Lessons From My 2015 Stuff Fast

Damon Gonzalez Budgeting, Retirement

It has been almost a year since I decided that I would try to go all of 2015 without purchasing stuffStudies on money and happiness say money is best spent on experiences, time-saving services, and gifts to others than on stuff.  I spent the year testing this theory on myself.

My rules were that I could buy others gifts, and spend all I wanted on food, drinks, travel, and experiences.  I tried to be really strict and not buy anything, especially clothes, books, and music.  It wasn’t really hard, but at times the terms of the experiment felt weird.  My rules said I could spend several hundred dollars on a vacation to Belize, but I had to deny myself a $1 song or a $10 book.  I think it feels good to buy something that you want, but I agree with the research that you are better spending on experiences.

Messy_storage_room_with_boxes

How did I do?

I am glad I tried this and I spent a lot of time this year thinking about money and I learned a lot about myself.  One surprise I found was that I had stock piles of toilet paper, shampoo, toothpaste, etc. and I didn’t need to buy any of those items.  It hadn’t occurred to me that I use less than one tub of shampoo per year.

I think I did pretty good.  Here is a list of things I broke down and bought:

Air filters for my HVAC system
Replacement battery for my work phone’s headset
New door for my smoker (The old one broke and life without smoking meat is unimaginable.)
Paper and ink for my work printer
Key lock box to sell my second house
New fans for my computer.  (My desktop computer fan was running very loud and I learned that you need to clean the heat sink every year.  The dust covering the heat sink was wearing out my fans and would have eventually burned up my processor.)

The CPU heat sink on my PC.

Pro tip: Clean the heat sink on your CPU fan once per year for optimal PC performance and life of your computer.

Lessons I learned

2015 was not a bad year by any means.  Denying myself stuff brought good reflection and reminded me that stuff doesn’t make you happy.  It was strange for me to get to the end of year and want stuff for Christmas and my birthday.  Thanks again for the awesome Steph Curry jersey, Kim! I thought it would be really hard for me to not buy any books, but I survived and read only 19 books that I had previously purchased.  I still own about 30 books that I haven’t had time for.  They can wait till 2016.

I will never have time to read all the books I want to read

It was good to realize that I was buying books at a faster clip than I ever could read them.  Moving forward, I am going to be much more selective about the books that I choose to buy.  It is not the $15 investment that matters, it is the 10-15 hours that it takes to complete the book.  The wish list feature on Amazon is a great way to save all the books that people recommend to you so you can later thoughtfully choose which book to buy and only buy the one you are about to read next.  I put over 60 books in my wish list in 2015.  I wonder how many I would have bought and not read this year if I didn’t try the experiment.

2015 helped me see the time constraint problem with Netflix, too.  Here is a list of all the shows that people have told me will change my life, but I haven’t had time to check out:

Madam Secretary
Suits
The Sopranos
The Good Wife
Strike Back
Damages
Brotherhood
Better Call Saul
Blacklist
Criminal Minds
The West Wing
Daredevil
Burn Notice
Archer
Cosmos
Mr. Robot

The above list is easily an entire year of TV to watch  Life is short and I need to be more selective in how I spend my free time and go for great or good.

Stuff doesn’t bust most people’s budget

The second big lesson I learned was that I don’t think buying stuff is a budget buster for most people.  If I didn’t try this experiment, I  may have spent an extra $2,000 maximum for 2015.  Shopping cell phone providers, cutting cable, changing your thermostat habits, and shopping less are all good ways to save more money.  They will make a difference, but I have come to believe that they aren’t nearly as important as where you choose to live, the car(s) you drive, what you spend on kids (college, weddings, traveling teams), vacations, health insurance/care, and eating out/alcohol in that order.

Most people aren’t going to ruin their retirement by buying books, CDs, and clothes.  It is the big stuff that is going to make or break your budget.  I suggest people buy a house that is well below thier means.  According to the US Census, the median home size in the US has grown from 1,525 sf in 1973 to 2,169 sf in 2010.  The size and location all correlate to your taxes, utilities, and repair bills.  Keeping up with the Joneses can also be a big temptation.

You should also buy quality cars and drive them till they hit at least 200,000 miles.  Consider the 20 year old that buys a quality car and keeps it for 20 years, buys the second vehicle at 40 and keeps it for 20 years, and the third at 60 and drives it till she can no longer drive.  Now contrast that person with someone who leases a luxury vehicle every three years over the same 60 year span.  That is 20 different leases and a continuous payment!

A person once confronted a health expert that it was too expensive to eat so many organic vegetables and grass-fed beef.  The expert retorted “Have you priced cancer?”  Prescription drugs, treatments, and extra doctor visits can really add up.  Taking care of yourself to the best of your ability can save you a lot of money.

In 2014, I heard Chris Gardner, the author of The Pursuit of Happiness (became a movie with Will Smith) speak at a conference.  He said that people always ask his son what it was like to be homeless and have to sleep in bathrooms at night.  I will never forget what he said.  He said that his son didn’t realize they were so poor and homeless.  All his son knew was that he had a dad that loved him and spent a lot of time with him.  You can spend a ton on your kids and it can have a dramatic impact on your retirement.  Be mindful and invest in your children wisely.

Vacations, bars, and restaurants are another area where you need to determine if you are receiving value for what you spend. I know people who regularly spend $120 for two people to eat one dinner.  If the couple is in the 33% federal tax bracket and pays Medicare/Social Security taxes of 15.3% on the money they earn, they have to earn $232.10 to be able to pay for that meal ($120/(1-.483).  How many hours of work did that meal cost?  Similarly, does a $400 night make your vacation that much better than a $150 per night hotel?  Only you can answer that question.  I just want you to think about the issue.

Clothing lasts longer than you care to keep it

I started 2015 with 106 pairs of socks and only wore holes in three pairs.  It has occurred to me that I could probably go my entire life without buying another t-shirt or pair of socks.  In 2016 and beyond, I am going to be a lot more thoughtful when making a purchasing decision on clothes.  I will try to wear out my clothes before replacing them.  I will also ask myself if I can see myself wearing the item in 10 years, now that I am aware how ridiculously long clothing actually lasts.

Unforeseen expenses

The last big thing that I learned this year is that it is really hard to budget for unforeseen events.  I came into 2015 thinking that I was going to save all this money by not buying stuff.  Instead, a major window leak and two basketball injuries ended up costing me about $5,000 that I couldn’t have anticipated at the start of the year.  I am reminded of the importance of having a cash reserve and budgeting for the unforeseen.  It is also nice to keep your health care emergency fund in a flexible spending account or HSA.  It is easier to cope with doctor bills when you don’t have to spend money from your checking account.

Summary

I don’t think you have to go an entire year to receive the benefits and lessons that I learned in 2015.  I recommend going one month to deny yourself and get more in tune with what, when, and how you buy stuff.  I think you will see lasting benefits from the experiment and gain a better understanding of who you are and your relationship with possessions.

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