Merry Christmas to me! Lifting the budget

Once upon a time I decided I wanted to retire early just like Mr. Money Mustache. I was convinced I would get my spending down below $30k a year, and have hundreds of thousands saved by the time I ticked over 30.

I was sure I would be a DIY queen, and flip houses like Mr. 1500. I'd make amazing food like Mr Tako, and retire to the countryside like the Frugalwoods.

Alas, as I sit here at (almost) 28, it is clear that these things take longer than anticipated. If I want to kick my FIRE into overdrive, I should be cutting back costs so I can save and invest more.

Instead, my Christmas gift to myself is permission to spend more.

In what might be seen as a frugal fail, I think it's time to cut myself a bit of slack, and loosen the purse strings. There are a few reasons why...

Inflation

Firstly, let's talk inflation, specifically Consumer Price Inflation. We're all affected by this, and it's a strange economic phenomenon where the exact same loaf of bread that used to cost me $3.40 a loaf is now costing me $3.50. It's the baffling part where my energy efficient changes haven't made a dent in my power bill, despite my usage rates having dropped by 15%. It's seeing clothes on special that cost more than you paid for them at full price five years ago.

There are many reasons why inflation happens (and if you want to dig into it, you can start here) but for the sake of this post let's just agree that it does happen. It's the reason most employers give you a small pay rise every year - so that you can maintain the same lifestyle. 

For the last three years inflation has fluctuated between 1% and 2%, mostly towards the upper end. This means that something that cost you $100 three years ago will probably cost you $106 now. Or on the flip side, spending $100 now should get you the same product as spending $94 three years ago.

Putting this into perspective, three years ago I set my budget for $40,000 a year. That same amount of money now only buys me $37,650 worth of goods.

Business Expenses

Once upon a time I strove to do just as well as the personal finance gurus. MMM and family lived on $30,000 a year in the early days of his journey, and Mr 1500 planned for his family of four to live on $40,000 a year. The first thing I noticed about this was a significant difference in living costs between Australia and the US. The second thing I noticed was that this didn't include business expenses. However, given that I was just spending for myself, and not for a family, surely I could reach those levels.

Here I stand three years later to say that maybe that was ambitious. However, it's not because I lack self control (I just spend a week debating with myself the value of spending $7.50 on a video game that was on super special). It's because I'm trying to cover the costs of an investment property with that money, including $8,500 a year in interest repayments.

The biggest expense in the Holy Trinity of Big Expenses is housing, and I'm paying for two of them! In fact, my annual budget is $15,000 for house number 1 (that we live in), another $15,000 for house number two (that I rent out) and a measly $10,000 left over for myself - that needs to cover medical, groceries, my phone bill, and still have some left to Have A Life.

Reductions in costs

But, wait! I hear you saying. If my biggest expense is paying two mortgages, then surely over three years since setting a $40k budget, my interest repayments have reduced as I paid down the principal. I am paying principal and interest on my loan, but I'm only paying the minimum, because I'm a firm believer in using the equity in your home to build wealth elsewhere. 

As an employee of the bank, I enjoy fee free loans and I've taken full advantage by restructuring my loans twice, and pulling out as much equity as I can. Coupled with that, while the Reserve Bank interest rates have not changed, all the major banks have snuck their interest rates up in the last couple of years. As a result, I paid $732 interest in October 2016, and $708 in October 2018 - a whopping reduction of twenty-four dollars!! Wow! A whole $288 over the year.

Except remember that according to my (very rough) inflation calculations above, my spending power has reduced from $40,000 to $37,650. I'm down $2,350 in spending power, but up $288 in interest savings!! That's... not brilliant.

Life is calling

Here though, we come to the crux of the issue. Life is calling me. I can throw up all the numbers I want, and I can come up with inventive ways to lower my costs. And while I will continue to do so, certain things defy even the most frugal of magicians. Here's a couple of pieces of life I want to experience, before I'm too old to enjoy them.

The grass is always greener

Have you seen grass? Smelt freshly cut grass? Have you lain in a hammock under a shady tree on a warm day drinking a glass of champagne and reading while the hours drift by? I haven't... because I have no grass. Our house is small, we have approximately 15m2 of dirt that is split between my chickens and my vegetable garden. I love both of these things, and wouldn't sacrifice them for a small patch of grass, but I'm keen for a bigger garden.

I want to step out my back door and gaze over the lawn. To see my chickens scratching in the near-distance. To see bees buzzing around the flowers. I want some space to stretch out, and of course...

It's time for a dog

When I was young I dreamed about all the pets I would have when I moved out of my parents house. Right now it's packed to the rafters with Mr. FIRE, FIRE-cat, four chickens, seven quail and a budgie. 

Mr. FIRE and I coo over pictures of puppies. We debate whether our dog will run mountain biking trails with him, or learn to do tricks and agility competitions with me (it's both right? definitely both). We tease the cat about how she's going to hate us when she has to share the couch with a dog. FIRE-cat ignores us, because she's a cat.

Realistically, we probably won't get a puppy. I've worked in shelters in the past and I know that puppies are noisy, and stinky, and they cry, and they poop and they chew things. We'll probably bring home an adult that's settled into themselves. But regardless of the age, we're so keen to have a dog. A big one.

This is not me. But hopefully,
soon it will be

I believe I can fly

This is an odd one, but I really want to hang-glide. And I've been watching the budget for years and there's never enough wiggle room. As inflation takes hold, the purse strings get tighter and hang-gliding gets further and further away. 

What's in a game?

Lastly, and least importantly - I miss the relaxed childhood of video games. I can't ever recapture a time when I could play games for hours on end, only taking a break to eat the dinner mum had cooked, which was generally my first meal of the day. 

I have responsibilities, see above for a cat, four chickens, seven quail and a budgie.. all of who like to be clean and fed. On top of that, I've sold 40 hours a week of my life to an employer. But I still sneak in a game here or there, and on my current budget each one I purchase sends me into an overspend-shame spiral. 

What now?

While staying accountable for my spending will keep me on the road to FIRE, my current level of tightness is getting too restrictive. I'm finding it hard to agree to events with friends, because while I don't resent spending on them, it means I have nothing left for the rest of the month. 

While it hasn't really hit yet, I'm not interested in being miserly-FIRE. I've been chasing the finish line for three years, and it's still at least 7-8 years away. I don't intend to spend those years refusing to spend on things I know will make me happy, because it might shift the finishing line by a year.

Based on the numbers above, I could raise my budget to $42,500 without feeling a smidgeon of guilt. It's the equivalent of 2% a year since I first set the budget. However, I have also been reducing my spending in the last three years - at first I recorded $46,000 in a year, then $44,000, and then down to $42,000. While it would be nice to assume the downward trend will continue, there's no signs that I'll hit $40k this year. In fact, it looks like I'll spend a bit higher, while still feeling pinched.

So, I'm giving myself another $924 a year to play with. It might seem like an oddly specific number, but that's because I'm shifting my monthly allowance from $3,333 up to $3,400. A nice round number. 

