Financial habits I am keeping (or adding) for 2021

2020 has been a crazy year, and the pandemic forced us to do many things differently. For some of those things, I can’t wait to get back to normal, but some of my new habits I hope to keep forever. Here are the keepers:

  1. Cooking at home. I never liked eating out. Not just because it is expensive, but I really don’t like people touching my food, eating meals that I don’t really know the ingredients of, and socializing with the servers. Meals out with people are sometimes part of my job, but I plan to continue to avoid them whenever they are avoidable.
  2. Bringing my lunches to work. I always planned to bring my lunches to work but rarely did. Most of the time, I bought burritos from Chipotle. For me, this doesn’t have most of the negatives of eating out – I know pretty much exactly what is in my burrito, and I can see the people cooking the food. Nonetheless, it is expensive. A $7 burrito each workday adds up to $140 a month or $1680 a year. And that doesn’t count the drink I often got to go with my burrito. I have gotten pretty good at preparing food over the weekend for the whole week, and when I return to the office, I will plan to have five lunches for my wife and me ready in the freezer each Sunday night.
  3. Only buying and eating whole foods. No Snacks September had quite an impact on my eating habits. We have continued to buy very little processed food, and it has been wonderful both for my physical and mental health. I am not sure there are direct savings, but this is definitely a habit I want to keep.
  4. Using grocery curb pick-up. I love Misfit Foods (Want to try it? 25% off code for your first box: COOKWME-IE2AJH). Fresh organic fruits and veggies arrive at my doorstep every week. I have compared with my local organic options, and the food is cheaper and much better at Misfit. I plan to keep those deliveries for the foreseeable future. There is also a lot to be said about grocery pick-up. My only complaint about curb pick-up is that I don’t always like the produce they select, but as most of my produce now comes from Misfit, that is much less of a problem. I believe I am saving a significant amount of money by not being tempted to throw random stuff in my cart, and I save at least an hour. Once it is safe, I would be happy to go grocery shopping once in a while, but I don’t think that will be the norm for my family.
  5. Not spending money on transportation. My office is 3.5 miles from my house, so driving is a minimal expense in terms of gas. Parking, however, is about $10 a day! Between that and my lunches, I was spending about $4000 a year to go to work. If it feels safe, there is a bus which is close to free. If that doesn’t feel safe, I have identified free parking 1.3 miles from my office. I think a 2.6-mile daily walk will do me good:0)
  6. Not spending money on gyms. I have had gym memberships off and on for years. I really don’t like gyms – I’d much rather be outside. I don’t plan to sign up for a gym even when that becomes safe.
  7. Not spending money on the weekend. Before the pandemic, we sometimes ended up at the mall on the weekend. Mostly, we hung out at the bookstore and didn’t buy much, but it still involved mall food and occasional purchases. After the pandemic, I would like to spend more time with friends doing non-mall things like hiking or exploring the surrounding towns

There are some things that I would be happy to start spending money on again. Dancing and 5Ks are very high on my list…..Actually, those might be the only things on my list:0)

What habits did you pick up during the pandemic that you want to keep?

Becoming financially independent is easier than you may think

Financial independence, from a mathematical point of view, is pretty straightforward. You need an investment portfolio 25 times your annual expenses. With some basic assumptions, confirmed by historical market performance, if you withdraw no more than 4% of this portfolio each year, it will last indefinitely.


Financial independence is not absolute; it depends on how much money you need to cover your annual expenses. If you can live on $40,000 a year, you need a million dollars in your investment portfolio. If you spend $100,000 a year, you will need $2.5 million. That is a lot of money but actually getting to financial independence is easier than it might seem because you don’t have to save all of that money on your own. Once you start investing, the market helps you along.

Suppose you save and invest $20K per year. It may seem that it would take you 50 years to get to 1 million dollars. But if we assume that your investment grows at 11% annually (a reasonable assumption based on historical averages), it will take you only 17 years. In other words, you will only have to actually save $340,000, and the rest of the money will come from the growth of your stocks. In the table below, notice that after year 7, the market is actually contributing more towards your portfolio growth than you are. The rich get richer!

Surprisingly, how long it takes you to reach financial independence does not depend on how much you make but only on what percent of your income you save. If you make $200,000 and you save 50% of your income (therefore, you can live on $100,000 per year), it will take you exactly as long to accumulate the $2.5 million you need as someone who earns $80,000 and can save $40,000 of their income to reach their financial independence number of one million dollars. Of course, making more money helps – it is much easier to figure out how to live on 50% of a $200,000 income than to figure out how to live on 50% of a $20,000 income. Nevertheless, the table below will tell you how long it will take you to reach financial independence assuming today you have no assets and no debt based on various level of saving. You can get information based on your specific situation with this straightforward calculator.

