This month we embarked on a frugal & healthy month challenge to to establish better spending, eating and exercise habits. Is it a good idea to just dive into a complete life overhaul like this? Probably not. But I’m a recovering overachiever, and my husband is always up for a challenge, so we went for it.
This is only the second time we’re sharing our monthly expenses and I can already tell that it’s helping to keep our spending under control. Nothing like a little public shaming to make you put the credit card away. Most of the time, that is.
The Frugal & Healthy Month Challenge
The frugal challenge was the least painful of the two, though we did veer off track a bit by the end of the month. The goal was simple – spend as little as possible on nonessentials. Since we are trying to find our baseline level of spending, we opted to reduce spending sustainably, rather than just shifting purchases to September. We were successful for the most part, until our beloved Nespresso machine broke. Obviously, we replaced it immediately. However, this purchase then led to a few other transgressions (hello, spa day). Luckily, August ended before things got too embarrassing.
In addition to our financial independence journey, I’m on a personal journey to improve my health. After nearly 15 years working long hours at a high stress desk job, my health was not great. I’ve also been an emotional eater for most of my life, which made my previous work environment even more dangerous. It may take a while to adopt better habits, but this is one step in the right direction. Mr. RichFrugalLife is healthy but agreed to join along for support. I love him madly. Gotta make sure he lives a long healthy life so I never have to spend a day without him.
The healthy challenge was a bit more comprehensive. Our primary health goals for the month were to: exercise daily; track food in MyFitnessPal; no desserts; get 7-8 hours of sleep; eat less processed food and more fruits/vegetables; and no alcohol (the hardest part!). Surprisingly, we hit all these goals, and as a bonus, I lost 6 pounds and Mr. RFL got a little bit ripped. We celebrated on September 1st with a few homemade cookies and a bottle of moderately expensive wine.
Why share our monthly expenses?
I should confess… getting a behind the scenes look at other finance bloggers’ spending habits and net worth gives me a voyeuristic thrill. You, too? It’s okay. I won’t tell anyone. Everyone’s financial situation is unique and, as such, you probably shouldn’t judge your own financial progress based on what others have achieved. However, I do believe there is value in sharing information.
It has been motivating to see how many folks in the community are happily embracing simpler lives and how little they spend while doing so. This knowledge has given us the confidence to begin our own journey to financial independence and a lifestyle which we believe will be healthier, happier, and more fulfilling. I applaud the kindness and openness of the FIRE community in this regard and want to pay it forward.
If you’re looking for the frugalist of the frugal… you won’t find that here. While Mr. RFL and I both tend toward minimalism, life is short and we have no problem splurging on things that make us happy (i.e. travel, good booze & music). However, while we continue to spend freely in these value areas, we’d like to ruthlessly cut back everywhere else.
I’m hoping that the commitment to share our spending with you each month will provide us the accountability we need to stick to our goals.
Other information useful in reading this report
Did we just buy a money pit?
We took a risk and bought a complete fixer upper in late 2018… with a toddler. When we moved across the country for Mr. RFL’s job, we chose to live close to his work so that he could have a shorter commute and we could have a better quality of life. After viewing MLS listings online in the months leading up to the move, it quickly became clear that the housing market in the area we wanted to live was quite a bit more expensive than the one we were leaving in North Carolina.
We scored a great deal on a fixer upper with a lot of potential, created a detailed renovation budget, and have been working on projects ever since. We’ve tried to control the costs where we can by learning some new DIY skills and doing a good bit of the work ourselves.
Since this is a whole home renovation, the costs are significant and non-recurring. They are not included in our monthly expenses budget as we have separate assets set aside to cover the expected costs from our financial independence portfolio. However, I will still disclose monthly spending for the renovation each month for a complete picture of our spending.
How we define an “expense”
Outside the renovation costs above, the table below includes all other true expenses for the month. I want to point out that they don’t include cash outflows for principal payments on debt. As a former accountant, I don’t view principal payments to be “expenses” since they directly reduce debt and increase net worth. Our current plan is to have all debt payed off by the time we fully retire. However, I do consider remaining loan balances and future payments when forecasting how long it should take us to reach financial independence.