Of that $77 a month, $40 is being split between my properties, $10 into groceries, $10 into pets (in preparation for a doggo!) and $10 into travel, with the odd leftover $7 going into the 'Other' category (where most fun stuff is bought).

While this isn't a hugely exciting splurge, it's a healthy update. I'll still be striving to reduce boring spending like utilities, mortgage payments, and groceries by seeking better deals and inventive approaches. But hopefully I'll stop eyeing off the categories that pay for living a good life.

There's no point in reaching FIRE if I don't enjoy the journey there.

Afterpay (is not) for dummies

When I first saw Afterpay spring up, I thought it was the dumbest way to scam people into spending money they didnt have. With slogans like "Broke AF but strongly support treating yourself? Afterpay" this was clearly a stupid trap for stupid people. A highly effective trap, but a stupid one nonetheless.

If you don't have money to spare, you sure as heck shouldn't be 'treating yoself'. But then I got to thinking, if you already have the money, and already intend to spend it, is Afterpay any worse than a credit card? Time for a quick review.

First things First, how is Afterpay making money?

At a glance you'd assume that Afterpay is making money from you via fees. In fact, if you're on top of your payments, Afterpay doesn't make a cent from you. Instead, they collect fees from the retailer. (Side note: If you really want to support a business, don't Afterpay with them, you're cutting into their profits)

Afterpay uses an age-old 'debt purchasing' model. When lenders are tired of chasing people for money owed, they can sell that debt to a different, more ruthless company. The original lender will sell your debt for less than you own, recoup most of their money and wash their hands of you. The debt collector then hounds you to make the payments, and collects a small profit.

Afterpay is like that, but friendly, and they do it at point of purchase.

For example, you purchase something for $100. You now owe the retailer $100. This is a debt.

Afterpay purchases that debt from the retailer for $96 (specifically, they charge 30cents, plus 4-6% of the transaction value)

The retailer accepts 4% less for an immediate sale. They're hoping that you'll spend money you wouldn't normally. The retailer would be better off if you paid them directly, but hopefully with the lure of Afterpay you've spent extra to close that gap.

Afterpay then collects $100 from you over 4 payments. They make $4 on the transaction.

The important part is, as long as you don't miss the payments Afterpay isn't going to cost you a dime.

Just like a credit card

In a sense, using Afterpay is just like using a credit card. You walk away with the item, and a debt to be paid later. To use Afterpay well, you need to follow three simple rules: 

1. Don't spend money you don't have.
2. Don't spend money you don't have.
3. Don't. Spend. Money. You. Don't. Have.

Got it? Good. If you are worried about your self control you can set up a secondary account for Afterpay transactions. When you make the purchase, move the required amount of money into the Afterpay account and leave it there.

Using it to your advantage

If you Afterpay something, you get to hold on to your money for a little bit longer. Just like with a credit card, this 'spent, but not gone' money can be placed in an offset account against a much loved mortgage, or a high interest savings account. The money can keep working for you before you make the required payment.

Say you make a $400 payment on your credit card and you don't need to pay the balance until 30 days later. You leave $400 in your offset account for those 30 days, against a 4% home loan. In 30 days, you save 75.6cents off your loan. While it's a small amount, it's free money.

Afterpay works even better, because the payment is stretched over a longer period, 42 days from the first payment to the last. Over 42 days, you accumulate an 88.8cent saving, even accounting for the incremental payments across those 42 days.

Combining these two delayed payment options,  you could take two whole months to pay back that $400, and reap the rewards, including credit card rewards points.

After quickly reviewing the numbers, it turns out that if I make a $400 purchase on the 1st of November with Afterpay, instruct Afterpay to take the money from my credit card, and hold the money in my offset account, I can save $1.578, equivalent to getting a 0.4% discount on my purchase.

Here's how it works:

1st November. Set up a $400 purchase with Afterpay, linked to my credit card. Afterpay immediately takes the first payment of $100.
I owe $300 to Afterpay, $100 on my credit card, and have $400 in my account. 

15th of November. Afterpay takes it's next $100.
I owe Afterpay $200, plus $200 outstanding on my credit card. I have $400 in my account, and in the past two weeks, I've saved 61.4cents. 

29th of December, Afterpay takes another $100.
I owe Afterpaty $100, plus $300 outstanding on my credit card. I still have $400 in my account, and in the month since making my purchase (that I still haven't paid for!) I've reduced the interest on my home loan by $1.227 

1st December, the party starts to die down... I make a payment on my credit card.
I owe Afterpay $100, my credit card balance is zero, and I'm down to $100 in my account. So far I have saved $1.249 worth of interest. 

13th December, Afterpay takes it's final $100
I owe $100 on my credit card, and I'm holding $100 in my account. Savings so far: $1.381 

1st January, I make the final payment.
I owe nothing on my credit card, and I'm not holding any extra money in my offset account. Savings over this period: $1.578

Is it worth it?

I hear you pointing out that I've just built an elaborate system for a measly $1.578 savings. The saving is so small I'm pushing my reported number out to another decimal point. It sounds like a lot of effort for such a minuscule return.

I'm here to tell you it's absolutely worth it.

When I shop online, I typically use PayPal. It used to take me 2-3 minutes to type in my details (forgetting my password a couple of times..), confirm that I was targeting the correct account, and hit 'Go' on the payment.

When I set up my first Afterpay payment, it took me less than 10 minutes, including the screen timing out while I wandered down the other end of the house to find my wallet and pat my cat. Any future payments (assuming I use the same credit card) will take me the same amount of time as logging in to PayPal. Just like that, I had a cat tree on the way for FIRE-cat, and I wasn't making the final payment for two months.

If this was a difficult, laborious task, I'd tell you to throw it away, and just make the damn payment. However, this is money on the table. For a couple of minutes of one-time set up, you can reap the (small) rewards forever more.

But, and I cannot stress this enough, don't spend money you don't have. Afterpay and credit cards are not a way to 'treat yoself' when you're 'broke AF'. These delayed payment tools are tricks that wily spenders can use to get ahead. They are also bear-traps that set you up for failure.

Missing an Afterpay payment will cost you $10, plus another $7 a week until the payment is made, regardless of the transaction size. Thankfully the fees are capped at $68, but a $20 pair of jeans could cost you $88 if you stuff up the payments.

If you've got a good hand on your finances, Afterpay can be an easy way to squeeze that extra bit out of each dollar. If you've got even the slightest concerns about keeping on top of your payments, stay away.

So there you have it, Afterpay (is not) for dummies.

Digging deeper for the junk food failure

For years I've been tracking my spending. It started in my first year of university over a decade ago when I wondered how I could make so much money and still have none left at the end of the week. Back in the day it was a simple notebook where I wrote down everything I spent, and totalled it up at the end of the week. Over the years it has grown bigger, more complex, and thanks to Google Sheets, easier to use. and yet somehow I still can't keep control of the 'miscellaneous' spending category.

