Hey it’s Tim and it’s amy from go with less welcome to our channel, we’re bringing you another early retirement video today they seem to have done really well and people say: they’ve received a lot of inspiration from them, which is amazing, and we really appreciate those nice Comments and that you’re watching so if people are looking for early retirement, education and inspiration, we’re happy to do that. We’Ve been retired for the past four years and we’re gon na talk about another topic today. Today, we’re gon na be talking about how we deflated our lifestyle, we’re gon na, be talking about lifestyle, deflation and how that impacted our life, so that we can retire early yeah. We come out with a new video each Wednesday, so we hope that you will subscribe over here in the corner and with that, let’s get started. We’Re gon na start out today by defining two terms. The first of those is lifestyle, deflation and the second of those is lifestyle. Inflation,
Actually we’re gon na start with lifestyle inflation, probably because, if you’re interested in early retirement, you’ve probably heard this term lifestyle inflation and what that is, is, as you earn more money, you tend to spend more money, you buy a bigger house, you buy a bigger car. You start having somebody mow your lawn, so your expenses rise in kind as you have more income, so that’s lifestyle, inflation. I haven’t really heard lifestyle – deflation – maybe it’s out there, but I think the Tim coined this, but it’s just the exact opposite and that is taking your life and expenses down in terms of how much it costs to live. Your life now
Most people don’t do that unless they’re forced to do it, and that makes what we’re doing kind of a hard sell, because most people want their creature comforts that they’ve worked hard and have earned, and we get that because we did that. But we are here to talk about how we deflated our lifestyle and why you might want to think about that too. Something that Amy and I saw regularly about retirement spending is that you will need to have at least as much money as you’re. Currently, spending in your working life, when you’re retired, potentially more if you have hobbies or travel or you’re, going to do things, they’re gon na cost a lot of money. When Tim and I were originally planning to retire, we were at a spending level of a hundred and fifteen thousand dollars. So we looked at a hundred and fifteen thousand dollars as the amount that we’re going to need in our retirement, and that was where we kind of started planning. That’S an enormous amount of money, a hundred and fifteen thousand dollars. And when you looked at how much we needed it was close to three million dollars.
We weren’t anywhere close to that and it only came from changing things in our life drastically and we’re gon na talk about what we did so that we didn’t have to wait so long and we didn’t have to have anywhere near three million dollars in the bank. Far and away the largest thing that we had in terms of deflating our lifestyle was getting rid of our big house. We had a giant house close to 6000 square feet, so everything …. It wasn’t just the mortgage that we had on that house, but it was everything that it took the taxes. It was the insurance, it was the care of the house, the maintenance of the house, the furnishing of the house utilities. All these things made for a huge reduction whenever we were able to deflate our life and move into our smaller space. I’M gon na talk a little bit about that smaller space. We moved into our rental property. We had a townhome that we rented out to one woman for five six, seven years solid one woman and it was a great size for one person.
Well, the three of us moved in here: it’s a two-bedroom two-bath and it is the exact right size for three people which is really nice right behind us. This is our only table. This is our kitchen table. It’S our dining room table. It’S our studio. It’S our studio. Every time we do a video, we have to clear off the whole table and set everything up so that we could have something clean and tidy. In the background and that’s our kitchen table in our big house, we had three separate dining areas: ( and that’s indoors – there’s also outdoor patio seating ). So there were all these different spaces. How many places do you need to sit down and eat dinner turns out. There’S only one table that we needed and we were really happy to have all the less stress and all that that came with that big house by moving into a smaller space and it plummeted our spending big time.
The next place, where we cut out a lot of spending, is with cars. So when we moved out of our big house, we had three cars at the time we got rid of our biggest most gas guzzling car at the time and just two days ago we got rid of one of our other cars. So now we’re left with one car so just like with a home, a car comes with insurance and a lot of other expenses that we were able to get rid of.
