Life’s Too Short to Be Spending All Your Money and Being Broke

This is a guest post from Kraig at Young, Cheap Living. Kraig is 28 years old and is on a mission to save all he can and reach financial independence as soon as possible. He knows what it’s like to be broke, but decided a few years ago that the anxiety and stress that come from spending everything you make just isn’t worth the nice things. Kraig now saves over half of his income and is on a mission to create a future where he can spend his time working on things that he’s passionate about and things that help him make this world a better place.

I have a guest post going up on his blog as I post his – so make sure you check it out.

When I lost my dad almost 12 years ago, I was just 17 years old. I was right in the middle of becoming an adult and my money handling habits were in pretty rough shape. As a kid, I didn’t really understand the value of money. My dad always kept a close watch on our family’s resources and it always came off as a negative to me. It meant that all the other kids I knew would get all the good stuff, the nice houses, the fancy cars, the name brand clothes, their own rooms, etc. All that ran through my head was that my dad was a cheapskate and it was all around a bad deal for me.

Until after my dad died, I didn’t realize the value of being smart with your money. My dad left us at just 46 years old. My brother and I were both in high school and my mom was left as a single parent. Dad left our family taken care of with smart planning and many, many years of hard work and dedication. He was a hero to our family.

But wouldn’t you know it, I kept spending everything I had for several years into my early adulthood. I bought a nice car with a loan that my mom co-signed, some great accessories for my car, and all kinds of other expensive stuff. I loved stuff. Now that I was an adult and had some money to spare, it was my turn to get the good stuff I had always wanted. But then… all that stuff that I spent all my money on, became worthless. I learned that nice stuff just doesn’t last.

After college, I got my first real job. I moved into an apartment on my own and set my lifestyle right at my income. I bought a bunch of new toys with my new income. After all, I had to furnish my new place with nice things and fancy electronics. I spent all my money that first year of work and then scheduled a road trip across the United States the next summer. It was a blast until my car broke down. It required over $2,000 worth of repairs, which I couldn’t pay for. I decided to borrow money again for another car.

Soon after, I was driving a $20,000 car, which was 100% financed. I was broke, anxious and stressed out. I was earning about $30,000/year at the time, so this was a big deal in my modest world. I also had student loans that I was paying on every month. When the recession hit of late 2008/early 2009, things felt even worse for me. Sure, I had a job, but I was scared to death, because I didn’t have any money. If something were to happen to me, I would be flat broke and would have to move back home (3 hours away) and live in my mom’s basement. This was the start of my search for a way out of this.

After a couple years of working semi-hard at paying down my debt and getting my income up, I was making some progress. But then, Murphy struck. I booked another vacation, was all excited to go, and then had to have $2,000 worth of emergency dental work done just days before I left. I was set back big time by these two big expenses hitting at once. It felt like I wasn’t making any progress.

Then it happened. I decide that I wasn’t living like that anymore. And I cut all my expenses, to the bone. I paid off all my debt later that year, in 2010. It felt outstanding. Then, I lived on less than half my income in 2011. It was the biggest rush I’d ever had. I was getting somewhere.

And then I saved over half my income in 2012 as well. And here I am today, with zero debt, a 6 month emergency fund and over 3 years worth of living expenses in liquid investment accounts. My life is different today than it was when I was first starting out. I’m in great shape financially, and it feels outstanding. I am excited about where I’m going, because this means my future is going to be different.

The thing is, I’m not doing this because I decided I don’t like stuff anymore. I do like stuff. Do I want a nice car, name brand clothes, the latest iPhone and iPad? Of course I do. Do I want a nice house and to take extravagant vacations several times a year? Yes I do. But, I want to be financially secure more. I want to have options in the future more. I want to reach financial independence like no other. I want to retire early, not from winning the lottery or inheriting a lot of money (although that would be nice), but from working my butt off, being persistent and keeping my eye on the prize.

The prize is freedom. The price is getting out of the rat race. What am I talking about? Have you ever woken up on a beautiful morning where the birds are chirping, the air is fresh smelling, the sun is shining bright and where you feel blessed to be alive? It’s a bummer when you figure out that you’re going to be late for work if you daydream for one more minute. It’s off to the office to sit in a cubicle all day, instead of being outside, enjoying the morning with a cup of coffee and a long walk and the afternoon with a round of golf and a long hike. Aw, and then in between, working on hobbies and interests that you care deeply about. Instead, we’re forced to be at work, earning a living so that we can pay for our life.

