bigato's journal

Where are you and where are you going?
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Post by bigato » Wed Dec 21, 2011 3:29 am

Hi. I'm gonna write my journal.
My first year after discovering ERE is ending with good results. I discovered the blog following Amazon books. Like much of you did, started from the first article and read through until the last. Then I came to the forums.
My first calculations indicated more than 20 years to retirement. Being 30 already, that would not be early. Heavily attacking the budget and starting to declutter, I soon could lower that number to 6 years. My wage is quite high (I probably will tell numbers latter), I was just not focused.
I took the approach of reducing the expenses rather then trying to improve the income. Quickly I realized that I should attack the bigger expenses first. Food (mostly eating out) and housing being the bigger.
Food would be easy to me to quickly change if I was still alone; but I'm married. We were already in the process of changing and bettering eating habits before ERE, because of health and not because of money. Since we married some three years ago. We tried a lot of strategies. Maybe I talk about it sometime. But to be short, this year is the last when I ever eat out out of pleasure. The exceptions will be social situations that we can't or don't want to avoid, or others that I decide that are fair. I took the decision power of the couple on that and it was not easy. Took me three years. By now I believe it's mostly done. So food budget is well under control. As we eat mostly brown rice and vegetables, with meat being rare, our food does not cost much. But the brown rice part is still expensive. Well, not much details yet or nobody will read my journal.
Food budget didn't need much of my focus to be improved. Quickly housing stood up on the way. We were renting. One year before knowing ERE we were living in Sao Paulo, one of the biggest cities of the world and one of the most expensive ones in Brazil. When we moved to the countryside (I could kept inside the same company, a bank), we lowered our rent. But it was still good money. Details later. Then the main aim of the year turned in my head to be: "stop paying rent". Or at least paying so little as to be able to forget about it. I had no idea how I would accomplish that, but I was determined and had good examples in this site. I researched a lot of options and finally were able to find a ubber-cheap house and little plot of land for as little as two and a half months of my wage. More details are on the thread I started at the time in this forum.
My wage improved well without effort of my part, not exactly because I got a promotion, but mostly because someone went away from the place and they had no option other than putting me in the function, as I was the only able to do it. It can drop again as soon as they get someone else, but the situation is holding up for now.
I sold around 50 books, not much more than 10% of the total (they are slow to sell here in my country). But having books on sell turned out to a habit. Buying the kindle did help with that. I bought some books by the end of the year, but much less that the amount I was used to buy (almost every month). Also developed a better strategy to buy books, being more selective and acquiring only what I really want not only to read, but also to keep. The ones I only want to read, I'll sell afterwards.
Well, more writing to come. But now the year is ending and my prediction is that I may be FI in 1.5 years from now. If I keep really focused, maybe even 1 year.

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Post by LiquidSapphire » Wed Dec 21, 2011 4:52 am

Welcome to the journals!

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Post by m741 » Wed Dec 21, 2011 7:15 am

Glad to see you're keeping a journal. I always enjoy hearing your perspective on things. As with Jacob, it's quite different from my own - but I can always see where you're coming from.

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Post by bigato » Thu Dec 22, 2011 3:47 am

Some more details about my progress:
Transportation has never been an issue. Since I have got a bicycle when I was around 8 or 9 years, I always used to cycle as a means of transportation. People probably always thought that someday I was gonna grow and stop doing that, but since I'm almost 31 years old, I don't think it will ever happen. Sometimes when living in Sao Paulo I used more public transport than I should; that would be my faults in this area. But since moving to the countryside, that's bike that I ride most of the time, since public transportation does not exist inside my city and I rarely use buses to go from the city I live to the one I work in (9 km). So ERE didn't change me much in transportation. I also fix most of the problems myself and change parts of my bike when needed. Have some good clothes for year-round riding in any kind of weather we face here. As we have no snow, it is quite easy.
I just updated my spreadsheet to reflect my wages and spending. It turns out that my core expenses are less than 11% of the take home pay. I'm not so much looking for ways to further reduce this, but it became a habit to always think of new ways to lower expenses. My core expenses now for myself and my wife, three dogs and two cats, are little more than the brazilian minimum wage: I'm at R$565/month. The biggest expense is the expensive organic high quality and tasteful short-grain brown rice, that is R$150/month alone. I order once a year, so that's a expense that I will deal with around next May. I believe that I may be able to lower my expenses to around R$300/month, around half of minimum wage. I would need more time to focus on growing food, solar water heating and some other few ideas. As much as I say that lowering expenses is not my main focus anymore, the fact is that once it becomes second-nature you just don't stop thinking about it.
I'm also close to an interesting milestone: almost 120 months of core expenses in my net worth. That is 10 years if I just can keep up with inflation. That's around the amount Jacob said that would be enough for the people that are shooting for semi-retirement with some part-time jobs now and then. I must say that it feels good and it is making my life at the job much easier to deal with. I always remember MikeBOS talk with his mother when she asks how much his emergency fund will last. That's a good feeling.

