“You should follow Mike on Twitter,” John told me one day early last week. “In his profile, he says he’s frugal.” Mike is a young teacher who is new to our school this semester. I talked with him about the “frugal” bit later that day, and I did follow him on Twitter. Like me, Mike reads MMM, but he doesn’t consider himself a “badass.” As we discussed his upcoming wedding, I asked Mike if he would consider letting me interview him about how he and his fiancée (named Charity) were planning to deal with finances as a married couple. I’m so glad he said “Sure!”
What would you say is your “money blueprint”? What are the messages about money that you absorbed as you grew up?
Growing up, my allowance money burned a hole in my pocket, with the Dollar Store being my store of choice. I liked feeling the rush of buying something rather than saving the money I’d been given. Like many parents, my mom and dad lived slightly above their means and tried to give their children most of what we asked for (for which I am very thankful).
I think this way of living made me think that money wasn’t a big deal and that if you had a decent job then you could live a pretty comfortable life. I also think I subconsciously understood money as a status symbol. The homes some of my friends lived in, the cars their parents drove and the clothes they wore represented something superior. My upbringing was very much middle-class, and there was a part of me that envied some of my peers’ bigger houses, more plentiful toys, and the travel they did with their families. That part of me wanted our family to be more “rich” – a result of my placing too high a value on materialistic possessions with the false idea that they brought happiness.
It wasn’t until later in life that I realized accumulating wealth is not easy and even with a solid income it can be tough to balance all of life’s expenses. I also learned that more stuff certainly does not provide happiness. In my opinion, having a healthy relationship with money requires careful planning, constant self-evaluation, and making your money work for you as opposed to only you working for money.
What is Charity’s money blueprint?
Her money blueprint is definitely different from mine. Her family had different financial obligations and goals as she was growing up. Her father became a specialized doctor, something that involved extensive commitments to his education in terms of money and time. Her family valued travelling, so that was always a priority – even when money was not plentiful. As she grew older, her family’s financial situation improved. Her parents instilled the importance of working and the view that money is a tool, not an end goal. She carries these lessons with her to this day but perhaps doesn’t have the same level of attention to detail or interest in finances that I have.
What got you started on a frugal path?
My frugal path started as I got to university. Through high school, I pretty much relied on my parents for my needs and wants. It wasn’t until university that I needed to start figuring things out on my own. My parents were kind enough to allow me to live rent-free at home in Ottawa through my undergrad, but they were not in a financial position to help me with the costs of tuition and books. I was fortunate to receive athletic and academic bursaries/grants along with well-paying summer jobs that helped me get through 5 years of university not only debt-free but with a few thousand dollars to my name.
My time at home during undergrad afforded me the chance to save enough money to then complete my Bachelor of Education in Toronto without taking on any loans. I was quickly realizing that if I was careful with my money, I could achieve the goals I had set for myself. My parents were in a decent financial position, but some unfortunate investments did not allow them to act as a ‘financial crutch’ for me. This made me more financially independent, and I was driven to become self-sufficient. I began to enjoy the process of saving money and figuring out ways to reduce my expenses and increase my income. I was always a competitive person and this was my new challenge.
To what extent would you say you’ve adopted the MMM “badass” philosophy about money?
I’m not as “badass” as Mr. Money Mustache. I enjoy occasionally reading and learning from his blog, but I’m not as extreme as he is. I do agree with the premise for his blog, which is to help people start to view money in a new way and to realize that their lifestyle (for the most part) is causing their financial struggles. I would say being frugal is a lifestyle, but once that starts to become your identity then it is no longer healthy.
I have had to give my head a shake a few times in my financial journey. There is a fine line between aggressively saving your money and obsessing over how many zeros you see in your bank account statement. Frugal and cheap are two different things. The dilemma with saving is: what are you saving for? You can accumulate all of the wealth in the world, but if you don’t have the time or health to enjoy it then it’s pointless. Striking the balance between saving but also enjoying the fruits of your labour is key. It’s a process not a destination.
You told me that Charity is not as frugal as you are. Where would you say she stands on the spectrum from uber-spendy to uber-frugal?
I would say she’s somewhere in the middle. She’s certainly not a reckless spender, but I think she has just lacked goals and a vision for where she wants to be financially. This has contributed to some times of financial stress and shortfall. She is not different from most people in that there is little planning and understanding of basic budgeting. All that being said, she is definitely becoming more financially aware and is learning to prioritize when it comes to her spending habits. She also offers a fresh perspective on money and challenges me to not take my frugality too far.
You are aware that conflicts about finances play a huge role in marital discord. Have you and Charity discussed your respective outlooks about personal finances? How do you see these differences playing out?
We are both keenly aware of our different outlooks on money and spending and have been pretty proactive about working through these differences. The biggest thing when it comes to financial health as a couple is communication. As long as we are both open and honest about our intentions for how our money will be spent, I’m sure we’ll be able to work through our differences. I actually think our different attitudes towards money have made for healthy interaction since she appreciates my more frugal approach and I appreciate her less rigid view of money and finances. If we meet somewhere in the middle and make the necessary compromises then I’m confident we can manage our finances effectively.
You said that you were planning to buy a house. What have been your parameters in choosing your home?
Yes, and we actually purchased one last week!
Our parameters were:
- In the city’s core.
- An ability to rent out a portion of the house for rental income.
- Family-friendly neighbourhood.
- Something we can afford on only one income.
The house we found met all of the above criteria. One of our ‘wants’ was a garage which unfortunately this house does not have, but overall we feel like we found a gem that should serve us well for at least 7-10 years (if not more).
What are your longer-term financial goals?
Our long-term financial goals would be:
- Financial freedom – meaning we’re working because we love our jobs and not because we have to; ability to travel and be able to experience various things without being constrained by money.
- Being in a financial position to give back to local charities, churches and causes.
- Multiple streams of income (salary, rental income, investment interest, and my small business) so Charity does not need to work in the future (but can if she’d like).
- Own a cottage just outside the city; a place to enjoy the outdoors and act as a meeting place for family and friends.
- Mortgage on our principal residence paid off by age 40. I currently own a townhome, in addition to the house we just bought, which I’m renting out. If we sell it in a few years and put the equity from that towards our principal mortgage, then it’s certainly do-able. We have over 11 years to reach this goal.
Is there anything else you’d like to add?
I’d just like to thank you for including our story on your blog. Your blog is a great resource and I have enjoyed reading the stories and insights you provide. Also as an aside, a goal of mine (that doesn’t fall under a financial goal) is to start a financial literacy course at school.
Mike and Charity are getting married this summer. Do you have any gems of wisdom to share with them as they approach their big day? Your comments are welcome.
*Image courtesy of Wikimedia Commons