How we live on $40k a year

I decided to blog about something to distract me from all of the gun violence and political garbage.

Something near and dear to my heart: living on what you make, no matter how little that may be.

I have lots of experience with this. My parents weren't rich. I wore hand me downs for all of my middle school years and can only recall one shopping trip for clothes to last my entire high school career. I paid for my own prom outfits and didn't get a driver's license until I was 21, because insurance and a car was something I would have to pay for. I also paid my way through college. All of it...and managed to escape with about $10,000 in student loans and a credit card balance around 2 or 3 thousand (not something even remotely possible now a days, which is why I believe something needs to be done to help out college students). After college my money woes disappeared. I graduated earning $50,000 my first year. I paid off all of my loans and purchased a house less than a year after graduation. I was frivolous with money for many years. I married a man making the same amount of money and our raises were substantial. I had a kid 4 years after graduation and began working part time. Together we were making $150k. Then I left him, easier to do with a career paying so much and allowing for a flexible schedule. I still spent a little more than I should, not worrying about having a savings account, although I did take advantage of the 401k plan offered by my employer.

Then 2008 hit. It terrified me. I looked at my bills and my earnings and my empty savings account. I watched my 401k drop 40%. I realized if I lost my job, I'd be worse off than in college. And my college days were still so vivid...lunch every day was a Snickers bar and Sprite (neither of which I could stand to eat once I graduated). Dinner was mostly 4 for $1 mac and cheese (funny how I still love mac n cheese!), with the occasional canned ham diced up into it (Grandma loved to send me care packages with canned ham!). I, literally, wrote down every single penny I spent. I had a spiral bound Virginia Slims calendar than my mom had given me that I wrote every single penny I spent or earned in it. (One thing I regret throwing away, I would love to peruse through that now). At one point I had 3 part time jobs while attending pharmacy school full time. I would be envious of my friends who could go to the food trucks to get hot teas on the cold winter days...I couldn't afford it...30 cents. I was angry that I had to live like this...blaming my parents, because all these other kids had a free ride paid for by theirs.. But I learned a lot from this. Most people pay no attention to the amount of money they spend or earn. I was always very conscious of it, even when spending frivolously. Once I graduated I never carried a credit card balance again (except on the rare occasion I got an interest free offer).

So 2008 was a wake up call. Ironically it made me STOP putting money in a 401k. I was angry that all of that money just disappeared and mourned the things it could have bought. On the other hand I realized I needed to start saving enough money to pay bills should I lose my job. I started researching and learning that you should always have enough money to cover at least 3 months expenses. I decided to get a credit line, figuring getting approved with a job would be much easier than without and would provide me with instant access to fairly low interest money should I need it and would cost me nothing if I didn't. We never ended up using the credit line, but it was comforting to know it was there. At this point in my life I hated my career as passionately as some people love theirs. The company I had been with for 12 years,since college, had gone bankrupt and after that point I was a job hopper, never finding bosses or a job that I could live with, until right before my retirement when I found the independent pharmacy that I ended my career at (by this point the stress of misfilling a prescription outweighed how nice my boss was or how much better an independent pharmacy was over a chain). During the entire time since I had left my first husband I had only worked full time for about a one year period...yes I could have worked more and saved more, but I really just could NOT.

Around this time we had decided Pennsylvania winters were too much and we knew we were going to move once my son graduated high school. Original ideas included South Carolina and then Florida. In Florida I would not be able to practice pharmacy without taking the boards again. I hated my job way too much to invest the time and energy and money needed to pass the boards. This actually gave me hope...made Florida more appealing. It was a great excuse to retire. But that meant living on less. My plan was to practice spending less now to see if we could survive on less. We were currently averaging about $100k/ year. We would use all of the money we saved to pay for our house with cash and the equity from our current home, thus having no big bills in our future life. No car payments, no mortgage. I did lots of math and it was a solid plan. In 5 years we saved a whole lot of money and were ready for the move. We had changed the place, but California is one of the only other states requiring you to take the boards again, so we still needed to be able to live on less. We bought in 2012, prices had started to go up but were still below what they are now, had we waited any longer, we would have a much smaller house. I had hoped to get more for our house in PA, so my math was off a bit. We didn't have enough to pay off the new house and still have savings, and with neither of us employed, we wanted to have plenty of money in case we couldn't find jobs. Turns out it took 4 months to find jobs, so waiting to pay down the mortgage was the right move. We have also since realized that perhaps living in a place where an earthquake could destroy your house, equity in your home isn't as valuable as money in the bank. So I readjusted our plans to include a mortgage payment.

Now this is where it's going to get personal. Some people don't like to discuss this stuff, I believe if I can help others see that living on less can be done then my transparency is useful and worthwhile...what's the big secret anyway? It should be obvious that working part time at a mall isn't bringing me a big paycheck!