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Post by m741 » Thu Dec 22, 2011 5:25 am

10 years of expenses saved is pretty good. I'm at about 80 months and I definitely feel free. I might have trouble for a few months in an emergency. But I don't feel like I could have continuous trouble for 7 years.

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Post by LiquidSapphire » Thu Dec 22, 2011 7:25 pm

That is really interesting, that if you have 10 years saved you can semi-retire. I am coming up on 12 years. I still don't feel comfortable jumping though because half of it is in tax deferred accounts I can't easily touch until I am 60... but there is a way to convert it here (called Roth Conversion) so maybe I'd look into that...
Isn't having savings great, I LOVE having options, there is nothing sweeter.

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Post by bigato » Thu Dec 22, 2011 9:09 pm

More then a third of my money is in an account that I will be able to touch only if I get fired or only three years after I stop to work. That's important. Before the end of the next year I should have enough liquid money to semi retirement without needing that money that is locked.

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Post by palmera » Thu Dec 22, 2011 9:49 pm

Hi bigato, I'm so glad you started a journal!

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Post by akratic » Thu Dec 22, 2011 11:28 pm

Your expenses of R$565/month is the equivalent of $303 USD/month or under $3.7k USD/yr.
I think you might officially be the most frugal poster we have! Well done.

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Post by bigato » Fri Dec 23, 2011 1:15 am

Hi Akratic,
Thanks, but I don't think so. It's not fair to compare different currencies this way. The minimum wage here can buy a lot of things. For example, Jacob if I'm not mistaken used to live on half the usa minimum wage, or something like that. But, on the other side, my expenses goes for me and my wife, and the pets. She is not working at the moment, but she is in charge of all work at the house. We prefer it this way. This way I have more time to train jiu jitsu and study, and she doesn't need to slave away at a job. She produces some things like whole flour breads and tofu that we can sell at farmer's market, but right now she's not doing it, but will start again next year. The money from this goes straight to her savings, as she has no expense in hour household. Another thing that she is doing this year is learn to grow some food. I do the heavier part on the weekends, and she does the more extensive parts, like taking off the sprouting weeds. I teach her what I know about it, and we learn together. I decided to focus more on growing food myself only after ERE, because I want to keep my training going and to make the jiu jitsu grow in my city.
Also, that represents only the core expenses. I'm not including one-time expenses, one of the things I'm still learning to deal with. Like, this year I will need a bigger refrigerator (I have a 120 liters now). That is a consequence of not eating out at all. We have to keep things easy there for any situation. I had an idea these days about one time expenses, I'll try it and post here. Keep reading!
Thanks also LS and Palmera for the welcome!

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Post by bigato » Tue Dec 27, 2011 2:30 am

In case someone is interested, below I post details about my monthly expenses. Currency is always brazilian "Real" (R$). What you see below is my current "ideal" budget. Reality does not match it exactly. Specially the food items currently. Around the beginning of 2012 I should probably have a more realistic budget written down.
150 Brown Rice (organic, short grain)

140 Farmer's market (mostly vegetables)

85 Electricity

40 Pets food

40 Hygiene

40 Internet

34 Propane (for cooking)

26 Water

6 Cellphone

4 Housing tax

565 total
Internet used to be 10/month, using the cellphone as a modem (details in the wiki), but I decided to pay something better to be able to use skype and google voice and watch some videos and films now and then. If I was single, I would keep the cheaper option.
Minimum wage is currently R$545/month in Brazil. In 2012, it will be R$622/month.