Pen and Paper

In early university I wanted to buy an investment property, so I knew I needed to properly track my money in and out. At the beginning, all I did was write down what I spent in a notebook, and tally it up at the end of the week. Then I started recording my income at end of the week, directly next to my expenses. Then I started writing down $50 a week for 'bills' and $50 a week for 'savings'. Each time I had a bill I would deduct it from the saved amount. Then I found that making big luxury purchases was hard to fit into the budget, so I started making a list at the end of each week of things I wanted, and putting $5-$10 aside for them each week.

It was a good starter system, but I couldn't really see what I was spending on over the long term. Was I a booze hound? Did I blow all my money on video games? Should I stop buying books? (never stop buying books...)

Technology revolution

A couple of years ago I graduated to Google Sheets. Now I had 12 months of my expenses in my pocket at all times. Recording my spending was easy with my phone. I never had to worry about my pen running out of ink, my book running out of pages, or explaining to everyone what I was doing.

My spreadsheet has morphed and changed over the years, to a point where I now have 1 tab for each month, with columns for each spending category. Another tab collates all that spending into one easy to see snapshot. Other tabs track money being diverted into spending, and my income - which allows me to pull out spending and saving percentages at the drop of a hat.

This visibility of my money habits has dropped my spending from $46,000 in the 2015/16 financial year, to $42,000 in the 2017/18 financial year. While not a dramatic amount, watching my spending going down, and my lifestyle staying steady (or going up?) despite inflation has been a warm fuzzy feeling of success.

Yet somehow, in all of this I've been completely unable to get a hold on my 'miscellaneous' spending category.

Digging deep for expenses

For about a year I've been ending every month by kicking myself and saying 'stop spending so much on miscellaneous crap! It's your early retirement you're wasting!'. Turns out this isn't the most effective method. A lot of things sneak into this miscellaneous category. Some I can control, some I can't. Things like care packages for my derby team mates when they break limbs, and (very occasional) lunch meetings with my co-workers are things that I agreed to when I signed up for these communities. Some things I know are wasteful (hello Red Wine!) but I love and so I choose to continue spending mindfully. And some things are just plain stupid habits, like $7 coffees every time I'm at the airport...

After utterly failing to control this spending, I did a one year review, and here's what I found:

Books - $99.91, $7.93 a month

I am absolutely okay with this! I re-read books all the time, and since I was a small child I've had my nose glued to the pages. I could get more out of this time / money by reading investing books, personal development and all that other nonsense, but I love the escapism of reading about dragons and magic. (Right now I strongly recommend The Waking Fire: Book One of Draconis Memoria )

Video Games - $46.54, $3.70 a month

This is great. Once upon a time I had a bad habit of buying Steam games that I never played because they were on special. It's nice to see I've properly kicked this habit. All the games I've bought recently have twice as much playtime as dollars spent, which is a great Dollar To Fun ratio.

Alcohol - $382.56, $30.38 a month

This is one where I know I could spend less but I don't want to. The majority of my spending is on Red Wine, and I am super sneaky about it. I buy bulk, mixed packs from places like Virgin Wines, and Qantas. I always wait for a sale, and always get things at significantly reduced prices, generally with bonus frequent flyer points.

I do have long term plans to brew my own beers and ciders, but I'm not sure what the savings will be. It's something I plan to do for fun, rather than financial gain.

Clothes - $52.00, $4.13 a month

I have a confession to make - I hate buying clothes. Nothing fits properly and nothing suits my style. Why are bras so expensive? Why does underwear come in 7 different cuts and what is the different between 'boy leg' and 'full brief''? Why is it so hard to find a comfortable pair of jeans that aren't blue or $100?

The end result of my clothes shopping hatred is a super low bill, clothes that come pre-worn from the thrift shop, and underwear that is a decade old....

Medical - $226.60, $18.00 a month

This is excluding my health insurance, which is $91.61 a month for hospital and extras. $18 a month this year has covered contact lenses, 2 trips to the GP, multiple trips to the physio, and a trip to the dentist. I actually think I should spend more here and take better care of myself.

Comfort food - $785.15, $62.35 per month

What, what, What!!! What madness is this!! I've written before about the Latte Equation and the stupidity of paying $5 for takeaway coffee when you can make your own for barely 50cents (using the expensive milk). I've gone on and on about the virtues of baking your own treats and making your own snacks. And here I am spending almost $60 a month on comfort food, how is this happening!

First of all, December happens. In December all your friends want to go out for dinner. All your coworkers want to go out for lunch. And I want to buy Christmas treats. All of this is expensive. In December alone last year I spent $215 on comfort food.

I'm not too mad about December. I love my family and friends, and we're all pretty quiet throughout the year, so having a month of events is okay by me. What is not okay by me is keeping up this crazy spend throughout the year. I found $50 worth of coffees, $100 worth of pizzas, and over $100 worth of entries just labelled 'Junk Food'.

Alone, each of these entries isn't too offensive. But when over $60 a month is disappearing into this chasm of cheap, lazy snacks, something has to change.

Everything else - $2,059.08, $174.95 a month

Inevitably, when sorting out the miscellaneous column, there will be things that don't deserve their own category. Items left in this everything else category include crafting supplies, that time I paid for parking at the hospital, concert tickets, and odds and ends like replacement charging cables, some rammekins and a pair of scissors. While there is a lot of uncategorised spending here, this is a number I'm happy to live with for now.

Where to from here?

In case my rant and the title of this post didn't give it away, I'm less than thrilled with spending $60 a month on comfort foods - especially when I'm more than capable of baking better tasting things myself. 

I'm a very firm believer that what gets measured gets done, as long as the measuring is accurate. To bring the comfort food spending back to a happy level, I've created a new column in my budget, and allotted $50 a month to snacks, junk food, takeaway and other deliciousness. I'm 'funding' that column with $10 out of my groceries budget, and $40 out of my miscellaneous budget.

I'm under no illusions that this will be properly managed in December. While I believe in controlling my spending, I don't believe in cutting out my friends to do so. When I get invited to Christmas outings, I'm absolutely going to go. Then when January rolls around and everyone is burned out from celebrating and feasting, I'll tackle this in earnest.

Why do you think $40k isn't enough?

One of my Australian FIRE blogger friends Pat the Shuffler was recently featured on ABCnews.

Not only was it a good read, but the bottom half of the internet (i.e. the comments section) was highly entertaining.

But one ongoing comment that I want to address has been a bane of the FIRE community for years. "Hope he likes eating two minute noodles, because no one can live on $40k a year."

What is it with everyone outside the FIRE community trying to tell us we don't know what our own budgets are?

Negative whingers

First of all, let's tackle the obvious theory - maybe they are all just negative whingers? I've been reading FIRE blogs for years, and not only do I think that $40k a year per person is an affordable lifestyle, I think it's downright decadent. So many FIRE bloggers out there are living on $40k or less per year for a family. Pat the Shuffler and I are aiming for $40k a year in retirement funds for ourselves alone.

