: food is probably the biggest expense with zero possibility for future returns.
If you splurged on a nice big house in an expensive neighborhood, at least home prices pace up equally which means you’re getting some of your money back especially you owned it long enough.
If you let me free range dine out, the only thing I can turn that money into a trip is a trip to the bathroom 😀
(Fun fact, my friend Soapy and I held a chicken nugget competitive eating contest last year in front of some of her friends. We each purchased 120 nuggets each and I ate about 60 to 70 nuggets. I don’t remember her count but I naturally killed her. Even her mom told her to never doubt a skinny bitch when it comes to eating a conspicuous amount of food.)
My guilty-food wish is to spend $1,000 a month on eating out someday. Maybe in the richest phrases of fat fire… In August, we spend about $350 on dining out so we’re “saving” $650.
I do feel a little bad about that…that’s me with self-control frugal brothers and sisters. Our grocery bill was under $200 because it was all spent on dining out haha.
I maintain eating out as the hobby…I wonder if I can talk my husband into setting tacos into entertainment…
Frugally I’m trying, seriously this is me trying, this could get a lot worse, don’t even doubt me for one single second I can eat circles around your humanly fragile appetites:
Amount Saved = $7,800
Amount Needed to Earn = $9,750
Aha! My entire life prepared me for a low budget in finding the best frugal entertainments. All of my fun is obscure and related to Project A of course 😉
After a lifetime of no money, you find very odd, unconventional obsessions…is what I’ve come to notice hah.
The average American family entertainment budget is $2,482 annually which is about $200 a month. I’m surprised it’s not more…the cable packages are pretty pricey at $100 per month for my in-law family, as I recall.
We came through with a lot of entertainment surpluses last year. In total, we spent $837 for 2017’s budgeted annual compared to an average American family at $2,482. That means we retained a $1,645 savings.
(P.S. Download Google opinion rewards so your survey credits can apply to buy whatever you want in the Google Play Store for free. That’s how we get shows, movies, books, and audiobooks in addition to the local library we use.)
If you have an odd personality, you don’t need to seek the outside world for entertainment because you KNOW you’re a true freak and not much the normies do interests you 😉 AMEN
Amount Saved = $1,645
Amount Needed to Earn = $2,056
Dealing with just internet and phone here. Targeting the smaller size expenses now might not be as worth it as the big three above (food, house, transportation) but it’s about being selective with what matters for the least effort.
My husband work often enough that he qualified have a huge portion of our $60 monthly home Internet bill waived. For simplicity, we just consider it paid for. His phone and plan are provided by work if he promises to use it for work (which he does.)
We ignored switching our phone plan out of laziness and only started last month on a lower plan.
The normal individual’s cell phone bill is $71 per month which jumped from 2009 averages. I was paying $35 for my plan which I thought was good…nope. I ignored switching our phone plan out of laziness and only started last month on a lower plan. Going forward my plan will be ⅓ of my AT&T charge with Red Pocket. Overall, it is a $20 dollar per month savings, every month going forward from now on.
For us, it’s $60 (internet) + $20 (phone) = $80 x (12 months) saved annually.
You pray and pray and pray and pray and pray for Google Fiber to come to your stupid freaking city but nooooo, Comcast and AT&T is a monopoly and we will never be freed from their greedy clutches.
Amount Saved = $960
Amount Needed to Earn = $1,200
Personal Care + Apparel
According to the 2016 BLS results, American households spend $1,803 on apparel and $707 on other misc personal products which both total $2,510 annually.
Our personal care budget in 2017 totaled only $425 for the entire year which means we spent approximately $2,085 LESS compared to the average American household.
Fairly often, our personal care budget has come in a $0. Last month in August, our personal care budget was -$8 because I ended up returning a pair of shoes to a department store.
We choose to forgo new clothes and instead opted in for heavily discounted ThredUP and thrift store clothing. Go the home haircut route for all 3 of us and just spending time researching how to cut a style properly. Doing our own manicures…if you recall that I give my husband manicures because he likes them haha.
In terms of a gym membership, my husband uses the free gym amenities at work three times a week. I walk and dance every single day, sometimes I work out up to 3 hours which totals about 20 to 25 hours a week I’m on my feet. It’s all YouTube sponsored content and besides the huge toll I’ve done to my worn down carpets from all the friction, it’s been all for free. 🙂
Being low-maintenance and pretty hot looking people by default is frugal because we don’t have that much ugly we have to hide (OH right, Internet, this is sarcasm!!!)