George the original one
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Post by George the original one » Tue Dec 27, 2011 6:13 am

Food is essential and I know you're targeting it in the budget, so I doubt more focus will help you there. That leaves electricity as the next largest expense... what does it do for you and can you find any places to trim usage? And, if Brazilian electric bills are similar to American ones (at low usage levels the connection fees & taxes are the predominant costs), does trimming usage actually provide any real relief?
I'm also asking about your electric useage because I'm curious how it might be different from Americans. Heating, air conditioning, and refrigeration are the bulk of our useage, then followed by television, computers, lighting, cooking, and other trivia. Heating and cooking might be handled by using other fuels; a lot depends on what's locally available.
I really like how you're getting the expenses below Brazilian minimum wage. Is that for you alone or does it include your wife?

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Post by bigato » Tue Dec 27, 2011 11:55 am

Hi, George,
Food needs some better tracking on the spending. I'm probably overlooking some things, like shoyu and misso made the traditional way, that I buy in bulk. So probably I'm over minimum wage, but I'm close. Yes, that includes me, the wife and the pets.
One of the main points to be improved in next year is, absolutely NO EATING OUT. I've been talking to wife about it all the year, and we are improving on it. We still fail sometimes as we have some place to go or someone to see, and in the last moment we see that we have no lunch packed for the situation. I told her, if it happens next year, we will stay at home and make the food. It won't matter if we won't be able to go to the social meeting. I believe that we will quickly get in the habit of planning in advance the food consumption of the next days, specially weekends.
I don't know if I will be able to lower the rice budget. I could stick to a lower quality one, but we really feel the difference in flavor and I suspect that it also has a difference in nutrition. As it is our main staple, maybe it will stay the way it is until I quit the job and have time to maybe growing it myself.
The electric bill is mainly the shower, the computer and the refrigerator. The other eletrical appliances are the cellphones and kindle chargers and the ilumination itself. We don't use electricity for the cooking. The climate is nice enough that we need no AC and not heating. The shower could be converted to propane, but I doubt it will really save as we (mainly the wife) will have the tendency to use the maximum output of water possible, wasting water and propane. I'm still trying to convince her to use the shower in the "summer" setting (it is possible and we are in summer, you just need to lower the water output so the water gets hotter). The computer, maybe when I buy a new one, I could substitute for a notebook, I'm not sure. The refrigerator is already a small one (120 liters) and as we are going to eat everything made at home, it is not being enough for us anymore. We are buying a bigger one this year, one that spends a little more on electricity. The ilumination is already quite economic (better

than what we have, only if I get led bulbs for a decent price). It seems that to lower it I need a notebook and change the shower water heating system to propane or solar or a combination. The shower will wait as it takes time. The notebook I probably won't buy soon as the computer is working well enough for now. Maybe I try getting back to cold showers or navy showers...
We have mostly no fixed costs on electric bill here. If I lower it enough, I will start receiving only one bill every two months or so. The water, on the other side, I can't avoid paying the minimum that is around R$24/month, even if I don't use water at all. You can see that we are very close to the minimum already. So trimming on the water doesn't change the financial aspect; trimming on the electricity, on the other side, would translate to money saved.
Thanks for the observations.

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Post by LiquidSapphire » Tue Dec 27, 2011 4:38 pm

Hi bigato -

I don't know what the difference is in cost of living in Brazil vs the US but it sounds like you are reaching a point in diminishing returns. It sounds like you have cut all of the superfluous stuff out and to cut even more would start to hurt. Life is meant to be enjoyed and not a sacrifice so I think you're doing fine as you are! I think you are doing great to be supporting two people, owning your own house, and your pets, on just minimum wage! Even if you go ERE and it doesn't work out for whatever reason, you would think it wouldn't be that hard to just go get another minimum wage job again for a little while to replenish savings.
On the point of No Eating Out. Maybe you could buy some things at the store (Crackers, some kind of cheese spread that doesn't require refrigeration) and just keep them around for those times where you didn't have time to make a lunch, then at least you will have something ready to go when you want to go out and meet people. Cutting back on meeting with people because you don't have food ready to go seems a little sad to me, why not just have food ready to go all the time for those days? I know you are thinking that it is not as healthy as fresh food or the food you normally eat, you are right about that but life is full of trade offs, and it can't be that much worse than the food you would have gotten eating out. It might be a nicer way to transition to not eating out, maybe. Less harsh.

