Yesterday, I was reorganizing our office and came across some old bank statements from a few years ago. As I read through some of the statements, I was shocked to see how much money we wasted back then!
I decided to grab one of the six calculators I found buried in our desk drawers and do a quick analysis. I wanted to see just how far we have come at reining in our expenses. Below is a spreadsheet that compares our spending from 2014 to what it is now.
|Mortgage, HOA, Property Tax||$1,343.82||$1,664.18||We refinanced a 30 year fixed rate mortgage to a 15 year fixed rate mortgage. We moved from a 7.86% APR to a 3.27% APR and saved about $192,000 worth of interest!|
|Cable, Phone, Internet||$186.00||$202.36||We are using the same service provider, so this is the cost of inflation.|
|Car Payments||$964.33||$0.00||We are down to one car, our beloved Toyota Camry which is fully paid for.|
|Car Insurance||$241.96||$49.59||We comparison shopped and found cheaper insurance rates, plus we are only insuring one car.|
|Natural Gas||$122.85||$52.00||Gas was higher, plus we replaced our furnace with a high-efficiency model just recently. Maybe the next blog post, perhaps?|
|Electricity||$77.72||$83.00||Not much of a change here.|
|Water||$43.00||$32.00||We replaced our shower head with a low flow model and keep an eye on the usage.|
|Cell Phones||$176.84||$61.15||We switched from a Verizon Wireless contract to a no-contract, Straight Talk plan. Then just last month, we moved to Total Wireless dropping down the cost even more.|
|Medical / Dental||$1,700.00||$495.25||The $1700 was from a root canal. We have since invested in Sonicare Toothbrushes to help keep up our oral maintenance. The $495.25 was a left over medical bill from when Mr. FE needed treatment for the tumors on his liver.|
|Household Supplies||$1,132.54||$26.96||The $1132.54 were all needless purchases. Home furnishings, decor, etc. The $26.96 represents batteries for our smoke alarms purchased from Costco.|
|Food||$1,436.71||$356.22||The $1436.71 was from eating out. As you can see, there has been a big reduction in our food spending!|
|Gas||$288.23||$56.94||One car + less go,go entertainment means less gas.|
|Gym||$200.00||$0.00||We ditcheded our gym memberships and enjoy the great outdoors.|
|Miscellaneous||$944.53||$29.86||More wasteful spending! This was from fancy lattes and a weekend get-a-way.|
|Total Expenses||$8,858.53||$3,109.51||We saved $5749.02! Shocking, I tell you!|
By changing our spending habits, we were able to pay off over $30,000 in revolving credit card debt in less than six months. But even though I was absolutely thrilled to see our financial outlook improve, I couldn’t help but think about what led us to spend mindlessly to begin with.
Exactly why where we so careless with our hard-earned money? Or so willing to completely submit ourselves to a life of consumerism? Then it came to me as I was looking at some of the variable spending categories like food, household supplies, and miscellaneous.
We felt entitled.
We thought we deserved to have the finer things in life. Big ticket items like luxury cars, fancy meals, and expensive get-a-ways somehow became justifiable because we had earned them by working hard. It didn’t matter that we couldn’t really afford to have these things.
We built a lifestyle around our own personal greed, and by doing so, we disregarded what our true need really was – financial freedom.
Looking at this now, I feel as though we were robbed blind. We literally allowed our attachment to “things” control our financial destiny. And we were wrongly duped into believing that we needed to keep up with the status quo. It became crystal clear, and I finally understood what this old bank statement truly represented.
Worse, our wasteful spending wasn’t because we weren’t capable of managing our money, or even that we didn’t care. In fact, we were bothered by our financial picture for some time before we finally changed our ways. So what was the straw that broke the camels back?
We got scared
We woke up and decided that we didn’t want to live out the rest of our lives stuck in a rat race. We also came to the conclusion that it is unrealistic to believe that we will be able to work until the full retirement age of 67 1/2, or beyond. The reality is that many of us will be forced to leave the workforce early thanks to involuntary job loss, automation, age discrimination, illness, the need to take care of a loved one, and other reasons.
Now we no longer feel entitled.