Saving for our future financial independence important. Embracing the present moment is important as well. So how do we find a balance that helps us achieve both goals?
I’ve invited Angela Rozmyn on the show today and she’s going to share her family's journey, trials and tribulations with this conundrum.
Angela is a mother to a 4-year old son and has been married to her husband for the past 10 years. She writes about the balance of saving for the future and living for today on her award-winning blog Tread Lightly, Retire Early. Her story and advice have been featured in major media outlets like MarketWatch, GoBankingRates and Business Insider.
She also hates most seafood but loves her pets and the outdoors.
Andy Hill: What did your life change financially when you became a mother?
Angela Rozmyn: So financially, not so much. I had a list of like 30 things I needed to get done before I got pregnant. Part of it was to have separate funds specifically to pay hospital bills and make sure that I could stay home for some amount of maternity leave.
I actually ramped up very early and then was full-time when he was 5 months old, and at that point, I was working about half-time in the office and then half-time trying to work during nap time and after bedtime.
I was so exhausted dealing with the baby all day and then he'd finally go to sleep and then I'd have to open my laptop and do a bunch of work. And so Monday through Friday I was either working or taking care of the kid or attempting to do a few house chores and errand stuff. But it meant that it bled into the weekends and life was a blur and it wasn't very fun. It was really overwhelming.
What changes did you make that helped with your schedule as a working mother?
I had the opportunity to put him into preschool a couple of days a week when he turned a year old. And we're really lucky to have family support for the other days.
And so we started paying for preschool at the same time that I then cut my hours but still went into the office. So I am there Monday through Friday, but I'm there shorter days.
We have our mornings together, we can have breakfast together, and then I pick him up in the early afternoon and we have the rest of the day. Or occasionally I will sneak into work early and do a podcast interview or after work, I'll go for a run before I grab him. Life has a lot more balance these days.
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How did you develop a flexible working arrangement with your employer?
I think it was more just talking about what I wanted and what I was hoping. There are more employers that might be open to that sort of thing if you can talk them through it like, “Well, I can do all of these things at this amount of time. I just would have to give up X, Y, and Z, but I'm also willing to give up this significant chunk of my income to do it.”
But as long as I could keep my core stuff, then we found ways to shift it around. And as I've worked less for 3.5 years, now I'm finding more and more people that have different schedules and hours than you would think. A lot of people don't realize that I work with, that I don't work full time because I'm in the office five days a week and I'm there when they see me, so they don't really notice, especially people that don't work in my office.
They can't tell I'm not working full time. But then as you get into conversations with people, even with city staff, like government employees, private employees, across the board, if you start paying attention and talking to people more and more, there are more flexible working agreements and I think it's just not talked about and the expectation is that everybody works full time, but a lot of people don't.
How much of your income was decreased?
I went to 80% time so I cut my hours by 20% and my pay by 20%. Though, it's probably more than 20% because there is some additional value to being full time.
So it's probably more like a 25, 30% pay cut.
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How did you handle the decreased income?
I wasn't preparing for that change. I expected to just continue working full time. That was my plan, but we have very low fixed expenses. We have to pay for food and pay our mortgage and pay for childcare, but we don't have any other debts or any other big expenses. Also, we have a roommate, so that brings the cost down more. We just had enough fluff in our budget that I just really like having very low fixed expenses because it gives you a lot more flexibility.
Once I cut my hours, I felt like I had more time to breathe and think and process. That's when I started really trying to ratchet down what we were spending on as far as consumables and non-necessities, but it was starting the blog really that really turned it up to the next level.
We had a 22-23% savings rate before I started blogging. At the end of 2017, I documented a “no-spend November” where I tracked every penny for the first time in my life. I've always been reasonably frugal. I've always lived below my means, but beyond that, we didn't pay super close attention, but then no-spend November was very enlightening, and I actually had to like triple check that I paid my mortgage because we had too much money in our checking account at the end of the month.
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What is a “No Spend November”?
