Last year, outside of rent and taxes, I paid approximately $2,200/month. I also managed to travel internationally. I visited 8 states (2 of which for the first time) and was in the air for 42,242 miles. Not a record setter. But that’s not what my frequent fliers miles account says, earning over 230k in various airline mileage during the year. This equates to roughly $4,000 in additional bonuses (or reducing the above cost by $300). How is this possible?
The most important three elements to achieving a personal finance goal are:
The first one looks the easiest but I beg to differ. There are tons of resources available for the final two bullets for those who are motivated and have the time. RewardBus itself has an extensive library to read for some of these informations. The part that is impossible to provide from a personal finance website is the first. What is the goal and what are the priorities?
My exact numbers are not attainable for a vast majority of Americans. I am unmarried, do not have children, have a fairly flexible work environment and do not own a car (living in one of the densest counties in America). That doesn't mean that there is nothing to learn from the experience or story, though. Your goal may just be slightly different but I wanted to share how a lot of personal financial goals are attainable on a relatively small budget.
When I tell people my traveling preferences and some of the activities I do, I am often greeted with the response that it is impossible to afford. I fly almost exclusively non-stops and focus closely on the arrival time of my destination. It is all in the eye of the beholder! I look at minivans, gas and an expensive restaurant budget as unaffordable. All my experiences do is reflect what I have chosen to prioritize. This may best be described by looking at my actual budget:
|$400||Food||Roughly 75% from groceries|
|$100||Commuting||No car; includes public transportation, Uber/Lyft/Taxis|
|$700||Travel||Flights, hotels/AirBNBs, travel to/from airports, bag checks|
|$200||Entertainment||Spotify, Netflix, Hulu, HBOGo, all add up; sporting events|
|$350||Health Insurance||Need to not die|
|$200||Miscellaneous||Home decor, gifts, furniture, silverware; where should I put this?|
The numbers that I imagine to be the most different for my readers are child-related expenses, personal travel and commuting. I do not own a car. I am not personally opposed but looked at it as more of a luxury where I would want to cut more of my budget. Add insurance ($80?), payment (or depreciation, $300? depends on the car), gas ($200?) and maintenance (underrated, $150?) and the numbers add up a lot.
The response I get the most is that people are stunned about how much I spend on travel. Being an annoying pissant myself, I would want to challenge that I am amazed at how much many others spend on clothes or cars or jewelry, etc. Instead I nod my head and say that I enjoy my vices. Also, $700/month is $8,400 a year. One solid international trip, including hotels and all transportation on the trip very often can cost $3k+. It is possible to be frugal on the airlines you choose but sometimes you just need a non-stop flight at a certain time. You get one of those and it's another easy $800.
My point in writing this is not to explain how everybody should spend like me. In fact, I want the exact opposite impression. I want readers to read the budget, think it's insane and not change a thing to reflect how I spend. What I would want to change, however, is an evaulation of how money is spent. Are you saving for your child's education? Well, maybe it's time to downsize the vehicle or house. Struggling to pay down debt and eating out 5x a week? Saving too much money? It's possible. For some, you can probably loosen the reigns in a few areas of your budget and not lose sleep.
The key is mindfulness.