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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Introduction: Why did I decide to live on 60 % of my income?
I don't have an exceptional salary (it's actually quite low at the moment). I'm not rich, my parents aren't rich, and I've never received an inheritance.
However, I made a choice that may seem surprising to many people: I am looking to live on about 60 % of my income and to save or invest the rest (40 %).
For what ?
Simply because, over the years, I've come to understand that’Saving money is not just about preparing for the future. It's also about buying freedom.
Before I was 23: I spent everything
At the beginning of my professional life, I operated like many people.
I received my salary, I paid my expenses, I treated myself… then I waited for the next month.
In reality, I was living salary by salary.
The famous: I receive my money today, I spend it in 30 days, and I wait until the next month to receive my salary.
As long as I had no debts, I thought I was managing my money properly.
I didn't really have any savings and therefore very little margin for safety.
The turning point: my car broke down
One day my car broke down.
The problem was simple: I didn't have enough money to pay for the repair (That's normal, I had no savings.).
So I asked my parents for help. Their response struck me:
«"You want to act like an adult, but you turn to mom and dad when things go wrong."»
They were right.
This situation made me realize something essential: Unexpected financial events are a part of life.
A car can break down, an appliance can break, an unexpected bill can arrive, or a medical expense can occur.
If you have no savings, the slightest unexpected expense can quickly turn into debt. And consequently, a source of anxiety and stress.
So I started to question my personal finances.
This reflection changed my perspective on personal finance.
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. !
My goal: to no longer depend solely on my salary
After this conclusion, I wanted to earn more money to cope with unforeseen events.
I started thinking about my professional future.
I considered becoming self-employed or pursuing further studies in order to earn a better salary.
Then… I understood something more important.
My real goal was not to earn more in order to buy more, but above all to not depend on a salary to pay my expenses.
And a very simple way to become less dependent on a salary is simply to spend less!
The example of my parents
My parents greatly influenced me in this thinking.
They always had very low wages. They were a cleaning lady and a house painter. Yet, they always lived below their means and saved about 40% of their combined wages.
My mother once explained to me why they saved so much:
«"We prefer freedom to unnecessary expenses."»
Their example and that phrase have stayed with me.
I started analyzing my bank statements and my financial behavior. And I discovered that I was spending a lot of money on things that ultimately didn't bring me much benefit.
For example :
- subscriptions that I rarely used
- a phone plan that is too expensive compared to the competition
- impulsive online purchases
- avoidable bank fees
- questionable or duplicate insurance policies
- small, unnecessary, repeated daily expenses
I realized that the real problem was not my low salary.
It was mainly my way of spending money.
I started cutting out unnecessary expenses.
So I started to optimize my spending.
For example, I cancelled some subscriptions, reduced impulse purchases, and started thinking before every expense.
The goal was not to live miserably.
On the contrary : I wanted to keep the expenses that actually improved my life and eliminate those that brought me almost nothing.
Little by little, my savings began to increase.
By eliminating some unnecessary or avoidable expenses, I realized that I was saving about 30 % of my income.
Indeed, I had 30 % of my expenses that didn't make me any happier! They were just thoughtless expenses!
Savings = Freedom
In my case at that time, I understood that by consuming "only" 70% of my salary, it meant that I could avoid submitting to a boss of approximately:
- 12 hours per week
- 528 hours per year
528 hours of work per year that I could have avoided simply by having reasonable consumption!
As a result, I discovered something very motivating:
Every franc I didn't have to spend became a franc I could keep and invest in my future.
Consuming less also saves time
When a person saves money, people generally only see a few CHF saved.
But in truth, this approach goes beyond the simple question of money.
- Buying less also means fewer things to store, clean, maintain or replace.
- Fewer subscriptions mean fewer bills to check and fewer payment reminders.
- Fewer orders mean fewer deliveries, returns, and problems to deal with.
- Fewer purchases = more savings = more opportunities to invest and grow your money
So I discovered that Consumption doesn't just cost money. It also costs time.
And also something even more important in my eyes: excessive consumption costs years of work that can be avoided.
If I can stop working a few years earlier instead of paying for frivolous expenses, why hesitate?
Saving to buy freedom
The goal of saving and investing is not to become a millionaire at all costs.
For me, the objective is much simpler: to have sufficient resources to be able to make choices.
Because in truth, once you have saved well and built up a good nest egg, you can:
- Changing jobs without salary being the most important aspect
- Coping with an unexpected financial situation without getting anxious or asking for help.
- To finance a personal project (for example: a trip lasting several months or important training)
- Take a few months off to reflect on your life
- Stop working to live for a few years in a poorer country
It is this idea that I associate with the financial freedom.
It's not so much the idea of no longer working that I'm looking for, because I enjoy working. But it's primarily the freedom to change my life with my savings that attracts me to financial freedom.
Why live on 60 % of income?
Today, I aim to keep my spending and leisure activities around 60% of my income. This means I allocate approximately 40% to savings and investments, when my situation allows.
This is not a random number.
I think that's a good percentage if I'm looking for a balance between:
- expenses
- hobbies
- savings for unexpected events
- building financial wealth with my investments (to optimize my financial future)
However, this percentage is not a universal rule.
For example, if you earn little, have several children, or live in an area with high rents, saving 40 % may be impossible.
The goal isn't to copy my percentage. The goal is to find your own balance between spending, leisure, saving, and investments.
Even starting with 10 % or 20 % of regular savings can already make a significant difference in the long run.
Conclusion
Why did I decide to live on 60 % of my income?
Because I realized that it's more important to think about your future than to think about the latest smartphone or the latest high-end car.
Note that earning more money depends on several factors that we cannot control. On the other hand, spending less depends only on us.
In summary, I apply 3 steps:
- Spend only on the essentials
- Avoid spending money on unnecessary or cumbersome items.
- save and invest the rest of the money, in order to improve my future
In the end, Every expense avoided becomes a small part of my future freedom. Whether it's in savings, investment, or clutter.
And that's probably the most important lesson I've learned about my personal finances:
The money you don't spend today can become the freedom you have tomorrow.
Why did I decide to live on 60% of my income?
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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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