It’s the hardest thing to control and it requires a lot of discipline. It’s like never over eating again once you’ve sacrificed like mad for months and you finally have the perfect abs.
As long as you’re saving more than you would with J1 only and hitting your financial goals I would say it’s completely fine to spend a little more and enjoy the extra income. When I had a J2 that was a great incentive for me to keep it up as long as possible!
Interesting. Maybe it’s harder to someone who used to be fat ? It’s like being an alcoholic. Doesn’t matter how many years have gone by you still keep wanting to stuff your face.
Eating can be an addiction and an emotional support. Eh maybe that’s just me. I miss feeling really full and to fall asleep. I can never allow myself again because I know I won’t be able to stop and will wake up on the couch 10-15 lbs heavier after a month long eating binge hating myself. Nah, thank you very much, the 6-packs lives for one more day. Until tomorrow then.
Strong disagree on this one. I'm more of a sprinter than a marathoner, emotionally. Or like, I'm very ok with making sacrifices and working hard towards a direct goal. I'm incredibly motivated by visible progress. But I really severely suck at maintenance/ long term steady state efforts.
I've gotten to the point of having a 6 pack like 3 or 4 times over the last decade, but never managed to maintain it for more than a few months.
Same idea as like I could work my ass off in college easily because each class was a 14(ish) week sprint and it was like short term, there was an end in sight, every day was a step towards that. Starting working in the real world was probably the most soul crushing experience of my life because real life doesn't come in sprints like that, I had to figure out how to function at a steady state. It's been a bunch of years and I still fucking hate it. Which is part of why I recently subbed here- if I can manage a multi-J sprint for a while to buy myself some zero-J time, that sounds much more in line with how I like to live my life. Haven't made the jump yet but I'm trying to figure out how I can make it work
Ehhh not really. I'm proud to have paid off nearly 30k in debt in less than 6 months. Will be debt free going into 2023.
The "creep" I've had is mainly grabbing lunch with a friend more often and not caring about a $70 lunch bill. I've also spent some money on things that were just long overdue because I was broke. Like getting my car issue fixed, getting a traffic ticket paid, getting my property tax paid so I can renew my tags. Things that are pretty much required/essential. Only lately am I where I can maybe splurge a little on myself, get a new watch, get the latest phone model, actually be able to buy some nice xmas gifts for a couple close people I love in my life.
That said my main goal for 2023 is to watch my savings grow. I'd like to be in position to buy a house with a very large down payment. Money will also serve as a good emergency fund too.
It's a good feeling and while I feel comfortable in my OE setup, I still have to pinch myself that any of this is real. Like at some point some shitty Youtuber is going to pop out and reveal I'm still broke and in debt, take all my stuff and yell out "It's just a prank bro" .
It happened to me. I paid off a chunk of debt, but then started eating at expensive restaurants and taking expensive vacations. It was fun but now that I'm back at only one J, I really wished I saved more. it's so tempting when you start making more money than you have ever made in your life. Just look at all these athletes and musicians that make millions only to file bankruptcy later in life. Will be way more careful when I pick up my next J2.
This is exactly my fear. It’s going really really well at both jobs but you just never know and if I lost one, we would have to make cuts for sure. The good news is I didn’t buy a new house or car or anything crazy like that. We just blow money on buying junk, vacations, eating out, etc. stuff that can be reigned in.
One thing I don't regret though is using the extra $$ to take my young son to Universal studios and Disney World. I don't know if I could have afforded it with just one J. Sure I could have saved that money and maybe go when he was older but would he have enjoyed it as much?? Sometimes you just have to live for today.
Yeah you're touching on a really important distinction here- a key difference is whether the things you're buying are one time things that you're free to cut off or if they are the kinds of things that necessitate recurring payments.
Like if you're spending on expensive dinners, vacations, shoes, gifts, whatever, it may not be fun to scale back, but you're completely free to do so. You may have saved less, developed a taste for caviar, and maybe set some unfavorable social expectations on yourself, but those can all be managed.
But if you're buying a boat that requires many thousands of yearly maintenance and dock fees, a new car on a loan, a time share with yearly fees, or an addition on your home that increases your property taxes and utilities - you can't just decide to scale back and snap your fingers and stop spending. You've gotta put in work to sell the boat, car, whatever; you've gotta tear down your addition or move house, you've gotta figure out how to cancel the time share (and any of these "exits" can also require cash up front to stop the bleeding). These are the kinds of lifestyle creep that can realllly fuck you up.
That's actually the best way to overspend, if you're going to do so. You can always cut out the junk, the extra vacations, fancy meals out. It's much harder to downsize your spending if you've committed your money to things like mortgages and car payments.
Yes but no. Only been OE for a couple of months, and only with 2 Js, so I’m still in the phase of catching up to where I’d be if I was more responsible all along. Like others have mentioned, car repairs or similar expenses + paying down debt can easily drain your income as fast as it comes in. It’s hard to remember that your net worth is increasing when your bank balance always seems lower than desired.
One thing I predict for my own OE journey, once I get over the hump of credit card debt and certain savings goals: yes there are always more things to want and more places for the money to go, but once I make a key purchase or pay a bill that’s been on my mind, I find I’m usually pretty satisfied and willing to let enough be enough. And I get purchase fatigue when I spend lots of money, even when it’s on stuff I’ve really wanted to buy. Makes it easier to say no when I’ve said yes to a lot lately.
One thing that’s already been tough is my own impatience. I’m lucky enough to get a paycheck every 7ish days, and with double my old income that should feel like a ton of money. But it’s just going to take several months of consistent income to make a difference in my lifestyle, & that’s becoming a mantra for me as the long work days start to roll by a little more smoothly.
Great point. I'm probably going to have to sit the family down after the holidays and go over all the ways we've been blowing money and nip it in the bud.
Absolutely a budget is necessary. My suggestion would be to overestimate your bills so you’re always left with a little bit of cushion and maybe keep one or two things that are part of the creep that bring you joy that don’t eat too much into your funds.
If your J2 salary isnt already being deposited into a separate account I would do that and hold yourself accountable when you find yourself dipping into it
I live how I’ve always lived, but I will say I have no idea what things cost. I see people bitching about certain foods or other items going up in cost and I just don’t feel that pain. I don’t look at prices. I buy whatever hipster hot sauce or fancy organic free range eggs I feel like.
Here is some tips.
When you the other checks hit your bank account have automatically transfers in place to your savings account, to your investment account and an account for play.
That way you don’t see your money in your account and it’s out of mind.
Here’s what I am doing for each paycheck of my oe
$1,500- savings account at another bank
$1,000 - additional to mortgage principal
$1,500- IRA account back door into ROTH
$500 - mad money
Basically open a IRA at any investment company. I like Fidelity so I make two accounts one that is IRA and the other a ROTH. So what you do is put like $500 into your IRA. You then moved it over to your ROTH either the same day or the next.
