How Much We Spend a Month | Frugal Living & Financial Minimalism

Money — a pretty delicate topic. In this video, we talk about how much money
we spend a month and more importantly, why we spend as much or as little as we do — focusing
on variable expenses that are modifiable through lifestyle choices. Here's a little bit of context: both of us
were raised thrifty, so we've never been big spenders. Some years ago, we left salaries and paychecks
behind to build something of our own. Money is important, but we wanted HOW
we made our money to be just as, if not more important than how much money we made. When business wasn't doing well, and often
it wasn't, we would live off of our savings.

There were too many instances where we came
uncomfortably close to running out of money, but we always manage to scrape by. Part of the reason why we've been able to
scrape by, is by going lean with our expenses, without feeling like we're compromising on the
quality of life. Our thinking is simple, if we can trim away
any excess, if we can not have to worry, or at least worry less about money, then we'll
be able to divert that energy into focusing on doing things that excite and fulfill us. So with that said, let's take a look at some
numbers. First let's talk about bills. For water and gas, we pay a little under $30
a month, and for electricity we pay a little over $20 a month. Partly for sustainability reasons, and partly
for monetary reasons, we have cut down our usage of air-conditioning and water-heating
to close to zero. The combination of air-conditioning and water-heating
alone can make up half of a household's total energy consumption, so just these two adjustments had
brought our energy consumption to about 40% of similar sized homes.

We don't have an issue with turning on the
water heater for a warm shower if we're down with a cold, or turning on the air-conditioner
if it gets uncomfortably hot. Otherwise, we're comfortable with the fans
on, and cold showers make a lot of sense in our country's climate. Our internet and phone bills cost $50 a month. $40 for our broadband at home, and here's
the fun part: $5 dollar mobile plans for the two of us. We're home 90% of the time, so even with a
$5 dollar plan, we get through most months with a healthy chunk of our data remaining. It helps that we've gotten into the habit
of not surfing mindlessly, or streaming videos on our phones when we're out and about, but
when you think about it, we're already online at home all the time, so if we're going to
be outside, we might as well be looking up from our phones for a while.

Working from home, we don't have a fixed commuting
schedule, so transportation expenses is an area that fluctuates quite a bit. In the last few months, it ranged from $20
to $60, so we'll take the average of $40. Public transport in Singapore is great, so
that's our default mode of transportation. Taking taxis, or using ride-hailing apps are
reserved for absolutely necessary scenarios, which are few and far between. These days, to increase our level of physical
activity, if the weather is good, we've gotten into the habit of substituting short bus rides
with walks, which we quite enjoy.

And for myself, I ride my bike whenever I
can, multiple times a week. On top of the health benefits, the commuting
costs that I save by biking would have easily covered the cost of the bike in just a couple
of years. Our food and groceries expenses total up to
about $500 a month. We eat affordably, but we still believe in
eating well, so food isn't an area that we're really trying to cheap out on.

We cook most of our meals at home, but we
would occasionally eat out or order takeaways if we're feeling lazy. Food is generally quite cheap in Singapore,
unless you're dining at more fancy restaurants, so you won't find us at the more expensive
places unless it's for a meal with family or friends. Shopping & entertainment is a tricky category. We don't shop for leisure, we mostly buy what
we need.

pexels photo 105004

We don't go to the movies, to concerts. We don't drink, we don't have a nightlife. There are things that we do for fun,
for free. We go hiking, because nature is free. We can meet up with our friends, good conversations
are also free. So our shopping and entertainment expenses
are virtually zero for most months. But once in a while, there are celebrations
of occasions, getting gifts for family, friends, etc. And we do have hobbies that costs a bit of
money as well. For example, I string my tennis racquets a
couple of times a year, but I get to play for free at a friend's court. Recently HL has been getting into brewing
her own Kombucha, but some of that, along with her other kitchen experiments, would
have already been factored into food expenses. So for this category, we'll put in a
generous, arbitrary number: $100 We'll also put in another arbitrary amount
of $100 a month for miscellaneous expenses like having to get something fixed, getting
a haircut, or just anything unexpected.

So in total, not including fixed expenses,
we spend about $840 a month. Or $420 per person. We won't be going into detail into some of
our fixed expenses for a number of reasons. Things like insurance and business expenses
can't exactly be altered through lifestyle choices, and are mostly irrelevant without
context. And of course, there's the biggest monthly
expense in most cases — housing, whether that's paying rent or paying off a mortgage. In our case, we live in public housing in
Singapore, in an apartment that we purchased through a built-to-order process. But at the moment, we're technically not paying
off our mortgage out-of-pocket, but through a government mandated retirement/savings fund
— that means part of our income goes into this compulsory account, and a subsequent
part of that can be used to pay off the mortgage if we choose to.

Including all fixed expenses, our total expenses
hover around the $2000 mark, or about $1000 per person. By now, most likely, you would have formed
an opinion. Money can be a divisive topic. Something that can be objective down to dollars
and cents, can be utterly subjective at the same time. Some may think that life is too short to live
the way we do, like cheapskates, and at the same time, another group may think that this
is not frugal enough.

And that's totally cool. Ultimately, there is no one right way to earn,
spend, save and invest your money. One question that we always ask ourselves
is: How would we want to raise our children, when we do have children of our own? If we'd like to say that it doesn't matter
whether they grow up to be successful or wealthy, as long as they're healthy and happy, in a
financially responsible manner, then we'd certainly like to lead by example, and
to be a living blueprint that they can follow. Our game plan for personal finance, or life,
for that matter, is not to make the mathematically perfect move at every step of the way. Our game plan is to be patient but not idle. And be content, but not complacent. Anyway, we're not the people you should be
going to for financial advice. Financial literacy is such an important skill
to have and there are many different sources to learn more about finance. In preparation for this video, we even sat
through a class by Justin Bridges, "Modern Money Habits: 5 Steps to Build the Life You
Want" on Skillshare.

Skillshare is an online learning community
with a ton of creative classes, and they're also kindly our sponsor for this video. If you're a beginner in finance, and you need
a basic framework to get started on managing your financial health, then this class by
Justin Bridges can be a great introduction. Skillshare costs less than $10 a month. Even if you've already done a free trial of
Skillshare, be the first 1000 to click on the link in our description, and you can get
30% off an annual Skillshare Premium Membership.

Question of the day: what's the biggest challenge
that you face when it comes to managing your personal finance? Let us know, start a conversation in the comments
below. Have a good one..

You May Also Like