49 comments

Getting Started #4 – If you Try Sometimes, you Just Might Find, you Get What You Need

By the Realist

Mr. Money Mustache has been a bit more reasonable lately, posting some numbers to back up his assertions. But I thought I should join in at this point to address something that has probably been in your mind: how much can I really give up, without going crazy? After all, we all COULD live under a bridge and eat out of dumpsters, but no amount of money savings would make this worthwhile.

The miraculous answer to the question of how much you have to give up is: not much at all. The reason is that you will be using your creativity to enjoy the lifestyle of your choice, at about 75% less than the standard cost. You can  think of it as gaming the system. And it can be really fun once you get into it.

Let’s start by explaining why the system is so easy to game if you live in a so-called rich country like the US, Canada, Australia, or much of Europe.

Our country is home to a great surplus of wealth. It is very unevenly distributed, but there is plenty of it. We also have mind-bogglingly advanced technology and international trade which makes it so that certain goods are unbelievably cheap to buy. You can buy enough basic food (rice, beans, oats) to power you for a day for about $1.00. You can buy enough oil to carry you and 2400 pounds of steel 40 miles for $3.50. But there are also goods that are incredibly overpriced. You can pay $900 for a decorative leather satchel that serves no purpose. A day’s worth of food could also cost $900 at the right restaurants.

The whole game of our system is for the rich company owners to pay for advertisements to convince everyone else to buy their products at as high a price as possible. Ads and peer pressure make it very tempting to have the more expensive products. Rich people and other big spenders buy these products briskly, driving up the high-priced products while simultaneously advancing industrial technology and competition which actually drives down the price of medium-range products. But if you can peek through the ads and identify the actual needs that you want to meet, you can pick much more suitable products for yourself and save a bundle. To put a number to it, your goal should be to spend only 25% of what the average person of your income spends in each product category.

By letting yourself spend 25%, instead of 0% like the guy living under the bridge, you can still be part of the good life, enjoying normal modern society without anyone even knowing what you are up to unless you choose to share it with them.

So to go through a few examples:

  • Goal is getting around the country on 4 wheels: Average person spends $25k for a Honda CRV or Ford Explorer, you can spend $7k for a few-years-old Scion Xa
  • Goal is being not naked all the time: Average person spends $600/year on clothes from the mall, you can have a slightly smaller rotation of nice clothes (considerably nicer than Mr. Money Mustache’s clothes, for example) from Target for $150/year
  • Goal is getting out for healthy bike rides: your friends may buy $2400 carbon fiber road bikes. You can still find a great bike with some old-fashioned aluminum on the frame and carbon forks for $600 on Craigslist and ride just as fast as them.

You can figure out a trick like this for just about every category of living expenses. I challenge you to tell me one (leave comments below if you like) that can’t be improved over the standard person’s expenditures. There are some that are easier than others of course, so I like to cut those even more than 75% to free up some money to spend on things more dear to me. For example, I spend 0% of the average on cable TV and 10% of the average American dining out budget, but more than 100% of the average on housing since I like to live in a nice place. As long as my other savings can more than make up for the house I can still meet the 75% off goal.

So you’re giving up some spending.. but you’re not giving up your needs.. or your happiness, if you do it right.

  • Tracy May 25, 2011, 1:24 pm

    Is there a source for figuring out what the average person in different income ranges spends? Or just guesstimate based on peers?

    Reply
    • trev May 29, 2014, 10:44 pm

      stats canada is GREAT if you live in Canada. Americans must have a similar public statistics bureau. Try the census.

      Reply
      • Mike July 11, 2014, 9:19 pm

        Bureau of Labor Statistics – Consumer Expenditure Survey is just what you’re looking for.

        Reply
  • fwinter June 3, 2011, 2:28 pm

    So with you on the bikes thing. Used to buy the expensive Italian bikes but sold up when family commitments took over.

    Now I’m back in the game getting fit with a bike that cost a quarter of what I paid before. Lower spec Shimano i.e. Tiagra is now not far off Ultegra and we are really talking small aesthetic differences and a few grams.