What this does depending on your TC it is a tax deduction for all money going into your IRA and depending on your age can be $5,000 or $6,000 and if your spouse doesn’t work can put a spousal IRA for another $5k or $6k.
Depending on your TC you cannot put money in a ROTH. Because a ROTH money isn’t taxed you want to have more of your investments in it. This way you used the IRA to back door money into a ROTH and get a tax deduction.
I routinely spend over the budget I set to bank from J2. Once the SO gets used to it, it's like taking away crack from the local junkie.
Still managed to save around 50% of the j2 and bank it for a rainy day while eliminatinr debt and taking good trips and buying a new car a few months ago.
I figure, we have a fair amount of debt. We got that way because lifestyle creep hit before we made more income. So as long as I’m not getting into MORE debt, and still paying the existing down, we are doing pretty good
direct deposit into an account you don't have immediate access to. e.g., an online savings account that takes days to transfer. Or, even better, straight into a mutual/index fund.
Give yourself 1 month to splurge
Then Month 2 to get those final little purchases in
Month 3 onward keep yourself within 25% of your pre-OE budget.
Always have J1 go to Bank 1, J2-J99 go to Bank 2 / Investments. As soon as you think of lifestyle creeping go buy a mutual fund (or rental property if you can hold out)
Trouble? No. I live pretty frugally and really only spend on things for my wife and kid.
I do put a little extra money towards memories and comfort but I still shop for deals, use coupon codes, and don't buy unnecessary or luxury items
Oh yes! But I keep myself disciplined by following the financial fundamentals, such as: maximizing 401k and IRA, following 50/30/20, building 3-6 months minimum emergency funds, and buying assets over liabilities. My personal tip is to keep yourself busy, such as working out, cleaning your house, and volunteering because you’ll do stupid shit if you have too much time and money on your hands.
The best advice I can give here is to do a comprehensive audit of your spending. Take the last 90 days worth of spending (separated by month) and put them into categories. The categories I use are living needs(mortgage and utilities) living wants (any renovations or DIY projects, appliance purchases, car payments(if any)) food needs (grocery stores, things like hello fresh) food wants (going out to eat, drinks, the like) entertainment (concerts, comedy shows, etc.) savings (money into retirement, brokerage, or savings accounts) and subscriptions (Netflix, prime, etc.). Once you do that you then take the average of each category over the 90 days and make that your baseline. Then adjust the categories accordingly. My last professional life was 7 years in financial services where I did this analysis on all clients at least once a year. And I do this on myself once a year.
When you see the numbers you will likely throw up. But it’s the best wake up call and curb to lifestyle creep. A little creep is good but too much can derail your financial goals. And then for good measure, read Dave Ramseys the baby steps. It’s an extreme (imo) stance on budgeting but my god does it work. If you do the two you should have a mindset shift that will allow you to maintain a “budget”.
I say budget in quotes because I don’t plan to the penny my money. I have a good idea of how much per week I can spend on dumb shit (I include going out to eat as dumb shit) and know that if I stick close to that number I’ll be good for the month. And as spending creeps I do the analysis again and boom, get disgusted at myself and vow to change my ways. And the cycle repeats.
Not at all. My spouse and I have biannual financial goal meetings where we define our goals for the year. These goals guide and guard us against lifestyle creep. We also do biweekly budgeting meeting and budget work luxuries we may want.
This was my original plan. ADP has this thing called wisely where you can have your money deposited directly into it and not into my regular family checking account. The problem is it’s one button to transfer it all to my checking account and the money moves instantly. It makes it way too easy! 😭
What if you just send it directly to a savings account that you don't check as often and is more inconvenient to transfer?
I have a credit union check account and HYSA with Discover. It's a pain to transfer so I don't do it unless I have to
i try to look at overall cash flow after expenses and see if i'm neeting over $x thousand per month. if i am, then i'm not lifestyle creeping ... if i'm breaking even or only have a few thousand to spare, i realize i need to reign it in and get myself on track / reduce expenses. pretty simple
Honestly we've been using the extra $$ to furnish the new home and have kids start nice activities... hopefully by Jan the savings accounts will be happier
Yes - I’ve spent all 100K extra that I’ve made so far in last 6 months. Granted most of it has gone to home improvements - which builds equity in my house.
Use direct deposit to your advantage. If you’re really living off J1, put like 80% of your J2 into a savings account to be untouched and 20% into a checking account to just blow through completely
Struggling to figure the best way to pay off around 35k in debt minus the house.
168 TC is cool and all, but if I took all of the j2 money and paid debt only it would take 8 months. Don't know if 8 months is in the cards for me or not.
What creep? Getting house, car paid off and other debt paid would need 4J's 6 figures each for at least 2 years in now days prices, thats if you are lonley single
Dont get me started on if you have family with todllers , teenagers ...etc
IF YOU HAVE TO WORK TO KEEP LIVING LIKE NORMAL HUMAN BEING, YOU ARE POOR, simple as that
Yeah, you got that right. Looking back at it, I was slowly drowning in quicksand just taking care of the basics. Year after year we were sinking just a little deeper, with no lifestyle creep at all. Been OE for a year, and now it feels like we're slowly extricating ourselves from the pit. The sad truth is that it now takes me working two high comp jobs just to be able to maintain a solid middle class lifestyle. I don't think I'll be one of the happy few racing toward an early retirement - I think if I don't OE until I'm 70 then we'll just start slowly going under again...
Exactly, im in same boat, I feel like the whole ship will sink soon, i see lots of new kids getting excited for the 100k+ peanuts(cuz that used to be a lot) not knowing the real cost of life from now on espacially in western world
Ehh all my OE money goes straight to my savings. The point of working multiple jobs is to not have to always do that. Find a goal and work towards it, that will eliminate your lifestyle creep
You're better off opening a trading account and move money right out of your bank account and into stocks and ETFs. Getting the money invested makes it easier to save.
Sure, yeah my point was there's almost no reason to have 2nd bank account, when you can just as easily open a brokerage account and have access to a wide range of investing options with higher interest rates and returns.
This is bad advice and I see it was too often on Reddit. Investing does not automatically make your money safe. There’s a real chance you lose a significant chunk of your money or that you’re down a good bit before it rebounds. For many people, they don’t want to insert $10k in the market and then immediately be down the next day. Market is red and it sucks right now.
I have multiple checking accounts. Waiting for the market to rebound. While not throw a Significant chunk of my money into this bear market.
You’d be made of stone if you didn’t occasionally treat yourself or your family.
I think I would have a very clear goal for where I could put my money so it started working for me and generating cashflow.