Yeah, so we owned the cars outright, we didn’t have car payments, but we had maintenance and all kinds of expenses with a car and just the hassle of this car depreciating now the two of us are together, like 95 % of our time, early retired, which works Great for us, I don’t think it would work for a lot of people. It works fantastic for us, but we are apart 5 % of our life, and now we have one car in a mega-suburb that has extremely poor public transportation. The two of us love public transportation. We can’t wait to get to an all public transportation life, but we’re not there yet so for now we’re in suburbia
And the way we look at it is the times that we both need a car. Maybe we have events or I don’t know, appointments or something like that – that we both need to be in a car in a separate place. Either we get a ride. We use an uber or something like that, so we’ve determined that it would be cheaper to pay little bits every now and then than to have the maintenance and upkeep of a second car. So the car’s out the window and now we’re left with one car
Lifestyle deflation comes with this negative connotation, specifically the lifestyle part of this. It makes it sound like somehow our life is going to be “ less than” if we spend less money so we’re here to say that our new deflated lifestyle is more full than our big spending. Lifestyle ever was our really inflated lifestyle. So the the fact that we were able to reduce all this spending hasn’t reduced our quality of life in any way, shape or form. I’M gon na share a little story about a friend of mine and a conversation we had just this week. That really hits this home
The friend is getting close to 50 and she was talking about her days of travel when she was in her young 20s. She’D say that she would go on vacation with 20 bucks. That was all she needed, because she’d be going to stay with a friend. They’D pick her up at the airport, she’d have $ 20 for food, and that was all she needed, and the food for 20 bucks …. She said, she’d have a jar of jam and, like a loaf of bread and she’d, sit in the park, she was recounting this story with like great memories and fondness.
She said these were some of the best ships of my life $ 20. Imagine taking a vacation with $ 20 if you’ve already inflated your life, that’s impossible to consider that you’d spend 20 bucks on vacation, but she did – and it was great when my girlfriend – and I were in college – we didn’t even have a dollar to buy …. We used to be obsessed with frozen broccoli, frozen broccoli was a dollar and tax at the local convenience store, and we didn’t even have a dollar between the two of us. Even though we both worked, we didn’t have an extra dollar, so we would scrounge and ask our dorm friends to look under their mattresses for spare coins because we didn’t have a dollar now. I do not look back at those days of having absolutely no money. In anything other than like love, and just such incredible times back then – and we had nothing if you’re over 30 – think back to your 20s, your young 20s. Did you need a ton of money to have a good time, or did you have a really good time without spending a lot of money? That’S kind of what we learned?
We weren’t expecting …. We were expecting to have some sacrifices in our life. I think the big surprise for us is that it really wasn’t a sacrifice. We were prepared to make some sacrifices to have the freedom of not working anymore, but it turns out that I mean if a sacrifice is like a negative thing, it really wasn’t for us at all, not at all. I think also. We found some tricks so that we can entertain ourselves inexpensively. There are things that we do now in our life that make it so that we don’t have to spend money to make amazing things happen. I’M gon na say the dining is our third largest expense, where we really reduced, where we really were able to cut back
And that was primarily from dining out. We ate out a lot and when there were five of us and we were all eating out at one meal, you could easily spend 150 bucks on a meal with five people, no problem, and so once we moved into our smaller space and we’re not dining out. As much and we are cooking our meals on our own, it’s …. Actually, we love the food that we cook and we were able to save a lot of money by not dining out so much, and I’ve mentioned this before Tim lost 30 to 40 pounds after we retired. I think because he wasn’t on the expense-account meals, so dining out, not only for business, but also just the family, and the two of us was definitely contributing to health issues because of weight gain yep for sure we love saving money at the grocery store, and we Are not couponers at all. We did a very early on series back at the very beginning of our channel, so the videos are really rough. We had no editing equipment at all.
So we have to say everything like mistakes and all were out there, so we had to talk really fast to make sure that they didn’t get on camera but anyway, so they are rough but they’re. I think our 20. I don’t know 16 or 20 types of how we save money on groceries. I’M gon na put a card up top. I know that it is rough, we get it, it’s just that it’s the very beginning, so hopefully, you’ll give us a little slack on that. Entertainment was also a big expense that we had in our former life, whether that was going to a concert. We would try and do that frugally. … we’d sit in the cheap seats, but we still we went to a lot of concerts.