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Post by J_ » Tue Dec 27, 2011 4:51 pm

Hi Bigato,

Reading your Journal, I am impressed how well you and your wife have allready reached such a frugal way of life, and that you at a young age have already saved such a lot. As acratic says, there no much to improve, I think.

As I have read a lot of your comments it is as if I know you for a rather long time, and I have seen the care you take to live healthy by knowing a lot about food and how to keep your body in shape.

Sometimes I get the impression that you are a little bit frustrated by your bosses or that your wife has another feeling about being frugal. For the bosses: you can never be too carefull in choosing your boss!!, but you have seldom the choice.

My wife has sometimes also other views but I am gratefull for that, I learn from her point of view that there are other possibilities, and very often my views are changing for the better!

As FI is not the meaning of life but only a good start to be free to choose how to live as you want, I wonder what you dreams are, the moment you quit your job. Hope to hear from you.

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Post by bigato » Wed Dec 28, 2011 3:16 am

Thanks LS.
I'm sure I'm around the point of diminishing returns on the process of reducing the expenses. I always prefered to focus on reducing expenses as much as I could, instead of trying to improve income, because it has a exponential effect in reducing the time to ERE. But now even that changed, and I'm thinking about side incomes next year. Like the idea to start charging something on the jiu jitsu classes, even if I still allow some people to go to the classes without paying anything.
I thought that once I get over 80 or 85%+, it would make no more sense to keep thinking about lowering expenses. But the thing gets in your system, and talking to you all everyday, I just can't stop thinking about ways to save additional money. Of course it is not my main focus anymore. But there ARE things to be improved and it will take not much effort to improve them. I get such a high savings rate (remembering that I still spend outside my "ideal" budget above), not so much because I'm frugal, but also because I have a somewhat high income for Brazil and even higher for the standards of the region I live in. It's not being a sacrifice. There are some poor people around here supporting a family bigger than mine on minimum wage or less, and being more frugal than I: growing as much food as their backyards allow, raising some chicken. That's one nice consequence of choosing to live in a poor place. You have some really good examples to learn with.
I agree with the idea of having some food ready to go. We are doing it to some extent. We could buy some crackers, some whole wheat bread, and some things to spread over. But instead, my wife makes some very good bread with wheat and brown rice (a quality we won't find anywhere near here), sometimes she makes some crackers from whole wheat. She makes some kinds of tofu cheese of some flavors, for us to use instead of butter or something. She makes tahine (a kind of sesame butter) out of sesame seed, using a hand-powered mill. It tastes very good with misso and lemon. And there are other less-known lunchs we make. She makes tofu out of soybeans (we have no place to buy tofu here in my city even if we want). She makes my lunch early in the morning so I can take it fresh to my job. When there are that days when she misses the ring of the alarm, or forget to set up the alarm, there are some quicker foods that we can make. We have white rice (quicker to cook) that we use in the pets food preparation, but that we

can use in emergencies. We always have some whole wheat pasta, that's a quick dish to make. Some cans with corn, others with green peas, and some cans of tuna. Most of the time we have around some eggs from free-roaming chickens. That's our emergency dishes and they work quite well. She is still failing sometimes on planning on having the quicker foods available, like the bread, crackers and some other lunchs we make from brown rice. Overall we are doing very well, and it will take very little to go from our present situation to not eating out at all. We just need some planning. That thing about missing some social meetings everytime we don't have food ready, is more of a motivational thing. It will happen only once or twice in a long while that we are really gonna miss to meet people. But as it happens, we will take care much more closely of the planning in the future. It's not that hard, it's not sacrifice. Not long ago, there were not all those places for people to eat out. It would just natural to pack a

lunch everytime. It is not impossible and not even hard to do it again. We just need a good strategy to get the habit again. Once you are conditioned to do something, once you have a habit strong enough, it's just not a sacrifice anymore.
Also, the not eating out part is not as much a economic decision as it is a health decision. We are struggling on it since we met, and we are making progress. I know that I can't control 100% of what we eat, I know that sometimes I will really decide to eat out of home, like when someone invites me to a dinner or something. I agree with you that it's not what you do one day that will change everything. It rather the average of your way of life that will shape your health. As I know that I can't avoid some lack of control unless I'm planning to live in a cave, then I'm gonna control better the part that I can control, so I can have room to spare. It's like oversaving money so that even when something completely unexpected happens, it doesn't change the course of your finances. The philosophy is the same. Also remembering that even when you loose control, you still have some degree of choice. When eating at a friend's house, I still don't need to eat everything at hand, and most of the time I can choose what


