Since 8 months I now live on a single salary. It is not the typical FIRE one salary whereby one stops to work because they have reached certain financial milestones in their financial long term plan. This one salary family is enforced on me due to my divorce.
I see this new reality as an opportunity to reorganise my life and be closer to my true self. Not only financially, also in terms of what I value and where and how I spent my time.
As this is a FIRE blog, I will focus on the financial side. During meetups (like fin-x) We can have a chat on the other aspects.
As from January, I live on my new budget. My budget had the following requirements
- It needs to be below my income
- It needs to allow for enough fun
- It needs to cover all expenses except travel. Travel is separate and tracked as well
With that in mind, I set up a monthly budget and automated as much as possible. Automation is key to have a worry free financial life. It is also great in hiding money from yourself so that you are not tempted to spend it all.
My experience so far – in a random order
- As a half time dad, I spend more money on going out and babysits than before. I do not intend to cut my expenses here. Spending time and money on my hobbies and friends is something that I value a lot. Given my situation, it means I have extra costs in the week that I have the kids. I try to limit this to max 1 babysit evening when I have my girls. Typically, this then translates in a babysit for the improvisation training.
- Costs for housing remain almost the same – state offered reductions are no longer there. This is one that I imagined up front. Seeing it in action is another thing. As the kids officially life with their mom, I loose some benefits on property tax and the water bill.
- Food planning – a challenge for me. I try to limit the food that I have to throw away because it goes bad and I try to limit the amount of pre prepared meals that I serve myself and the kids. I get better over time.
- Personal development is worth it. I have regular session to support me in my personal development. And I take regular trainings in improvisation.
All in all, I did overspend by 250 EUR the first 7 months of the year. July was a particularly expensive month. Especially when you consider that I was on holiday 6 days. Nevermind. I do not have the feeling that I splurged. I did eat out a little more, I did pre pay some trainings, and I bulk bought new cloths. I am confident that the remaining 5 months will allow me to catch up.
This new situation alse means that I review my financial plan. I have a simple approach for now.
I have no more financial plan
And with that I mean that I have stopped tracking my savings rate and the progress towards the 4pct rule. It is somehow in line with earlier thoughts. It now goes one step further: I do not want to know what my theoretical FIRE date will be. That spreadsheet is now unemployed.
Part of that is that I have decided to take some actions that will reduce my salary.
I am actually writing this post on the last day of my one month parental leave and just before starting to work 90 pct. This has for sure an impact on my finances. I just value the benefits even more.
I had a great one month off this summer with a lot of me time and family time. I plan to do this again next year.
Working 90 percent will allow me to be there for my girls each 2nd Wednesday. No more taking half day holidays, asking my mother or the mother of my children. It will be us time, for the three of us. I look forward to that.
With all these changes, my new theoretical FIRE date will be so far away, maybe even after my pension age. I have no guts and energy to update the spreadsheet. I trust that living by the principles that I lived by the past years will allow me to organise my life the way I want. And that already now. I am even more convinced now that chasing a big reward in the far future is not helping me now.