The first full year of of us working here we made $39k. That was with me working about 20 hours a week and Dave working full time. We were able to pay all of our bills and have some spending money for things like small home improvements and airline tickets fro my son to visit and the occasional dinner, movie or concert. The second full year we made $44k. Again with me working 15-20 hours and Dave full time. This time we were able to SAVE money and still do all of the above things.

You may want to argue that we started out with saved money so our living expenses are lower. I don't know exactly what rent is in our area, but I do know that it is no more than what we pay for our mortgage, taxes and homeowners insurance...roughly $1300. Our cell phone bill is our most outrageous bill, as I am paying for my son while he is in college (he paid his own from 12-18)..it's about $170. We do not have car payments, but do pay car insurance(about 125/month). And, of course, the miscellaneous bills: water(20), gas(15-40), electric(100-200), internet(60) and food(400-500). We refuse to pay for cable, but do have Hulu and Amazon Prime. All of these expenses add up to about $2400/month. After taxes we made about $3400/month, if you divide our gross income by 12 and subtract taxes paid--but reality is, it is never that cut and dry. We, of course, have miscellaneous expenses, gas for the car, eating out occasionally, toiletries, hair cuts, pool chemicals, pet supplies and health insurance and donations to our favorite pet charities.. We both are paid bi weekly, mine varies from $300-500 and Dave's hovers around $1000, so on 4 week months, the reality is we earn around $2800. Luckily we have those few months that have 5 weeks to give us a little extra spending money....it is a must that I fly my son out here at least once a year! But still we manage to save...on just $40k a year. i acknowledge that raising a family on this would be difficult and that is why I advocate for a higher minimum wage and even more importantly requiring big companies to stop avoiding offering benefits by scheduling their employees just below the full time line. I also acknowledge that being single, as opposed to a couple, would be more difficult as well. It seems housing for one person isn't half of what it is for 2 or more, and that makes it very difficult for single people.

All those years of knowing where every penny went helped me learn to budget. I watch people I work with bitch about how poor they are...as they piss money away on buying lunch at work; soda and water from vending machines...call out, leave early and worst of all get payday loans to pay their rent (meanwhile spending money on cigarettes and in one case, a woman I work with is making payments on a $2800 vacuum (I think she may be exaggerating, but WHO makes payments on any vacuum when you can't pay your rent? Meanwhile she just started collecting welfare!!))...and I wonder if they are even aware of the amount of money they waste and how much more stress free their lives could be with just a little planning. It can be done. We are doing it. My parents even doubted that I knew what I was doing --moving here, giving up a high paying job. They don't believe it is possible to live comfortably, happily..on just $40k a year. We have done it...twice now....and probably this year too. I may end up working full time, so we may end up making more. And then we can afford to vacation again, but we both agree that living in paradise with stress free jobs hasn't left us with the need to get away, like when I was a miserable pharmacist, living in miserable weather. I don't feel like we have deprived ourselves of anything. Sure there are things that I wouldn't have hesitated to do or buy if I was still a pharmacist...I would have gone on the Rick Springfield trips the past 2 years, I wouldn't hesitate to return back East for my 30 year reunion and I would probably own a convertible blue BMW (with AC!!!!). But I wouldn't trade the peace and happiness I have for those things....not for one second.

And now you know how and why I do it...and that it can be done.

I didn't want to bore you with more specifics on what we do and don't consider necessities, but I think you can figure out that we have learned that THINGS just aren't that important..and a big way to learn how to not spend money, is to not shop! I still waste money because I am working at my favorite retailer, where I have shopped for probably 20 years, so it is very difficult to see clearance items and have coupons and my employee discount and NOT buy things, even though I don't need them. For example, I currently own about 10 bikinis...because they were $3 each!

I am constantly reassessing our budget, finding ways to eliminate waste. Like cable...we just don't watch that much TV to justify $60 more for cable. Once my son graduates college, we will be looking for a new cell plan...hoping to save about $1200 a year, and I will probably drop Amazon Prime, it just isn't as good as Hulu, for the shows we watch. The free shipping only lures me into buying things I don't need. We eliminated our pool guy, saving us $1300 a year (but now have pool chemical expenses, which are far less than that!). When you really look at where your money goes, you can decide what is and isn't really a necessity for you, we all have different needs...mine is to never be stuck in a job I hate ever again..making so little allows me the freedom to know I can quit at a moments notice because I still have my savings and I won't be losing much if I am out of work for a few months. I believe this adds to why I love my job so much, I am not a slave to it, I choose to be there.

Here we go again...toddlers and guns

I am still angry from Orlando. We all should be. I felt a little better yesterday because my Governor (California) enacted some common sense gun laws, he didn't even wait for November, when some of them were going to be on the ballot for a public vote...how many lives did he save by not waiting? We will never know.

Meanwhile in Tennessee....another dead toddler. I can not even imagine taking my son to someone's house, a friend, a family member, a neighbor...and he ends up dead because of how they store their firearms. How does one live with that? The gun owner had signs in his yard proclaiming his home was protected by the 2nd amendment...who was protecting that child? Will he take these signs down now? Will he still be allowed to own a gun? Is he considered a responsible gun owner?

