In this article, why did I decide to live on 60% of my income? We will analyze how saving gave me choice, a better conscience and freedom 😉
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For starters, I don't have a dream salary, I'm not a daddy's boy, and I'm not rich.
Firstly, before you think it, I don't currently have a high income. In fact, as I write this article, my salary is below the Swiss average.
Before you think so too. I didn't win the lottery, sell drugs, or receive an inheritance. Although I wouldn't mind winning a few thousand Swiss francs in the lottery 😉
The question people often ask is this ”"If he earns a very average salary and doesn't have a large fortune, why does he spend well below his means?"
I will summarize my art of living in this article 😊
Early Adulthood and Personal Finances
Before I was 23, I was like most people with their personal finances.
That is to say, I would receive my salary, spend it at 100% and wait until the following month to receive my salary again and spend it entirely again.
I told myself that as long as I didn't have debt, I was managing my money well. I practiced the famous "live from paycheck to paycheck”.
The financial trigger
One day my car broke down.
Since I had no savings, I asked my parents to lend me some money to pay the mechanic.
My parents laughed and told me:
“You want to play the grown-up, but you turn to Mom and Dad when things aren’t going well.”
My parents were 100% right. In this case, without them, I would have had to sell my car at a very low price to the mechanic because I didn't have the money to pay for the repairs.
Or I would have gotten into debt with my mechanic with debts that would be very difficult to repay.
This situation made me understand a very important aspect.
👉 In reality, unforeseen financial events will constantly occur in our lives. For example:
- The car that breaks down
- An emergency at the hospital
- The veterinarian for cats
- An emergency at the dentist
- A device that needs to be replaced urgently
And as a rule, unforeseen events mean high amounts to be paid urgently!
I understood that the “living from paycheck to paycheck” is not suitable for personal finances, as there will always be unexpected financial expenses to pay!
A thought that changed my personal finances
Shortly after this episode with my car, one night before going to sleep, I had a thought that summed up this:
” Well, I finished my studies a year ago and started "real life", as an employee at 100%.
I work over 40 hours a week, with only 5 weeks of vacation per year.
In my job, despite the fine speeches in front of me, I see clearly that I am in reality just a number in the company.
I'll have this life for over 40 years. 42 years of commuting, working, sleeping. 5 days a week, 47 weeks out of 52 in a year!
For whom? For employers who don't care about me.
As for the salary I receive, it only finances my expenses and some minor pleasures.
In reality, I would have a certain freedom only in retirement, that is, after my 65th birthday, without knowing in advance whether my health would still be good.
Furthermore, even if I am fortunate enough to be in good health at 65, my financial freedom will be very limited, as the government will not give me enough money to live decently as a retiree.’
I had trouble falling asleep that night, but I understood an important aspect. I don't want to depend on a boss's salary or a few clients' money all my life. !
Besides, I have no desire to have a very limited salary and spend my healthy years working for others!
First thought, become independent
My first thought was to become independent with my professional career. I told myself that if I didn't depend on a boss, my life would be less dependent on others.
But actually, after talking to freelancers and having a few clients that I worked with in the evenings after my job, I quickly realized that I was changing one submission for another.
Indeed, when you work for a boss, you depend on him. But when you work for clients, you depend on them as well.
And don't forget, when you're self-employed, you're not entitled to unemployment benefits and you have to contribute to your second pillar pension yourself. This means you need to set aside even more savings than if you were employed.
Therefore, I told myself that I had to find another solution to become financially independent.
The second thought, studies
I then thought about doing long studies.
However, I quickly realized that I was going to study only for money. And I always thought that doing something only for money is doomed to failure.
Then, while reading the book "Not everyone was lucky enough to fail their studies.”, I concluded that in reality, it is only at the end of a career that studies are financially profitable.
Moreover, When I saw friends who had very reputable studies, I didn't necessarily see them happy or fulfilled in their work!
In fact, some people changed careers a few years after working very hard to get their degree because they were fed up with their job.
Indeed, I realized that regardless of our studies or professions, we all share a common desire for financial freedom and not to depend on others to earn our money.