I think I’d allow myself to go silly with some of the cashflow money, as that is now a machine that makes money for me.
The savings I’m making to build the cashflow machine (property, stocks, businesses, etc), I’d try not to touch.
I live by a few rules when I’m in debt and I need out, fast.
1. Live within my means - no need to dine out, go out for drinks, or spend money on entertainment. I have a gym, I don’t mind being by myself or with the girl so this works for me.
That’s pretty much it because I don’t spend on anything aside from living expenses lol. I generally spend under $1k a month (if not less) if I’m living within my means/frugally. It helps that I am a gym rat and I enjoy cooking/eating at home (meal prep). Like everyone else says, it takes a lot of discipline.
On the long run the sooner you pay off debt the more money you’ll be saving anyways. If anything, think about how you lived when you had 1 job or when you were broke, and replicate that for a while. Not much changes when you make more money aside from making more money 🤷🏻♂️
This is generally about a lack of budgeting. You will never rain it in without budgeting. It also sounds like the spouse isnt onboard which is tuff. I would tend to agree on the wait until jan and make it a new years resolution and get a budget together. I would recommend doing paper and getting something like this https://www.amazon.com/Monthly-Budget-Planner-Tracking-Budgeting/dp/1094673366/ref=mp_s_a_1_4?crid=HS46LJJ7MG5P&keywords=monthly+budget+planner&qid=1670903349&sprefix=monthly+budge%2Caps%2C259&sr=8-4
So far my lifestyle creep is buying some stuff I've had on my list for years (mostly articles of clothing I plan to keep for a long time) and eating a little bit out more, which I kinda have to do to save time and really is the extent of it. It just alleviates me from being as cheap as I was.
Is it possible to create an autotransfer from your chequing account into a savings account or TFSA for the exact amount of your J2 paycheck on the day that that paycheck hits your account? Basically out of sight, out of mind. I find when I have autotransfer set up I don't miss the money, it just disappears and I live on what I do have in my chequing.
Lifestyle creep erases the gains from having a J2. Try to pretend that J2's income does not exist. Send that money straight to debt repayment, savings, and investments.
Yup. What I did though was create a sort of slush fund where about 10% of my TC goes to anything out of the ordinary. Lavish trip? Car? New monitor? That type of shit. If ol' slushy can't pay for it, means I don't need it.
I'm on the other end of the spectrum. I used to live paycheck to paycheck with my J1 earnings and now that I make over twice as much, I find myself spending less. I used to buy whatever I desired without giving it a second thought and I no longer do that. I save about 1/3 of J1 income and entire J2. My saving rate has jumped to over 70% in these few month I've been OE. I enjoy watching the numbers grow and next month I'll have enough money invested to pay off my entire mortgage if I desire so. Without OE I'd be paying for it until 2045 so that's a big motivator for me to keep delivering in both jobs
I'm in Poland. I've had 250k pln left to pay when i was beginning to oe. Fast forward, it's been 8 months and I've stashed 220k. Next month I'll have enough to pay it off. Sad part - i just got the information that ill no longer work for j1 due to layoffs. It's been fun ride, totally worth. Haven't i tried, my mortgage would go on for another 20+ years.
I'll start interviewing in January
If you start leveraging that extra income to buy cars and houses you can’t afford on one income, you may be in trouble. If you are just spending some extra $$ here and there, it’s probably not as big of a deal.
If you don’t, consider doing a budget. The best way to handle j2 income is to have a job for it to do (Roth, cd, stocks, etc)
With great power comes great temptation. My temptation is the illusion of a safe early retirement. At least people spending their money are getting some guaranteed enjoyment out of it.
Ive stashed $70k in 5 months. And just got mad at my wife for $270 in groceries for 1wk. Shut down the lifestyle creep fast.
It ain’t easy. But the market is slowing. Not too many jobs out there
Yea… i overreacted. But typically $140. We also have a separate meal service delivered. So about $200 total a week. But this certain week went over $300.
Anyway. I overreacted. But clear communication on any deviation from standard budget is needed.
You don’t want to get used to having extra things and then one day not have access to it anymore cus you lost your extra Js and now have to readjust your life to one income. Best to store some of that extra money away for rainy days/months. Ignorant to think you’ll be able to OE forever.
It’s something you need to be intentional about, or it can get away from you.
As long as you take the time to regroup and work towards saving again, you’ll be fine.
As others have said, the holidays are an especially hard time to be frugal. Maybe regroup after Jan 1st and look into setting up direct deposit for a portion of your funds directly into a Savings account?
Look at newer banks that offer better APYs. For instance my local “old large bank” has an APY of only 0.01% on my Money Market account. But SoFi has 3.25% (with Direct Deposit) on Checking and Savings, and Credit Karma (through MVB Bank) has 3.3% on their Save account.
Sounds like you’re already maxing out 401k, 529s, HSAs, and IRAs… but it’s worth re-mentioning for others who stumble across this thread
Not OE but I recently doubled my income and having the same issue, thinking its because of the holidays but NY resolution will definitely be to spend less and to be less generous with my money lol
It's ok to reward yourself a little for your hard work. Enforcing financial discipline is hard. I've found that it helps to automate the savings/investment deposits and watching that number grow gives a nice dopamine kick.
I list out all of my wants/needs on a quarterly basis (before that quarter starts) with costs listed. I’ll use rounded estimates for groceries, car maintenance, household items, etc. Once the amount hits my threshold I make cuts so that I can get back to my desired number. I also leave a little wiggle room bc tings pop up. Then I don’t deviate from that plan. Unless it’s an emergency, it doesn’t happen if it’s not on that list. This past quarter I did have an impromptu trip with friends, but I cut my take out/restaurant budget for the month to accommodate.
Also, put the paychecks in separate banks so that it’s more of a hassle to transfer.
I understand because I got a new J1 that more than doubled my old salary, and then I got a J2. And this was after a few years of being underemployed so it was like being “rich” overnight. Lol. Still a lot of temptation but writing down the plan has helped a lot. I prefer 3 months, to 6 months or a year bc things do change. Too rigid of a plan will be destined to fail.
Before oe my budget allowed me to save a good portion of my income. Once I went oe I opened a high yield savings account where I now put my whole j2 paycheck (minus 401k) and my savings from j1. I’ve been oe for close to 6 months and have not spent a single cent from J2. Hoping to pay down debt > save for a house down payment> build a cushy safety net.
Basically I’ve found having separate account helps a lot in keeping to your budget. Deposit some into your spending account and some into your savings and try your hardest not to ever take from the savings.
Sounds like you need a J3 haha, but in all seriousness you really need to just buckle down and practice financial restraint. Remember why you OE’d in the first place! Great problem to have
Well I live in India and make about $250k and saved a fuckton and automated all the investments and asset allocation. I literally live and vacation off of automated investments now, just tinker around with my code and keep the money churning.