I want to know how these responsible gun owners think...what is their daily routine? Do they load up their guns every night at bedtime and keep them on a nightstand or under their pillow? Because if they don't--well how are they being protected? Do they think waking from sleep, when disturbed by the sound of a possible intruder that they will have time to go to their gun safe, unlock it and load their weapon before the intruder attacks? Because realistically don't they need to be loading that thing every night and then unloading, storing and locking it the next morning to be considered a responsible gun owner. If it's always just locked away then how is it defending them? Isn't it really just a trophy for them to pound their chests and say "Me, big, strong and scary, me own gun" if they aren't doing this?

I kind of feel sorry for people who think they need a gun to feel safe..note I don't say "be" safe..because all the statistics prove otherwise...I won't go into them, because I am too lazy to google them again. But I have seen them. It is extremely rare that a gun is actually used to stop an intruder, sure we all have that friend that has to post that one time when that one "good" guy stopped the bad guy...but they conveniently never post about the many, many times when accidents happen, or suicides or domestic disputes gone bad because a gun was in the home. They far outnumber that one time when a gun turned out to be a useful thing. How many toddlers have died this year or have shot themselves or someone else...last count I heard was 23, but that was a few weeks ago and apparently had grown by at least one. Back to why I feel sorry for these people who live such a paranoid life. They have spent years being terrified that someone was going to break into their home and they wouldn't be allowed to own a gun to defend themselves..so we have 2 problems here...they are worrying about someone denying their "right" to own a gun. I won't go into how the 2nd amendment doesn't actually say that an INDIVIDUAL is guaranteed to own a gun, because, it's irrelevant...the government isn't trying to take that away...they merely want some common sense laws to stop this insanity. Oh and your argument that criminals don't obey laws? Again...simply stupid....let's not have ANY laws then, mmkay? To not try to stop this insanity for that reason is just...well stupid.

So there's one fear debunked...onto the next..an intruder breaking into your home...again, not going to get into numbers..but it seems to me that most criminals don't want to be bothered with shooting you, they just want your stuff or maybe you think they are going to rape you...again breaking into homes to rape people is not the number one way rape is occurring. You are much more likely to raped in college and then denied that you were raped. And I am sure you are much more likely to be shot in a mall, movie theater, night club, school or just about anywhere outside of your home now than IN your home. Oh wait so now you want to argue about your right to carry a concealed weapon?? Again let's go to the facts...it seems these "good" guys are starting to think carrying means they can shoot shoplifters...that's not how America works...we have a justice system and shame on you if you want to scream about your 2nd amendment rights while denying everyone else their right to be innocent until proven guilty. So while you are trembling in your home afraid someone is going to deny you your right to own a gun so that you don't have to tremble in your home from the bad guys coming to get you...news flash...the bad guys are OUT there...and they are getting you...nearly every week now...a mass shooting every week...but still you want to do nothing. Standing on your arguments that criminals don't obey laws and that someone is trying to take your damn gun.

Well, the rest of us are done with that...we are done with the moments of silence, we are done with the prayers..California may become the first state to have tougher laws, but that isn't enough...people want to use Chicago as an example of how tough gun laws don't work...again making STUPID arguments (sorry but it's time to stop tiptoeing....if you can't see that one city's laws aren't enough, that people can go to another city, go to another state and then COME BACK to kill people...well you are, in fact, relying on stupid arguments).  We need every state on board. 80-90% of Americans want reasonable gun laws, it's time for the rest of you to shut your paranoid mouths up...because one day there will be universal laws that exempt those with mental health problems from owning guns...and you and your paranoia may actually find your gun being taken away...as it should be...because paranoid people shouldn't own guns!

And I am not saying that stricter gun laws alone will fix the problem we have with mass shootings and toddler shootings, we need to address the mental health problem. But we can do one thing while looking for solutions to the other. We have to start somewhere. Closing loopholes, getting rid of magazines that hold insane numbers of bullets, a gun registry, an ammunition registry...taking guns away from people who shouldn't have them (felons, domestic abusers, stalkers, people on the no fly list)...all of this can and should be done nationally. If you don't like it...feel like this is the Home of the Free and the Brave....well I don't feel very free or brave when wondering about whether a mass shooting will occur at the next concert I go to...or at the mall where I work...or at the movie theater I'm at...I want MY freedom back and if you aren't crazy or a criminal, this won't effect YOUR freedom at all. (and if you think I am paranoid for thinking these things....do you get a flu shot? Because right now, in our country, more people are being killed by guns than by the flu annually...think about that)

I edited my post to change the part where I called people stupid, I do my best to try not to call people names and when angry, I do fail on occasion. I stand by my assertion that the ARGUMENT is stupid, not the person making it, there are some extremely intelligent people trying desperately to cling to these arguments. which I believe are stupid based on statistics showing the argument to be baseless.