The city received a light snowfall on New Year’s eve. The next day, the ground was blanketed in a sheet of whiteness. Our son awoke excited, unaware of the new year, but eager to trod and make his mark on the blank canvas outside. Daniel took him outside, and the kid made a beeline for areas of snow not yet touched, dragging a stick on the ground to make tracks and drawings. “I only like stepping on clean snow,” the kid said.

I stayed indoors with the intent of making tracks of my own in a new moleskine planner, the year 2018 printed on its crisp blank pages. I used my favourite 0.5mm black gel pen, and jotted my first words of the year: the time and date of my first social event of the year (January 2, date night with Daniel to watch Star Wars, 6:45PM). Those first words (and subsequent ones) were by no means profound, but there was such a thrill writing in a planner on the first day of the year.

Anne Shirley of Anne of Green Gables captures the excitement and hope of a new day best: “Isn’t it nice to think that tomorrow is a new day with no mistakes in it yet?”

Mistake of the year

2017 was a good and prosperous year. For the first time since before the first kid was born, Daniel and I were both working full time the entire year. We both received promotions, and associated raises, at work. Our household income was at an all time high.

That made saving easy. We were easily meeting our monthly savings goal and putting more money into paying off the mortgage. At the end of day, we patted ourselves on the back for a job well done. While we saved diligently, we also spent inordinately.

We wanted to update our worn and unsightly though still usable couch; so we got one. We wanted to go camping over the summer, and therefore bought a tent and cooking gear to use. Daniel stumbled across a Le Creuset sale, and I had previously mentioned how a bigger dutch oven would help with my meal prep, so he got me a bigger pot. When I realised my health insurance at work covered portion of laser eye surgery, I pulled the trigger (after years of hemming and hawing); a couple weeks later, I had 20/20 vision.

We also made smaller purchases for items we deemed to add value to our lives. Daniel outfitted our home with smart plugs, switches and Google Home minis. I started a new hobby- watercolour painting- and spent my allowance (and some) on art supplies. When our son committed to reduce his plastic consumption, I went out and purchased Keep Cups and metal straws for everyone.

While we saved diligently, we also spent inordinately.

Our spending wasn’t limited to material objects, but food as well. Having to work long hours in the fall, we relied on the convenience of take-out a lot; we became regulars at the noodle restaurant across the street (which, by the way, make the most delicious hand-pulled noodles). I rewarded myself with treats for a day of hard work. Kicked ass in a meeting? Let’s have a freshly baked chocolate croissant (or two); the kids started thinking “treats” and “afternoon snack” were synonyms (“mama, can we go out for a snack?”).

Inflation lifestyle indeed.

We didn’t spend unreasonably…I don’t think (though some may argue otherwise). Most of our purchases (with the exception of food related ones) were made after careful consideration, research and discussion. We never spent frivolously or impulsively, and we never, ever spent more than we made- not even close.

So what exactly was the mistake?

None, I guess, except, there was always a nagging feeling that something wasn’t quite right.

When is enough, enough?

While I was grateful for to be in a financial situation where I could spend freely without consternation, to be able get what I want, there was always a constant running list of other things I wanted. Okay, now that we have a new couch, I wanted new cushion covers, and a piece of art above the furniture, and maybe even a wall hanging on the other wall to balance room etc. After eating at a delicious omakase meal at a Japanese restaurant, I look up other sushi restaurants to eat at. After taking the big kid to the symphony, I wonder when he’ll be ready for ballet.

To covet, it seems, is human.

So when will I have enough?

I realised, I will never be content with what I have unless I choose to be content.

Wartime Austerity

A decade before the first world war, consumerism increased in America. The nation saw a greater pursuit of material goods, and subsequently, household spending drove prices of goods one-third higher in a single decade. Inflation became a concern for the government, especially during the war. When the US joined in the war in 1917, President Woodrow Wilson urged for frugality: “This is the time for America to correct her unpardonable fault of wastefulness and extravagance.” During the Great World Wars, people practiced frugality to revitalise public virtue and mutual aid; desperate times called for desperate measures. But much can be learned from their way of living, to learn self-restraint and to simply do without.

