50 Comments

  1. Hey Penny, you put forth some interest points on the subject of frugality.

    In some ways, looking at the PF blogosphere, considering frugality is the celebrated trait, it is easier to talk exclusively about it, irrespective of any supporting factors. It just ends up bringing in more clicks.

    Personally, like you, me and the husband aspire more towards earning more money while retaining the current level of frugality. I am a little unsure as to what is the level of frugality that will end up making me miserable, rather than celebratory.

    Frugality is good, but yes, it is not the entire picture.

    • Thanks, Aparna. I love your perspective always! We do really value frugality (after years of being super wasteful), but I realize that frugality alone won’t do it for us.

  2. Awesome post! I am all for transparency! I do think sometimes, when you are in this world of PF, frugality, minimalism, etc – you can forget to share your whole story with people. They see the results and not the process of how you got there. When we tell people we are in the middle of a mini retirement they are baffled, but we explain that we had worked hard on prepaying our mortgage for almost 10 years. We sold that home and are living off the equity. It was a trade off that was worth it to us, that most people wouldn’t consider.

  3. I am guilty of not talking about high incomes enough on our blog. My husband is a high-income earner, something I was recently reminded of after reading this article:

    http://www.businessinsider.com/how-much-money-rich-people-earn-in-america-san-francisco-new-york-2018-2?utm_source=facebook&utm_medium=cpc&utm_campaign=auddev-test2266

    Because of that, we can save all of my (modest) income. High income earners also have way more disposable income than the average income earner. Food, housing, cars, cost the same. High income earners can spend a smaller percentage of their total income on these items, but an average income earner can’t. They can’t choose to spend 5% of their incomes on food, because you can only get food so cheap. Thinking about future articles on this topic. Thanks for the inspiration, Penny!

    • Of course! Thanks for sharing that article. It’s always so fascinating. I think part of my frustrating with what the mainstream media writes about high earners is that it is always so archetypal.

  4. Penny, you have the sweetest, most fair way about calling out bulls**t. I think I just going to forward everything that annoys me over to you to write about. I’m overly prone to feistiness. 🙂

  5. When I first started reading FI blogs, and even after starting my own, I was focused on frugality because it was pretty much all I saw people talking about. And to be fair there was quite a bit of excess I could trim out of my spending. But it took me a *very* long time to come to terms with the fact that, as much as I hated having to give up my free time to earn more, if I ever wanted to get ahead at anything more than an incremental rate, I needed to get a part-time job and earn more money.

    Income is a HUGE part of the equation. I added up all of my spending last year and was pretty proud of myself at how relatively low it was. Without some drastic lifestyle changes, there’s not much more I can do to frugal up my life right now without it crossing the line into no longer being comfortable. But I couldn’t also save the same amount and have a 50% savings rate because I don’t earn enough to do so. I expect that’ll change in the future. But achieving a higher savings rate will be all thanks to a higher income, and it’s important to acknowledge that. Thank you for this incredibly well-written post!

    • That’s such a kind thing to say, Erin. We focus on frugality a ton, too. I love it! And it’s really important and totally in line with my increasing awareness about environmentalism and mindfulness. BUT that being said, it isn’t the only reason we are making progress toward FIRE.

  6. Jover

    I think the reason the frugal narrative is so pervasive is that for 90% or more of us reading these posts, there’s always something we COULD cut or replace with a more frugal alternative… But depending on location and type of work you do, there’s sometimes No Chance at making $XX,000 or $XXX,000 per year. So the frugal messages/tips/hacks/tools/apps keep getting shared, while stories about “this is what we do with our $140k a year salary as a couple” basically don’t exist (that I’ve been able to come across).

    • Oh, for sure! I was the queen of frivolous spending. I would love to see how high earners spend their incomes. Everything I find that goes mainstream is such a caricature. I hope to be able to share that perspective one day!

  7. Income is the denominator in this equation. Those living at or even double the poverty line (with nothing extra to spare) often are way more frugal than any of us will be thanks to necessity. But also, a high(er) income allows you to buy in bulk / higher quality stuff / have time to look into other money saving options. I talked a bit about this in my clothing ban post, but there is some serious privilege not normally discussed in the FIRE community.

    Ps – we do make six figures COMBINED – barely – in a HCOL area with childcare. No way we can ever save 70-80% of our income, and I’m okay with that. We’re doing awesome with what we’re working with, and we still do have a considerable income to work with.

