Investing will allow you to reach financial independence. You must Invest your savings or you’ll miss out. Invest your savings or the big, bad inflation monster will gobble them up!!! Invest, invest, invest. That seems to be all we ever read in certain parts of the personal finance blogosphere.
And it is true, investing is one of the chief ways of growing your wealth long term. But I will let you in on a secret: Mr. Frugasaurus and myself do not have most of our savings invested in the market. In fact, our savings to investing ratio plummeted this past month, as our sudden house purchase was not entirely planned, and I had to take out some money during the recent dip in the market to cover the rest of the closing costs.
But the simple truth of it is, we don’t have the majority of our savings in the market because we don’t have a terrible lot of savings to begin with. When we came from London, I had $5000 to my name in a mortgage savings account, and Mr. Frugasaurus had even less.
I have talked about the Norwegian mortgage savings accounts before. Tax beneficial, at a decent 3.2% interest, with an upper limit of 300k NOK or about $37k. On top of that, you can have a non-tax advantageous mortgage savings account for another $37k. Multiply that by two because Mr. Frugasaurus can have two accounts as well, and you’ll reach the healthy sum of 1,200k NOK or $148k.
Since we consider a paid off house a large source of wealth and security, filling those accounts take priority. In just the last year and a half, my accounts have grown from those measly $5000 to a rather more healthy $22k. And a new boon of the year is that banks may take security in your mortgage savings account, without you emptying it.
That means we can continue saving in it (up to 34 years old) at the healthy 3.2% savings rate plus tax benefits, while our mortgage is currently set at a rate of 2.2% interest. You don’t have to be a math whiz to see why we didn’t cash out the accounts to get a smaller loan in the current market, scary though it may be.
When all our accounts are full however, and our mortgage is ticking down at a healthy rate, there is no doubt we will put much more of our surplus income towards investing.
We just aren’t there yet.
There is so many great blogs out there these days, it can be easy to get overwhelmed by all the advice back and forth. My point with this post is not “Save in a mortgage savings account!” (especially since I don’t know if they are available anywhere except Norway).
My point is that people are different, and needs vary. My income is currently locked at a medium for area at about $50k per year before taxes for the next few years. It is the most I have earned any time in the past, to be sure. But it is not the amazing six figure income some people make. Mr. Frugasaurus is making less than half of that because his freelance business is just starting out.
So while we are not struggling to make ends meet, we can’t put 90% of our income towards savings or investments either. We just don’t have that kind of disposable income to throw around.
If you want a $10k emergency fund before you invest a penny, do that if it gives you peace of mind. Prefer paying off your mortgage to safeguard against a downfall or job loss? Rock on! I know how it feels to want to optimize every penny. In 2.5 years I might find myself without a job again. The clock is ticking in every sense of the word.
But if you make decisions you’re not comfortable with, even if it looks good on paper, you might find yourself feeling miserable all the same.
At the end of last year, I sat down and wrote down my seven financial goals for 2018, in order of priority. Those were:
I have got through goals 1-4 already, and was sooo close to crossing out 5 when the unplanned house purchase caught us a tad unawares, and I had to empty it again for closing costs.
As you can see, I put investing way down there after my “peace of mind” goals. My student loan is even further down, as it only accrues interest at 2.0%. Way below anything the mortgage savings account or potentially the market could give me in returns.
I still like seeing the student loan principal decrease, don’t get me wrong. But that is exactly where this list of goals comes in real handy. I can look at the list and know that getting the student loan under 200k NOK is a priority, but only after I’ve seen to these other money goals. Lists makes it easy to see exactly how and where your priorities lie, making it easier to follow through on them. Same with investing. I can increase how much I put towards index funds, only after I set the rest of my financial house in order. Right now, I invest as much as I pay towards my student loans. That seems like a healthy balance.
I love reading personal finance blogs online. They were a large part of the reason we are now financially able to get a mortgage on a great house (for us) in the first place! Without the PF blogosphere I never would have saved quite so aggressively, or worked quite so hard at trying to find a sidehustle which fits my personality. I probably would have gone to work and called it a day, happy with my effort and happy to spend money on fabrics and crating supplies, maybe even *gasp* lunch at work because I’d earned it.
So I am not at all hating on bloggers who tell you investing is the holy grail. It probably is. For them. At this stage in their life.
But some of us are not quite so far ahead yet. Some of us are still trying to find our feet financially and try to create a safe platform from which we can make decisions based on strength, not desperation.
And that is perfectly ok.
This is going to be a very difficult post to write. Even typing the title made my fingers resist the keyboard. This topic is still too raw and too close, but I will try to write it anyway, because I think it is important to capture the thoughts behind why we did this. We bought half a lamb, and intend to try to keep it as our only source of meat for a whole year. Time will tell if our experiment will be a success.
