Our Journey Towards Financial Freedom
In 2013 our third child had just been born when we moved to Sweden. I noticed that my husband was not quite himself. He was losing lots of weight and was not as happy as he usually had been. I sized this up as a result of moving across the world and a new baby. As time went on, he just kept getting skinnier and I really began to question his health. He was checked out but nothing was found wrong with him. While in Sweden, my husband was given the opportunity to take paternity leave for a year in 2015 and decided to do so.
As soon as he went on leave, I could see him changing and returning to his former self. That was when we both realized that he had been overworked. A couple of months into his leave, James told me he did not want to go back to his stressful job as a project manager but did not know how we would make it work since his being on leave left us with a 70% reduction in income. Knowing that James’ returning to work was not an option at that time, we would have to make drastic changes so he could do what he loved most, spending time with our children.
This is how our journey towards financial independence began(and is still going):
The first action we took was to look at our finances together, which we had almost never done. We had to analyze our income and expenses, and work on lowering our expenses so we could live on our income. The next thing we did was to examine expenses that were not at home. We realized that we had rented a storage unit for years to store things we could not fit into our apartment and were not using much. So we emptied the unit and sold, donated or threw away anything not really needed or that had not been used for years. One week later we closed our storage unit and removed that monthly cost. We even made some money by selling items we had stored for years.
Next, we looked over what costs we could cut at home. This is what we did:
- Reduced our WIFI expense by getting a slower connection
- Stopped all subscriptions
- Stopped eating out and ordering take-out
- Grocery shopped once a week
- Baked bread
- Made weekly meal plans
- Reduced food waste by taking care, and using food in fridge and freezer
- Ate from our pantry
- Walked or biked to get around
- Bought only used clothes (besides socks and underwear for kids)
- Stopped buying clothes for the two of us
People assumed that we were denying ourselves and were missing the full income; but surprisingly, even though we lived on way less money, we lived more and had much more fun as a family because we spent time together. Once my husband felt 100% well, we decided that we did not want to go back to working full-time, so we continued to live very minimally. Our family is a much happier and healthier one because of that decisio. Today, we live comfortably on a part-time salary and even save money each month. Our goal is to pay off our house, have no loans at all, and have so much money invested and saved that we have the option not to work if we wish.
Our tip for working towards financial freedom is first to ask yourself this: What’s the real goal of all your (my) financial decisions?
For us, financial decisions had to create freedom to make lifestyle decisions that would make us happy today and in the future.
The way to do this is by following a plan:
- Make a plan to pay off debts — pay off as much as possible each month;
- Look at each expense every month to find out what you’re paying and how much;
- Take control of expenses;
- Reduce expenses;
- Make a goal and a plan for your money;
- Adopt a new lifestyle;
- Save and invest;
- Talk with your partner about your finances.
Here are some ways you can reduce your living expenses:
Reduce cost of food — Make lunches, eat at home, bring snacks, and picnic when out and about. Reduce food waste and take care of vegetables that are going soft.
Reduce living space — Maybe a smaller home is an option or, like us, decide to stay in a smaller home instead of buying something bigger but more expensive. Make sure home is close to work, school or activities in order to reduce travel.
Change the car, or travel by public transportation or bike — We now have only one car instead of two; and we walk or bike as much as possible.
Take advantage of free activities — Parks, beaches and playgrounds usually are free; and most kids love having a picnic outside.
Get extra income by renting out your home while gone
Here are more tips how to reduce cost of living