Well, I’m going to opt out of this “rat race”. I want to enjoy more of those mornings and afternoons than I get to now. I don’t want to work all my good years away at the office. My dad didn’t make it to 50. Who knows if I will. I want my life to be meaningful even if I don’t make it that far. I want to go down a path where I am free to enjoy my life to the fullest and work on things that excite me, like helping others and making his world a better place.

My “Why” of personal finance and of living far below my means is that I want a future that is bright. I want a future that is free and full of options. I am sacrificing today so that tomorrow, my life can be better than I’ve ever dreamed. Yes, I realize that I have to enjoy today too, because tomorrow is never guaranteed. The funny thing is, I’m learning to enjoy living modestly and frugally. It’s not bad at all, when you’re aiming high at a goal as big as financial independence. My goal is to reach financial independence by the time I turn 40. It’s a long shot, but I think I can do it. I have to, because life is too short to be spending it all working on things you aren’t passionate about. It’s also too short to not be outside, enjoying the day, or spending time with your family and friends, whenever you feel like it.

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Life’s Too Short to Be Spending All Your Money and Being Broke — 19 Comments

  1. Great post Kraig.

    It was great to do this blog swap – in the process I’ve gone back and read some of your older posts. We are so similar in our goals and thoughts it’s a little scary. You’re my long lost brother from the US. You’re welcome to post here any time.

    • Hi Holly,

      So much is within our control. You summed it up incredibly well in your latest post, linked to in your comment. Wow, you rocked it with that post and I hope everyone here checks it out.

      I agree that we can kick butt if we roll up our sleeves and decide to. We need to stop being victims to really make our lives meaningful and accomplish big things.

    • TB,

      You got it, living modestly does come with more freedom and less stress. I’ve recently become more interested in minimalism too, because it fits in well with living frugally.

      With more stuff, you have more to stress out about and maintain. And it costs you more, which means you have to work longer to pay for it. But lowering our consumption and our need for stuff, lowers the required income we need, and helps us on our way to retirement.

      Plus it feels good to live this way. It really isn’t much of a sacrifice, once you get used to it.

    • Financial security is so much more satisfying than anything you can buy.

      What I didn’t expect was that living frugally and simply – the process of getting to financial independence – is also much more enjoyable than living close to the edge of your financial capacity.

  2. Kraig you’ve made some great points. I agree that life is too short to spend most of it working to acquire stuff. I’ve got a plan that I’d like to enact that hopefully will allow my wife and I to be financially independent within 15 years. It doesn’t involve saving half of our income, it’s more of a let others save for us type plan.
    Good luck with you goal.

  3. Living modestly helps us appreciate the more important things in life and not worry over losing a $1000 purse, or scratching a $100,000 car. My first job out of college was $35,000 a year, not much higher than yours was, so I know how hard it can be to make a living for young people in our generation. I’m trying to grow my net worth to a million dollars by the time I’m 40. I think it’s a stretch as well, but it’s fun to try :)

  4. Great post! I love hearing about other people who are striving for financial independence. We want to reach a point where our real estate rentals and investments will pay for our living expenses. The target is 35 ;) So I don’t think your goal of 40 is far fetched at all. Best of luck!

  5. Hi Kraig. Your Papa sounds like he was a wonderful role model who made financially prudent decisions to care for and protect his family. Thank you for sharing your story with us. Finances are so deeply personal and emotional, and I wish you luck on your journey toward prosperity.

    It really is astonishing how many well-meaning folks end up sacrificing their tomorrow by unwittingly chaining themselves to debt (aka, indentured servitude) just to enjoy the transitory moment of ‘right now’.

  6. This is a great story. My dad is a workaholic who never gets to enjoy life because of overspending. At 70 years old he’s still barely getting by. I vowed not to go through the same path and I am slowly making progress on being financially free as well.

  7. I’m aiming to reach FI by 40 as well although if I can continue to have years like 2012 I think I’ll be able to have those lazy morning walks a lot earlier. It’s very liberating knowing that someday much sooner than most people I’ll be free to do as I please and not have to worry about money. Just being on the path is freeing, in itself because if I happened to get laid off I would still be in so much better shape than most people. I’d actually still be able to invest/save because my expenses would be less than I’d receive in unemployment.

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