Together with my best friend M, we went ahead and bought a lamb carcass from a local, organic farmer, half a lamb each. We did this to buy locally and to reduce our food miles, but also to remind ourselves where our food comes from. For M the latter was not necessary, as she grew up on a farm. To her, buying clingfilm-wrapped packages in the supermarket is something she was only exposed to as an adult, but I digress.
I dipped my toes into it by posting on twitter. Having been known as a mainly plant-based household by other bloggers, it was a difficult thing to admit to. But response was largely positive, so I will try to describe what we did and why. It has been less than a week since we picked it up, and here are my thoughts on the process so far.
Having been on a plant-based diet for three years, with animal products slowly sneaking their way back into our kitchen the past year after we moved back to Norway, I can only say writing this post feels difficult. Mr. Frugasaurus was never plant-based, yet he still went with me when I asked if we could have a plant-based only kitchen in London.
But Mr. Frugasaurus loves his cheese and especially his stick meat, which is one of the main Christmas dishes in Norway (we have several based on region/family history), which he gets at his grandmother’s house every year. Every so often the rest of the year, he would get meat cravings. But because he is an economical fellow, he bought the cheapest meat in the grocery store.
This made me concerned. How could I know this animal had led anything close to a decent life with sunlight, outdoor spaces and little stress?
Of course, I couldn’t.
So I went online to the local organic food guide and checked whether there was any local sheep farmers in our district, so that I might accommodate the desire in the best way I could think of. I wanted the whole animal, because there are only so many pieces of filet/leg/etc. I wanted to be conscious about the whole process. But because a whole lamb was too much for the two of us, I roped in my experienced friend M, who has butchered several animals in her childhood, to share the animal with us.
I figured, if we are going to bring meat back into the house, it will be with the full consciousness of the violence of it all, and with the mentality that it should be the only meat we purchase all year. No more occasional purchase of simple packages in the store, far removed from the real animal.
We eat too much meat and animal products.
From this site I found that the average member of an OECD country in 2017 (Norway is one) ate 30.2 kg of poultry, 23.6 kg of pork, 14.5 kg of beef and veal, and 1.4 kg of sheep meat per person. By comparison, an average citizen of the US consumed 48.8 kg of poultry, 25.8 kg of beef and veal, 23.6 kg of pork and 0.2 kg of sheep.
This is absolute madness. Especially considering that 1 kg of meat takes on average around 10 kg of feed plus copious amounts of water to produce. That is food and water that could be used to feed our growing population. Or even better, surplus land from eating less meat could be turned back to wildlife habitats.
Our one lamb was 14 kg. Divided by two households that is 7 kg of meat and bone. Divided by the 365 days in a year, that is comes out at about 20 grams per day for our household. If my experiment goes according to plan, this will be paced out over the year. With a new influx only if we decide to do this again next October. No grocery store meat.
That would sound like very little to any meat eater, but that is the level of meat consumption per year it is realistic to aim for if we want to continue to consume meat. Especially if we want to live sustainably and add a bit of dairy and eggs on top. That is a couple of slices of ham or cheese for your breakfast or lunch bagel. Or it could be 3-5 thin slices of wok meat in your stir fry. It is not a lot. And remember that any dairy, cheese, eggs or fish is added to the total as well.
If you want to live sustainably, yet eat a little meat at the same time, you could either eat a tiny, tiny bit every day and probably feel deprived. OR, you could eat plant-based dishes during the week and serve yourself a meat-based treat for supper on Sundays. If you want the flavour to linger, make broth from the bones and add to vegetable soups and stews. There are many ways to make the flavour go further.
In the words of Graham Hill, be a weekday vegetarian. I think this idea is much easier for people to swallow, because it means not giving up anything permanently. You can still visit grandma and eat her famous roast. You can still have a burger once in a while if that is what you are truly craving. Although I would add to his statement – be a weekday vegan (as best you can).
Just because we can afford to trash the planet, does not mean we are entitled to. Meat free Mondays are just not going to cut it. It needs to be the other way around.
Here is what I learned from the process itself.
As I mentioned, M grew up on a farm and has both slaughtered and butchered animals before. For that reason, we opted for “whole lamb” as opposed to roughly butchered in large pieces. We wanted the whole process, and M could teach me a new skill.
The only caveat is that we did not get the offal, only the muscle. We asked if offal was possible, but the slaughterhouse could not guarantee it would be from the same animal. Getting offal from any and all lambs from that slaughterhouse was not a risk we were willing to take. The whole point was keeping things local and organic.
So we had only the carcass, bled and hung for a week. M, ever the experienced one, served vegetable burgers for dinner before we got to work, sharp knives and whetstone ready at hand.
I will not detail the process, and I did not take any pictures. The violence of cutting a creature apart was such that there was only room for a mind that was focused on the task. We finished dinner at six pm and worked well into the night.