New Year, New Mentality

With the new year, our resolution here at Urban Departures exercise financial austerity and embark a year of no shopping. The plan is to only spend on necessities for the entire year. The overall focus, the overarching resolution, is to be content with what already have, break preconceived notions of what we need, and acknowledge that what we already have is more than enough.

We had done some small-scale shopping bans in the past- with varying success. One holiday season, we didn’t eat out for 90 days. I gave up shopping for clothes and beauty products one month, only to make purchases on my clothing wishlist at the end of the month because of hard-to-come by sales. None of those experiments made lasting impressions, probably because of duration.

But much can be learned from the wartime austerity way of living, to learn self-restraint and to simply do without.

We had also endured several seasons of frugality. There was that time we were newlyweds, living on a single income with a gazillion dollars in mortgage and school-loan debt. There was that other time we were both unemployed: me on maternity leave, Daniel laid off of work. Adopting austerity measures, we slashed our budgets and lived minimally out of necessity. Similar to the war, no sooner was the period of hardship over when the attitude of self-restraint dissipated; the ideal of simple living losing much of its appeal in time of prosperity. However, we hope that this experiment, not borne of necessity, will help us achieve bigger value-based life goals and preclude a return to lifestyle inflation and the “laissez-faire” attitude towards consumerism.

While we want to save more money and accomplish a number of financial goals set out for 2018 (like paying off our mortgage) we want to consume less, to produce less [waste], to give more generously, and to care more deeply about the world. In exhibiting restraint and denying ourselves of certain wants, we hope to be challenged to be better versions of ourselves.

In the next year, before make a purchase, we will be asking ourselves these three questions:

1. Can we use something we already have?
2. Can we borrow?
3. Can we do without?

As the Dorothy Day liked to say, “The best thing to do with the best things in life is give them up.” Here’s our pledge to do the best thing with the good things in our life.

I knocked on the door of my sister’s apartment, trying hard not to drop a bag filled with Muji ceramics and a sansevieria trifasciata. She had recently begun adulting-  graduating from university, moving our of our parents’ home and starting her career. The gifts in hand  were a housewarming present to celebrate her new life milestones.

My sister opened the door, inviting me into her brightly lit apartment. The space was unfurnished, completely empty with the exception of 15 or so pairs of shoes lined up against a wall.

I laughed at the shoes – how silly they looked in the vacant room!

“What?! I am paying rent now. Can’t afford a furniture, let alone a shoe rack,” she joked.

She gave me the grand tour. Her bedroom, unlike the the rest of the apartment, was furnished. There was a bed! She caught me eyeing the bed curiously.

“I had to get one! The frame is from Ikea, the mattress is Casper. It’s my present to myself for growing up… I’m going to keep it forever and forever, so it’s more like an investment,” she explained.

I laughed again, remembering the same sentiment when I moved into my own place many years ago. The first thing Daniel and I bought for our new home was also a bed frame and mattress. At the time, I was hesitant to spend the money. Daniel had urged me to, emphasizing it was where we would spend a third of the day, or more– we were newlyweds after all. It was a good argument and I relented.

I fell in love with our mattress; it was so comfortable! We had had a running joke before bed where I would say to Daniel, “I love…Bed”. He would feign indignation and then tickle me until I told him I loved him too. Completely cheesy, but, again, we were newlyweds and I really loved my bed.

To celebrate my sister’s entrance to adulthood, I want to share five things, in addition to a quality mattress, that adults can sometimes overlook but make a worthy investment :  

1. Relationships

Despite living in different cities, my girlfriends from high school and I used to meet up at each other’s homes to discuss relationships and rant about work. It was a lighthearted time to, well, gab; there were many multi-hour conversation about The Bachelor, but when someone needed advice, we all provided solidarity and encouragement.

