I don’t monitor my savings rate, but based on my annual net income* and the increase in my net worth in 2020, it looks like I was able to save 75% of my salary per month on average.
This is a huge accomplishment for me because I am NOT the most motivated, disciplined, or focused person you could ever meet. I feel like the level of willpower I am able to expend at any given day is very limited. LOL.
I reflected on it, and I believe these are the 5 ways I was able save that much:
We have a small house
Our one-bedroom condo is less than 50sqm and the bedroom is only around 18sqm. Having a small house means:
- I am not inclined to buy stuff (e.g. furniture, appliances, home decor) because we have no space.
- Our electricity bill is low because we have fewer appliances and it doesn’t take a lot of energy for the A/C to lower the temperature of a small space. Our electricity bill is only around ₱1,800 (it goes up to a maximum of ₱3,000 in the summer).
- We consume less cleaning supplies and we don’t need to hire professional cleaners because there’s not much to clean.
I can’t imagine myself living in a bigger house anymore.
We don’t own a car
Before the pandemic, we thought it was wise not to buy a car because we live near our respective offices. I absolutely regret this decision (as well as not learning how to drive).
Driving to anywhere might have given me a respite last year when I felt like I was losing my mind. Not owning a car significantly affected (and is continuously affecting) our mobility.
I feel lucky that my husband and I are eligible to work from home, but earlier in quarantine we had to walk several kilometers to the supermarket. I could almost cry of happiness when supermarkets started offering grocery delivery services.
I digress. If there’s one good thing to come out of not being a car owner, it’s that we were able to keep our fixed expenses low. If we had a car we would need to either pay for parking rental or buy a parking slot. Parking costs ₱8k-₱10k/month in our building and if I had bought parking space along with the condo unit, we would also be paying for additional real property tax. We would also need to set aside money for gas, maintenance, and insurance.
I still prefer not owning a car and I wish PH government would prioritize fixing the public transportation system over building new highways.
Limited exposure to shopping cues
For most of 2020, I was so busy with work to a point where it significantly reduced my exposure to shopping triggers (i.e., social media ads and influencer posts). I took it a step further by unfollowing celebrities and influencers who post mostly just ads and sponsored products.
We also don’t have tv. We have the device itself, but we don’t have cable subscription, tv plus, or satellite antenna. We only use the tv for netflix and youtube.
Tinodo ko na towards the latter part of the year — I unsubscribed from promotional e-mails and turned off app notifications for food panda, shopee, lazada, etc.
‘Out of sight, out of mind’ is key 😉
The gap between our income and expenses is wide
It felt easy to save without feeling deprived because my saving strategy didn’t feel restrictive. I move a fixed amount of money every month to a bank account as if I was paying a monthly bill. I spent whatever was left however I wanted.
It’s a more chill way to go about saving where I didn’t need to account for expenses. The latter takes so much of my brain’s processing power and I really REALLY dislike accounting for and logging everything 😭
This was feasible only because the gap between our income and essential expenses is wide.
The pandemic made me feel overwhelmingly grateful despite my challenges at work.
I don’t know how I would’ve handled it if the pandemic happened when I just started working, earning close to minimum wage, living paycheck to paycheck, by myself, with no emergency fund.
I am grateful no one in our immediate family got sick.
I am lucky I was born into a middle class family with parents who were able put me through college.
I am lucky I don’t need to provide for my parents. They prepared for their retirement and live healthy lifestyles (they don’t need maintenance meds).
I am lucky I didn’t get laid off. I’m lucky my husband also didn’t lose his job, else I wouldn’t have anyone to share expenses with.
So many things could’ve gone wrong, but didn’t and I’m grateful.
* excluding interest income and investment gains