We saw a lot of movies. We did a lot of things to entertain ourselves on a regular basis. What we found is that there are unique ways where we can entertain ourselves for virtually free, primarily through volunteering, with cultural organizations that are doing the things that we like to do. We volunteer for our Denver Film Society. We volunteer for the Denver theater Center, so all of our entertainment is pretty much free through our volunteering yeah and that cut out a ton. I think these are like the big …. Actually there’s one area that went up and that is vacation.
But thanks to house-sitting and thanks to travel, hacking were able to keep that pretty good. The thing is in our past. We couldn’t take that many vacations, so we went from like two weeks of vacation to over a hundred days, a year of vacation. Of course, vacation is going to go up when you’re, comparing 14 days to over a hundred, but we still found ways to make that much more affordable. Yeah. Definitely we’ve mentioned this many many times before. In that we went from a hundred and fifteen thousand dollars a year spending to thirty six thousand dollars a year. So something that we want to note is that $ 36,000 a year is still a lot of money. There’S a ton of fat in that for us and by the way, that’s sixty five hundred dollars a month that we cut out of our budget when we decided to deflate our lifestyle, the budget categories that we cut out the most we talked about in today’s video. But almost every category had a big hit in our budget.
That includes shopping. We weren’t big shoppers ( if you can believe it or not. ) The hundred and fifteen thousand dollars a year included very little shopping compared to our overall budget, but some things did go up. Our health went up because of our self-pay health insurance and our more fancy gym and, of course, our travel, as I just mentioned, but most things did go down. These are just the biggies where in your life, can you consider deflating your lifestyle? Even if your goal isn’t retiring early, a goal of financial freedom is a good idea for everybody. We think, because things change so often and getting to financial independence is fantastic and having less spending is one of the big keys to do it. When we decided to make this leap, we had a lot of fears, so this wasn’t something that we just did and we knew it was gon na work. We knew it was gon na be great on the other side of taking $ 6,500 a month. Out of our budget
You can still have an amazing life and not have all these things in your life. All these things in our life that we thought were going to make us happier more fulfilled …. Having those things gone, we don’t miss any of those things at all and here’s the thing. Even if you miss it, add it back. If it’s that big of a deal, there’s one big thing that we did add back, we used to have a housekeeper for our big house, because we both had really busy jobs and, as soon as we moved to our small space, it made no sense that have A housekeeper we were both retired
Turns out we love having a clean house, we hate cleaning, the house, we hate it, so we brought back a housekeeper once a month and that’s 140 bucks once a month and it’s a big splurge for us, because we’re sitting here like on the couch while she’s Cleaning our house, but that is $ 140 – I’m happy to spend. Actually this is something Tim wanted more than I wanted definitely yeah. So if you do cut out something – and it went too far – just add it back.
You could do that no laws about this Nope. Thank you so much for being with us here on our Channel today. When this video comes out, we will be an Amsterdam with our daughter and it’s going to be the height of tulip season, and we are so excited to be there part of our financial independence. Is this idea of freedom and the fact that we can do these sort of things when it’s the right time to do it? The tulip farm is only open for two months a year and I think they have like 7 million Hand planted tulips every single year and it’s only opened, like I said for two months:
So we are crazy, excited all three of us. It’S like the thing that I’m most excited for about our trip, but we will be in Paris, Amsterdam and Brussels and that Brussels trip we’re gon na be visiting Ghent and Bruges so expect some good travel videos coming up. We still have all kinds of travel videos to publish from Merida, so we’re not done with Merida yet, but this early retirement conversation kind of keeps poking us on the shoulder, so we’re not going to avoid it. We’Re gon na have that. So thanks for joining us today and we hope that you’ll give us a thumbs up.
If you haven’t subscribed yet, please do it over there or down below, because we would love to see you next Wednesday and every Wednesday. And if you would share this with people who are interested in this concept of early retirement, maybe people who are afraid about cutting expenses out we’re here to tell you it’s not so scary dive right in the water’s warm see you soon..