It was really like a low-spend November, but it doesn't sound as good. I was going for as many zero spend days as I could. I had it in a notepad app on my phone. When I spent X dollars on whatever, I would write it down.
It was more like don't spend unless you have a really, really good reason to spend it. But from that like 22-23% savings rate, since I've been tracking closely and every month now on the blog, I write a post updating everybody on how much I spent so I kind of have to pay attention. Last year we had a 46% savings rate.
You made some big changes in your food spending recently as well. Can you share how you did that?
Yes, but it was more about, even with the cut and pay, we could still make things work. But it gave me the time to think about it and think about what I was doing, and I started really slowly.
Once I had gone back to work full time and I was just trying to get through my days, I was taking time pretty much every workday to go walk and grab lunch, which in Seattle can be anywhere from like $10 to $15 or $20 for lunch.
But what I finally figured out was that I was really doing it for the walk and less about the food, so I switched that out for the most part to a walk around the block instead of a walk to pick up food, and then I would just have something simple at my desk.
I gave myself a $150 budget for the first month just for lunches and I came in at like $87 that first month and then like $40 the month after that. Then I went 6 months without buying lunches to really kick the habit. And then for a while I was trying to keep it to almost nothing.
And then, I had a conversation with Gwen from Fiery Millennials about intentional spending and what we actually value. I was trying to not go grab these tofu spring rolls that I really liked from the place around the corner and she was like, “How much does that even cost?” I was like, “Well, it's like $10,” and it made me realize that once a week is not going to break my budget.
So I have now loosened the strings a little bit and so now I feel free to go and grab my food once a week and otherwise I eat what I brought from home.
What does financial independence mean to you and how are you pursuing it?
A lot of people have to opt-out of the workforce to care for someone else or any number of reasons. I want to be prepared and protected for any kind of future.
We do have a mortgage still. While it's a lot less than a lot of people in the Seattle area, it's still a lot more than people that don't live in high-cost areas, so I'm paying a little bit extra there, but not a lot. I do include my mortgage principal in that savings rate because I feel like it's still our money. And then, IRAs and then some other REITs as well.
Where do you spend your money that makes you super happy?
I don't know about super happy, but I'm super happy that my dog is still alive. She's been very expensive for the last couple of years. She had some heart problems a couple of years ago and that cost a lot of money and then she, most recently, had to have a couple of toes amputated because she's got this autoimmune thing going on.
I realized that we've spent a lot of money on them already this year. So our savings rate is a little bit lower but I'm glad to do it. I enjoy having dogs in my life and I think its part of being a responsible pet owner is taking care of them.
Where do you not spend money that maybe the typical person does?
As of last week, I'm at two-and-a-half years of a clothes-buying ban. So I've not spent a dollar on clothing for myself in two and a half years. I do have a few new things from hand-me-downs from friends and whatnot but that budget for me has been zero.
And then my husband works in construction, so when he wears out a pair of Carhartt's he buys new one. But other than that, he doesn't really spend money on clothes.
And then my son's clothes come from either hand-me-downs or other stores. So that's oftentimes a zero on our budget monthly. And then, you know, I think we're under a couple of hundred dollars for the year so far.
If you had $1,000,000 more today, would you buy more clothes?
No. I've had people offer me like “I will buy you something so you have something new”. And I'm like, “I don't need anything new”.
I get new things from people that are getting rid of their old stuff. It's new to me and the clothing ban started out as trying to get to a more minimalist wardrobe initially, but wanting to do it in the most sustainable way possible. That means wearing out the clothes I already have.
And by the time I'd hit that year-mark, I decided that I was going to go past a year and just kind of see where it took me, and it has kind of morphed into not just a money savings thing and not just a shrinking closet thing, but really the sustainable bit.
The most sustainable thing is to not have new stuff, to begin with. It doesn't matter how sustainable it is. The best is just to not have a new thing in the first place. And so even here, someone that I know commented on Instagram some months ago about a dress I really liked that she was wearing, and she's paring stuff down to get ready for a big trip and she brought it for me. I'm going to wear it tonight at the closing party, and so I have a new dress and it's beautiful.
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