    Thanks to Taiwan cheap bikes are all you need.

    Reply
  • David Baillieul July 4, 2011, 11:31 am

    I purchased a new Giant OCR3 carbon fiber at end of the season ( Aug ) 4 years ago for $1000. Rode the bike regularly and maintained it well. Sold the bike this spring ( prime season ) for $1000. Pretty proud of that one :)

    Reply
  • Bener July 10, 2011, 6:45 pm

    Loving the blog, I will be a regular follower. Thanks for opening my eyes to the massiveness of some expenses!!

    Also, +237 bonus points for the Stones quote…

    Reply
  • Jack October 17, 2011, 6:53 pm

    Living in a city like Vancouver, I’m wondering how it is possible to lower the housing cost. With an average income, buying any kind of housing is difficult. Is renting the only option?

    Reply
    • MMM October 17, 2011, 7:57 pm

      I’ll defer to any expert Mustachian Vancouverites, but as a general rule I’d say, “Yeah!”. In Vancouver and other super-pricey cities, rents are way lower than the capital cost of tying up the corresponding amount of cash in a house. So the landlords are actually making a very low return on their investment – many of them bought the places at far lower prices and are content to get even the lower rent, creating a nice irrationally low price you can take advantage of. Some areas have rent control rules that contribute to this effect.

      The best strategy, monetarily speaking, is to rent an affordable (and walkable) place while taking advantage of the high salaries in a big city for accelerated saving. Then move away when you’re done with the income. If you are in a big city with a lower income, you might consider if there’s even a reason to be in that big city – if you could get the same salary in a smaller place with affordable housing. Of course, personal preferences vary between big and small cities, but I’d say people should only live in a place like Vancouver if they love it more than anywhere else and/or they are getting paid enough to justify living there.

      Reply
    • Todd Carnes February 5, 2014, 2:24 pm

      I have owned two houses in the past and I refuse to ever do so again.

      I would rather rent than own a house anyway. Why tie yourself down with a 30 year mortgage and a house that is basically just a big money-sink anyway?

      It’s not worth it.

      Rent a house and let someone else deal with mortgages, and repairs, and home owner’s insurance and…. etc. etc. etc.

      Besides, what if you buy a house then find out you don’t like the neighborhood as much as you thought you would? Now, you’re stuck with trying to sell a house before you can get the heck out.

      On the other hand, if you rent and find out you don’t like it there, just pack up and move.

      Reply
      • Tony May 6, 2014, 7:16 pm

        Depends on the rate of the mortgage. The average rate of inflation for the past 20 years is 2-3%. So a mortgage at 3% is practically free money. Lock in at a good rate and use that freed up cash for other investments.

        Reply
        • Todd Carnes May 8, 2014, 7:55 am

          First of all, there is no such thing as “free” money. Why worry about “locking in” a so-called good rate so that I can invest, when I can use that same money to make those same investments you’re talking about sans the debt.

          Second, in your example you are still loosing money because you didn’t account for all the expenses involved such as taxes, insurance and upkeep/repairs.

          People that think their house is an investment are lying to themselves.

          Finally, if you have a mortgage, you don’t “own” your house anyway. The bank owns it. The only thing you “own” is a ridiculously huge debt.

          Reply
          • Mara May 25, 2014, 8:03 am

            If you can stay there long enough and it is in a popular neighborhood, a house can be a good investment. We bought one for $49,ooo and sold it for $325,000 after 26 years.

            Reply
            • D312 July 1, 2014, 9:28 pm

              49k, compounded over 26 years at 7% with no other additions, adds up to $302k. At 8%, it produces $392k after 26 years. At 10 and 12%, $660k and $1.1m respectfully. I’ll take my chances with a low cost index fund first. Although if someone in Mara’s situation buys low and pays off early, the opportunity cost of not paying rent for a substantial # of years could be very beneficial. Just trying to point out how far that 49k could go with minimal effort.