I quickly understood why M did not want to eat meat on a butchering day. Never have I ever, even in the midst of my purely plant-based years, felt so fed up by meat. It was everywhere. It got into my nails, I had stains up to my elbows, and the smell lingered on my fingers as a constant reminder. We are always keen on traditional preservation techniques, so much of it is now lying in brine or covered in salt to cure. The job is not done yet.
At the time of writing this post, it has been four days since we butchered the lamb, and I still cannot even stomach the idea of consuming it. M boiled a broth on the bones the next day, and used some of it to flavour a vegetable stew. We picked the scraps of meat off the bones and served it as a side. Mr. Frugasaurus and M’s partner who had not partaken in the work happily added it to their bowls, M and I abstained.
Personally, I think M’s reaction is more telling than mine. I have been plant-based for three years and have only deviated for the past year. I have never killed anything larger than a small fish, and I have never butchered a whole animal except store-bought chicken. But M grew up with this, and she tells me this is normal. Another goat dairy farmer I’ve talked to spoke of the same thing. When she has to club the baby male goats to death because they are useless in a dairy herd, she doesn’t want anyone to talk to her, let alone crack jokes.
It is a serious business, slaughtering and eating other animals, and it should be treated as such.
Here are more bloggers tackling the issue, and one news article about the recent UN IPCC report:
A while back, I posted my very low-key, zero-waste hair care routine. The post turned out to be quite popular, so I thought I’d have a go at writing about my extremely simplified “beauty” routine.
Now, I have never been big on makeup, always finding it took an awful lot of time for very little reward. As a teenager I tried to don some for special occasions, but I have never been one to wear makeup on a daily basis. Luckily for me, I live in a country/work in an industry where you’re not penalized for not adhering to sexist beauty standards. So if that is not the case for your area/office/profession, this post will probably not be of much use. I am reluctant to even call it a beauty routine because, much like my hair care, this is almost as simple as it gets, and yet I smell clean and fresh for work.
I have been pondering about this recently. We have been saving a large chunk of our income for over a year now, but to be honest, I don’t feel like we are depriving ourselves of a normal life. Being frugal has become an intrinsic part of our daily routine.
We eat good food, have a great flat, and my electric bike feels like the epitome of hedonic adaptation and luxury. Looking at how I grew up, it feels like we’re way more luxurious than my childhood memories. Then again, Mr. Frugasaurus and myself don’t have children to raise and care for.
But at the same time, the question comes back to haunt me: What do “normal” people spend money on that we don’t? Obviously, this is not such an easy question for me to answer since I, admittedly, don’t spend money in the way other people do. But as I remarked to Mr. Frugasaurus the other day: What would I do with all my income if I didn’t save the majority of it? Sushi? Lunch at work? A bus pass? Maybe a bunch of new socks?
Then what? I’d still have quite a bit left over I’d imagine, unless we started going out every month.
So here are 7 things we simply don’t spend (much) money on, which enable us to save half of an average income in my area.
September has been a month largely dominated by the teaching semester being on in full. Work has been hectic, and even though we made attempts at being social, I have just had to scale back.
Mr. Frugasaurus is also working hard on making his freelance gig work. So even though there have been one or two excursions, this month has been largely dominated by work and working.Read More
Earlier this week, Mr. Frugasaurus and me did something exciting. We went out and sat our butts down at a cozy, independent and local café.
This café was started after I moved away from Trondheim the first time, and I have been intending to visit it ever since we moved back.
That means I have been intending to visit this place for over 1.5 years, but haven’t! In part because I’m a homebody, but also in part because I lean a bit too far to the cheap side of things, especially since discovering the possibility of financial independence.
So here is why we consider our small splurge a good thing. Even if we could’ve taken that same money and stuffed it in our ever-growing savings accounts.Read More
Like so many things in life, even lifestyle inflation is relative. A year ago, when I first started this blog full of the cumulative fires of binge-reading several financial independence blogs, we were in the middle of a two month long complete spending freeze as a paperwork error had smacked us with a tax bill from hell.
We had just moved into our flat in Trondheim with the amazing pantry – but said pantry was nowhere near full yet. We had run the numbers and knew that if we only walked/biked everywhere and bought nothing but rice, beans and frozen veg, we would still be able to pay our rent, electricity, phones and that massive tax bill.
There had been some tight months in London as well, and we were both used to the student experience of being low on funds. We knew we could do this – and we did – not least because it had a short and definable timeframe. But it was not particularly fun, an we would not want to live like that for a decade, even if it meant being financially independent sooner.
What I am getting at is that, 12 months ago, Mr. Frugasaurus and myself were living on the bare bones of our budget out of necessity, and we survived. Everything from there is technically considered “lifestyle inflation” is it not?