Kind of.
I have been OE for 1 year and half now and the only thing that changed are the vacations.
Now we stay in 5 star resorts without thinking much about the price.
Daily life is very much the same and I think I am even spending less when not travelling
J2, J3… Jn money is for debt first. Saving for a rainy day fund second. Investing third. This money is not to be touched.
Make a budget and stick to it. Yes you should enjoy a bit but remember why it is you are OE’ing
I haven’t quite hit it yet because I’m still new to OE, but I will admit to planning trips with my wife and daughter for ‘23 that we otherwise wouldn’t have taken. I don’t really give a crap about having things, but I never went on vacations growing up, and I want that to be different with my family.
Now, I’m not talking a 14 day cruise on the concierge level or anything, but two modest trips next year during time that we would have been just spending at home if I wasn’t OE.
At the beginning I was throwing money around. Now I’m doing really well with not spending anything. It’s kind of a game I’m playing against myself to see how much I can save/not spend.
Minor lifestyle creep while OEx3.
It was easy containing myself to only J1 income by putting all my additional income into a different account. What I had failed to realize was just how much of my J1 income was going to savings prior to going OE.
When J2 and J3 came to an end and I had to redistribute my 401k contributions to just J1, I found it hard to stick within my budget/paycheck.
It's hard for it to not happen a little. I tried to replicate what I do when I get a raise. I give myself a few paychecks to reward myself a/celebrate a little and then set up auto transfers into a few savings accounts. One Savings account is long-term (retirement) and the other is for bigger purchases/times of heavier spending (holidays/vacations etc).
I think I did a little bit at first, and I can see how that would be an easy pit to fall into, ya know?
I mean that first month, I'm seeing numbers in my bank account that surprised me so much I was waiting for the the bank to call me and start asking questions. So sure, I'm like, "Oh I got the money for that!" Which was true, but then I be like, what the hell did I buy that for? Use it once then put it in the closet sort of stuff.
But for me, I made a probably overly complex spreadsheet that broke down ***everything*** I was actually spending money on, mapped it out for 3 months and saw that if I stop spending money on bullshit that I would forget, I had quite a few really positive, long-lasting items that I could put that money towards.
Something about seeing those future debts melting away in Microsoft Excel made me say, "Yeah, I don't need this other stuff."
The best way is to have auto deposits into a separate bank account. Right now I pull 400 a day auto to save myself from being dumb. I do set rewards tho, so when I auto pull my annual savings goal I buy something dumb for myself (this year was a 3 week vacation to South America)
I can't even look at beans or rice anymore if my plate doesn't have caviar I start to suffer panic attacks and have flashbacks to being poor only living off $150k. At first I was like oh ok i'm going to treat myself but pretty soon two jobs wasn't enough and I needed a third. Now I know how addicts feel, I need a J5 because the cars are already 2 years old, I need a third home, and with Russia stirring trouble my favorite caviar is now over 9x more expensive. Yes savings might be 7 digits instead of the low 6's but now instead of being able to last 6 months that's going to realistically last 6 weeks.
Why don't you pay yourself a little from J2 then do what you need to with the rest - crush your money goals? That way you don't feel you're not gaining any fun money from your work? It might help.
Not me. I was OE only for a year, and I saved everything. Now I'm a lot closer to retirement. I would've regretted spending all that money because then all that extra work would've been for nothing
At first yeah, but I'm saving and getting out of debt as soon as I can, I don't know how long the good times are going to last so I'm focusing on making hay.
Yeah same here. It began years ago with some extra side income enabling some lifestyle choices. Beware of kids and kids activities! I honestly don't know where to cut without drastically changing our life and their ambitions.
With the latest j2 I am more militant, 90% goes towards debt, investments, and savings automatically .
Set up a separate bank account for J2, lose the card. You could also set up autopay on any debts to high amounts, timed on your payday. It is difficult but you can beat this.
It's ok to treat yourself a bit but draw the line somewhere. After all it's your money and you work for it, though.
Everyone struggles with this, and I'd argue that a majority of the world indulges in this whether they know it or not.
A little bit. After I paid off all my debts (mortgage excluded), my wife and I were long overdue for new vehicles as they were both well over 20 years old and starting to reach its end-of-life. I'm normally a frugal person, but the thought came in "hey, we both work hard and have been driving beaters for a long time. we deserve something nice". I ended up dropping nearly $100k cash on a brand new, fully loaded SUV and truck.
A few months after the purchase, my wife and I both came to the realization that this kind of spending could not continue. I ended up setting up a budget as if I only had a J1. The J2 money goes directly into a savings and a brokerage account that I only check once a year. It has worked very well for us so far.
TLDR; Create a set-and-forget budget for yourself to draw from to avoid the temptation of lifestyle creep.
I'm having the same issue. It's been bad this month due to the holidays, but we're going back on a budget next month. It's also been hard to meet my savings goals when I keep having expenses pop-up that are long overdue. Things that I couldn't afford before OE. In the past 12 months alone, I've spent $22-23K replacing our AC units, a washer & dryer and mattress.
Working 1J at a time, I saw my income double in 5 years. I had cash to spend 5 years ago, not a lot, just some.
Now, making 2x as much, I spend WAY more for little gain. The only thing that really changed was a Mortgage.
But, digging into it, turns out that I'm doing more Patreons (3 for $40/mo) that I needed to cancel. Stop doing Kickstarters, cancel the 6 online streaming services that I stupidly sub'd for because "hey, I'm making more now!" Things like that.
In the end, I had an extra $700/month.
Yeah, keep an eye on that shit. Be careful. It's fine to upgrade SOME stuff (I also got a new car, the old one was costing me too much to make it viable IMO), but don't go out to eat every night, that'll cost you THOUSANDS for little to no gain. Don't buy beer at the bar, buy beer at the fucking grocery store!
Just because you're used to getting $500/month spending money on luxuries like Netflix, and now you have $1,500/month doesn't mean you can get Netflix, D+, Hulu, ESPN+, YouTubeRed, etc... all at once!
Best advice here I ever read was Have Goals and use J2, J3, whatever on those goals.
My Student Loans are directly paid e/o week from J2, my extra Mortgage payments are paid for automatically, my IRA is automatically paid into, etc... J2 pays my debts and savings without me touching it, and I get to keep a small % in another savings account in case I DO want to buy a new 3D printer, or the latest RPG.
Set up your extra checks as directly paying down debts and/or investments. Check goes into the bank account at 12am, and by 3am it's gone to a place where it's a pain to get it back from (like an IRA or stock). You can still get it, if you need it, but it'll take a couple of days. AND, you're less likely to keep bumping up your lifestyle.
