Spend Less and Get More

Making more money is a great way to get what you want, but not the only way. Spending less also frees up income for pursuing your goals. That's one of the lessons in the following excerpt from my ebook A Survival Guide for Interesting Times, a part of The Secrets Package.

Living On Less - A True Story

I saw keeping expenses low as an indirect way of making money. Spending less to get what you need, and so having more money left over for what you want - that's like getting a large raise, isn't it? It certainly never made me miserable. Nor did it mean giving up what I wanted.

Actually it meant getting to do the things I really wanted to do. The less you spend on each thing or activity, the more of them you can have, right? So the key is to spend less and still get what you need and want. Here is how I managed it.

Low Cost Housing

My first house was a mobile home on a small lot. I bought it for less than $20,000, and had payments of $257 per month. Even with taxes, insurance and repairs, it cost less than rent. It had three bedrooms, an expanded living room, and a nice fenced-in yard with a garden out back. It was very comfortable. (I eventually sold it for $45,000.)

That was a good start, but I wanted to live really cheap in order to save money for more important things, so I paid as much as I could on my home when I was working. As a result I owned it free and clear within five years. From that point on it cost an average of $300 per month to pay for the utilities, phone, garbage collection, taxes, insurance, and repairs.

Then I found that I could easily rent the other two bedrooms, and get $65 per week for one, and $75 or more per week for the other. I included all utilities, and found decent renters. The increase in utilities was almost unnoticeable, so that added close to $600 to my monthly income. Now I made almost $300 per month and lived for free.

(Note: After getting married, I added an efficiency apartment on the back of the home. It cost just $2,000 to build, and allowed us to rent all three rooms out - $80 weekly for the other room.)

Time For Planning

I found that I could work less once I had no rent or house payment, so I could get by without a car. That saved a lot of money. Occasional bus fare, and the used bicycle I bought didn't add up to a fourth of what it cost to have a car. I had to plan my trips around town a little better, and I would never choose to go without a car now, but it was worth it at the time.

During those years I never paid more than $40 for a piece of furniture. You have to know what is important to you. I did pay $220 for a high-tech sleeping bag, because I liked ultralight backpacking. On the other hand, I couldn't appreciate the difference between a nice, clean used couch for $30 and one that cost $500 (thank goodness for a lack of discriminating tastes), so why pay for the latter?

I found that when I worked less, I had time to look around at my options. I discovered that free time can save you a lot of money - if you use some of it to take advantage of opportunities. I paid half of what others paid for groceries, since I could afford the time to find the deals. When I finally bought a car, I found a repossessed one that was worth much more than I paid.

I wasn't being a scrooge, by the way, nor denying myself anything important. I tipped well when I went out, and paid for my rides with friends. I also went to Ecuador for a month. It cost me $1,040 total, including all airfare, hotels, meals, a guided climb up a 20,000-foot mountain, and more. It was possible because I had the time to search for the deals.

I worked part-time jobs for years. I read books, played chess, wrote poetry. I traveled several times a year, and met the love of my life in South America (and have been happily married for many years now). All this was possible not because I made a lot of money, but because I spent less than I made, and used the difference for the things that mattered to me.

There were many years where my total income was below $10,000, yet I never paid a bill late, and I always had money in the bank. I'm not suggesting that anyone can follow my example. I had no children, and we are all different in many ways, so this isn't a how-to guide. This story is simply meant to get you thinking about the possibilities, and point out a few important principles, including these:

- Don't buy things you don't need.

- Find ways to pay less without getting less.

- Spend less time working and more time thinking (which is a different and often more profitable kind of work).

- Find alternative sources of income.

- Stay out of debt.

- Discover what's truly important to you, because you can have more of it by eliminating what isn't important.

There's nothing wrong with buying expensive toys, meals, or houses. If the time is right, the money is there, why wouldn't you buy things to better your life? This isn't really about being cheap or sacrificing. The point is to control your finances so you can have more of what will make life better for you. As an example, my wife and I now pay to have the house cleaned yet still buy clothes from thrift stores, because having new clothing isn't important to us, but having our time is.

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