Live Cheaply and Invest In Yourself

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The The Money Diaries series at Wealthsimple continues to offer periodic interviews with an interesting mix of people sharing about their financial lives. I’d never heard of Carson Mell, but I appreciated how he cared most about doing what he wanted with his time as a young adult, and how he lived cheaply in order to invest in himself. (His most well-known project is probably Silicon Valley on HBO.)

The power on knowing the cost of your minimum viable lifestyle. My advice to a young ambitious person would be to figure out exactly how little you can live on. Mell’s monthly expenses were on the order of $1,150 a month:

[…] after a few months, I’d saved up some money and I made a decision: I’d quit my job and live as simple and frugal a lifestyle as I could, so that I could invest my time and energy in my own work. I had my own small apartment and paid $700 a month for it. I found that beyond rent, I could get by on 15 bucks a day. A nearby taco place had a $2.75 special for huevos rancheros — I ate there every single day. While I prided myself on throwing myself into my art instead of filling my days working mundane jobs, I learned quickly that meant becoming a cheap bastard.

Once you establish at level at which “I know I can survive on $XXX”, that can create a certain type of self-confidence. For example, I once knew that having $20,000 meant that I could cover my expenses for a year, and thus once I amassed that amount, I could take all the risks with my TIME that I wanted for a year. I could start a new business, learn a new trade, change the direction of my life.

Maybe cheap eats is key too? Beside my apartment, there was a restaurant that sold two eggs any way, hash browns, and toast for $1.99. I lived in the same rundown apartment and ate those over-easy eggs when I made under $20,000 a year, and when I made over $60,000 a year.

I decided that the thing to do was to keep investing in myself — living simply, being a cheap bastard, and putting my time and effort into my work.

Finding the motivation. Some people equate spending thoughtfully with being caring a lot about money (bad). However, it can really extend from caring a lot about how you spend your limited time on Earth (good).

As for myself, I no longer have the headache of hewing to a budget of 15 bucks a day. These days, I don’t mind paying to park in a parking structure, or leaving my car at the valet if it looks like finding a free space will be a pain in the butt. Anything that saves you time is worth spending money on, because your time is an invaluable resource. But I’m extremely mindful of where I spend my money. Here’s the thing: In TV, you don’t know when the next job will come. And I never want to have to take a job just to cover the cost of an upgraded lifestyle. I want to continue to have the chance to invest in myself — my own ideas, my own projects.

I spend money very thoughtfully, and because I save money, I can be selective about what jobs I take or don’t take, and where I put my time and energy.

I forget the exact quote, but to paraphrase – Once you find your “why”, the “how” becomes so much easier.

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Comments

  1. I appreciate him talking about eating cheaply but cooking at home is typically the best way to keep food costs down. He talks about buying breakfast at a diner for $1.99. That will typically include tax and tip so it is more than that. We eat breakfast for $1 a day for both my wife and myself. You can do variations on this and it is still way less expensive.

    https://costcocuisine.blogspot.com/2017/01/can-you-really-do-breakfast-for-two.html

    • Yes, cooking at home is definitely the cheapest, but the idea of minimum viable lifestyle will vary by person. We all have things we will do, and won’t do, to save money. One person might think a studio is cheap, another might take on a roommate, but another person might be willing to just pay for a room in a house. Yet another might be fine with sharing that same room.

      My wife once rented a renovated attic studio with a hot plate and a single sink in the room (but no sink the bathroom) and thought she was being frugal. After she moved out, the same 200 sf mini-studio was rented to THREE construction workers.

    • Ha, glad I’m not the only one wondering why he thought he was getting a deal with that $1.99 breakfast. He does value his time though, so maybe he was picking it up to eat on the go.

      • Avi: Making enough hardboiled eggs and oatmeal to make it through the week probably takes less time than one trip to the diner. The same thing probably applies to other meals since he could very easily make a batch of food to last for days.

        Some elements of his life are minimalistic and some are definitely not. Eating out twice a day, even at a budget diner is extravagant compared to cooking at home.

        And I haven’t even touched on dinner. For example, we make two pizzas and killer breadsticks for $10 to $12 (if that much) that gives us 10 meals.

        https://costcocuisine.blogspot.com/2020/05/some-pizza-ideas-with-belgioioso-fresh.html

        https://costcocuisine.blogspot.com/2020/05/buttery-cheese-bread-sticks.html

        I can go on about low cost tasty dishes that can be prepped ahead that you can enjoy for multiple meals but I know I have illustrated my point.

        Yes, he had some frugal behaviors but he also had some that were definitely not frugal. That well might apply to a lot of people that claim they are living cheaply.

        I just know his story is not inspiring to me because I to have had a couple of periods of very low income.

        • Yeah, it’s all relative. Unless you’re eating rice and beans for breakfast, lunch and dinner, there’s probably always someone being more frugal than you.

          • I am not asking him to eat beans and rice. My point is that he could eat better and more inexpensively by cooking.

  2. Hey, Jonathan. Is that “minimum viable lifestyle” a throwaway comment, or have you written on it before? (I just googled, and didn’t see anything here. I didn’t do a larger search yet, though.) I *LOVE* the phrase and what it evokes.

    • Hey, JD! I don’t think I’ve written about that term specifically before (obviously a play on the minimum viable product), but I’ve been trying to develop a series of “advice” to my kids and that’s definitely part of it. In their 20s, I want them to live as cheaply as they can (while staying safe) and take asymmetrical risks (big upside, little downside).

  3. I would disagree with one point…..I think the “where” defines the “how”. And any senior citizen or retiree that still believes America is anything but an incoherent, plundered empire that’s worth living in can have it. Finding your place in Asia especially and for some South America….. is the answer to affordable living, higher degrees of personal safety and medical care costs that make sense even though Medicare coverage is not useful out of the US. You don’t need to have a minimum lifestyle out of the US, you can have a full blown comfortable middle class lifestyle on a minimum lifestyle budget.

  4. I will interpret this post for retirement. Knowing how much you can spend in retirement is the biggest step you can take pre-retirement. We kept track of our expenses for two years before retirement and we didn’t hold back on spending. When retirement came around we were totally prepared financially. With Covid we found out how much money we would could live on in an emergency.

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