  8. Jennie

    THANK YOU for writing this. I have been feeling the exact same way lately but you put it into words so much more eloquently than I ever could. With my husband and I working our butts off 24/7 to make 60k a year it can be super hard to relate to those making 3-5x our income who then make it sound easy to do the same.

    • That is my issue, Jennie. I really hope to earn six figures one day! But I will never pretend that it wasn’t easy. I don’t want to assume too much, but I sometimes wonder if people feel like they will be judged too harshly for being honest about how much they earn. (I, on the other hand, plan to take out a billboard when I cross that threshold.)

  9. It’s an interesting one, and we all know it’s the combination of income and savings, i.e. the savings rate that lets people retire early.

    And seeing how much different bloggers disclose shows you the various paths taken. I think we are all guilty of assuming people like us are the norm, and the internet brings you out where anyone can access or comment. To be honest, having solid middle class incomes would be my norm, it’s what I grew up with and assumed was normal as a child. So I can see that bloggers would assume their readers were like them, and not bother mentioning it.

    I’m one of the lucky and hard working with a very decent income,which I don’t hide in any way. I’m damn proud of increasing my income, and happy to share the sacrifices and tips that got me there.

    And I’ve noticed a lot of rhetoric lately about income which I feel is divisive and I’m not too comfortable with. After all, they are only blogs. That people can choose to read. Or not read. It may be true, it may be fiction. Who am I to judge?

    • I do think that we are all guilty of James Frey-ing ourselves to some degree. No memoir is ever entirely precise. If nothing else, we get the timing wrong just by definition of writing. I try not to worry too much about what is and what isn’t fiction. But I do think that there’s something to be said about disclosing the hand you’re playing with if you’re going to talk about how to win the game.

  10. We focus too much on the word “frugal”. We should spend money on the things that actually bring us happiness, and not spend money on things that don’t bring happiness. Figuring out which is which is the process of finding your balance. For some, that $5 latte truly makes you happy. For others, it would not. Everyone is different and has to find the balance in their spending that maximizes their joy. It is very difficult to make that assessment for others.

  11. Joanna

    Thank you, thank you! I feel like this is the elephant in the room in the FI conversation. Like Erin said, frugality was all I heard for years in FI. It was frustrating hearing stories about people who realized they could retire in 5 years (by living on my whole annual income).

    Even more so when people continually said, “you don’t need to earn 6-figures”, but it was usually from married couples who combined made 6 figures. I’m married and the solo bread winner because of my husband’s health issues.

    I’m not going to be retiring in 5-10 years, unless my income increases drastically. Yes, there are always drastic changes that can be made, but I’m either unwilling or unable to do them, which is something I’m okay with.

    I finally realized that my whole goal for FI was to be able to be home to raise my future kids. I can do that without retiring, I just need to find a way to work from home, which is what I’m working on now. I still want to achieve FI, but it’s a frustrating movement to follow when you’re lower income.

    • You’re right, Joanna. I always really appreciate it when people remind me that I can move at whatever speed that I’m willing and able to go.

  12. Someone linked to this article on FB so I jumped over to read it, rolling my eyes after reading the title and thinking, ‘Duh. Of course. Here comes a rant.’
    I was pleasantly surprised. No jumping up and down and screaming about how unfair life is, no gnashing of teeth while mentioning avocado on toast and the 1%ers etc.
    You were articulate, balanced and very clear and this was a pleasure to read. When you said you were also a teacher I nodded and smiled.
    Here in Australia I’m pretty sure teachers get paid better than in your country. We also get paid for the summer holidays – pretty aghast that you guys don’t usually appear to be, to be honest – but it’s still not a 6 figure salary, except for principals and the like. In the public system, we have no control over the amount of money we earn so being on a single wage with 4 boys was a balancing act. My 6-year side hustle helped enormously. I was fortunate to be paid enough in my full-time job so that a side hustle was optional and was done to throw the profits into the mortgage and investments, not as a means to keep our heads above water so every penny of it was spent on surviving.
    Yes, income is important. Should bloggers disclose what they make? Probably not. Stating a profession is usually enough to peg pretty much where they sit on a wage scale.
    Should they emphasise frugality? Absolutely. Without spending less than you make, none of the rest of the FI journey is possible.

    • It’s probably partly my bad, Frogdancer. As someone who has always been a teacher and never really considered doing anything else, I don’t really have a sense of what other professions make (besides a generic more). Thanks for the kind words, too!