It's hard not to see people as negative whingers when surrounded by like-minded FIRE folks. But it's not just the FIRE folks living on very little - minimum wage in Australia is only $36k  per annum, NewStart payments are a measly $14k per year, the maximum disability pension for a simgle person is $23k. One person living on $40k has plenty of money. 

Money buys happiness

Let's tackle this theory. Most of the people complaining - if they bother to give a reason why $40k isn't enough - say that the reason $40k is insufficient is because you have to live a miserly, poverty fueled lifestyle.

Here's some things I can't do on $40k a year:

• Learn to fly a plane - a one hour lesson can cost over $200, and you need 25 flight hours for a Recreational Pilots license. 
• Join a golf club - at $660 joining fee, plus $405 annual clubs fees, PLUS playing rights / greens fees... no thanks.
• Have new car every year - the 2018 model of Mr FIREs car would cost us $36k... he's been driving his old one for almost 8 years, and it was old when he bought it. 
• Hire a Maid - for $70 a week for a two hour clean, I'd be out $3,640.. I'll scrub my own toilet, thanks.
• Pub dinners and shows every week - Going out for dinner is anywhere from $20 - $50. Going to a gig, theatre show, or event can cost $50 - $80. If this was the only time I socialised, I'd be $5,200 out of pocket.
• 4 bedroom mega mansion - buying a bigger house than I need could cost me $40k a year in interest payments alone. Mr. FIRE and I don't have kids, so why would we need a big house? We barely use all of our 2 bedroom place.

However, here's things I can and do enjoy on $40k a year:

• Sports! I train 8hours a week for Roller Derby.
• Interstate sports! I travel 2-3 times a year, for Roller Derby
• Holidays! Admittedly, I don't travel often outside of derby - more because I'm lazy than because of my finances - but I still do it and keep my expenses down.
• Picnics and Dinner Parties - why would I go to a pub and pay too much for average food, when I can have friends come to my place, play board games and cook them dinner? I can feed 3-4 visitors for less than I would spend on my own meal going out.
• Hiking, Biking, Fishing and Slacklining - need to head outdoors? That's free after the initial equipment outlay
• Rock-climbing - for a little more adrenline and a little more expense, I climb indoors at a gym. But I could buy a stack of gear and climb outdoors.
• Crafting - I craft a LOT for costume parties, joke prizes and things I actually want. I've made necklaces, beanies and slippers, as well as a chicken coop and planter box.
• Video games - let's be fair, I enjoy a lot of fancy nice things, but I also play video games. A lot.
• Coffee and great food - whenever I have food cravings, I just learn to make it. I can make yoghurt from scratch, I'm decent at sushi rolls, and I have a pretty amazing salad selection.

I need this little dude in my life

Anything I'm missing? Actually, I know exactly what I'm missing - a dog. Mr. FIRE and I have started plotting moving to a house with a bigger yard so we can have a dog :D And a workshop, and a bigger veggie garden, and maybe build a skateramp in the backyard. But mostly get a dog.

Medical bills and maintenance

This is where I think people might have a good point. $40,000 a year, as a young person is a pretty cushy lifestyle. My health insurance at the moment is only $85 a month for hospital and extras - I make a point to use as much of the extras as possible, and having hospital cover will be a big deal when I hit 30 and tax rules come into play. Right now I just keep it because I play a high speed contact sport with wheels on my feet. I've already had one knee reconstruction...

But, that's me being youthful. As I get old insurance companies will start charging me more as my body breaks down due to old age. I'll be doing my best to take care of it, but time defeats us all everntually, and I have a choice of paying an insurance company for the privelege, or paying for the health care when things happen.

Of course, this doesn't actually mean I suddenly need thousands more. It just means being aware of the upcoming costs and planning for it.

Someone who plans to spend $40k a year for the rest of their life probably isn't planning to spend exactly $40k every year. For starters, we plan for inflation. But personally, I'll be planning in some wiggle room - it's easier than you'd think! 

Ready, here we go...

Plan to spend an average of $40k a year? 

Option One: Don't retire when your portfolio is generating $40k a year

If you plan to spend $40k a year to have the equivalent life that you have now, but recognise that your expenses will change in the future, just work a little longer. If you have a million dollar portfolio, working one extra year will give you a $1.07million portfolio (assuming a 7% return) plus any contributions you made.

It has only costs you a year, and now your safe withdrawal has boosted up to $42,800. If you then retire and live on $40k, you will have an extra $2,800 per year to deal with unexpected crises and rising costs. Of course, you won't need to spend that every year, so it will just build up for when you do need it.

Option Two: Earning money in retirement

Gasp working in retirement? Then you aren't really retired! Well, to be fair, I said 'earn money' not 'work'. Many early retirees like to create things, you can earn money from blogging, from writing books, from selling arts and crafts. I have earned money in the past by pet-sitting - getting paid to hang out with cool dogs! Lately I've been watching video games streams, did you know some of the top ranked gamers on Twitch pull in six figures.

Option Three: Start small

If you plan on spending an average of $40k per year in retirement, you can start smaller and work your way up. In your first decade of retirement, maybe you could live on only $35k. This frees up a lot of money for later years, and lets your portfolio grow.

Option Four: Leave the country

If you're living in a High Cost of Living area (looking at you Sydney) then consider spending a year or two somewhere else! According to The Earth Awaits, I could spend $4,600 a month in Sydney for a modest lifestyle, or a mere $415 for the same lifestyle in Madurai, India. Don't want to travel so far? Staying in Australia, Hobart is only $2,550, or if you want to stay on the mainland Adelaide is a mere $3,000. Much cheaper than living in Sydney.

If things really don't work, move somewhere smaller!

While travelling can be expensive the biggest cost factor is the flights, and fancy hotels. If you are going for a long trip then the cost of the flights becomes a smaller portion of the overall cost, and you can rent long-stay accomodation, rather than paying night by night.

FIREy wrap-up 

While I like to think the best of people, and I'd love to believe the naysayers have our best interest at heart - when you think it through $40k per person is plenty of money for a good life. And that's without even going into extreme ideas like living in an RV, or going off the grid.

There are plenty of 'Plan B's that you can take up to make your retirement foolproof.

Now I just need to get there!

You should be buying cheap shit

Just last week I said that you should stop wasting your money on shit. A big part of that is not spending money on cheap shit that falls apart after a couple of uses and you have to constantly replace.

I'm not changing my mind, but sometimes you really should buy cheap, second-hand, knock off shit before you buy the expensive top of the range good stuff.

Let's be frank, $140 jeans are totally frugal if they last 8 years. But if you buy them and realise you hate them, it was a waste of money.

That kitchen aid gathering dust?

The thermomix you bought and discovered you hate risotto?

You got a pool then realised you're afraid of drowning?

Absolute total wastes. Good quality expensive things that have burned a huge hole in your wallet without making you happier.

If you want to buy something expensive, you should buy a cheap shit knock off version first.

