The Money Snapshot: A Public Policy Researcher Shares Thoughts on Her Frugal Habits and Inheritance
Spending
How much do you spend on the following categories on a monthly basis?
Groceries: $800
Restaurants, bars, takeout, and delivery: $100
Clothing and accessories: $25
Transportation: $220 for subway to work; no car payment, but $40-ish on gas
Rent/living expenses: $2,295
Entertainment: Library books, Netflix, Amazon Prime
Health care — premiums and other costs: Monthly premiums of around $220 for couple; maybe another hundred yearly for co-pays.
Other major expenses: Travel and skiing: depends on the year, but can be as much as $5,000 combined.
What's your spending range for these things? What's your average?
Vacations – Average: Varies wildly depending on destination, but $3,000–$5,000 for a trip for two to Europe is probably about right.
Charity – Range of donations: Donate to three to four organizations each year.
Charity – Average donation: $50 per charity; currently working to establish scholarship fund for husband's alma mater.
Individual items of clothing – Range: Wedding dress was $250. Do not spend much on clothes otherwise.
Individual items of clothing – Average: Shirts, $20; pants, $70; shoes, $100
Apartment or house – Current main residence: $2,295
Car or other vehicle – Average: $20,000
Car or other vehicle – Last purchase / current main vehicle: $22,000 in cash
Have any large medical expenses for yourself or others played a role in your financial picture?
Planning to support elderly relatives in the future, but exactly how is unknown.
Fill in the blank on this question: I could save _____ if I stopped ______, but I don't because _______.
I could save thousands if I stopped traveling and skiing, but I don't because they're very worth it and there are a million things I'd rather cut first.
When was your wedding, how much did it cost (total), and how much did YOU pay?
2014; $15,000 total; paid $1,000 ourselves
At any point in your life to date, has inheritance played a role in your money situation?
Had a college fund from paternal grandparents and inherited low six figures from maternal grandparents at age 25. I have been incredibly lucky to have received an inheritance. It helps me be frugal by choice while minimizing the risk that a huge medical bill could sink me or that I have to stay in a job I hate because I can't go without a paycheck for a month. I am proud that I save and work hard to reduce expenses in a very HCOL area, but the inheritance has “taken the edge off” in a very real way. I'm so grateful to my grandparents for managing their money so well and for living frugally themselves! We have all made good choices, but even more so, we've been very lucky.
How has your family provided financial support in your adult life?
Zero other than no-interest loan when they paid off my student loans.
Money Strategy
Do you have a general money strategy?
My general money strategy is to have enough saved that I have choices. For example, we're considering moving to a new state (lower cost of living) in the summer. The fact that that would mean missing my year-end bonus is not going to stop me. I'm also not worried if there is a stop-work order at my office if the government shutdown happens, even if I have to miss a few paychecks. I have worked hard to keep my set expenses low so I don't need to rely on the next paycheck or bonus to keep going.
Do you spend money to save time (e.g., cleaning service)? Do you donate your time instead of money?
I am willing to spend more for a direct flight to save time, but otherwise, I don't spend money to save time in most circumstances.
What are your favorite resources for personal finance (podcasts, blogs, books, series, conferences)?
Frugalwoods, Mr. Money Mustache, planning to read The Simple Path to Wealth.
What advice would you give your younger self about personal finance?
Start contributing more to retirement and keep it going through grad school.
In honor of the original name of our money advice series, Tales from the Wallet, here's a wallet if you're on the hunt:
just an fyi-The headline mentions a 25 year old, but then the post says that the age is 30.
Why not say the spouse’s income? Even if you have separate finances, if he contributes to say rent — that frees up more cash for you to invest in 401k and in non-retirement investments. I feel like people want to act like “I’m doing it by myself” but you’re really not if anyone else is contributing to your rent/groceries/utilities.
It’s my money snapshot and I’m not sure why my husband’s income isn’t there – I thought I filled it out? It’s ~$140K and we have completely joint finances. The only things that are separate are our retirement accounts. Also, for context, he is a former refugee who was on “welfare” in the U.S. for a few years. I like to think that his career success now illustrates how public programs can really provide an important helping hand when needed.
Thanks for filling this in – good for both of you!
Thanks! That fills in a lot of blanks. And his story sounds really interesting, too!
I think this post should have been JOINTLY written with both man and woman writing; that way, we would not have gaps b/c the man did not participate. I do not have any man, and my dad handles all the numbers for me, so I can focus on my legal carreer. FOOEY! If I did, I would have much more to spend then I do now. DOUBEL FOOEY!
Agree. That seems like a very large and relevant bit of information.
Yes–as I was reading, I was thinking, she makes $75k and spends over $2k on rent? But having the husband’s income makes a huge difference. On a 215k income, the rent number makes more sense.
A lot of people make $75K and spend that much or more on rent in the Bay Area, though. $2295 is a steal (sadly).
Yep, my husband and I spent about $1800 on rent on a combined ~$45k income (he was a grad student, I was mostly unemployed but doing some part-time contract work). Most people in the Bay Area put a huge percentage of their earnings into housing, over 50% of your after-tax income isn’t unheard of.
Hi, thanks for sharing. You said you received a low sixes inheritance, what did you do with that money?
Most of it went to Vanguard investment accounts, $25K paid for my graduate degree at a top school in my field, and the rest went to bolster our emergency fund.
Thanks for this post! OP, did you get a MPP or a PhD in public policy? I’ve been a lawyer, and am considering going back to get a public policy degree — I’d like to do something research focused.
Is that saving $2,000–$4,000 a month?
Ps. Props for keeping the clothing budget down!
Other than the fact that they aren’t charging you interest, I’m curious why you haven’t just fully paid off the student loan to your parents? Seems like you have plenty of cash to be able to do so from your large emergency fund/cash balance.
Isn’t that reason enough?