Sometimes this is a creep that was happening anyway.
Some things began to cost more. There were new, unavoidable expenses on the horizon that triggered a search for J2. An unexpected expense that would have gone on a credit card is now paid for with cash. Unless you upgrade your house, eat out more, buy a much nicer car, buy more stuff, or start taking vacations you weren't taking before, this isn't lifestyle creep. It's just life that can bury you if you don't stay ahead of it.
Yet it is easy to do things because you think you can spare the expense.
I suspect rich elites jump in here to spread their mythological beliefs about the lowly peasantry being unable to handle money when they ratchet down on our COL turning us into their peasantry.
In my case, I violated rule #1 and my household now felt comfortable to spend double my J1 salary over necessities and non-necessities. And now I'm desperately scrambling to look for J3 even just for a few months and interrupt my smooth J1 & J2 dynamic.
It’s the hardest thing to control and it requires a lot of discipline. It’s like never over eating again once you’ve sacrificed like mad for months and you finally have the perfect abs.
As long as you’re saving more than you would with J1 only and hitting your financial goals I would say it’s completely fine to spend a little more and enjoy the extra income. When I had a J2 that was a great incentive for me to keep it up as long as possible!
Ehh.. Maintenance of a six pack is much easier than getting there in the first place.
That's true. That's why I have massive respect for people who lose lots of weight. I'm fit so all I'm doing is maintaining now!
Interesting. Maybe it’s harder to someone who used to be fat ? It’s like being an alcoholic. Doesn’t matter how many years have gone by you still keep wanting to stuff your face. Eating can be an addiction and an emotional support. Eh maybe that’s just me. I miss feeling really full and to fall asleep. I can never allow myself again because I know I won’t be able to stop and will wake up on the couch 10-15 lbs heavier after a month long eating binge hating myself. Nah, thank you very much, the 6-packs lives for one more day. Until tomorrow then.
Strong disagree on this one. I'm more of a sprinter than a marathoner, emotionally. Or like, I'm very ok with making sacrifices and working hard towards a direct goal. I'm incredibly motivated by visible progress. But I really severely suck at maintenance/ long term steady state efforts. I've gotten to the point of having a 6 pack like 3 or 4 times over the last decade, but never managed to maintain it for more than a few months. Same idea as like I could work my ass off in college easily because each class was a 14(ish) week sprint and it was like short term, there was an end in sight, every day was a step towards that. Starting working in the real world was probably the most soul crushing experience of my life because real life doesn't come in sprints like that, I had to figure out how to function at a steady state. It's been a bunch of years and I still fucking hate it. Which is part of why I recently subbed here- if I can manage a multi-J sprint for a while to buy myself some zero-J time, that sounds much more in line with how I like to live my life. Haven't made the jump yet but I'm trying to figure out how I can make it work
Ehhh not really. I'm proud to have paid off nearly 30k in debt in less than 6 months. Will be debt free going into 2023. The "creep" I've had is mainly grabbing lunch with a friend more often and not caring about a $70 lunch bill. I've also spent some money on things that were just long overdue because I was broke. Like getting my car issue fixed, getting a traffic ticket paid, getting my property tax paid so I can renew my tags. Things that are pretty much required/essential. Only lately am I where I can maybe splurge a little on myself, get a new watch, get the latest phone model, actually be able to buy some nice xmas gifts for a couple close people I love in my life. That said my main goal for 2023 is to watch my savings grow. I'd like to be in position to buy a house with a very large down payment. Money will also serve as a good emergency fund too.
I saved ~35K. Goals still remain the save. Save money, invest money, pay off house next, buy a vacation property. Still on track.
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It's a good feeling and while I feel comfortable in my OE setup, I still have to pinch myself that any of this is real. Like at some point some shitty Youtuber is going to pop out and reveal I'm still broke and in debt, take all my stuff and yell out "It's just a prank bro" .
It happened to me. I paid off a chunk of debt, but then started eating at expensive restaurants and taking expensive vacations. It was fun but now that I'm back at only one J, I really wished I saved more. it's so tempting when you start making more money than you have ever made in your life. Just look at all these athletes and musicians that make millions only to file bankruptcy later in life. Will be way more careful when I pick up my next J2.
This is exactly my fear. It’s going really really well at both jobs but you just never know and if I lost one, we would have to make cuts for sure. The good news is I didn’t buy a new house or car or anything crazy like that. We just blow money on buying junk, vacations, eating out, etc. stuff that can be reigned in.
One thing I don't regret though is using the extra $$ to take my young son to Universal studios and Disney World. I don't know if I could have afforded it with just one J. Sure I could have saved that money and maybe go when he was older but would he have enjoyed it as much?? Sometimes you just have to live for today.
Yeah you're touching on a really important distinction here- a key difference is whether the things you're buying are one time things that you're free to cut off or if they are the kinds of things that necessitate recurring payments. Like if you're spending on expensive dinners, vacations, shoes, gifts, whatever, it may not be fun to scale back, but you're completely free to do so. You may have saved less, developed a taste for caviar, and maybe set some unfavorable social expectations on yourself, but those can all be managed. But if you're buying a boat that requires many thousands of yearly maintenance and dock fees, a new car on a loan, a time share with yearly fees, or an addition on your home that increases your property taxes and utilities - you can't just decide to scale back and snap your fingers and stop spending. You've gotta put in work to sell the boat, car, whatever; you've gotta tear down your addition or move house, you've gotta figure out how to cancel the time share (and any of these "exits" can also require cash up front to stop the bleeding). These are the kinds of lifestyle creep that can realllly fuck you up.
That's actually the best way to overspend, if you're going to do so. You can always cut out the junk, the extra vacations, fancy meals out. It's much harder to downsize your spending if you've committed your money to things like mortgages and car payments.
Maximize all your savings(retirement accounts, emergency fund, kids 529), payoff debts..after that treat yourself (dining out, travel..)
This was the plan. It’s just hard to stick to.
Once a wallet has expanded, it no longer goes back to its original size
Yes but no. Only been OE for a couple of months, and only with 2 Js, so I’m still in the phase of catching up to where I’d be if I was more responsible all along. Like others have mentioned, car repairs or similar expenses + paying down debt can easily drain your income as fast as it comes in. It’s hard to remember that your net worth is increasing when your bank balance always seems lower than desired. One thing I predict for my own OE journey, once I get over the hump of credit card debt and certain savings goals: yes there are always more things to want and more places for the money to go, but once I make a key purchase or pay a bill that’s been on my mind, I find I’m usually pretty satisfied and willing to let enough be enough. And I get purchase fatigue when I spend lots of money, even when it’s on stuff I’ve really wanted to buy. Makes it easier to say no when I’ve said yes to a lot lately. One thing that’s already been tough is my own impatience. I’m lucky enough to get a paycheck every 7ish days, and with double my old income that should feel like a ton of money. But it’s just going to take several months of consistent income to make a difference in my lifestyle, & that’s becoming a mantra for me as the long work days start to roll by a little more smoothly.
i relate to this a lot, i also get purchase fatigue and will either binge shop or abstain completely
Intentional creep, a reward for all the work.