  13. Penny you are a beautiful person and beautiful writer. This needs to be sent to every single writer of a finance blog, in my opinion. “even if you can’t or won’t share your numbers, you can name the ballpark you’re playing in”. Perfect. Perspective is what is lacking and greatly needed in all these stories. Thanks for giving me plenty to think about. Here’s to hoping we are slowly changing that and painting more well rounded pictures in the future.

  14. You know how I feel about this. Bravo 👏🏾

    I quite simply would not be where I am today had I stayed in my old field and would not have my current level of stability and quality of life. In a high COL country, the average wage only goes so far and there’s not much wiggle room making 40-50k.

    In my new field I can potentially make six figures (was not realistic in my old one) and although it is just a number it’s one I really want to hit. Right now my total comp would put me over but somehow salary feels a bit different. Here’s to joining the 100k club!

  15. You can’t save money you don’t earn, so unless a major part of those “save $75,000 next year” articles focus on how your can significantly increase you income, and save a huge portion of it, then they are clickbait.

  16. Egotrage! Egotrage!! Egotrage!!! You can save $75K a year if you live in a single-wide trailer. And in your area of Illinois, I’m sure a trailer park isn’t very far from your school. But admit it. You’d be embarrassed to live in a trailer. I love ya, Penny (in a totally honorable way, of course). And I marvel out your writing ability (Matt beat me to the punch about little pieces and James Frey). But you’re letting people off the hook too easily. Despite all the problems our country has–despite all the good manufacturing jobs that have been shipped overseas–the biggest financial problem facing the typical American is ego. We’re too good to live in a trailer. We’re too good drive a crappy car. We’re too good not to have the latest iPhone. That’s why we can’t save money. Sorry for being such a curmudgeon. I haven’t been myself since I went down in flames in the Rockstar Rumble. Who knew the Russians would sink so low as to hack our friendly competition? I curse you Mr. Putin!

    • Ha! Those Russians! I wish I wasn’t anonymous so I could call out the specific burbs I live in. But there are ordinances for how you put out your garbage. So no, there’s no trailer park. For a while, we had to drive a town over to get to a dollar store. We definitely could move to save money on cost of living, but our salaries would take a HUGE hit. My redonkulous property taxes pay my (relatively high) teaching salary.

  17. My quick thoughts are semi related….

    As a start up business I’ve become more frugal because starting from scratch is tough. Everything seems expensive!

    Sometimes I’ve thought, “It’d be so much easier with more expendable cash”. While there may be some truth to that, I’m almost always reminded that more money doesn’t solve things.

    Businesses with larger amounts of cash flow should still be diligent and careful to pick their basic and marketing expenses. Just because you can doesnt mean you should right? It all cuts into your bottom line.

    When I reflect on the stage of where I am in my business, I find joy in the struggle. Mainly because I know it’s part of the journey to get to six figures. It doesnt have to end up that way. I’m aiming for sustainability and profitability.

    The journey is quite amazing. As a chronic overspender, I’ve become more disiplined. Running a business gives me extreme awareness on how money really works.

    What I’d love to see out there more is the truth on how people got started. Like way before they sawa profit. Maybe even way before the started the business that became a success.

  18. So true! The one-sided coverage here irks me for two other reasons as well:
    1. It makes simple, classic thrift out to be an “extreme” lifestyle of frugality. As if drinking coffee at home were a super-human act of sacrifice. The “extreme” label is marketing, I realize, but it also makes it seem like something it’s not, and possibly seems unattractive or unattainable to some.
    2. It makes it seem like one person’s year of low-spending can be reproduced decade after decade, which it can’t–not by the “frugal” person being covered, and not by anyone else, either. Everyone has more and less expensive years, and highlighting one year is just not a realistic way to look at finances.
    But your overarching point is more important–tell the whole story!

    • That’s something I didn’t touch on in the post, Kalie. But it definitely impacts me. I will literally say to my husband, “We can’t buy that. I’m a frugality blogger.” Bless his heart for not telling me all ten of my regular readers won’t actually know if I buy a new pair of gym shoes. A good chunk of frugality is sustainable. Unfortunately, a lot of the extreme frugality that is so dang clickable isn’t.

  19. I love this post, Penny! I’m actively working to double my income and then I can be sooooo frugal. (Or just pay off the student loans) The ridiculous clickbait pieces irk me so much. Living on $25K when you have the cushion of earning $75K is vastly different from living on $25K because that’s what you have available to you.

