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Friends who are more frugal than us

Posted by mapetitechou on Jun 3, 2015 in lifestyle, philosophy, traveling

If you think my husband and I are very frugal, you should meet our friends Sophie and Gary. They also work in the high tech industry. Gary is a software architect and Sophie is a senior software engineer. As you can imagine, they make very good money. I’d wager it’s upwards of $250,000 a year between the two of them. But they are probably the most frugal couple I know. They live in a modest 2000 square foot house. There are people we know who make way less than that live in much bigger houses. They drive two old Toyota Corolla and VW Golf. The Golf has over 300,000KM on it already. I don’t think they have any plans of upgrading to new vehicles anytime soon. Their two boys, age 5 and 7, are so well-behaved and not spoiled with fancy toys or iPads or gaming consoles.

Gary doesn’t seem to have any expensive hobbies. He’s learning to play the saxophone, which I think is fantastic. Any musical endeavors are a plus in my book and I totally support that in my family too. My husband plays the guitar and my son’s learning to play the piano. Gary and Sophie are just not materialistic people. Sophie isn’t a shopaholic like me when it comes to buying clothes and shoes. She tells me she doesn’t like going to the mall at all. Although I feel justified about my spending on my fashion somewhat because I have a fashion blog which is my main hobby that I completely love.

As for vacationing, they tend to stick with the low cost kind like camping. That’s where we differ the most from them I think. Because I’m a travel bug, I am willing to spend a substantial amount on traveling to faraway places. We go to China every couple of years because I still have family there. We’ve also traveled to Europe and South America quite a few times. So there’s usually one major vacation in a year, plus a few smaller vacations like going to Mexico for a week, or going away for a long weekend. Gary and Sophie’s traveling is much more cost-efficient. They just pack up the kids and drive. When you don’t have to pay for airfare and hotel for 4 people for a week or two, you definitely can save a lot of money. We just got back from a week of cruise to the Caribbeans. Sophie was asking how it was and if it was worth it. They have never been on a cruise so she was curious. I told her it was awesome. But I think she is skeptical about spending that much money in a week. In the same vein, they are also skeptical about tropical vacations in Mexico and similar places. We totally love beach vacations.

I was talking about how it’s hard for us to save money in the summer in my previous post because we tend to travel quite a bit in the summer. We love it and don’t regret any of it. But if you are like my friends Gary and Sophie, you know this is an area where you can either spend a lot or save a lot.

They are great friends and such simple people that they serve a good example to me on being frugal and finding little pleasures in simple things. I think they must be socking away so much that they can probably retire early, which is pretty inspiring because that’s my goal.

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I’m the “Villain”

Posted by mapetitechou on Mar 26, 2015 in financial planning, philosophy, relationsips, saving

Apparently in my in-laws’ eye, I’m the “villain” because I am an iron-fisted wife with our money — I don’t let my husband spend any. I knew that they thought of me as “frugal” or “good with money”. But recently I think I got a better idea of what they really think. I find that quite amusing. I’m a private person so I don’t usually broadcast our financial situation, unlike some other family members. So I suppose it’s easy for them to speculate what’s going on in our family’s finance. For some reason all my husband’s family think that we have oodles and oodles of spare money laying around, especially my mother-in-law, according to my lovely youngest sister-in-law (my husband has three sisters). She and I get along very well and she’s very open about her life and her opinions and she appreciates that I’m a good listener, so we often chat. Personal finance is one of those topics.

When I explained to her, I basically said every dollar is accounted for. Ha, I wish we had a ton of spare money laying around for us to spend! If we did, I’d definitely let my husband get his dream car. He’s always complaining about having to drive my old Corolla because his Tiburon (a sport coup from his pre-children days) died last year and it was just not feasible to get a new sports car anymore. And my MIL thinks I’m holding him back somehow. There are quite a few aspects to our finance that she does not understand.

Because of my “pay yourself first” rule, basically for every paycheque some of the money is redirected to our RRSPs, TFSAs, RESPs and other investment accounts. These have to be taken care of first. I am very firm on not shirking our responsibilities because you are ultimately responsible for yourself, present and future. So if you don’t take care of your future self, nobody else is going to do that for you. I think because she and my father-in-law did not live this way, she cannot even comprehend it. They are living on government pension. They never saved for their retirement. They don’t have any investments. They live a very simple life in a small town in Newfoundland. So their living expenses are very low, except for my father-in-law’s penchant for a new car every several years (that’s a whole other issue for another post). So the question of why you are putting your money in all these places is pretty complicated to grasp.

Also, my in-laws (and all my guy’s siblings for that matter), seem to forget that my husband has been in school for as long as we’ve been together. And that university education costs A LOT of money. My husband is a very smart and hard-working person. He did computer science in college. Then when we were dating, he did electrical engineering. And after we got married, he decided to do a business management degree while working full-time. And after he got that degree, he went on to do his MBA also while working full-time. He also had size-able student loans during early years of our marriage that we managed to pay off quickly. Essentially we invested a lot of money in his schooling. Every month a portion of our income was going to his tuition. I told my sister-in-law it’s like paying two mortgages every month. We just don’t broadcast that, it’s not in my nature to complain about it. If it was any of other siblings, we would be hearing about constantly. Again, this speaks to my philosophy about taking responsibility for yourself.

And furthermore, because we feel so strongly about education, we are saving for our children’s education. And somehow that’s hard for my MIL to understand too. She thinks when we talk about saving for their university education, it’s something that might or might not happen in the distant future. It’s not! My son’s 5, my daughter’s going to be 3 soon. In only 12 years my son will be going to university. 12 years will be gone in a blink of an eye. If you don’t start preparing for it now, you’ll run out of time. Time is your biggest ally in investing. So to my MIL, it’s money that’s being not used right now and being wasted. Well, again, I understand it’s a concept hard for her to grasp because they didn’t save for their children’s post-secondary education. My guy and his youngest sister are the only ones that have university education and they paid for it themselves. Massive student loans. My parents saved for my education. I had a jump start on life after school. That is something so valuable for your children to have.

We have our fun money obviously. Traveling is our biggest hobby. We go to China regularly. We take beach vacations every year. We’ve been to Europe a few times. My kids are seasoned travelers. My son has traveled more and further distance-wise in his 5 years of life than my in-laws have ever traveled in their entire life. It’s a gift that I want to keep giving to my kids for as long as they will let me (we will see how that goes when they are teenagers). The vacation funds have to be allotted and these aren’t inexpensive vacations. My MIL doesn’t seem to understand that either.

So essentially, every dollar is accounted for. And if somebody thinks it takes an iron-fisted wife to manage that, so be it. I sleep very well at night.

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