The Savings Trigger = The Parents' Example
My parents always lived below their means. Yet, my parents were housekeepers and house painters. As you can imagine, their salaries were never high.
Yet, my mother explained to me that they saved about 40% from the 2 salaries combined (my father + my mother). Not to mention, at that time, they had my brother and I to support with small salaries.
One day I asked my mother why they saved so much for the little income they had? She explained to me:
“We prefer freedom to unnecessary spending”
I didn't understand this sentence right away, but I kept it in the back of my mind because it made sense. And I studied it for weeks.
The beginning of smart saving
I started looking at my bank statements and analyzing my spending. I quickly understood what my mother had told me. Indeed, I concluded how much I was wasting my time. For example:
- A phone plan that was too expensive compared to the competition
- An online order that I bought and used very little (sometimes I didn't even open the packaging)
- A subscription I paid for every month, but I couldn't remember why I was using it.
- Unnecessary bank charges
- Insurance I paid for twice
- A soda I drank every day out of habit, but I wasn't thirsty.
-> I realized that all these unnecessary expenses were the result of my hard and poorly paid work. 🤔
In reality, I was, in broad outline, working very hard to keep the consumer society alive and enrich others!
I calculated my unnecessary expenses and estimated 30% of avoidable expenses 🙁. I still remember today what I thought:
”"Uh-huh, I work one and a half days a week, that is to say 12 hours a week. To consume objects or things that give me almost no pleasure!"”
Then I calculated the time lost per year working for my dispensable consumption. And I was scared!
I was working for useless consumption approximately:
- 66 days a year
- 528 hours per year
Therefore, one by one, I started eliminating each unnecessary expense in order to reduce spending 😉
Examples of smart saving
To save money, here are some examples I've created:
- Cancel some insurance policies
- Remove unnecessary subscriptions
- Switching bank accounts to a low-cost account with no management fees
- Stop making unnecessary compulsive purchases online or in stores
- Stop consumption ”"out of habit"”, such as, for example, coffee at the end of the day or a chocolate bar at 9 a.m.
With these financial tips, month after month, I noticed my savings increasing and I thought:
“In reality, the less I consume, the less I am subject to the money or services of others.”
Savings = Freedom
In my case at that time, I understood that by consuming "only" 70% of my salary, it meant that if I wanted to, I could avoid submitting to a boss.
- 12 hours per week
- 528 hours per year
-> Simply by having reasonable consumption!
Adapting from compulsive consumption to a minimalist and responsible lifestyle takes time. However, with self-reflection and careful monitoring of finances, everyone can learn to manage their money better!
The 5 positive effects of consuming less and saving more
Why did I decide to live on 60% of my income?
Here are the 5 main positive aspects of saving
1st positive effect – Long-term savings
👉 Unsurprisingly, the first positive effect of changing my consumption was significant savings over a long period!
In a few months, without changing my lifestyle, I went from being a compulsive shopper to a saver who easily saved 30% of his salary.
Without realizing it, in my case, saving 30% per month means saving approximately 1,200 CHF per month. In 10 years, we are talking about savings of 144,000 CHF !
And I repeat once again, without changing my standard of living and while having a low salary.
In reality, I simply stopped paying "overpayment" for unnecessary services and fees, and I started keeping that money for myself!
Note that this saved money brings me financial stability, reduces stress and allows me to embark on personal projects.
2nd positive effect – Less management and less administrative work to manage
👉 The second positive effect is to reduce administrative management!
I noticed that by reducing my consumption, I had fewer problems with my administration. For example:
- A delay in delivery
- Damaged packaging
- Insurance to manage
- Subscriptions to manage
- Invoice management
All these mishaps and secondary management tasks are a waste of time and avoidable headaches 😐
In reality, The more items you own or the more services you add, the more administrative work you have to manage and the more you have to pay.
therefore, By reducing my consumption, I simplified my life and stopped bothering myself with excessive consumption..
3rd positive effect – Cleaning time & Tidying up time
In my home, in order to sort and throw away, I started to remove useless and bulky objects every day!
