Tuesday, June 8, 2010

21 day early retirement challenge



I have been reading about the 21 Day Makeover for early retirement. It has been really interesting, and I have decided to give it a go.

I am going to go a little slower than 21 days and do it more like 1 a week. I have only read a few weeks and the basic overview and it is definitely doable. Some things will be harder than others where I live, but that’s ok. His is an “extreme” blog, so naturally the ideas will push boundaries. How else can you expect to retire early?

If you have never seen his blog, you should definitely check it out. It is very interesting, with lots of good information. He is extremely frugal, as is his wife.

A lot of his ideas might seem crazy at first, but when you think about his lifestyle vs. the average person’s lifestyle, don’t you think working 9 – 5 in a job you probably hate is worse? I mean, it doesn’t leave much time for spending with family and it is a HUGE portion of your day. If cutting back a bit meant you had more time to do things you enjoy, wouldn’t you do it?

One prime example of this is your spare room. When I did the math on this is horrified me.

Day 1 is Finding a place to live. He recommends no more than $200 - $300per month per person. With my 2 kids, I come in at $245pm per person. When my husband was living here it worked out to be $184 pm per person. Why? Well, I live in a 1 bedroom granny flat under someone’s house. It is nicely done and larger than most 1 bedroom places. I wanted it as soon as it became available. I know my landlord is not going to sell the house which gives me security whilst looking for a house to buy.

I have pretty much the cheapest rent available where I live. Last year when I moved in there was maybe 1 or 2 places that were getting rented out for less, also in less desirable areas. I live on top of a hill, with gorgeous views and cheap rent. Those 1 or 2 places were only $5 cheaper and are now $20 - $40 more expensive than mine.

Yes, it can be hard. Yes, if I moved cities I could buy cheaper, but right now, I want to live here. As such, I found the cheapest rent I could. It would not be possible if my kids were older I don’t think. It would be a complete nightmare actually to have teens in a 1 bedroom place, but you do what you have to and if that was all you could afford, so be it. They would adjust. It would be an excellent life lesson for them.

I am also within walking distance to some shops and since I do not work I don't need to be near anywhere in particular.

So, lucky for me, Day 1 was already done. It will be slightly different when I buy a house, but still, I am not looking for a big house and am still saving for a decent deposit.

2 comments :

  1. Technically, what I mant was 200-300 per income earning adult. I guess if there are nonearners, the figure would be closer to 300. Of course for people with high income, we can step it up. The goal, though, is not to spend more than 15% of the after tax income on housing.

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  2. Thanks. I definitely come under 15%. $200 - $300per month in Australia will get you a car space. Not even caravan parks/camping grounds here are that cheap, but I am sure many could try for the 15%.

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