Trial it, see how much you like it, see if you enjoy baking muffins in a cheap silicon tray before buying an expensive set (FYI, silicon bakeware is amazing. I make so many muffins now...)

Buy it cheap

So you've decided to start off a new diet where you drink green smoothies every morning? Good for you, but step away from the $80 NutriBullet. Instead, grab yourself a $15 Blender. Let's be honest, it might not last forever, but there is a good chance it will last longer than your obsession with green smoothies.  

Buy it second hand

Whatever it is that you're just starting out - from cooking, to hang-gliding, to fencing, and back someone else has probably done it first. Before you rush out to drop $20,000 on a hang glider, see if you can pick up a second hand glider for a measly $5,000.

Or maybe, for a more relate-able idea, you probably have a friend with a thermomix sitting in the back of their cupboard not being used.

Financially free AND gravity free!

Buy it on special

If you've have a cheap knock off in the cupboard, and you've borrowed from a friend, then you can hold out for specials. While new rock climbing shoes can cost over $100 places like Anaconda regularly have sales where you can get new gear for 50% off. 

or maybe, you'll find a new hobby

The beauty of buying cheap shit, before committing to top price, top of the range equipment is that you'll never be left with a $30,000 hang glider and the realisation that you're afraid of heights. If you're enthusiasm outlasts your equipment, then that's a great reason to pick up some better quality items. But if you're only going to stick to a juice diet for a few days, why bother dropping $80 on a blender when a cheaper version will do the same thing.

Five things you wont find in a finance bloggers budget

There are a lot of things in the world worth paying for. Good food, warm blankets, a roof over your head and comfy bed to snooze in every night. There are also a lot of things that you should never waste money on. Some are ridiculously overpriced, some are unfair, and some have free alternatives lying around.

It's important to keep in mind that just because we don't pay for these things, doesn't mean we're missing out. There are so many free alternatives in the world that it's foolish not to take advantage of them. In this world of entrepreneurs every single transaction has been monetized. From grocery shopping, to house chores, to paying for a puppy party, if you want to spend money on an experience, someone has devised a way to handle it.

Instead of paying, here's a list of five things you'll never see on a finance bloggers budget.

#1 Finance bloggers don't pay for music

I am listening to Spotify as I write this post. I listen to Spotify as I ride to work. When my friends and I wanted a dance party but couldn't afford a DJ we just spun up a great Spotify playlist.

You don't have to pay for Spotify. With the free version you have to listed to an advert every six or seven songs. It won't kill you, but you will reach a point where you can quote each advert word for word.

The only problem with free Spotify is that the bands don't make any money from you. If you want to give a band some money, find a way to do it directly. Buying albums or paying for subscriptions services gets a little bit of money to the band eventually, but most of it is eaten up by paying record labels and the platform.

#2 Finance bloggers don't pay for bottled water

The most ridiculous expensive first world luxury - bottled water. Seriously, it's just water! It comes out the tap! A litre of petrol is around $1.50 right now and everyone is constantly outraged at the expense of this processed, imported liquid that runs our cars, and yet we don't bat an eye at paying $3 a litre for water.

The water that comes out my kitchen tap costs $2.27 for a kilolitres. That's 1,000 litres, or 0.2 cents per litre.

While I'm complaining about water, be careful ordering water in a restaurant. I once asked for water for the table. The waitress asked if I wanted still or sparkling and (not being used to high class dining) I said still. When we checked the bill at the end of the night we were charged eight dollars for water.

#3 Finance bloggers don't pay bank fees

How much do you hate seeing this screen? "You will be charged $3.00 for this transaction". I love seeing that screen because I don't pay those fees. ING Direct pays those fees for me. The fee is charged by whichever banks ATM I am using, but ING simply covers the cost for me.

I guess it works out for ING as a cost of business. They could be paying to install and maintain ATMs, or they could just cover the cost of their customers using everyone else's ATM network. It's a great deal for me, and a great deal for them.

I also don't pay any ridiculous month to month 'maintenance' fees. In fact ING pays me one of the greatest interest rates on the market right now. Oh, and their customer service is pretty amazing.

Want to join the best bank out there? Sign up with my referral code EBB062. Deposit $1,000 in the first month, and ING will shout us both $75.

#4 Finance bloggers don't pay for garbage bags

This one baffles me. When you buy garbage bags you are buying something just so you can throw it in the bin. I wrote a post about throwing your money in the bin, but this is next level ridiculous!

A roll of garbage bags typically costs about $5 - just to wrap up your garbage. For some reason you can even get scented garbage bags.

Skip the absolutely ridiculous cost of garbage bags. You don't need it. Instead buy more fruit and vegetables, and hoard the small plastic bags that you bought them in. Congratulations - you now have an endless supply of garbage bags.

And no, your trash won't smell. With small bags you'll be taking it out from under the sink to the wheelie bin before it starts to smell bad.

Bonus - start a compost bin or get some chickens! Instead of an overflowing garbage bin, you'll have an abundance of compost and rich soil so you can grow veggies and slash your food bill.

#5 Finance bloggers don't pay for exercise

Look at all these fit gorgeous people running on treadmills. You want to be like them to, so you should pay for a gym membership right? Wrong! It's a trap and you should run (literally) the other way. Go outside. Find a park and run under some trees. Run at dawn if you're a morning person because it is gorgeous outside. Or if you're a night person download the free Zombies. Run! training app and run after dark - it's creepy and amazing.

Not into jogging? Prefer weight lifting? Keep on eye on Gumtree or Craigslist for weights, and let your friends know you're looking. Mr FIRE and I picked up a full weight lifting kit for a measly $50. Including a weight bench and close to 100kgs of weights. We're just looking for a squat rack if anyone has one going ;)

Prefer cardio - use youtube. Looking for some yoga? Try the Down Dog app. I've had three different yoga instructors and I can honestly say the Down Dog is better than all of them.

Bonus: Finance bloggers don't pay for ... date night accessories

As a bonus, many finance bloggers report every item of their spending. They meticulously list the cost of toilet paper, a dozen eggs, happy hour beers and their new-to-them shoes. But I have never ever seen a finance blogger report the costs of, ahem, 'date night accessories'.

Are we really boring? Or perhaps we're hiding our costs under and overblown grocery spend. Either way, you'll definitely never see these in a a finance bloggers budget report.

Let's talk about finances and taboos

Despite our lives being ruled by the things we do to get money and the places we spend that money, getting people to talk about their income and outgoings seems impossible. Discussing investment strategies is either considered really boring, or some hush-hush back room conversation that can only be had with your closest confidants. I was in a 5 year relationship where bringing up money was met with avoidance, hostility, and a pretty derisive attitude that made me feel worse than Scrooge McDuck because I was thinking past next weeks pay.

This isn't to say that when you meet someone you should shake their hand and say "Hi, My name is Jane Doe, I make $32.37 p/hour working 35 hours a week and ascribe to the '50% on Needs 30% on wants and 20% savings' strategy. Personally I like the low risk nature of index funds but I'm keen to branch out into flipping houses when I have enough capital." That's a little bit overshare, but I think this conversation needs to be opened up.