              Reply
              • M Smyth August 1, 2014, 4:27 pm

                49k, sunk all at once into an investment would be great– supposing you had the 49k to invest all at once. But you’d still be paying rent. The sum of those rents over 26 years for a typical 3 bedroom house might be in the range of 150k-250k for the exact same house.
                On the other hand, someone who buys that 49k house with nothing down would make payments of about 300/ month, and leverages someone else’s 49k as an investment to net 275k, without having to fork over 49k all at once.
                The clear winner is using someone else’s money to make money.

  • CG January 23, 2012, 9:16 am

    That would mean a family of three(US median household size) can live on $12.5K a year(based on 25% of $50K US median household income). That’s about $4K per person. I know our family of 5 would do just fine on $20K a year, not counting any health insurance premiums. My 1 year emergency fund is $17.5K so I’ve figured out our very lean but not totally deprived budget before. We’d still be able to keep and use our paid for car, pay our mortgage, take care of average health issues, eat well as usual and get presents on our birthdays.
    The 25% idea reminds me of when I was a kid. My dad would sometime surprise us by bringing home a variety full sized candy bars on his way home from work. That was a big treat. We’d all agonize over which one to pick. My siblings would wolf theirs down lickity-split but I would eat only 1/4 to 1/3 of mine and wrap up the rest of the bar for later. I’d make my bar last for days. I feel lucky that I have that hard-wired into my personality. It requires such a huge change of thinking to go from a whole bar mentality to a 25%-er.

    Reply
  • sadpanda March 15, 2012, 9:58 pm

    Ok. According to the Australian Bureau of Statistics, in 2009-2010 9the most recent year I could find at the moment) the average Australian household spent $1,236/week on goods and services. 18% of this was allocated towards housing costs, so about $222.

    25% of that is about $55.

    A quick search on the biggest nation-wide real estate site reveals that across the whole of Australia, for $55/week I can rent…a lock-up parking space. Even the single bedroom in a crackhouse deals are more expensive than that.

    Hmm. Belt needs to be tightened elsewhere, I guess.

    Reply
    • Mr. Money Mustache March 15, 2012, 11:28 pm

      Exactly! If housing is only $222, what are your fellow Australians spending the other $1000 per week on? Probably some pretty expensive stuff.

      My own housing cost is probably at least up to the US national average. But other categories are a full 100% lower to make up for it.

      Reply
  • Tundra March 21, 2012, 1:54 pm

    Hi – I just came across your site this week and have been learning a lot! Thank you. No cable TV, cook at home, love the trails, bike sometimes in the summer, but still struggling to save.

    I have a 16 year old subaru with 83000 miles – need a AWD here for winter. Trying to figure out if I should keep putting money into it for repair and maintenance (REC title-ignorance on my part, new to the country, etc.) or buy a used new car like the suzuki.

    Reply
    • Mr. Money Mustache March 21, 2012, 6:53 pm

      Wow, that’s pretty low mileage for a car of that age! The reliability shouldn’t be much of a problem, assuming your annual driving continues to be low. But Subarus are very fuel-thirsty.

      Then again, if you live up a steep mountain road and actually need AWD for the forward traction, you probably already have the most cost-effective car.

      (Note that AWD does not increase safety in level terrain winter driving, since it helps you accelerate faster, but not brake any faster. For maximum safety AND fuel efficiency, just throw burly snow tires on a front-drive car for the winters: just ask any of my fellow Canadians. There are few places with more extreme winter driving than Ottawa, ON, where I lived before moving to Colorado where there is no winter.).

      Reply
      • Blaze October 15, 2013, 1:18 pm

        Gee MMM, you must be missing the freezing rain, slush, 3ft of snow, rinse and repeat cycle. And sometimes that’s all before lunch time!
        Just replaced my ancient vehicle with a new to me model. Part of budgetting the purchase is assuming $800-$1000 for new snowtires and a second set of rims so that the spring/fall tire swap is an easy DIY job done in the laneway. The old rims aren’t compatible with the new car so if we can’t sell them to someone, they’ll go for $crap metal.
        In Quebec it’s now law that you must have proper snow tires on from Dec 15 to Mar 15. I wish they’d do that in Ontario. I can’t believe anyone actually believes that “all season” tires actually refers to all of Ottawa’s seasons. And then they’re surprised when they end up in a ditch. My luck they’ll slide into the back of me when I’m able to stop and they can’t.

