A Frugal Year

One Woman’s Journey to Save 50% of Her Net Income

Of all the things I thought I would be doing as an adult, I can’t say I ever imagined I would be attempting to save 50% of my net income at the age of 39. But here I am. 

Hello! It’s me, Jill.

You may be thinking - what is this elder, female millennial talking about? Allow me to explain.

Facing a new year (I’m writing this at the end of 2023), is a time to take stock, write goals or create resolutions in the hopes of making this next year better than the last. For me, thoughts of 2024 have brought on rather revealing anxieties. For one, 2024 is the year I turn 40 (deep breath), yes 40. 

By acknowledging and reflecting on this truth, so many others came into focus. Though I have wonderful friends, supportive family, a good job and my health, my finances are in serious need of care and attention…if I want to retire this century.

The Breakdown

Experts advise that you should plan to retire on roughly 80% of your pre-retirement income per year until you die. Let’s say you make $80,000 a year, 80% of $80,000 is $64,000. This means if you aim to retire at the age of 65 and live another 20 years, you should save roughly $1.3 million to retire comfortably. And since we don’t know how long we will ultimately live, we should save a good deal more than that, according to experts.

With a clear view of retirement (again, about to turn 40, 65 is cresting into view, I’m essentially an old hag), I made an honest assessment of my savings. (Another deep breath) I have maybe one year’s worth of savings based on this 80% rule if I were to retire today - yikes. I am woefully behind, pray for me.

How I Got Here

Unlike many of my friends, I did not save for my future. Nay, in my early 20s I took one look at the next two decades of my life and laughed. Save for my future? I live in the present, man. Put a little aside for a downpayment? Homes will be accessible when I’m good and ready to buy them, you can’t tell ME what to do, society. Take 10% of my income and roll it into a retirement savings plan? I’ll worry about that once I figure out my career. 

In short, I didn’t really save money in my 20s and 30s. My friends got married, bought homes, started families and built nesteggs. I went on trips, moved far too many times, spent money on things I can’t even remember and more or less spent a bunch of money. I knew enough, having grown up in less than wealthy circumstances, that I should never spend more than what I make. However, the concept of saving and getting my money to work for me never burrowed into my brain.

In more recent years, after switching jobs countless times, moving, dealing with breakups and breakdowns, I began to slowly realize how important saving is. And with those anxieties I mentioned, thinking about the future, what I hope is my future. I know now, it’s time to make a change.

The Goal

Over the next 12 months I will save 50% of my net income and embrace a frugal lifestyle. 

You may be wondering if I’ve lost my mind, I assure you that I have not. I fully acknowledge that this is an ambitious goal. Another question that may come to mind is: what the heck why?! Well dear friends, I would consider myself to be an ambitious person. My friends would likely agree that I tend to take things to the extreme. I figure, why not be a little extreme with a financial goal if it sets me on a better path.

Arriving at 50% as my goal was a bit of a journey in itself. I spent a few weeks researching different savings methods, generally improving my financial knowledge along the way. Still unsure of where to begin, I happened upon a concept called: FIRE. The acronym stands for Financially Independent, Retire Early or FIRE. The goal of FIRE is to generate enough savings in the form of investments so that you can comfortably live off the compound growth of those investments, retiring early as a result.

This is achieved by, you guessed it, saving a large percent of your net income per year. Most individuals attempting to retire through this method save at least 50% of their net income, with many saving between 60%-70%. (And you thought 50% was a lot.) Though some components of the FIRE method seem a bit too ambitious for me, I was really inspired by the overall concept. And with at least a dozen examples of people achieving this early retirement, it also meant that others had made it work.

Heartened by this, I completed some initial assessments and found that saving 50% of my net income seems doable. 

But something ‘seeming doable’ is very different from making it work and actually doing it. Ever the procrastinator (and oh boy do I procrastinate), what better way to make myself do something than create an entire blog about it. Being accountable to faceless, nameless humans (potential bots?) is far more pressure and accountability than simply shouting it inside my head. 

The Sneaky Goal

With my main goal of saving a butt load of money over this next year, there is a secondary, sneaky goal. In researching all of this hub-lub, yet another realization creeped into my mind - I will need to change a lot things in order to save that much money. But, a BIG change might be just what I need.

As a young-ish (once I turn 40 I’ll turn into sawdust) professional, working, grinding, and giving my all to my career has left a rather large, turd-sized rock of discontentment in my heart. Though I’m not naive enough (again, almost 40) to think that by simply saving money my life will magically transform, I am in need of some sort of ‘life reset.’ So, sneakily, tied to my lofty goal, my secondary goal is to embrace simplicity, putting to bed the notion that I need to keep up with those forever spending Jones down the block.

Ultimately, we will see how it all comes together and if I lose my mind in the process.

What, Dear Reader, You Can Expect…

Here ends my first post (huzzah!). Thank you for reading this far. Before scanning before exploring other posts, I wanted to let you know what you can expect from me and the A Frugal Year (AFY) community over the next year.

Along with my ambitious financial goals, I will be posting regularly on A Frugal Year substack. I’ll be sharing everything I learn as I embrace a frugal lifestyle. You can expect to see monthly updates, retrospectives, mistakes made, tips & tricks, how-tos, and any and all content in-between.

In addition to compelling content, I’m committed to creating a welcoming and safe community for everyone. This is a space to learn, ideate, test and transform barriers into new opportunities. More on this as the community grows.

Your support means the world to me, so please subscribe below, follow me on instagram and join me for the adventure of a lifetime.

Now comes the fun part(?), making it happen.

---