There's no reliable statistics that say talking about money solves the worlds money problems but financial literacy can't be underestimated. My first 'job' was as a paper-girl. Once a fortnight the newsagent would drop the bills, a stack of envelopes and $40 on my parents doorstep. It was my job to fold up the bills, put them in the envelopes and deliver them to the right houses. It probably took me 2-3 hours of sorting and 3 hours to deliver. So I was on roughly $7.20 p/hour ($20 p/week) and I had no concept of financial literacy or saving that money. I remember blowing $20 on lollies at the local deli. I remember buying Red Bull at the supermarket most days. I remember my phone bill being $30 a month, which was a terrifying 37% of my income!

When the newsagency switched to digital delivery of bills (I guess, one day they just stopped delivering the money) I picked up a job at a supermarket. For 3 hours a week, at about $8.70 p/hour.  So after tax, it was still taking me more than a week to earn enough to pay my phone bill. It sucked, the job was terrible and I hated it. Twelve months later I picked up a job at Hungry Jacks, for $7something an hour, but closer to 12 hours a week. Suddenly I had spare money! And like every teenager in their first job, I had no self-control. And suddenly a lot more stuff.

Thankfully, somewhere in my early years I had an exciting 'investment' moment. My parents had set up Dollarmites accounts for my brother and me when we were young. They were pretty terrible, with some horrible fees and low interest rates that meant money in those accounts was pretty much stagnant. But I had a savings account, and I knew those numbers slowly going up were kinda cool. Then a couple of things happened.

• My parents moved my money to an account with a better interest rate. I seem to remember getting 6+% p/a
• My grandad needed to unload some money and gave all the grand-kids a rather excitingly large gift. Seeing that jump in 'my' savings was amazing.
• I got a bank statement and saw my interest payments for January, February and March. I was outraged! Why was February's payment less than the others! So I got my first lesson on how banks calculate interest.

I don't remember any other serious Financial Literacy lessons. But I knew money was pretty cool to have. And I knew there were ways to get it other than work. And I really hated seeing money go into my account one week, and be completely gone by the next. It felt like a huge waste, I was doing all this work and all my money was dribbling away into pointless snacks and soft drinks.

Getting it together

I started a budget. It was a crappy paper budget that I've redrafted a few times, but stayed with me for about eight years. At first I just tracked what I spent. Then I started tracking what I earned against what I spent. And added what I saved. Nowadays I use a big elaborate spreadsheet stored in Google Sheets so I can access it anywhere. I track my spend month to month, and my income and savings / investments year to year. I even have separate spreadsheets at home for more in depth savings and spendings tracking. It has become an ingrained habit to know how much I spend, and how much I saved. I've just opened a new credit card for travel hacking and they delay reporting expenses for almost a week, which is driving me absolutely batty!

When I was 17 my father started buying investment properties. For as long as I can remember I was keen on buying a house and having someone pay me so they could live there! Wow! It was a solid, visible investment that paid back hundreds per week. When I was 18 I put in an application for a home loan and was unsurprisingly laughed at by the banks. So I dumped all my money into a high interest term deposit and came back next year. Thanks to a huge pile of luck, a great property mentor and my parents confidence in me, I bought a house. At 19.

For the next few months I read everything that came my way about real estate and squirreled as much money away as I could. I don't want to do things in halves so I tried to buy another. And was again solidly laughed away. This time I had no out, I had a borrowing capacity of $1 including my personal income and my rental income. So I switched tactics, dabbled in the share market, mostly sticking to low risk bonds.

What's the point of this story?

The point of telling you this isn't to brag. I stumbled drunkenly through my personal finance journey. At 26 I own a rental property and have a comfortable cushion of investments. But, honestly, despite the amount of time and research I poured into all these things, I was lucky. I was lucky to have a cashed up benevolent granddad. I was lucky to have a savvy father. I was lucky that the day I first saw a bank statement I was in the right mood and the sun was shining, and it was exactly 11:23am or whatever it was that caused some tiny something to tick in my brain.  I was ridiculously lucky that I met my property mentor who jumped through rings of fire over a shark tank to get my first property. And I've been crazy lucky ever since that my tenants have accepted all the rent rises, taken care of the property, that the house hasn't flooded, that the stock market hasn't crashed, that I've fallen from job to job and ended up somewhere that pays me quite well.

Having my successes with my finances so heavily based on luck scares me. Since buying my first property I have done a lot more research on my investments, but the basis of my success is the luck of having the right random childhood experiences that shifted my mindset. Which leads me to my point, no one ever spoke explicitly to me about finances unless I asked first. And watching those big responsible adults umm and ahhh and shuffle their feet was pretty nerve wracking. I am immensely grateful that my father and property mentor were willing to talk to me about money and answer my questions, even if the answer was occasionally "I don't know".

When was your last money conversation?

Here's the thing though. Money is integral to our lives. Even if you ascribe to a minimalist lifestyle, that minimal still costs you money. The freedom to go home, turn on the lights and have a nice hot shower is driven by money. So refusing to talk about it baffles me. It is a taboo subject, and that needs to change.

I asked on Twitter who you could talk to about money and a scary 38% of people are only able to talk to their family. Almost 10% of people can't talk to anyone. While @DiligentDividend is happy talking to anyone about how much he earns @FatherWithCents thinks it might be shame that keeps people quiet. @indie_finance doesn't like talking about making more than others - although having those conversations might lead to pay rises for everyone if you lean on your boss hard enough.

Talk to your kids

I'm not a parent so I can't say much about parenting. But if you don't talk to your kids about money, where do you expect them to learn it? Primary school taught me how to count money, and the difference between dollars and cents. High school, the time when children enter the labour market and start earning, had work experience but no conversations about spending, saving and budgeting. School isn't designed to teach us how to cope with cash.

I can't talk about general parenting, but if I wanted to go back and teach young me about personal finance, I'd do it with games. Monopoly was initially designed to show you all the problems with capitalism. The Game of Life gives you a job, an income and expenses. Cashflow 101 is about collecting enough assets that you have a passive income, can quit your day job, escape the rat race and achieve 'life goals' like traveling the world and starting a successful charity. It also comes in a kids version.

The games all have varying levels of realism but they all make a good starting point for getting your brain switched on. At worst they're a bit of fun, at best they can open up that conversation.

While you're playing Cashflow 101, you should read "Rich Dad, Poor Dad". Robert Kiyosaki recounts the difference lessons his Rich Dad (his friend Mike's father) and his Poor Dad (his real father) taught him about money. The book is accessible and easy to read, I found it on Dad's bookshelf in primary school and I loved it. If you asked me about it I would probably ramble for ten minutes about how great it is.

Talk to your friends

You probably already do this. If you ever chat about that super cheap recipe that you made, or complain about the crazy big electricity bill you just got, then you're discussing finances. I find that most people tune out when I start talking about intangible things, interest rates, stock markets, diversified funds. They're scary unfriendly words. But personal finance is just as much about your day-to-day choices. About cheap nutritious meals. About looking for a cheaper electricity company.