        Reply
  • KittyWrestler June 18, 2012, 4:47 pm

    Too bad the early posts didn’t attract much comments like the later ones are.. Sometimes it is interesting to see what ppl have to say per their personal experiences.

    Health care actually is going to go up if I ever quit my job. My company spends $15000 a year on my family paying up all kinds of premium so there is little out of pocket money for us including medical/dental/vision.

    but I did see your other post about how little the medical will cost if you are on your own and assuming you don’t have pre existing conditon. I think that “Get rich slowly” guy had a heck an aweful time getting himself a plan since he had pre-existing..

    I did a quote myself a long time ago when I was out of job. healthy, no baggage, single no kids.. still cost me $185 a month. Now it would be anywhere around $400 for my family. And everytime I take my family to go see doc just for routine dental cleaning or physiclas, it would cost a lot more..

    right now? it cost me $40 a month on medical premium, $18 on dental and $4 on vision for a family of four.

    Reply
  • Ryan June 24, 2012, 9:00 am

    I’m with Tracy. I’d like to do comparisons, but what’s your source for average expenditures in different categories?

    Reply
    • VeroGall June 28, 2012, 5:27 am

      Hi Ryan. MMM will probably answer better than I will, but thought I’d speak up because I had the same question a few years back.

      There are a number of places to get the data, but the information varies dramatically depending on where you live. So don’t depend on national averages unless you live in a small country like the Nethelands.

      In America what you pay for stuff depends on which state, which city, even what part of town. My brother living in the-middle-of-nowhere Texas can buy a 3-bed, 1-bath starter home with a 1/4 acre for 10% of what family would pay for the same house witht less land in FIVE different locations. (We had a very interesting family discussion about this.) Data research or marketing companies, insurance companies even real estate companies gather this kind of data.

      Reply
    • Gerard November 11, 2012, 6:37 am

      For Canada, try
      http://www.statcan.gc.ca/daily-quotidien/120425/dq120425a-eng.htm

      Statistics Canada numbers are pretty reliable, usually.

      Reply
  • Sarah June 27, 2012, 7:03 am

    Love the bike, and you can go even cheaper in my area. We got a $600 bike for $75 because every quarter the local university auctions off surplus, including bikes that were abandoned on campus the previous semester.

    Reply
    • Todd Carnes February 5, 2014, 2:34 pm

      Why are people spending $600 or more for a bicycle? Are you people high? I spent $100 for mine and still thought it was too high.

      Reply
  • Annie October 17, 2013, 6:43 pm

    I buy nearly all my clothing from second hand shops, Salvation Army shops, for example. The exception would be my underwear which clearly has no place in my wardrobe having been on someone else’s butt.

    I have bought some AMAZING designer clothes for just a few bucks, and often just run of the mill stuff you can jazz up with some fancy buttons. Top tip from me: scan the racks for quality fabric. And shop on Tuesdays – this is when all the “new” used stuff comes in.

    Reply
  • Kirsty October 20, 2013, 7:52 pm

    I think my mum must have been the first mustachian. In her twenties she took a sales job which she hated but it enabled her to pay off her mortgage by her thirties.She has been pretty much retired ever since. Now in her seventies she lives extremely well on a small state pension. She sold her too big house in the suburbs and moved to a smaller house in a more affluent part of town with more amenities. There are two supermarkets in walking distance both of which have mark downs every night. My mum walks to both supermarkets every night and stocks up on anything which has been marked down (bread, vegetables, fruit, fish, meat) .This becomes her diet for the following day and any surplus is turned into soups or stews which she then freezes. Her weekly shopping bill is about ¬£5 a week. She changed her double bed for a single bed so that all her sheets fit into a single wash, any small things are hand washed and left to drip dry over the bath. She loves meeting people and so does lots of volunteer work in the community including helping out at the local sports centre where she has a daily shower free of charge. Her spare bedroom is used to store junk which other people have thrown out and this is either recycled or sold. She goes to bed early and gets up early to cut down on electricity for lights and on the odd occasion when she is just sat around the house on a cold day she ‘ll snuggle down on the sofa with a blanket and hot water bottle before turning on the heating. All this means that she can take 5 or 6 fancy holidays a year and yes people are envious of her lifestyle and can’t understand how she does it! She is truly an inspiration!

