People ask me often enough that it warrants writing down. For each of my three years living in New York City, I have willfully chosen to be unemployed for about six months, traveled abroad for about two, yet still saved money. The first assumption many people make is that I must earn a lot of money when I do work or have some hidden income source. My employment varies widely—most recently contract work with the United Nations and disaster clean-up with FEMA. Sometimes this does pay well in short bursts but my year-end earnings are 12k- 18k — less than half the median income of NYC ($37,435). It’s not about income; it’s about expenses.
The official federal poverty line is $11,945, though the cost of living in New York City is significantly higher than the federal average. While my earnings sometimes are a bit higher I spend less than that each year. My disclaimer is that I have an ideal situation for this. I have no debt nor any children or dependents.
In a typical month I’ll spend $1,000. My rent makes up about half that. I always have roommates, a smallish room, and live in immigrant neighborhoods. Food is the next biggest expense but also comparatively low for this city because I cook almost all my own meals—$40 to $50 a week. Transportation is next but kept down by religiously avoiding taxis and biking or walking whenever possible.
Beyond the above three I consider everything else luxuries. I do not pay for insurance and have not visited a doctor since I moved here. The money I save by doing so I put aside in case of emergency and am effectively self-insured. Cooking vegetarian lunches and doing lots of walking is not only cheap but also healthy. I never take drugs for medication and only rarely for pleasure—I’m counting alcohol, nicotine, and caffeine as drugs. I pay $10 a month for my ‘dumb phone.’ I don’t have a television or cable. I’m more entertained and engaged with a good book from the library, conversation with friends, or exploring new places than most things I could trade money for.
There are tons of things to see and do for free in NYC and I do take advantage of some of them, but this is not a way to afford a lifestyle beyond your means, it’s about rejecting the thought that that lifestyle is even desirable.
When I travel my expenses stay fairly consistent with my NYC numbers. Before leaving on a long trip I’ll move out of one apartment and upon returning move into another—having so few possessions makes this easy. The cost of the plane ticket is balanced out by not paying rent in one of the world’s most expensive cities. I tend to travel in the developing world–most often South America–and try to live as locals do. When you give up things such as air conditioning, leg room and the notion of anyone speaking English, costs stay pretty low—usually $10 to $15 a day.
I cut my own hair and wear almost exclusively donated clothes. In fact, I believe the cornerstone of my happiness and freedom is assigning my own value to things. A friend may give me a coat because it is no longer the style he desires, but I will accept it because it keeps me warm. Its value to me has nothing to do with fashion trends, marketing or superficial perceptions. If you assign your own value to things, rather than accepting the value a hyper consumerist and self-conscious society assigns, life can be a lot cheaper—and happier.