The first and, I would argue, best step towards financial literacy is knowing how much money you get in and where it goes. Talking to my friend and co-workers has turned up a wealth of information about rebates on gas, where to find a cheap conveyancer and house hunting tips.

Diving headfirst into a conversation about  insurance, or investments is pretty daunting, but chatting about a new house is exciting. If you push past the taboos, those exciting conversations can turn up a wealth of knowledge. And knowing that the guy you sit next to at work owns eleven properties is pretty interesting too.

Money is considered a measure of 'success' in society. It's hard to get people to open up about their income because we're all afraid of being judged. At the same time it can be considered uncouth to talk about your financial success. After all, if financial success is 'life success', it comes across as bragging. I'm not suggesting that you start comparing dollar figure incomes with your friends, but knowledge shared is knowledge gained. You help yourself by solidifying what you know. You help your friends by sharing. And when you talk about the big scary topics, they start to feel smaller and easier to manage.

Talk to your partner

For so many reasons, talk to your partner! Communication is key in every part of your relationship, from cooking dinner to travel to sex. If you can't talk to your partner about your long-term and short-term finance goals, you've got a problem. They are going to be the ones comforting you when shares dive, high-fiving you when an investment matures and standing next to you scratching their head when the bills come in. Eventually most couples combine their finances, so when you start investing or making money saving choices, it's not your income and livelihood that is at risk, it's theirs too.

Your financial literacy

Financial literacy isn't just the big 'boring' investment questions. It's the basics, it's starting small and building up. The important part is identifying your goals and working towards them. If your goal is to travel as much as possible, you might be willing to eat rice and beans every night to save the cash for your next around the world extravaganza. If you hate travel and love food, do the opposite. At it's core, financial literacy is understanding where your money comes from, where it goes and making conscious choices about your spending and saving.

Financial literacy leads to financial freedom - which is a vague, loose term that depends on what you want. It can be something as small as the freedom to buy a coffee every day without every worrying if it fits in the budget. For me it means eventually not relying on my employer as my primary source of income. So all that 'boring' investment mumbo jumbo is fascinating to me.

Epic Food Week: Perpetual Food Plan

Food. For many Australians it accounts for the second or third biggest chunk out of their budget, after housing and/or transport. Poor food choices are also leading to an increase of “lifestyle” diseases, such as Type II diabetes and heart disease. Four Australian personal finance bloggers (Adventures with Poopsie, All About Balance, Enough Time To... and yours truly) decided to get together and offer an in-depth look at how we all “do” food in our households. It doesn’t matter whether you like to plan or just wing it, whether you have gourmet tastes or enjoy simple food, or whether you love or hate cooking; we’re sure you’ll find some tips and tricks to eat healthier and find ways to save.

Food in the FIRE household

This was actually chilli
cheese fries, very heavy
on the cheese!

Eating well on the cheap is always a problem for Mr. FIRE and I because, well... he's difficult. Mr. FIRE refuses to eat vegetarian, he's not a fan of beans, and he can't be trusted not to bring home chocolate, chips, expensive cheese... you get the idea. He also has a tendency to order pizza if I leave him home alone, or eat the wrong leftovers.

Surprisingly though, food isn't a sore point in our house. We are happy to eat pretty simple foods, we don't stress too much about variety, and we've figured out how to eat some tasty comfort food on the cheap. 

The biggest challenges we hit are preventing food waste, and making sure we have enough easy meals for lunches and roller derby nights. We tend to cook bulk meals, and take leftovers for lunches and roller derby nights when I don't have time to cook before running out of the house.

Perpetual Meal 'Planning'

Firstly, we don't meal plan in this house. Setting specific rules for what we eat Monday, Tuesday and Wednesday always leads to us getting to Friday and really not wanting what we have planned. Instead we do what I am coining as 'perpetual meal planning' which is an ingredient based planning system.

Mr FIRE makes pizza!
This is why I love him

For ingredient based planning we rely heavily on Evernote as a recipe book. Mr. FIRE and I look up recipes whenever we want to try something new and save them to an Evernote notebook. This makes them easy to find later, but also gives us the ability to search by ingredient - which is the cornerstone of ingredient based planning.

The best way to explain this is with an example - Celery. Can we all take a moment to agree that celery is the most annoying food item out there. Every recipe I have calls for two or three sticks of celery, but you can't buy less than half a celery which way more than I actually need.

One of my favourite cheap easy dishes is Cajun Chicken Jambalaya (I'll put the recipe at the end of this post). Depending on your serving size and ingredients it comes down to $1.00 - $1.50 per serve and it's super tasty. However, it only calls for two sticks of celery, which means I end up with half a celery in my fridge going to waste unless I follow a perpetual meal plan.

With Evernote this becomes super simple, because I type in 'Celery' as a search item and recieve a list of recipes so I can use up my celery.

This becomes the list of what I am making this week. I'm a huge fan of this method because it reduces waste, gives me an easy list of meals to cook and saves me from actually thinking. Lazy meal planning is the best.

This becomes a perpetual meal plan for two reasons. Firstly, there will be something left over after I make all these recipes - for example Chicken Soup is on the list, and it requires one leek. Everywhere I shop for leeks they are sold in pairs so leek becomes the next ingredient. Secondly, we stock our Evernote recipe list with things that result in lots of leftovers. One celery normally results in four recipes, which results in twenty to thirty meals. By cooking four times, I feed us for two weeks of lunches and dinners.

Tracking leftovers

Managing leftovers is an important part of meal not-planning. When Mr. FIRE and I first moved out together we would often dig something out the back of the freezer and have no idea what it was or how long it had been there. The chickens ate well those days.

Hawaiian Chicken
Delicious! but not a cheap meal

Saturdays I do a leftovers check and work out what we'll be eating the next week. Generally we need fourteen things to get through the week - five lunches each, plus dinners on the nights I have roller derby. If we are running short we have a few tricks before we panic.

Firstly, lunches are an easy change. If we're short of leftovers then I don't take leftovers for lunches and simply buy sandwich supplies instead.

On the (very rare) occasions that we have more leftover than we need, I turn again to my trusty ingredient based, perpetual meal plan. If I have a leftover leek, then I can use it to make Irish Stew or Potato and Leek soup. The stew is great for also using up leftover carrots, but the soup is easy because it contains very few ingredients. If I'm in a place where I have too many leftovers, I pick the recipe that will use up my ingredients and leave me with as few perishable items as possible.

While I call it the perpetual meal plan, it's important for it to stop at some point otherwise you end up with far, far too many left overs and not enough time to eat them all. Admittedly, this is great because it gives us a week off cooking and still plenty of options to choose from.

Sometimes we will be very very short of leftovers. Generally after having too many and taking time off cooking, oops. If we are very short of leftovers, then I plan to cook something big the next night, which leads in to the next important consideration for food - shopping.

