How Much Money Can You Really Live On?
- Written by Candice Elliott
Andrew and Matt calculate the absolute minimum they could each live on. We hope it will inspire you to cut some of the frills out of your spending.
If you cut your expenses to the bone, how much could you live on? And what does “live on” mean? Would you be willing to eat ramen for every meal or would you still need a weekly Whole Foods run? Is it realistic to get rid of your car?
We pad our expenses with a lot of unnecessary fluff. If you lost your job or if you decided to quit your job, you would get by on a lot less than you are spending now. As a hypothetical, list out your expenses, or check your Mint account and decide what you could cut but still maintain a good quality of life and be happy.
Now see what you could cut to live like a recluse, never going out, eating only two meals a day, no alcohol, no public transport.
Of course you could try one of these approaches for a month and see how you do but it’s really just an exercise. It can be reassuring to know that if you had to live on $1500 a month you could.
Imagine if you did it though. For just one month. How much money you would accumulate and the things you might discover you could live without for longer than a month. Maybe some of those changes will become a permanent part of your life.
Our mental attachment to things is strong but once that attachment is broken, we usually see that not having cable does not really change day to day life in a negative way. It may even have a positive impact. Now you have to fill those hours spent in front of the TV with something else. Maybe you read more, cook more, start exercising, spend more time with your family. Take the one month challenge and let us know how you do!
Shiner White Wing Belgian White: With hints of coriander and orange peel.
Mint: The easy way to budget.
Betterment: The smart way to invest.