    • And there’s nothing wrong with either! In fact, I think there’s real value in learning how to spend and save on a middle class (and above!) income.

  20. Yes yes yes. There has been so much going around the Twitterverse over the last week and this was the post we all needed. Bloggers who act like saving 3-4K per month is because of frugality…uh yea sure. But also, having a take-home income of 6-10K per month helps. Sure, everyone tells their story a little differently but come on, that’s a pretty big part of the story.

    “Even if you can’t or won’t share your numbers, you can name the ballpark you’re playing in” sums up exactly how I feel. I do not track my net worth on my blog, nor my exact full-time or side hustle income. But I give readers many indications of where I am. People know my approximate salary range at my day job. I like disclosing that because I actually feel like it’s one of the more relatable numbers in the PF world and context for our stories is important.

    • Agree 100%. I don’t talk too much about my husband’s income (or my husband) because it isn’t really my story to tell. But I do always mention that we make far more than the average $50k combined. That’s really all it takes, I think. Ballpark it for the world.

  21. Yep, we love living frugally, but it comes a lot easier with our white collar jobs, paid vacation time, and solid health insurance. We maxed out our tax advantaged accounts since we earned that much extra money last year! We definitely recognize that this is not an option for most Americans, and we learned our frugality from our Grandparents and parents who did never earned as much as we did in 2017.

  22. This is a fantastic post that sums up a lot of my recent conflicted feelings around the frugality topic.

    My husband and I are both very high earners without any kids. I don’t consider us frugal and we do live in an expensive city, yet I save about 50% of my net income in addition to maxing my 401k. How? Because my salary is high enough that I can!!! We are established in our careers and are fortunate to earn way more than we need, so of course our savings rate is high.

    I have read the PF frugality stories in awe for years. I assumed I was reading about couples earning a fraction of our income that were so far ahead of us thanks to frugality. It’s only in the last couple of weeks that I fully recognized I’d only been getting half the story. There is plenty of fat I could trim from our expenses to reach those 70%-80%+ uber-savings rates. We’d still be living pretty well, purely thanks to the ballpark we play in.

    Without sharing details of that income ballpark, any story on frugality leading to fast abundance feels very disingenuous.

    • I try to be fairly forthcoming with what we are working with. My husband and I are in interesting positions in that we really can’t seek out a higher income (no raises, bonuses, negotiating, etc.) without moving. So we do have to rely on frugality (or side hustling). That being said, I’m paid pretty well for being a teacher. 🙂

  23. Penny,

    I love this and how you have articulated something I have been thinking about for a long time. I need to go back to our own little blog and make sure our three readers know the ballpark size of the PIE pie……

    Another piece of the salary gmish is related to bonuses and sometimes stock options. Often missed out in the “salary transparency” dialog. Full disclosure here, I have had ridiculous bonuses for the last two years. And each time, been able to bank them into either Vanguard or our checking account. 10 years ago in our spendy days, we would not have done that. Blown on fancy vacation, pricey restaurants, a needless piece of furniture stuff. Being able to bank bonuses is based on two high salaries AND mindful spending to manage our budget/expenses with those salaries.

    Your little Tweetstorm today brought me over and I am reminded to NOT make my next trip over here as long. A belated Happy Easter to y’all.

    • I am so glad you stopped by! And honored too 🙂 Bonuses! You’re right! Part of the issue is the fact that I read through my teacher lens usually, so it doesn’t even occur to me necessarily that some people might also have bonuses. As for my own blogging, I could definitely talk more about other benefits afforded to teachers that aren’t sheer numbers (at least not in terms of income).

  24. Buckeyecub

    You said so many of the things I have been thinkink. It was shocking to learn that some bloggers are in different ballparks then I thought. I regularly read blogs of high net worth individuals who are transparent to their ballpark. I have no problem with there income level but I am disappointed with ones that aren’t transparent. I will be more discriminating in the future.
    In the last decade with a chronic health issue and job loss for healthy spouse, frugality was specifically appealing because it provided hope. As the spender it helped me be more aligned with my thrify husband. However without the good fortune of a new career opportunity that led to income increase I don’t think we would have much retirement savings or positive network. Downsizing and frugality kept us from further debt. The income increase led to savings. Very blessed to say family income hit six figure threshold. The difference it made is significant. Salary increases allowed for 401k and IRA to be maxed out and for the mortgage to be within 3 yrs of being paid (15 years early).

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