Meet new people, expand your network, connect with old friends, and build strong relationships; there are always those willing to help in your time of need. Good friends and close family are your pillar of support when adulting gets hard. The more you invest in your relationships, the stronger your foundation. Reach out to see how friends are doing and commit time to spend with them.

2. Self Care

The focus of self care is to identify your needs and to take the steps to meet them. For me, self care has meant setting aside the time to create. Post graduation, it was stressful searching for a job. To keep calm and carry on, I took on a waitressing job to earn money for art classes and supplies. I would search for jobs during the days, waitress a few hours in the evening, and paint, sew, bead, draw in between; it kept me sane and motivated.

Self-care is really a form of play; for adults, play may not be with toys (though for some it does), but it is simply time to nurture interests and passions to keep us young at heart.

3. Career Development

A year into his engineering career, Daniel took project management courses to develop new  skills. When he decided to switch careers, the knowledge he gained through the courses helped secure a new job in a new industry with a nice salary bump.

Whether it’s additional certification or course in a field of interest, professional development can open opportunities and lead to the achievement of goals and aspirations. You are your greatest asset- put time, energy and money into improving yourself.

4. The Future

Whether you have your sights set on a down payment, wedding or travel, it’s important to set aside the funds to save for your dreams. I don’t believe I’ve ever heard anyone regretting having taken the trip of a lifetime.

While you’re saving up to live a little, it’s important to keep in mind the need to set aside a something for retirement. We all know the earlier we start, the better off we’d end up- I wish we had started earlier. If you can, start now because the magic of compound interest will grow your money.

5. Some Stuff

When you’re just starting out, buying stuff can leave you in a pickle- like my sister and her shoe rack. As a guiding principle, start with the purchases that will improve your quality of life.

For those who work in a formal business environment, a dapper suit or work bag can be worth the expense. Athletes will spend on equipment that gives them a competitive edge. For those who love to cook, a proper knife or a pot improve the experience; I’ve been using my Le Creuset french oven daily for years and not once have I regretted spending the four bills. Daniel bought a fancy-schmancy router so we wouldn’t constantly be wasting time waiting for things to load.

While the stuff you value varies from person to person, the point is to spend on what makes a significant impact in your life and will grow with you. The new car, designer purse (or designer anything for that matter), and anything that will put you in debt, can wait until you can afford it, at the very least.

The Last Word

I had visions of grandeur for adulthood (shaped largely by the TV show, Friends), but in reality, the early years of my adulthood were much more modest. Although Daniel and I had bought our condo, we had a sizeable student loan to pay off. We dedicated our salaries to paying it off, and as a result, lived in a primarily unfurnished apartment, only ate home cooked meals, didn’t travel, and basically pinched pennies where it made sense.

It wasn’t a destitute life- on the contrary! We were happy and content; laughed at ourselves for being “young and poor” and found joy and accomplishment when we found discounts for concerts tickets. Our home may have been empty, but we filled our time with doing things we loved and spending it with family and friends. In those early years, we learned much about the difference between wants and needs, and it molded the way in which we would manage our money in our “older” years.

So new graduates, young adults, and my dear sister, do not be discouraged when you cannot afford the things you want or if it takes time to build up your wealth; this is just a rite of passage. You can have it all, just not at the same time. Instead, revel in the beauty of being young and not inundated by the responsibilities of life and all the physical things to be acquired with time. Do not worry about what you do not have, but spend the energy to invest in what matters: a good night’s rest; a hobby, course or project that gives you purpose; a relationship with friend who is willing to watch a very bad television with you; travel/retirement fund, and, maybe, a decent laptop with AC-wifi so you can read all the words of wisdom I have to bestow upon you.

(And in case you were wondering, we retired my beloved bed and upgraded to a King-sized Casper mattress to accommodate the kids. So if you’re in need of a comfy mattress and are looking to save a cool $65, let me know and I can share my referral code with you!)

Who still buys second hand?