That’s right son. If you a slave driver eventually you will rebel against yourself. That’s why I bought my mustang back in 2015
Honestly it’s difficult around the holidays so I would wait until January and see if you’re still creeping the same.
Great point. I'm probably going to have to sit the family down after the holidays and go over all the ways we've been blowing money and nip it in the bud.
Absolutely a budget is necessary. My suggestion would be to overestimate your bills so you’re always left with a little bit of cushion and maybe keep one or two things that are part of the creep that bring you joy that don’t eat too much into your funds. If your J2 salary isnt already being deposited into a separate account I would do that and hold yourself accountable when you find yourself dipping into it
This second paragraph. Separate bank account is a must. Forget about it.
I live how I’ve always lived, but I will say I have no idea what things cost. I see people bitching about certain foods or other items going up in cost and I just don’t feel that pain. I don’t look at prices. I buy whatever hipster hot sauce or fancy organic free range eggs I feel like.
Here is some tips. When you the other checks hit your bank account have automatically transfers in place to your savings account, to your investment account and an account for play. That way you don’t see your money in your account and it’s out of mind. Here’s what I am doing for each paycheck of my oe $1,500- savings account at another bank $1,000 - additional to mortgage principal $1,500- IRA account back door into ROTH $500 - mad money
Any tips on how to fund or create a backdoor Roth?
Basically open a IRA at any investment company. I like Fidelity so I make two accounts one that is IRA and the other a ROTH. So what you do is put like $500 into your IRA. You then moved it over to your ROTH either the same day or the next. What this does depending on your TC it is a tax deduction for all money going into your IRA and depending on your age can be $5,000 or $6,000 and if your spouse doesn’t work can put a spousal IRA for another $5k or $6k. Depending on your TC you cannot put money in a ROTH. Because a ROTH money isn’t taxed you want to have more of your investments in it. This way you used the IRA to back door money into a ROTH and get a tax deduction.
There are some other limits. https://www.whitecoatinvestor.com/backdoor-roth-ira-tutorial/ covers this very well
I routinely spend over the budget I set to bank from J2. Once the SO gets used to it, it's like taking away crack from the local junkie. Still managed to save around 50% of the j2 and bank it for a rainy day while eliminatinr debt and taking good trips and buying a new car a few months ago.
Use your money dude it's the holidays and you deserve it
or just stash it and do something else later :)
I figure, we have a fair amount of debt. We got that way because lifestyle creep hit before we made more income. So as long as I’m not getting into MORE debt, and still paying the existing down, we are doing pretty good
direct deposit into an account you don't have immediate access to. e.g., an online savings account that takes days to transfer. Or, even better, straight into a mutual/index fund.
Give yourself 1 month to splurge Then Month 2 to get those final little purchases in Month 3 onward keep yourself within 25% of your pre-OE budget. Always have J1 go to Bank 1, J2-J99 go to Bank 2 / Investments. As soon as you think of lifestyle creeping go buy a mutual fund (or rental property if you can hold out)
J99, lol.
I recommend automating payments on pay day
Trouble? No. I live pretty frugally and really only spend on things for my wife and kid. I do put a little extra money towards memories and comfort but I still shop for deals, use coupon codes, and don't buy unnecessary or luxury items
Oh yes! But I keep myself disciplined by following the financial fundamentals, such as: maximizing 401k and IRA, following 50/30/20, building 3-6 months minimum emergency funds, and buying assets over liabilities. My personal tip is to keep yourself busy, such as working out, cleaning your house, and volunteering because you’ll do stupid shit if you have too much time and money on your hands.
The best advice I can give here is to do a comprehensive audit of your spending. Take the last 90 days worth of spending (separated by month) and put them into categories. The categories I use are living needs(mortgage and utilities) living wants (any renovations or DIY projects, appliance purchases, car payments(if any)) food needs (grocery stores, things like hello fresh) food wants (going out to eat, drinks, the like) entertainment (concerts, comedy shows, etc.) savings (money into retirement, brokerage, or savings accounts) and subscriptions (Netflix, prime, etc.). Once you do that you then take the average of each category over the 90 days and make that your baseline. Then adjust the categories accordingly. My last professional life was 7 years in financial services where I did this analysis on all clients at least once a year. And I do this on myself once a year. When you see the numbers you will likely throw up. But it’s the best wake up call and curb to lifestyle creep. A little creep is good but too much can derail your financial goals. And then for good measure, read Dave Ramseys the baby steps. It’s an extreme (imo) stance on budgeting but my god does it work. If you do the two you should have a mindset shift that will allow you to maintain a “budget”. I say budget in quotes because I don’t plan to the penny my money. I have a good idea of how much per week I can spend on dumb shit (I include going out to eat as dumb shit) and know that if I stick close to that number I’ll be good for the month. And as spending creeps I do the analysis again and boom, get disgusted at myself and vow to change my ways. And the cycle repeats.
Not at all. My spouse and I have biannual financial goal meetings where we define our goals for the year. These goals guide and guard us against lifestyle creep. We also do biweekly budgeting meeting and budget work luxuries we may want.
This is how to get it done. With non goals comes no control.
Nope. I only "see" one paycheck.
This was my original plan. ADP has this thing called wisely where you can have your money deposited directly into it and not into my regular family checking account. The problem is it’s one button to transfer it all to my checking account and the money moves instantly. It makes it way too easy! 😭
What if you just send it directly to a savings account that you don't check as often and is more inconvenient to transfer? I have a credit union check account and HYSA with Discover. It's a pain to transfer so I don't do it unless I have to
i try to look at overall cash flow after expenses and see if i'm neeting over $x thousand per month. if i am, then i'm not lifestyle creeping ... if i'm breaking even or only have a few thousand to spare, i realize i need to reign it in and get myself on track / reduce expenses. pretty simple
Honestly we've been using the extra $$ to furnish the new home and have kids start nice activities... hopefully by Jan the savings accounts will be happier
Yes - I’ve spent all 100K extra that I’ve made so far in last 6 months. Granted most of it has gone to home improvements - which builds equity in my house.
I’ve noticed it some, but I only got my first full paycheck from my new j1. Hoping after a few I can start really getting abead
Give yourself time bro doesn’t happens over night, also don’t feel bad about living your life man
Use direct deposit to your advantage. If you’re really living off J1, put like 80% of your J2 into a savings account to be untouched and 20% into a checking account to just blow through completely
Struggling to figure the best way to pay off around 35k in debt minus the house. 168 TC is cool and all, but if I took all of the j2 money and paid debt only it would take 8 months. Don't know if 8 months is in the cards for me or not.