👉 Indeed, as I became more and more minimalist and essentialist, I noticed that I spent less time cleaning and tidying.
It actually makes sense.
The fewer objects there are in the house, automatically, the less dust there is and the easier and faster it is to clean your home!
The fewer objects there are at home, automatically, the fewer objects there are to store and the easier and quicker it is to sort your home!
VSThe time saved, resulting from spending less time cleaning and tidying, means more free time for hobbies!
In addition, this aspect allows for a more zen, more harmonious and cleaner interior of the home!
4th Positive Effect – Investment & Financial Freedom
One day, while reading a blog, I heard this word that seemed incredible to me but I did not understand the meaning.Financial Freedom”.
By reading books and blogs, I realized that, in a nutshell, financial freedom is about saving your money and investing it in order to become financially free later.
Indeed, if an investor makes good financial investments, the money he has saved, a few years later, with the income from financial investments; this money earned will allow him to pay the bills and thus become financially free thanks to the passive income from investments.
5th positive effect – Maintaining my expenses
👉 These days, I spend roughly the same amount I did 10 years ago. In fact, there isn't really a single new significant expense.
What has changed compared to 10 years ago, however, is that there has been price inflation.
Indeed, certain expenses, such as grocery shopping, public transport or health insurance for example, were much more accessible 10 years ago.
However, In 10 years, the percentage of my salary that I save increases year after year! Because my expenses have remained as simple as 10 years ago, but my salary and passive income are gradually increasing (as I write these lines).
These days, I save about 41% of my salary each month without any effort! That is, I only spend 59% of my monthly salary.
Yet, I regularly feel very happy and I don't feel like I'm depriving myself! Not to mention that my income is increasing exponentially, Warren Buffett-style.
Why did I decide to live on 60% of my income?
Conclusion
Why did I decide to live on 60% of my income?
It wasn't me who decided, it was my personal finances 😉
In reality, I simply transferred the money I was overspending into savings and investments.
Instead of spending my entire salary and being financially dependent on someone for the rest of my life, I decided it was better to stop buying "junk".
So, with the money I save from this old dispensable consumption, I invest a good part of this money and make my money work for itself in order to increase my chances of becoming financially free.
Without realizing it, along with financial minimalism, I also started minimalism in my home, in my private life and in my job.
In truth, Consuming less has allowed me to avoid the unpleasant tasks associated with overconsumption and has opened my eyes to the advantages of minimalism.. For example:
- Reduce administrative management time
- Reduce cleaning time
- Increase my free time
- Clear my schedule
- Sorting out my harmful friendships
- Avoid some problems in my job (and reduce the chances of burnout)
To summarize, reducing my consumption has allowed me to improve 7 important aspects of my life:
- More savings for financial contingencies
- Opportunity to invest my money and increase my chances of becoming financially free
- Cleaner housing
- A tidier home
- More free time
- Less administration to manage
- Avoid problems at work with a minimalism approach
Why did I decide to live on 60% of my income?
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Overall, this blog lives on sharing a frugal and minimalist lifestyle.
For a question of transparency towards the readers. All recommended products are in order to make life cheaper, simpler and to promote the essentials.
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About me
I decided to create this blog to develop and help readers who are looking for a simpler and more economical life.
Compared to before, I was a person who consumed a lot until the day I realized that my consumption made me sadder and poorer 😑
Now I prefer the minimum of my needs to be happy and achieve my financial freedom.
Without realizingI started to focus on saving and investing to depend on a boss for as little time as possible and to speed up my personal projects.
As a result, I am getting richer in a way that I never imagined since I have an average salary in Switzerland.
It is for this purpose that I decided to create this blog. In order to share and learn with other people who seek freedom and simplicity 😉
Are you rather minimalist or frugal Jonny?
I am as minimalist as I am frugalist. However, there are situations where I lean more towards an art of life.
To conclude, I think the most important thing is to feel comfortable in your lifestyle 😊
Why did I decide to live on 60% of my income?
Why did I decide to live on 60% of my income?
Minimalist Frugal
Why did I decide to live on 60% of my income?
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