Do you feel inspired? What percent of your income are you willing to save? The average US household saves about 7% of their income which translates to 58.8 years until financial independence. Can you do better?

November Spending

As we expected, November was a big spending month. December is turning out very similar, so be prepared!

Food has again climbed over $1000 for the month. In this case, this is actually OK. With Covid spiking again, I decided it is time to restock the pantry and we are back up to more than a month of food stored. It is not the kind of food I actually want to eat for a month, but it is definitely survivable. We also splurged for Thanksgiving food. It is amazing how fast expensive food adds up! We have a nice stockpile of nuts left waiting for Christmas.

The next largest expense we had were pets. In addition to the usual food and meds, we had two vet appointments. One of them was a major work-up on our Beagle’s heart to make sure it is safe to put her under anesthesia and clean her teeth. The results were good and she got her dental on December 1. This means that in the next budget report you will see another big vet bill. Her dental was several years overdue because of concerns about her heart. It took 3 hours, she lost 9 teeth, and they cut out some weird growths on her gums (hopefully these will check out OK). She recovered from all of that within a day and is doing very well.

Next on the list are donations. I won’t say much about these to protect the innocent.

Child expenses are up too. Christmas. Do I need to say more?

The battery on one of our cars stopped working. A new battery, oil, and several other small things added up to almost $300. And we need another $700 of maintenance (the car just passed 100K miles) when we get around to it. As we are not driving much at the moment, I am in no rush.

Our phone bill is big because it is for two months. I am not very good at paying on time. However, we are going to try prepaid phones. More info on that next month if it works out.

As you see, I also got a nice blender/food processor. I am very, very happy with it. So far, I have made delicious banana ice cream, smoothies, and some great burgers. I got a Ninja. I can’t imagine Vitamix is four times better (and it is four times more expensive).

Next month, watch for our December spending and our end of the year summary. My goal was to stay under $60K. Did we make it?

Life without Netflix and our December Challenge

No Netflix November: November’s challenge was to survive without Netflix. As challenges tend to be, this was eye-opening. My screen time didn’t decrease, but I largely switched to Youtube, and that was great! It turns out I like to learn new recipes, and we had all kinds of delicious food, including stuffed “goose,” which I made completely from scratch for Thanksgiving. All the geese in the neighborhood (we live by a lake) heard about my amazing hunting ability and now fly away every time they see me (This is a joke. The “goose” was fake. We are still mostly vegan and definitely vegetarian.) I declared No Netflix November a success and canceled our subscription. We still have access to movies on Amazon Prime and through the library.

Modified SNAP December: For December, I decided to try something hard. I started by thinking of doing the SNAP challenge – living on $4 per person per day for food in December. This is $360 for the month for our family of 3. I tried to do the math, and it was impossible to continue eating organic, eat lots of fruit and vegetables, and still get a reasonable number of calories for $360. Either the organic food or the vegetables would have to go, and for an entire month, I am not willing to compromise on either. So we have decided on an easier challenge – $240 for the month, but most vegetables don’t count! We will still count vegetables that provide a significant number of calories, such as potatoes, corn, and avocados (I am drawing the line at 50 calories per 100 grams). Vegetables that don’t count will also not count if they are frozen or canned, but processed foods (such as pasta sauce) will still count even if they are made mostly out of “free” vegetables.

This challenge will involve some tracking. Foods we buy will get counted when they come into the house if we expect them to be eaten during the month. However, if I am using bulk foods that will last more than a month or are foods we already have, I will do my best to estimate the amount we eat and the cost. So “shopping” the pantry is allowed as long as we track the cost. Buying bulk will help with keeping the cost down. For complete record, I will also keep track of the cost of veggies we eat and report it at the end of the month.

Black Friday and Cyber Monday Shopping: Youtube influenced me exactly like it influences the average consumer — I decided I must have some of the toys people on Youtube were showing. That, combined with Black Friday/Cyber Monday, led to the purchasing of two kitchen toys – an Airfryer (on sale to $59 from $119) and a blender/food processor (on sale for $96 from $150). We have had them for just a couple of days, but the Airfryer makes the most amazing fries, and the blender makes the most amazing banana icecream, so I am quite happy with both. This weekend’s project is to figure out where to store them:0(