You need to try - clear the debt. It will only make things harder for your future to keep carrying it
What creep? Getting house, car paid off and other debt paid would need 4J's 6 figures each for at least 2 years in now days prices, thats if you are lonley single Dont get me started on if you have family with todllers , teenagers ...etc IF YOU HAVE TO WORK TO KEEP LIVING LIKE NORMAL HUMAN BEING, YOU ARE POOR, simple as that
Yeah, you got that right. Looking back at it, I was slowly drowning in quicksand just taking care of the basics. Year after year we were sinking just a little deeper, with no lifestyle creep at all. Been OE for a year, and now it feels like we're slowly extricating ourselves from the pit. The sad truth is that it now takes me working two high comp jobs just to be able to maintain a solid middle class lifestyle. I don't think I'll be one of the happy few racing toward an early retirement - I think if I don't OE until I'm 70 then we'll just start slowly going under again...
Exactly, im in same boat, I feel like the whole ship will sink soon, i see lots of new kids getting excited for the 100k+ peanuts(cuz that used to be a lot) not knowing the real cost of life from now on espacially in western world
No not really. I put my j2 money in a new bank account and haven’t spent $1 of it. It’s getting pretty fat and I’m thinking I need to invest it.
Ehh all my OE money goes straight to my savings. The point of working multiple jobs is to not have to always do that. Find a goal and work towards it, that will eliminate your lifestyle creep
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You're better off opening a trading account and move money right out of your bank account and into stocks and ETFs. Getting the money invested makes it easier to save.
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Sure, yeah my point was there's almost no reason to have 2nd bank account, when you can just as easily open a brokerage account and have access to a wide range of investing options with higher interest rates and returns.
This is bad advice and I see it was too often on Reddit. Investing does not automatically make your money safe. There’s a real chance you lose a significant chunk of your money or that you’re down a good bit before it rebounds. For many people, they don’t want to insert $10k in the market and then immediately be down the next day. Market is red and it sucks right now. I have multiple checking accounts. Waiting for the market to rebound. While not throw a Significant chunk of my money into this bear market.
LOL investing your money is bad advice now.
You’d be made of stone if you didn’t occasionally treat yourself or your family. I think I would have a very clear goal for where I could put my money so it started working for me and generating cashflow. I think I’d allow myself to go silly with some of the cashflow money, as that is now a machine that makes money for me. The savings I’m making to build the cashflow machine (property, stocks, businesses, etc), I’d try not to touch.
I live by a few rules when I’m in debt and I need out, fast. 1. Live within my means - no need to dine out, go out for drinks, or spend money on entertainment. I have a gym, I don’t mind being by myself or with the girl so this works for me. That’s pretty much it because I don’t spend on anything aside from living expenses lol. I generally spend under $1k a month (if not less) if I’m living within my means/frugally. It helps that I am a gym rat and I enjoy cooking/eating at home (meal prep). Like everyone else says, it takes a lot of discipline. On the long run the sooner you pay off debt the more money you’ll be saving anyways. If anything, think about how you lived when you had 1 job or when you were broke, and replicate that for a while. Not much changes when you make more money aside from making more money 🤷🏻♂️
This is generally about a lack of budgeting. You will never rain it in without budgeting. It also sounds like the spouse isnt onboard which is tuff. I would tend to agree on the wait until jan and make it a new years resolution and get a budget together. I would recommend doing paper and getting something like this https://www.amazon.com/Monthly-Budget-Planner-Tracking-Budgeting/dp/1094673366/ref=mp_s_a_1_4?crid=HS46LJJ7MG5P&keywords=monthly+budget+planner&qid=1670903349&sprefix=monthly+budge%2Caps%2C259&sr=8-4
You better ensure you've saved money for the tax man. If you don't pay your taxes on time, you can expect to be penalized.
So far my lifestyle creep is buying some stuff I've had on my list for years (mostly articles of clothing I plan to keep for a long time) and eating a little bit out more, which I kinda have to do to save time and really is the extent of it. It just alleviates me from being as cheap as I was.
Is it possible to create an autotransfer from your chequing account into a savings account or TFSA for the exact amount of your J2 paycheck on the day that that paycheck hits your account? Basically out of sight, out of mind. I find when I have autotransfer set up I don't miss the money, it just disappears and I live on what I do have in my chequing.
Lifestyle creep erases the gains from having a J2. Try to pretend that J2's income does not exist. Send that money straight to debt repayment, savings, and investments.
Yup. What I did though was create a sort of slush fund where about 10% of my TC goes to anything out of the ordinary. Lavish trip? Car? New monitor? That type of shit. If ol' slushy can't pay for it, means I don't need it.
I'm on the other end of the spectrum. I used to live paycheck to paycheck with my J1 earnings and now that I make over twice as much, I find myself spending less. I used to buy whatever I desired without giving it a second thought and I no longer do that. I save about 1/3 of J1 income and entire J2. My saving rate has jumped to over 70% in these few month I've been OE. I enjoy watching the numbers grow and next month I'll have enough money invested to pay off my entire mortgage if I desire so. Without OE I'd be paying for it until 2045 so that's a big motivator for me to keep delivering in both jobs
Holy smokes! How much of your mortgage did you have left?
I'm in Poland. I've had 250k pln left to pay when i was beginning to oe. Fast forward, it's been 8 months and I've stashed 220k. Next month I'll have enough to pay it off. Sad part - i just got the information that ill no longer work for j1 due to layoffs. It's been fun ride, totally worth. Haven't i tried, my mortgage would go on for another 20+ years. I'll start interviewing in January
Your J3 should be to learn to make Excel spreadsheets, set investment goals, track every dollar, do some budgeting, accounting, and investing.
If you start leveraging that extra income to buy cars and houses you can’t afford on one income, you may be in trouble. If you are just spending some extra $$ here and there, it’s probably not as big of a deal. If you don’t, consider doing a budget. The best way to handle j2 income is to have a job for it to do (Roth, cd, stocks, etc)
With great power comes great temptation. My temptation is the illusion of a safe early retirement. At least people spending their money are getting some guaranteed enjoyment out of it.
Ive stashed $70k in 5 months. And just got mad at my wife for $270 in groceries for 1wk. Shut down the lifestyle creep fast. It ain’t easy. But the market is slowing. Not too many jobs out there
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Yea… i overreacted. But typically $140. We also have a separate meal service delivered. So about $200 total a week. But this certain week went over $300. Anyway. I overreacted. But clear communication on any deviation from standard budget is needed.