How we shop

Here's a trick that keeps our food costs down. Mr. FIRE and I hate shopping. We make snarky comments about sales items, laugh behind our hands at people buying bottled water and we hate slow walkers. We're those people. We get in, we get out and we don't meander or get distracted by shiny things.

Unless choc mint biscuits are two-for-one. We all have our Achilles heel, that one is mine.

To keep track of what we need, we use Evernote (are you sensing a pattern here?). Evernote is a shared document system, so we can update it on our phones are any time, and if once of us goes and buys bread we can take it off the list before the other person buys a second loaf.

Our list is split into three sections - Markets, Butcher and Supermarket. Mr. FIRE is responsible for the butcher and goes once or twice a week. I go to the markets 2-3 times a week for fruit and vegetables. We both swing by the supermarket as needed, generally after visiting the butcher or the market. We have no set shopping routine, we just head out to the shops whenever we need something.

Unlike Mrs. ETT and Adventures With Poopsie we don't shop at Aldi, we watch for specials at Coles and Woolworths, but generally we just head to the closer store. There are two reasons for this - firstly we don't do a bulk weekly shop and secondly we don't have an Aldi nearby. We pick our supermarket by convenience.

Homemade beef and black bean
burgers. I made the buns myself
so these were pretty cheap.

After investigating Mrs. ETT's shopping list I don't feel like we would benefit greatly by switching to Aldi. Shopping at the markets means that my fruit and vegetables are significantly cheaper than shopping at supermarkets, especially because I buy the ugly fruit and vegetables, which is often heavily marked down. The prices I pay are similar or better than those Mrs. ETT is paying at Aldi. Yay for markets!

While conventional wisdom is to do a big weekly shop to avoid impulse buying we have a different method. As I mentioned, we both hate shopping, but on top of that Mr. FIRE has minimal cooking skills (past making brilliant pizza) so he doesn't bring home anything he doesn't understand. I occasionally impulse buy vegetables, but I ride a bicycle to the shops. While I'm tempted to buy things, I always have to weigh up (literally!) if I could get it home on the back of my bike.

Managing costs

Finally the question becomes how do we keep our costs down week to week with such a haphazard system? No prizes for guessing this one, we use Evernote (and google docs). I track our spending through google docs and when our spending is low we eat whatever we want. When our spending starts to creep up, I pull out Evernote and I search recipes by cost.

I have tagged a bunch of our cheaper recipes with prices per serve - if our spending is looks like it will go over for the month then I search by price and pick out a recipe that we already have ingredients for around the house. Unsurprisingly, the 'Under One Dollar' search turns up a lot of soups.

We have one magic recipe that doesn't sit in our recipe book called 'Pasta Bake'. Pasta Bake is made from:

• 500g of pasta ($1.80)
• 1 tin of diced tomatoes ($1.60)
• a jar of pasta sauce ($1.50, always stock up when they're on special)
• 500g of beef mince ($4), or 500g of diced chicken ($5)
• 500g of pureed beans ($1)
• whatever veg you have lying around the house or can buy on super special - I recommend zuchinnis, onion, carrot, eggplant - ($3 - $4)
• Top everything with a massive handful of cheese - ($2.50)

Cook the pasta in one pot, and everything else (except cheese) in another. When the pasta is done pour it into your biggest baking dish. Top with sauce, stirring as needed. Then top with cheese. Bake in the over for 20 minutes. Enjoy for days.

Pasta bake works out to less than $2 a serve and uses up all the sad leftover vegetables. It also seems to turn into a perpetual pasta sauce situation where I make far more sauce than I could ever possibly use. That sauce gets tossed in the freezer and next time I make pasta sauce I use the old sauce as a base for the new one.

Getting even cheaper - meatless lunches for me. 

Remember how I said Mr. FIRE won't eat vegetarian meals? Yepp, it's super annoying. I bulk out mince with grated carrot, zucchini and beans, but he gives me the stink eye when he sees me doing it. 

Sweet potato nacho
bake thingy... delicious, but
very weird.

One on hand, my kitchen my rules. On the other hand, I like Mr. FIRE and I try not to deliberately antagonise him. To balance out my desire for a super cheap grocery bill with Mr. FIRE's desire for meat, I occasionally cook us separate meals for our work lunches. 

Mr. FIRE has a very simple go-to meal - 2 chicken breasts, rice and frozen vegetables. I flavour the chicken in whatever seems like a good idea at the time (Lemon Herb, Honey Soy, Sweet Chilli, etc.) and split it out to five meals. Mr FIRE's lunches are under $10 for a week, but he says they don't entirely fill him up so we round it out with some baked treats.

This means I can cook myself my absolute favourite vegan lunch with mushrooms! Mr. FIRE is allergic so I have to cook this while he's out of the house. I got the recipe from the Frugalwoods, a simple delicious beans and rice recipe that is really filling and under $1 a serve.

The take away

This has been a big post, so let me do a quick wrap up.

Meal 'planning' tricks

- Cook things that create leftovers

- Plan based around an ingredient
- Keep track of what leftovers you have available

Shopping tricks

- Shop as quickly as possible

- Always have a list

- Don't take the car, the less you can carry the less you can buy

Keeping costs down

- Categorise your recipes so you can find the cheap ones easily
- Have some cheap go-to options
- Eat the occasional vegetarian meal. You'll survive, it might be delicious.

More Food!

Want to know how other Aussies are eating cheap while chasing the financial independence dream? As part of Epic Food week there are three other excellent posts your can peruse in case the Perpetual Food Plan doesn't tickle your fancy.

• Enough Time To... is a solid meal planner, and she provides a list of all her plans for this week, plus a copy of the receipt so you know exactly what it cost.
• Adventures with Poopsie also makes solid meal plans. She kept track of their household eating and shopping for for a month in preparation for her post. You've got to admire that dedication!
• All About Balance is even more relaxed than me about planning. As a foodie she knows how to mix flavours and get a healthy balanced of meats, veggies and grains. Check out her post for a balanced approach to food.

Cajun Jambalaya Recipe

Ingredients

• 1 chicken breast (approx 300g)
• 2 ham steaks
• 1 brown onion
• 2 celery sticks
• 1 green capsicum
• 2 cups rice (uncooked)
• 1-2 tablespoons cajun spice mix
• 3 cups of chicken stock (hot)
• 1/3 cup of tomato paste
• Cooking oil

Method

1. Preheat oven to 180degrees. 
2. Dice chicken and ham steaks, then brown in frying pan with cooking oil of your choice.
3. Dice celery, capsicum and onion.
4. Place all ingredients in a large baking tray and cover with alfoil
5. Bake until rice is cooked through (approx 45minutes)

Done - it's super easy and super tasty. You can serve with fresh tomato and sour cream if you want but I've never bothered because I'm lazy.

Use up the rest of the celery with a basic chicken noodle soup, minestrone soup and a chicken chow mein. Aim to end up with six servings of each recipe so you can take advantage of delicious leftovers.