When my family first moved to Canada, my parents couldn’t afford many new purchases. I remember visiting New to You, a program for gently used second hand clothing, at the local community center. As my family became more financially established, we progressed from trips to the community center to afternoons perusing through Value Village.

From community programs to garage sales and thrift stores, the second hand economy no longer serves only to support struggling families. According to Kijiji’s latest Second-Hand Economy Index, nearly 70% of Canadians have bought or sold second-hand goods.

The report identifies the highest intensity users or “heavy” second-hand consumer represented by households with an income of more than $160,000 and those with a considerable amount of money to save each month. They have a secret they’re not telling you- buying second perpetuates a higher standard of living.

If you’re not already taking advantage of the second-hand economy, here’s why you should be.

The Price is Right

There’s a clear cost advantage to buying second hand over buying new. The study found that Canadians saved an average of $480 annually when buying used. The deals are just waiting to be found in this second-hand economy.

We had been eyeing the Stokke Tripp Trapp for our little one to join us at the dinner table but couldn’t justify an insane MSRP of $329+tax. With a little patience, we ended up picking one up on Kijiji for $150. It was in such good shape that it was indistinguishable from one brand new. At over 50% off (don’t forget the taxes), it was a no brainer.

Simplify your life.

One man’s “trash” is another man’s treasure- as the saying goes. The study found that Canadians earn an average of $883 from personal items sold, with 70% motivated by the practical aspiration to get rid of things no longer in use. Last year, I made $730 off stuff we didn’t need. In the last week alone, I sold an old board game and a PS3 title from 2013 for a cool $50. Treasure, indeed.

When you have to buy new

Beyond the saving and earning potential, selling used can help to subsidize the cost of new purchases. I sold our entry level DSLR for an upgraded model with HD video when older brother was born. When little sister came along, we sold the zoom lens and replaced it with one capable of better low light performance. Leveraging existing items will serve to reduce the cost of upgrading.

Why we buy second hand

A substantial portion of our purchases are made second hand but not because we can’t afford to buy new. We simply can’t justify the paying the full Manufacturer Suggested Retail Price. We weigh the underlying value of new products against their contribution to improving our livelihood. If the value of a new product falls short of its impact on our well-being, we’ll look around and buy used instead.

Our children grow like weeds. We often find ourselves dressing them in ¾ length shirts and capris. At the rate they outgrow their clothes, it doesn’t make much sense to keep buying them new – especially when a new pair of jeans can run upwards of $40. Mud, stains and an afternoon at the park can make short work of any outfit. Buying used at a cost of anywhere between $2-5 per item, borrowing or taking advantage of hand-me-downs keeps more money in our pocket.

The Last Word

It seems a little counter-intuitive, but the Kijiji’s Second Hand Economy index shows buying second hand perpetuates a better standard of living. An average $480 saved paired with $883 sold, adds up to over $1200 in accumulated wealth that can be used either to soften the burden of new purchases or be put to better use elsewhere. Buying used no longer carries the same low income stigma it might have once provoked. Second hand purchases are a fundamental stepping stone towards building lasting wealth and stability.

Daniel and I lived as DINKS (dual income, no kids) for few years between paying off Daniel’s student loan and starting a family. We were both in the consulting industry as engineers and made a decent wage; we had a lot of disposable income. We did as all young folk do: eat, play and travel. Within our means of course. Way below our means, actually.

We were good savers. Saving was ingrained into our lifestyle, a product of our upbringing. We both had the stereotypical cheap Asian parents. We spent and spent and spent, but we also saved and saved and saved. Until one day, we had a chunk of money in the bank that we weren’t sure what to do with. We had been saving without a purpose or an end goal other than to save. We had no idea what we were going to use our money for.

Saving for the sake of saving was pointless. Yes, it is good to save, but without motivation—the why— we could have cleaned out our savings on impulse. That didn’t happen. Instead, Daniel and I took a good look at what we wanted to use our money for and acted accordingly. You see, we had an underlying philosophy that served as a general guide. This financial philosophy, which encompasses our attitude towards money, governs our financial decisions.