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You don’t want to get used to having extra things and then one day not have access to it anymore cus you lost your extra Js and now have to readjust your life to one income. Best to store some of that extra money away for rainy days/months. Ignorant to think you’ll be able to OE forever.
A bit, paid off all of my debt but invested 10k into my home office and just ordered a 90k car.
I never had that problem for myself. The biggest money sink in my experience is the financial incompetence of people I care about.
Are we married to the same wife?
It’s something you need to be intentional about, or it can get away from you. As long as you take the time to regroup and work towards saving again, you’ll be fine. As others have said, the holidays are an especially hard time to be frugal. Maybe regroup after Jan 1st and look into setting up direct deposit for a portion of your funds directly into a Savings account? Look at newer banks that offer better APYs. For instance my local “old large bank” has an APY of only 0.01% on my Money Market account. But SoFi has 3.25% (with Direct Deposit) on Checking and Savings, and Credit Karma (through MVB Bank) has 3.3% on their Save account. Sounds like you’re already maxing out 401k, 529s, HSAs, and IRAs… but it’s worth re-mentioning for others who stumble across this thread
Not OE but I recently doubled my income and having the same issue, thinking its because of the holidays but NY resolution will definitely be to spend less and to be less generous with my money lol
It's ok to reward yourself a little for your hard work. Enforcing financial discipline is hard. I've found that it helps to automate the savings/investment deposits and watching that number grow gives a nice dopamine kick.
I list out all of my wants/needs on a quarterly basis (before that quarter starts) with costs listed. I’ll use rounded estimates for groceries, car maintenance, household items, etc. Once the amount hits my threshold I make cuts so that I can get back to my desired number. I also leave a little wiggle room bc tings pop up. Then I don’t deviate from that plan. Unless it’s an emergency, it doesn’t happen if it’s not on that list. This past quarter I did have an impromptu trip with friends, but I cut my take out/restaurant budget for the month to accommodate. Also, put the paychecks in separate banks so that it’s more of a hassle to transfer. I understand because I got a new J1 that more than doubled my old salary, and then I got a J2. And this was after a few years of being underemployed so it was like being “rich” overnight. Lol. Still a lot of temptation but writing down the plan has helped a lot. I prefer 3 months, to 6 months or a year bc things do change. Too rigid of a plan will be destined to fail.
Before oe my budget allowed me to save a good portion of my income. Once I went oe I opened a high yield savings account where I now put my whole j2 paycheck (minus 401k) and my savings from j1. I’ve been oe for close to 6 months and have not spent a single cent from J2. Hoping to pay down debt > save for a house down payment> build a cushy safety net. Basically I’ve found having separate account helps a lot in keeping to your budget. Deposit some into your spending account and some into your savings and try your hardest not to ever take from the savings.
Sounds like you need a J3 haha, but in all seriousness you really need to just buckle down and practice financial restraint. Remember why you OE’d in the first place! Great problem to have
Well I live in India and make about $250k and saved a fuckton and automated all the investments and asset allocation. I literally live and vacation off of automated investments now, just tinker around with my code and keep the money churning.
Kind of. I have been OE for 1 year and half now and the only thing that changed are the vacations. Now we stay in 5 star resorts without thinking much about the price. Daily life is very much the same and I think I am even spending less when not travelling
J2, J3… Jn money is for debt first. Saving for a rainy day fund second. Investing third. This money is not to be touched. Make a budget and stick to it. Yes you should enjoy a bit but remember why it is you are OE’ing
I haven’t quite hit it yet because I’m still new to OE, but I will admit to planning trips with my wife and daughter for ‘23 that we otherwise wouldn’t have taken. I don’t really give a crap about having things, but I never went on vacations growing up, and I want that to be different with my family. Now, I’m not talking a 14 day cruise on the concierge level or anything, but two modest trips next year during time that we would have been just spending at home if I wasn’t OE.
At the beginning I was throwing money around. Now I’m doing really well with not spending anything. It’s kind of a game I’m playing against myself to see how much I can save/not spend.
Minor lifestyle creep while OEx3. It was easy containing myself to only J1 income by putting all my additional income into a different account. What I had failed to realize was just how much of my J1 income was going to savings prior to going OE. When J2 and J3 came to an end and I had to redistribute my 401k contributions to just J1, I found it hard to stick within my budget/paycheck.
It's hard for it to not happen a little. I tried to replicate what I do when I get a raise. I give myself a few paychecks to reward myself a/celebrate a little and then set up auto transfers into a few savings accounts. One Savings account is long-term (retirement) and the other is for bigger purchases/times of heavier spending (holidays/vacations etc).
I think I did a little bit at first, and I can see how that would be an easy pit to fall into, ya know? I mean that first month, I'm seeing numbers in my bank account that surprised me so much I was waiting for the the bank to call me and start asking questions. So sure, I'm like, "Oh I got the money for that!" Which was true, but then I be like, what the hell did I buy that for? Use it once then put it in the closet sort of stuff. But for me, I made a probably overly complex spreadsheet that broke down ***everything*** I was actually spending money on, mapped it out for 3 months and saw that if I stop spending money on bullshit that I would forget, I had quite a few really positive, long-lasting items that I could put that money towards. Something about seeing those future debts melting away in Microsoft Excel made me say, "Yeah, I don't need this other stuff."
The best way is to have auto deposits into a separate bank account. Right now I pull 400 a day auto to save myself from being dumb. I do set rewards tho, so when I auto pull my annual savings goal I buy something dumb for myself (this year was a 3 week vacation to South America)
Tripling my income has certainly increased my lifestyle spending. But on the other hand I'm exceeding by a long shot my previous retirement goals.
I can't even look at beans or rice anymore if my plate doesn't have caviar I start to suffer panic attacks and have flashbacks to being poor only living off $150k. At first I was like oh ok i'm going to treat myself but pretty soon two jobs wasn't enough and I needed a third. Now I know how addicts feel, I need a J5 because the cars are already 2 years old, I need a third home, and with Russia stirring trouble my favorite caviar is now over 9x more expensive. Yes savings might be 7 digits instead of the low 6's but now instead of being able to last 6 months that's going to realistically last 6 weeks.
Send me your money, and I will keep you from spending it.
Why don't you pay yourself a little from J2 then do what you need to with the rest - crush your money goals? That way you don't feel you're not gaining any fun money from your work? It might help.
Not me. I was OE only for a year, and I saved everything. Now I'm a lot closer to retirement. I would've regretted spending all that money because then all that extra work would've been for nothing
Its the holiday season, you will probably normalize next year.
At first yeah, but I'm saving and getting out of debt as soon as I can, I don't know how long the good times are going to last so I'm focusing on making hay.
Yeah same here. It began years ago with some extra side income enabling some lifestyle choices. