Planning My Spending

18 10 2012

When Ayo and I were planning for our year of mini-retirement (yes, the one that I have been doing for about two-and-a-half years) we tried to be as frugal as possible. The centerpiece of our dining room was a sturdy plastic folding table, we never really went out for meals, and we kept our expenses incredibly low – especially for a couple living in New York City.

I am at an interesting financial point in my life. I have no income beyond interest and dividends and  I am making my spending decisions independently. My net worth fluctuates with the economy but I am not making new contributions to my (very diversified) investments. Interest and dividends only cover a very small portion of my expenses. So what dictates my spending? How frugal do I want to be?

Is it time to buy a fancy watch and hit the casino?

Is it time to buy a fancy watch and hit the casino?

There are a number of questions whose answers are driving my overall spending decisions right now:

  • How long do I expect to continue with no income?
  • At what net worth will I no longer feel financially independent?
  • What kind of lifestyle do I want to lead?

I find it easy to track all of my expenses. I can tell you what I have spent this month to the penny. For real.

Or is it time to sit down and think out my budgeting?

Or is it time to sit down and think out my budgeting?

Do I want to budget? If so, do I want to spend freely within my cap? Do I want to live as frugally as possible? Somewhat frugally? How about my attitude toward “stuff”? Has that changed? Do I want to try living without a budget?

Answers in part two.

::Enter suspenseful music::

posted by yair



One response

4 11 2012

Hey Yair — when do we get to see part two? I am very curious to hear your thoughts on these!

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