Economizing on the "big stuff"

Only a handful of expenses really count when it comes to the desire save more by spending money wisely. Those core expenses are shelter, transportation and postsecondary education. Spending decisions involving those three areas dwarf any savings that might come from steering clear of lattes. Chris Farrell,To save more, sweat the big stuff, Star Tribune, February 16, 2020.

I prepared my income taxes last week. While chanting my mantra "I'm happy to have income on which to pay taxes. I'm happy to have income on which to pay taxes.", I take the time to review all my checking and credit card statements trying to get a picture of where I spend my money. Happily, where I do not spend money is on the "core" expenses that Farrell lists in his refreshing finance article quoted above.

Neither my children nor I had much student loan debt. We worked through college and attended state schools with (at the time, anyway) modest tuition costs. It looks like my grandsons may be taking the same path.

I drive the least expensive car I could purchase new - a Honda Fit. While the average new car price when I bought my car in 2017 was over $36,000, I paid less than half that amount for the small red car that gets about 35 mpg. I have a 4-year, $300 a month payment on it.  

A few years ago, I down sized my house, moving to a 850 square foot townhouse for which I paid $106,000 cash. My HOA, insurance, taxes, and utilities average around $600 a month. I call it my expensive storage locker where I can keep my stuff while traveling. One savings I had not anticipated when moving to home with just two small bedrooms, no family room, limited closet space, no basement, and a single car garage is less temptation to buy "stuff." I literally have no place to store junk I don't need. When I buy a new shirt, I donate an old one. I have one set of silverware, dishes, and minimal pots and pans with no desire to replace any of them - or add a counter-hogging "Insta-pot." *

Happily, having minimal expenses on the "big stuff." allows me to spend money on the things that actually bring me joy - traveling and family. I took seven trips of over a week in length during 2019 - five of which were international. I was able to help my kids with some travel costs of their own. I get a real pleasure in picking up the restaurant check - a form of friendly competition in my family.

I suspect I will need to rein in travel spending a bit. The past year was, as I called it, my year of living irresponsibly (aka senior gap year) after 43 years of professional employment. But I hope to continue to find ways to at least marginally improve the lives of my kids and grandkids. Money well spent.

As the quote from Ganesh below spells out, we too often focus on improving our lives around the edges, but ignore the core situations (or expenses) we live with daily. Instead of trying to add more to your savings account by skipping that Starbuck's coffee, maybe try skipping that $36,000 new car that adds a few hundred to your monthly car payment.

No one who dislikes their work or partner will ever offset the pain by mastering sleep, fitness, nutrition, digital abstention and other lifestyle marginalia. Lots try. Janan Ganesh (as quoted by Chris Farrell

* The Minneapolis-St Paul region currently has a much publicized affordable housing shortage. I always wonder if this could be at least partially reduced by re-defining how an "affordable" house is defined. Do even families with children really need to lay out $400K for 3000 sq ft house when perhaps 1500 sq ft might not be more affordable - and more comfortable as well? 

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