Our Financial Philosophy

We are stewards of our money

In the Parable of the Talents a man entrusts three of his servants with some money. The first two work to grow what they’ve been given. The last servant  dug in the ground and hid his share of the master’s money. Upon the master’s return, the first two servants were rewarded for their efforts while the third was admonished for his laziness. The story serves as a reminder that our money doesn’t actually belong to us- we are only temporary caretakers. Our finances belong to God and are to to further His purpose until He returns. Our faith and focus in honouring God with our money is our fundamental value; it is our responsibility to diligently manage what we have been given and use it to help those in need.

Money is earned

My parents did not start off with much. They had $200 in their bank accounts when I was born, so the story goes. My mum took menial jobs here and there—anything, really— to take care of her family and help my dad through school. Though my dad worked through university, he still graduated with a gazillion dollars in student loans (I exaggerate, but the story is told by my mum who claims to have walked barefoot uphill to school— both ways). Even with a third child on the way, my parents each worked two jobs. My dad was an engineer for a software company by day, but worked after hours to pay off his debt. Now in their early fifties, they’re debt free, mortgage free, and could retire if they wanted. They didn’t accumulate their wealth overnight; they worked hard for it. Really hard.

We are fortunate thanks to the my parents’ tenacity . We are committed to following their example of putting in the work needed to provide for our family. Daniel and I have agreed that we are not above any honest opportunity. Money is earned and circumstances can be changed with the right attitude and effort.

It doesn’t matter how much we have if we don’t manage it

Nicolas Cage, star of classics including Face Off and The Rock (so I’m told), blew through his $100-million fortune and owed $13-million in taxes in 2014.

Columbus Blue Jackets’ Defenceman Jack Johnson declared bankruptcy in 2014, claiming $50,000 in assets against $10 million in debt. He left the management of his finances to his parents who took out millions in high-interest-rate loans in his name without his knowledge.

Then you have those like Mr. Money Moustache, a former Canadian and engineer— former, well, because he now lives in the US and retired at age 30. On an income far less than Mr. Cage and Mr. Johnson, he was able to assemble enough assets to live off the proceeds of his investment portfolio.

Having money doesn’t mean you get a free pass. The habits for frugal living and smart investing can be learned. We do not want our hard-earned money to be lost or wasted, simply because we didn’t care enough to properly keep track of or invest it.

Live simply to make room for the things that matter

When Daniel moved overseas as a teenager, all his belongings fit into two check-in sized suitcases. He thought he was poor— until he saw migrant workers living in shipping containers. Seeing what little people can live with, he learned to appreciate the things he owned.

I came to that same understanding while travelling in Nepal. As we trekked through villages up to Everest Base Camp, we encountered porters along the path in flip flops and children using old plastic bottles as toys. I remember watching one rosy cheek toddler play with a cardboard box all through dinner. The Nepalese villagers had little, and yet they exuded joy and contentment.

Since then, we have pared down what we own. That is not to say we are minimalists; we are far from it. Instead, we strive not to pursue things and money with the belief that they will make us happy. As Ben Franklin once said, “Money never made a man happy yet, nor will it. The more a man has, the more he wants. Instead of filling a vacuum, it makes one.” Ironic, isn’t it, that his image graces the US $100 bill?

Similarly, we have simplified the way we manage our finances. We do not want to be bogged down by tedious penny pinching to meet saving goals nor do we want to stress about downturns in the economy. We have developed a financial ecosystem which allows us to chase the things that do bring us happiness.

The Last Word

Philosophies on personal finance, which can be shaped by values, past experience, culture and faith, are different for each person and family. It is important to define a financial philosophy to understand how you view money. Acknowledging your belief system will help you create goals and the plans to achieve them. While priorities shift with time and circumstances, your financial philosophy will serve as a constant guide through life’s different situations.

What is your financial philosophy? How do you think about money?