Wednesday, June 11, 2014

Living Within Our Means

Having a child is truly a major life changing experience.  It doesn't only change you as a person, it also has a huge impact on your financial statement. My husband and I are classified under middle class just like most people in the US.  Financial life before a child was very flexible and we always had extra money for saving.

We ate out a lot, up to 5 times per week.

We bought whatever we wanted without being in debt (we lived in an apartment back then).

I changed cars quite often (too often indeed, I wish I kept the first car it would be paid off years ago)

We were able to save for a down payment to build our 1st home

We traveled overseas to visit my family every year

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However life turned upside down after an arrival of a little bundle of joy. Financially we hadn't experienced a significant change until we started paying for daycare. During the first three years I decided to place her in a home daycare run by two very loving and caring ladies highly recommended by my coworkers. I knew I could rest assured since a few ladies at work had their kids there and raved so much about them and they were close to my office. Plus they were pretty flexible to work with. Most daycare establishments have a set weekly rate. Even if your child is there for 4 days, they still charge for 5 days. Back then my husband was off on Monday so he kept her. We only paid for 4 days/week which helped when you added up.

When she was about to turn 4, we were thinking it may be a good time to transfer her to a "formal"daycare establishments which would help prepare her for the future school settings/environment. We visited a few places and of course the best one (as far as safety/quality of teachers' education /cleanliness of place/ curriculum designs/better quality of food/teacher and child ratio and etc.) around was the most expensive one around. We came home, did our math and we knew it meant a lot more $$$ but with the same amount of incomes that we bring home. It costs as much as our monthly home mortgage so it is like we pay for two mortgages every month. We could afford it but we had to significantly cut back on other things. We bit the bullet and went with the place we were most confident about.

It has been two tough years I must say but we have seen the positive learning progress the little has as well which makes us feel better for what we have to sacrifice.

We eat out 1 to 2 times a week

I couldn't afford to go visit my family in the past 2 years (will be 3 years next March)

Sephora disqualified me from a V.I.B status because I no longer spend money there...haha.

We mainly depend on miles to travel/vacation

We cut back on cable/home phone and everything we could think of except food/grocery. I believe in nourishing our bodies with good food. That's our main luxury I am willing to splurge.

Our house doesn't have lovely furniture. We haven't bought a single piece of furniture since 2008 (we moved in 2007 and I was pregnant in 2008, we started saving then).

I never knew what it is like to live paycheck to paycheck until these past two years. It was very challenging and stressful in the beginning when you had to significantly change your spending habit you are accustomed to your whole life from one extreme to another. It is difficult but it can be done.

I have learned to think through before buying anything. My house has less clutters.  There are many things I realize I don't need to have them and I will be fine without them.

We find alternative ways to have fun for less or sometimes even free instead of spending a lot of money buying stuff out of boredom. The way I look at money/life and joy become totally different.

I can't deny that there were times I saw how other people can afford to travel several times a year and buy the luxuries then I started asking myself why we had to be in this financial situation. I wanted to go out and spend too. Then I realized how blessed we are not having credit card debt.
True that we live paycheck per paycheck but we never have had outstanding balance on our credit cards in the past 5 years since she was born. Never once had to borrow money from anyone. We can still put money towards retirement savings.  We learn to live within our means and manage well. I should be proud, it is a blessing. We have a house, a fridge full of grocery. A little one has toys and basic necessities plus she is happy. We have each other. Most of all, my husband and I have each other to thank for for riding out these challenges together successfully and a little one for being a huge encouragement for us. Whenever I think about what we have, it makes me feel content and grateful despite the lack of everything else.

Living within one's mean is all about strong mindset and focuses on what we have instead of focusing on what we don't have. It only makes you feel depressed thinking about everything you want but can't afford.

In a few months a little one will become a kindergartner and go to a public school. It is a huge $$$ difference in paying for a full time daycare program versus after school care only. I will continue with this living below one's mean concept for as long as we could because i appreciate certain perspectives of it but will be more flexible with money/spending.  We are going to have a financial break, say bye to living paycheck to paycheck life and hopefully catching up on saving for stuff we have wanted for years, visiting my family and putting money towards savings again.

{Warning: don't be surprised if this blog temporarily turns into a shopping blog later this year. I have to celebrate our financial freedom before she goes to college in 13 years}

Counting down to the last check to daycare on 8/18/14 with me. Amen!


  1. Can't wait for you to go on that well deserved shopping spree! I've been spending way too much lately, but I have to start saving for my condo and wedding. I've been looking at my spending habits to see where I can cut my spending (which is a lot, seeing how I also like to eat out way too much).

  2. Great post, so true and well said. August is just around the corner; it'll be here before you know it :)
    We were in the middle of moving when we found out that we were expecting. It was a pleasant surprise, but it sure put a dent on our usual spending habits. Needless to say, our house is still in need of remodeling/repair, and we hardly eat out anymore. We don't travel except camping in our RV. I miss shopping and traveling overseas, but it beats having credit card debt, so it's really not so bad once we adjust to it. The adjustment really took some getting used to of course. Like you, we splurge on groceries. It'll be a couple more years before we get there since my little ones are still young, at least there's light at the end of the tunnel. My bucket list is at least a mile long, lol!

  3. I know that when I will be mother I have to review all my spending habits. i'm a little bit scared about that but I know that it's woth.
    Bonjourchiara Facebook Page

  4. this is such a great post nelah. i don't have a child but after i quit my job we needed to be smarter about how we spent money. i don't regret it at all but there are definitely moments when i always want to eat out and buy things. it does take a strong mindset to live within you rmeans!

  5. This is such an inspiring post, Nelah. It means so much because so many people nowadays have or don't have kids based on the exact 'problem' you discuss. A lot of people, especially young people, are too selfish now to have kids because it is so financially straining, which is why the birth rate is dropping in so many different locations. I'm not surprised, the cost of raising a child is sky high, especially if you want them to grow up in a safe and friendly environment. Many people have forgotten or not found the joy in children and would prefer to save that money to spend on themselves. Make-up, meals out, entertainment…it is a hard balance indeed. You seem very happy with your lifestyle now, though, so I am glad for you. Well done for taking the plunge and giving up a few pieces of your own to make your daughter's life a happy one. Rosemary x

  6. It sounds like cutting back on your expenses hasn't been all negative since you have learned how to better save and manage your finances. I'm sure it will be somewhat liberating when you won't have to pay for daycare anymore but it must have been worth it to get the best care for your daughter. I'm all about living below my means as well as I have real concerns about having enough money for retirement.

    Rowena @ rolala loves

  7. love this post. we are learning to live within our means as well, especially because i am planning to resign from my job so i can be a stay-at-home mom. i totally agree that it's difficult to adjust our budgets, but our little ones are more than worth it!! i am so excited for august for you!!!

  8. Brilliant post! I love your blog and I have started following you with Bloglovin. If you ever get a chance to check out my blog I would be delighted, thanks!
    Camille xo.

  9. Nelah, you and your husband should be so proud. More parents need to be like you guys! Your sacrifice will be so worth it. I'm glad you guys are getting a breather. Before I buy anything, I truly think about it. I use all of my beauty stuff. I'm a lot more cautious when buying clothes and anything. It's expensive raising a child nowadays. Again, I applaud you. You're doing an amazing job!


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