Amount Saved = $2,085
Amount Needed to Earn = $2,606
Health Care, Home Maintenance, Vacations, Vices, Pets, Utilities, Miscellaneous.
Uhhhhhh. Hm…well. Nearly every light bulb in our home is energy efficient. We have double paned windows. Our appliances are energy star efficient…blehhh nelly, OK, way too difficult to quantify what the amount we are saving here is…so let’s just brush ALL this off out of laziness.
I know we’re much much under the average for vacations, pets, vices and miscellaneous. Way, way under the average for our income level that’s for sure but useless without a solid benchmark.
*Healthcare…I have no clue. We have a good plan and hubby’s employer pays the lion share (woo~) but it’s a crapshoot to compare something like network, coverage, and copays.
*Home maintenance…uh, dude we try when we can but I don’t foresee my husband redoing our entire 3rd story roof anytime soon. I don’t think we’re super duper cost saving here when it comes to water heaters and the big scary things…so this is a wash.
*Vacation in 2017 for us was $1,035 while for the average American household spent anywhere between $1,457 to $4,000+ depending on size and where they went. We’re shaving a fat chunk off :).
*Pets…we might come very slightly under the average so it’s still a wash. Average single dog ownership is $1,500 for the first year…it was under $1,000 for us in our first year – including having Grace professionally trained by police. Then $500 is the average cost for the subsequent dog years…for us 2017 was $493 for Grace and my pet rabbit so we’re very slightly under. Still a wash.
Then there are the miscellaneous expenses…that’s a total crapshoot too for most Americans. For us, we track EVERY SINGLE PENNY and rarely use cash, so our misc are never crazy. I say we’re shaving at least $1,000 off here but no solid benchmark to put it against 🙂
The numbers of $$$ “saved” is already big enough for me to settle how much our brand of frugality can pinch even without any of these other ugly “math-y” expenses above so let’s just label it as all a wash.
Summary + Results
So we’re saving $45,090+ a year in expenses by living our Brand of Frugality. In order for us to save that $45,090 net, we would need to bring in over $56,000 income because of the taxman.
Which is interesting because…
Category Net Gross Total Saved $45,090+ $56,362+ Dude that's the MEDIAN U.S. income!!! Housing $23,000 $28,750 Transportation $9,600 $12,000 Food $7,800 $9,750 Entertainment $1,645 $2,056 Connectivity $960 $1,200 Personal Care $2,085 $2,606 Health Care, Vacations, Vices, Pets, Utilities, Miscellaneous. N/A N/A Too messy to quantify so N/A but probably $3,000 more shaved off.
It’s interesting…because the overarching median household income in the United States is $56,516. That’s someone’s entire annual paycheck that we’re knocking not very far from.
HAHAHAHAHHAAH concidence?! I love it. I thought it was around the ballpark of $60,000 but not this close to the median US household income.
It’s like we added another whole income stream by doing very little when that’s someone’s entire 9 to 5 gig. How silly.
That’s why our community is as fairly tight-knit as it is. What we do is what not many people can do and the majority of people don’t have the discipline or forethought to do.
We remain relatively unchanged despite the increases to wealth over time. If someone from the “outside” asked how we ever achieved fatty fat fat Financial Independence in our early 30s I’ll just point to them what was conserved, increased, sacrificed, and how we have structured our lives to streamlined financial independence to come quite a few years earlier.
[Exits on maniacal laughter]
Top $ Resources We Use
Below are my recommendations for saving, earning, and investing money.
Personal Capital: Sign up and use their net worth calculator for FREE. They are a free financial service platform that helps you analyze your portfolio, retirement, and financial health all on one simple & secure account.
Ibotta: I thought this app was overrated before trying it myself. The “any item” promos instantly save you money after scanning your grocery receipt. Ibotta also hosts promos and contests for your team to save more by working together. One of the guys on my Ibotta team list has earned and saved over $100,000 using Ibotta. You can get $10 if you sign up through my link and start scanning receipts for cashback.
Dosh: Dosh is a unique cashback app similar to high reward credit cards except you don’t have to bother getting one. Simply link your current cards to the app and get cash back! No need to scan receipts, no turnaround wait time for cashback – Dosh is nothing but instant cash back! Get a free $5 bonus upon signup and linking your credit card.