November 2018 Financial Update

A record month of spending and saving!

 

November

What a month!

This month I spent an all-time one month high of $3,460.64 (blame Cyber Monday and some frivolity), but also recorded a record 84.29% savings rate with a net worth gain of $19,135.05. Talk about huge! This will decrease the ret of the way, but I did surpass $200K in net worth far ahead of schedule!

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I quit my cushy, safe, government job.

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My career has not developed in the way I initially imagined. Let me explain: I started out in the arts and the entire time I used to proudly declare: “I’m going to change things! I’m going to make this business more sustainable and accessible for everyone!”

That passion drove me to work in an arts centre below minimum wage just so I could attempt to network. It drove me to do an MBA. But when I got out of school, social mandate in my back pocket, ready to preach as if it were gospel, nobody cared.

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I Got My Six Figure Salary. Then I Inflated My Lifestyle!

Making more = Splurging more.

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Aspiring to be frugal is a funny thing. For all my posting about how I stay entertained in downtown Toronto on the cheap to how by despite making more money nothing in my lifestyle would change, reality sure has been different.

For context, when I changed jobs, my salary jumped a whopping 22%. When I saw the offer letter, I immediately thought to myself: “Yay! Expedited FIRE here I come!”

Well, as nice as that aspiration has been, my spending from January to June 2018 has gone up 21% compared to all of 2017. Mathematically speaking, 21% of a monthly spend versus 22% of an annual increase is kind of like comparing apples to oranges, but nonetheless I realized I’ve basically inflated my lifestyle without even knowing it.

Starting in January financial update post I was making up plenty of reasons why my expenses had gone up, ranging from Christmas gifts, to the need for new shoes, to suits, etc. But all that was a list of excuses. I’m spending more and I think today is the day I’ve figured out why.

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October 2018 Financial Update

Slowing growth.

October 2018

October was a rough month for many of us – shares dipped globally, meaning everyone’s net worth was largely flat, mine included.

This month I spent $2187.34, for an incredible 66.35% savings rate with a net worth gain of $2051.62. This should really increase next month when I start a new job with an added signing bonus!

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I Furnished My Bedroom for $7.50

Mattress not included.

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For the entirety of my adult life, I never stayed in any one spot. I rented basement apartments, condo closets dens, regular apartments, lived at home, etc. By my calculations, I had moved 11 times in the period between 2011 and 2016 mostly due to school and employment circumstances.

The brevity of these living experiences led me to meet many interesting roommates (for another day…), but also adopt the mentality of “own less”. “Own less” meant for every new purchase I made, I’d have to find a way to either throw something away or make it fit in my car upon the inevitable move. This worked very well for a period of time as it optimized my frugal habits but it got exhausting having to live knowing this particular roof over my head was temporary.

Finally when I got a full-time job, I decided it was time to get settled. I signed a one-year lease with a former roommate and we were in business. “No more moving!” I cheered, until I realized a big problem: that I owned zero furniture. Nothing except clothes and a laptop. For the past 5 years of my life, I had been subletting or renting furnished rooms. All of a sudden, I was going to be walking into a completely empty apartment.

Where do I start? What do I do? Where do I go?

I started to think about the things I’d need: a bed for sure. A desk. A dresser. A lamp. Probably a book shelf. Unwisely, the first place I started to google was Ikea and was quickly unimpressed with their pricing.

Then I took a breath and realized a few things:

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Dear Saver: These are the Forces That Work Against You

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Life is hard. Between keeping your financial head above water, living in the moment, and simultaneously saving for the future, there are so many variables you have to manage. Do you buy that thing because it’d be nice to have? Do you stay in a lesser hotel to save a few dollars on your trip? For that show you’re seeing, do you spurge on orchestra seats or resolve to the upper mezzanine?

We deal with these dilemmas every day, and if you’re a saver, you probably pretty good at balancing the pros and cons of your spending options.

But despite your best efforts, there are still forces that work against you. They work against you no matter what your resolve is. And frankly, these forces suck.

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What’s Your Marginal Rate?

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Not too long ago, I used to work for minimum wage in my spare time lightwalking for the Canada Opera Company. What lightwalkers do is stand on the stage wearing some neutral colours as the lighting designer and crew adjust the lighting to make sure faces are lit and unintended shadows are mitigated. Reason: it’s cheaper than having the actual opera singer stand there doing nothing.

The gig was fun. I’d work a 4 hour shift one weekend and pocket $44 and get to hang out on the majestic stage of the Four Seasons Centre in Toronto and rekindle my love of theatre.

But one day I stopped altogether. Why? Because my marginal tax rate caught up to me. Let me explain.

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