    Reply
  • Der Couponschneider March 7, 2014, 2:00 pm

    I’m also wondering about my fellow countrymen: the Germans. Why? A lot of them waste their money and if they are saving money then they don’t invest it in stocks. They make ridiculous saving contracts where they have to hand over a fix amount of money to an insurer (e.g. Allianz) every month. They do it for many years. Even the 13 % who reach the regular expiration of the conract have a small yield of 2 % per year, before inflation and taxes. The people who don’t reach the regular expiration have a negative yield.

    Reply
    • Oh Yonghao March 18, 2014, 5:23 pm

      I noticed that when I lived in Taiwan, so many people get scammed into it, and if they can no longer afford it they can lose everything. It’s a huge industry there of people trying to sell you on insurance for everything AND you get money back at the end, but the first bunch of payments is just paying off the commission the salesman made, the rate ends up being so low it’s insane. I’ve questioned some people on it and they get mad and claim that they would just end up spending it so this is better than nothing. We’ll see what they say when nothing is what they get.

      Reply
  • SNengr June 10, 2014, 12:39 pm

    We… just… can’t… do… it… Saving 75% is just sooo hard! We are stuck at 65% savings per year, but I feel we have a great savings/life balance. I guess my wife and I will have to work till we are 40 years old. If we had started saving more money directly out of college we would be retired already. Great Blog with great advice.

    Did you save 75% of income before or after taxes?

    Reply
    • Mr. Money Mustache June 11, 2014, 7:03 am

      65% sounds pretty great to me! And remember, as your income rises or you get windfalls, your savings rate goes up effortlessly because you maintain the same spending and bank the surplus.

      There is no rush in all of this, other than the rush to fix your situation if you are starting out in debt and spending everything you make or more, like most people.

      Also, all savings figures in this blog are generally after tax, since tax rates vary so much.

      Reply
      • SNengr June 13, 2014, 1:21 pm

        Our savings rate has gone up from 50% to 65% in the past 5 years mostly from income increasing faster than lifestyle creep.
        The hardest part for me is deciding “when” to get out of the rat race. One more year of working will set our children for college. Two more years will give us more financial cushion. I would rather work 2 extra years as an engineer than 10 years as a Walmart greeter when I am 80 and broke.

        Reply
        • SNengr June 16, 2014, 1:53 pm

          Percentage savings calculated after taxes changes things quite a bit. Check out these numbers!

          Paychecks + $162,335
          Expenses – $85,252
          ESOP Bonus +$55,000
          401k contributions +$35,000
          (162-85+55+35)/162 *100 = 103% SAVINGS RATE

          Since our pre-tax contributions was more than or total expenses, our savings rate is over 100% The house is now paid off so our expenses should drop $15k this year.

          I feel a little better about our frugality. Last week my wife told me I was crazy when I told her we should cut back more on our expenses.

          Reply
  • Mara June 11, 2014, 10:23 am

    Hi MMM,

    I am interested in Moustachianism, but we live in the country and have livestock… horses. They aren’t even salable now, with the poor economy and hay at record prices. We would not abandon them.

    I know we have a lot to learn from you. Are there other country folk in the group, too?

    Reply
    • SNengr June 19, 2014, 8:32 am

      I was a farm kid growing up. I owned a horses, pony and had a small herd of 12 cows between the age of 9 and 18. I consider Livestock to be an asset that makes you money. Horses are a luxury item. Figure out the real monthly cost of owning the horses, feed, vet bills, stabling. Then divide that by the average amount of hours your spend riding them each month, (consider the winter months, the horses are still eating). At 14 years old, I figured out the horse was eating most of the profits from my cow herd. I traded my horse for a dirt bike and got much more enjoyment for the investment.

