TL;DR - Was a good Mustachian this month, achieved SR of 90.77%
I am consistently amazed and inspired by you lot, so I was going back and forth on whether I should post in here, but wanted to share this accomplishment as I only have one person that I share my personal finances with.
My goal was to reach a one-time monthly savings rate of 90%, and after the final tally, I managed to hit 90.77%!
For context, 25M, single, grossing just under 100k per year, but monthly income varies a bit due to differences in pay period depending on how days fall. I knew I would have a few more hours than usual in the pay periods this month, so I decided to cut expenses hard and go after it.
The Math
My original estimation was that I would net approximately $3650 this month (after 2.35k in pre-tax contributions), meaning that I would have to keep my spending <$650 in order to reach the goal:
(Take home pay – spending) / (take home pay)
(6500 - 650) / (6500) = 0.90
I managed to do a little better than expected in both spending and take home, giving my final numbers of:
$2,350 pre-tax (401k, HSA) saved
$3,957 post-tax saved
$641 spent
Giving me: (6948 - 641) / (6948) = 0.9077
How It Happened
Obviously the income was going to be what it was going to be, I didn’t work any extra hours or anything. As I mentioned, the pay period fell slightly in my favor for these two particular paychecks.
As any seasoned mustachian knows, controlling spending is the most important factor in controlling savings rate. I decided to go bare-minimum as far as expenses, not allowing myself any discretionary spending (with the exception of already existing recurring subscriptions like Amazon Music and the gym).
Spending:
$325 Rent - I live with 4 roommates which brings the monthly lease of $2150 way down. I figured now would be the best time to live with a bunch of people to keep costs down, as I recently spent a lot of college years doing so.
$87 Utilities - got hit with electricity (monthly), gas/water (quarterly) and trash (quarterly) all this month, but obviously splitting it 5-ways makes it manageable.
$84 Car Insurance - expensive, but I am a young male.
$79 Groceries - utilized a lot of freezer, pantry, focused on what was on sale, ate more rice than usual
$35 Internet/TV - downside of roommates, we have cable TV. Would rather not, but I do take advantage anyways.
$20 Gym - last month went in and negotiated a discount
$8 Amazon Music Unlimited - my single entertainment subscription
$3 Cell Phone - taking advantage of Sprint’s 1-year free unlimited data/talk/text promotion
Notable Zeros:
$0 Eating out - difficult for me, but managed
$0 Shopping - easy enough, and fortunately no unexpected unavoidable expenses
$0 Gas - this was the month of the bicycle. One of my April goals was to bike more miles than I drove, and I did this. 100% of trips to work, grocery shopping and the gym were by bike!
Other Thoughts/Comments
1. Interestingly, despite doing way better than I needed to (I could have spent $54 more; or I could have earned $538 less and still ended up at 90%), this only translated to a 0.77% excess in SR. Shows how difficult small improves are when the SR is that high.
2. This was without any churning money coming in. I average a couple hundred per month churning CC/banks. Have a couple bonuses that will hit in May.
3. I am heavily motivated by challenges and achievements (maybe from growing up in the video game era?), and so goal setting with imaginary “Achievements” work well for me. In this case, I “unlocked” a few “achievements” in April including: Achieving 90% SR, Completing a month biking more miles than driving, Completing a “non-essential” spend month. This got me thinking.. Wonder if there would be interest in a Mustachian app, where you can unlock certain achievements in different areas touched on by MMM (finances, fitness, DIY, etc.)
4. I believe that the biking became the keystone habit which resulted in this success. I forced myself to only use my bike for commuting and grocery shopping, which was a constant reminder of
How sustainable is this? Probably not very - I had some things go my way and benefitted from a lack of financial “surprises”, unexpected expenses and a well-stocked pantry that allowed me to go without a Costco fill-up. However, this does put me at a 80% SR for YTD, which I think is consistently achievable with how my life is currently flowing. Anyways, thought I would share this achievement and break it down a bit. I owe this success to the motivation that MMM and these forums provide!