how much I will eat. For example, most people are quite used to having some friends that just don't drink alcohol.
I also splurge both on food and on finances. It's only that I prefer to have it under better control as much as possible. I prefer to have a huge dinner made at home, even inviting some friends over, even eating things I shouldn't eat often, then going to eat out. But there is a large difference in doing it because you chose to and doing it because your emotions are telling you to. Loosing control sometimes is part of life; but if everytime you "splurge" you see that it is because you have lost control, and not because of a rational decision, then that's a problem. You should listen to the heart, but the head should be above the heart.

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Post by bigato » Wed Dec 28, 2011 3:23 am

Hey J_ thanks, I feel touched by your comment. I will write a proper answer to it probably tomorrow. :-)

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Post by bigato » Thu Dec 29, 2011 2:44 am

Hi J_,
We didn't reached a frugal way of life in only one year. I have a quite long background on simple living. I just didn't have a plan good enough before discovering ERE. We also didn't have so much saved. My money could buy here in Brazil, say, a new corolla in cash. Or, around 50.000 kilograms of white rice. Translate it to your currency and you can have an Idea of how much it is. It's something, but that's not really such a lot. From the financial viewpoint, there's really not much else to improve, as reductions in expenses now will have a small impact on savings rate and on net worth. But... it's like a game you don't wanna stop to play. I still dream with the day I will use very little electricity and be able to produce it in my homestead. I wonder how will I feel when I have the hability to produce all of the food we need. I dream of having time enough and learning the skills to build an adobe house out of mainly plain earth. Financial Independence is one thing, but Independence of Finances... that's

another animal. I don't know how long I will keep with this focus. Probably this feeling will be stronger while I still need a job. You are right, I hate my bosses. But mainly, I hate the consumerism system. It is the root of most of our problems and most of us just don't see it. I want to live a better life, not slightly better, but deeply better. I want to set an example for my future children. I don't want to get back to a way of life of the past, I rather want to get over the current way of life to the next step in evolution of society.
Yes, my wife sometimes complain about being too much frugal. But it's more of a emotional reaction, resulting from not wanting to change habits or not wanting to put some extra effort on something. Everytime we talk about it, she ends up agreeing about what kind of lifestyle we want for ourselves. But she is more emotional and I'm more rational. I also learn a lot from her points of view. It's nice to live with someone different so we can learn from each other.
After FI I want to dedicate some time to improving my martial arts skills, building, gardening and carpentry skills, healthy and diet practical knowledge, and all the philosophy behind life. I want to be active on spreading the word about a better way of life. I want to talk to people that want to listen. I would like to join a community of like minded people living with less dependence of the consumerist and technological system. I may either join some friends that have a similar idea or start finding interested people around the place where I am.

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Post by Surio » Thu Dec 29, 2011 7:30 am


Got to rush, so here's my brief thoughts.
1. The journal really resonated. The cultural similarities in thinking and lifestyle really resonated.

> One of the main points to be improved in next year is,

> absolutely NO EATING OUT.

I also have a martial arts background, and I also understand the cultural outlook that prompts such strong stands. So, I simply say, "Go bigato!"! It is a great move.
Discipline towards every aspect of life must become as natural as the act of breathing. No thinking, no straining, no worrying about silly things as "Am I breathing enough to make it enjoyable?", etc. Just breathe, and stop worrying about external factors.
So from one martial arts practitioner to another: "Go brother, go".
> Yes, my wife sometimes complain about being too much frugal

This behaviour used to see-saw in our household... Sometimes it is me who is wondering if we are shaving away at nothing, and sometimes it was DW.... Oh well, it has died out largely.
Hmm, now that we have a non-US developing world journal, should I also start one?

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Post by LonerMatt » Thu Dec 29, 2011 7:37 am

@ Surio
Of course you should start one. Mine's coming in the new year as well, time for us internationals to get on board.

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