Our total debt outstanding at the end of August was $241,0000, which represents a decrease of approximately $12,000 from July! Substantially all debt relates to our home mortgage. The “mortgage” expenses included below include mortgage interest and an allocation of annual property tax and insurance costs. We also regularly make extra principal payments to accelerate pay down of this loan, which will reduce future interest costs.
We have no credit card or other debt with a high interest rate. However, we do have approximately $17,000 in low interest or non-interest-bearing loans, including the following:
- Student loans – Though my parents helped pay for college, I still graduated with student loans for the rest. These should be paid off by December 2021 and carry an interest rate of only 0.75% (approximately $3 per month).
- Home renovation project loan – We replaced the 20+ year old HVAC systems as part of our overall home renovation project (see above). The vendor offered us a project loan with 0% interest if paid evenly over four years. Since it’s not that difficult to beat a 0% return, we decided to take advantage of the offer. Payments for this are included in the monthly renovation spending amounts disclosed below.
August 2020 Monthly Expenses
Ok, here we go! Below are our monthly expenses for August, along with some thoughts (or excuses).
| Purchase | Amount | Commentary |
| Mortgage | $1,039 | Monthly interest, property tax and insurance |
| Health insurance | $360 | Health insurance is a necessity. Ours is a high deductible plan subsidized by Mr. RFL’s employer |
| Groceries | $806 | Another high month, though this one included my first trip into a Costco in 6 months with no eating out. I find it impossible to enter a Costco without dropping at least $250 |
| Dining out | $0 | Yay! This was a win for our frugal August challenge. |
| Wine & whiskey | $42 | Used an expiring Total Wine cash reward to restock. All will be drunk in good time. |
| Household supplies | $119 | Toilet paper, cleaning supplies, bath products and all that exciting stuff |
| Utilities | $314 | July bills. With temperatures averaging 110+ degrees in the Phoenix metro, I’d say this is pretty darn good. Most people we know pay $400 – $600 per summer month for just electric. |
| Internet | $42 | Locked in another promotional rate for the next year in June thanks to a 15 min phone call. |
| Cell phone | $60 | Planning to reduce this by switching to a MVNO plan soon. Just haven’t gotten around to it yet. |
| Streaming subscriptions | $52 | Cut the cord ages ago, but this is a lot of streaming. We’ll tackle this in September. |
| Gas for cars | $67 | With no fill ups in July, both cars needed gas this month. I can go almost two months on a tank these days. |
| Pest control | $65 | We’ll take this on ourselves in the future, but with scorpions abound we’re currently letting the professionals deal with it. |
| Coffee maker | $149 | Unfortunately, our Nespresso machine died halfway through our frugal August. It was the beginning of the downward spending spiral. |
| Spa day | $270 | Not a regular monthly expense, but a couple times a year I indulge in a few treatments at the spa. YOLO! |
| Clothing | $21 | Workout clothes for Mr. RFL. He’s been working out daily to help me with my fitness goals. The least I could do was get him some proper shorts, so he doesn’t have to work out in his boxers. |
| Website costs | $59 | Additional costs to get this website launched (most were incurred in June) |
| Kid purchases | $11 | More art supplies for the kiddo |
| Other purchases | $53 | Glass food containers for meal prep, additional face masks since COVID 19 is still raging, office supplies and student loan interest |
| Total August Expenses* | $3,529 |
So, what do you think?
Overall, I’d say this wasn’t too bad for our first attempt at a frugal & healthy month challenge. If we could actually manage this on a regular basis, we could lower our FI number and reach financial independence a lot sooner than I’m currently projecting! While we did have some unexpected expenditures, total costs were still more about 25% less than July. Let’s call it a win” for now and see if we can do better in the future.
Have you ever tried a “no spend” or “super frugal” month? If so, what were the results? I’d love to hear what kind of results you achieved, as well as your normal monthly spending level. Sharing is caring.