      Although I didn’t know it at the time, I grew up a Mustachian!

      Reply
      • Mara July 19, 2014, 4:24 pm

        Hi SNengr,

        You make a good distinction between livestock and saddle horses. I love my horses, too, and they are more like pets than animals raised to sell for food.

        I have two trade skills, one of which is state-licensed riding instructor. When I couldn’t find work at my other trade, teaching students to ride on my horses helped support me for years. When I retire (from the other trade), one of the horses will continue to be a source of entertainment and exercise.

        Although I didn’t grow up a Mustachian, I am currently learning about the benefits of that path. I would like to retire within the next few years, and hope to find a good home soon for one of the three horses, in order to reduce overhead and make the numbers work. However, it’s a tough economy to sell or give away even a good horse.

        Meanwhile, why not stay positive and do the best I can? There are really no other riders (horse, in addition to bicycle :-) or animal lovers in this group? I thought it would be nice to share ideas for economizing.

        (In case you are wondering, my husband and I have been making great progress at reducing overall expenses and adopting more earth-friendly habits; our thanks go to MMM.)

        Reply
        • missj August 15, 2014, 12:19 am

          I am somewhat rural/farm girl. We have 3 acres with chickens and a mini orchard.

          I did not grow up in any type of mustachian household but all my grandparents are hardcore great depression surviving, dumpster diving farm kids.

          My location is both an asset and an expense. On the one hand we raise our own eggs, chicken meat, fruit and vegetables. We have a well and septic, so no water or sewer bill.

          But I commute much too far to consider biking to work (or biking ANYWHERE for that matter). Since I love cycling, in the nice months I drive half way to work and park at a bike trail …but that is really more about exercise and enjoyment than cost savings.

          What I save in fuel I’m sure I spend on bikes or bike accessories….2 years ago I got a nice-ish women’s racing bike with carbon forks for only $800 off craigslist. I probably save roughly $2 in gas each time I bike half way to work so I would need to repeat the trip 1,600 times or basically 3 days a week 6 months a year for 20 years to pay off the cost of the bike. I’m not that ambitious.

          Reply
          • Mara August 16, 2014, 5:21 am

            Hi missj! I don’t feel so lonely now. We’ve tried chickens and guinea fowl, but the foxes got them one at a time. The eggs were wonderful.

            A nice bike is still much cheaper than a horse, so you’re ahead there. A long commute is a tough one.

            So far we have cut our annual expenses by about $10,000 by attacking each expense, one at a time. The one we are working on now is lowering the cell phone bill by switching from AT&T to Consumer Cellular, which should save us about $600 per year. The new SIM cards just came in the mail. Ditching cable TV also saved several hundred per year.

            We cut down on farm help and are doing more chores ourselves. That is saving us about $5000 and so far hasn’t been too difficult. We cut down on stall bedding a little to see if the horses could tolerate it. Two are fine with it and one needed to go back up to the old amount. Using less shavings is good because it saves work and how much we pay to dump the used shavings. We haul it away to a farmer who recycles it and sells compost. There is also a family that comes sometimes and picks up manure from our paddocks to use in their vegetable garden.

            We live in a small house and have a few acres. We refinanced and got the monthly home loan payments down to $1000 for interest and principle. That’s not bad for shelter for my husband and me and all the animals. Now that we’ve cut other expenses, I hope we can raise our monthy home loan payment.

            My commute is 10 minutes and I drive a pickup. I used to freelance from home, but the business is too big now. There would be no place to put everything. Or the employee.

            I don’t know about me riding a bicycle for commuting. The aerobic exercise would be helpful. Maybe I could find one on Craigslist and get used to bike riding again. Some of the roads on my route could be rough going. I have carpal tunnel syndrome and couldn’t put a lot of weight on my hands. How long would it take to ride 5.4 miles? What type of bike and tires would be appropriate?

            Reply
            • mcgee November 11, 2014, 5:21 am

              Could you ride one of your horses to work?

              Reply
              • Mara November 11, 2014, 8:23 am

                That would be fun, but not practical. Actually, maybe one of the homeowners near the office building would have a patch of grass and appreciate the fertilizer :-)

                My husband and I have started carpooling most days. That’s better for the budget and the environment. Our overall expense cutting project is now up to $33,400 per year. We started cutting expenses in April, so that’s a good sum for 6 months.

            • Hippo November 24, 2014, 9:05 pm

              You’re not alone! Although I ended up selling my horse (she was costing me at least $400/month and I didn’t have the time to enjoy actually having a horse), I’m still involved in animal rescue and at any point in time, have my one dog and three cats, in addition to whatever fosters I may be caring for.

              They’re a lot easier to budget for than horses, though :)

              Reply
              • Mara December 7, 2014, 9:52 am

                Thanks, Hippo! I’m sorry about your horse. Your work sounds interesting and caring. Even cat expenses catch me by surprise sometimes.

  • A.M. Frato July 11, 2014, 9:05 am

    This post reminds me a lot of what I have been doing lately to get my finances straight. More recently I have cut my cell phone spending by 40%. I was paying $130.00 /month for a plan with verizon wireless . I had an iPhone 5 but the damn thing kept breaking and I was always getting charged fees for not being able to pay in full. One day I noticed they had a pre paid plan for the iPhone 4 so I walked in the the nearest store, waited for nearly an Hour which really pisses me off ( no customer service ) and usually i won’t wait but on this day I was on a mission and the savings far out weighed the wait. When I told the sales rep I want to down grade they were shocked and used all kinds of tactics to keep my on a “contract” but i was persistent and 1 hour later my phone was paid for and I am now only paying $70.00 per month. Still high but ill take it.

    Reply
    • Mr. Money Mustache July 14, 2014, 5:57 am

      $70 per month for a phone!? You need to keep shopping A.M. – Republic Wireless is $25/month for unlimited everything and no contract, so any competitor will have to start there and then drop the price further: http://www.mrmoneymustache.com/2014/05/13/moto-x-vs-moto-g/

      Reply
      • Jacob July 14, 2014, 6:01 am

        And if your usage rates are low, Ting is a great option, too. My brother and I are on a plan together and usually pay about $20/mo w/o paying an ounce of attention to what kind of data/minutes/texts we’re using. I’m using a refurb Nexus from 2011 that works great and was dirt cheap.

        Reply
  • Melissa November 15, 2014, 9:17 pm

    My mother is the QUEEN of this tactic. She is always bragging about how she found some “deal” on some cheap-o version of whatever. And it shows. She’s got a 4 bedroom house (2 kids currently living in it with her) filled with way too much stuff, and half of it is half broken. I’m not a fan of ill-fitting clothing, flexible-framed bicycles, or unwieldy backpacking packs that make life more of a chore and less of joy. If you can’t afford to buy the version that’s not going to break in 2 months, then don’t buy one at all. Do without. Have a few nice things, and treat them well.

    Reply
    • Sonia November 28, 2014, 10:25 am

      With all due respect, I think you’re setting up a straw man argument. Buying a bunch of stuff you don’t need because it’s a “bargain” is falling squarely into the consumerist trap (look at all the suckers, er, I mean, consumers in a feeding frenzy over Black Friday sales), and the opposite of what I think MMM espouses.

      Reply
  • Reinard November 18, 2014, 1:03 am

    I’m just getting started on reading your blog and enjoying it so far.

    One questions you asked was to challenge you on what I can’t live at 25% of average spending. For me that’s healthcare. Not just insurance, but doctor visits, medications etc. (I have a back injury from a car accident that will unfortunately require lifelong medication).

    Still I’d be interested in what you can recommend for getting these expenses under control. I’d be happy to get them to anywhere near 50%.

    Reply

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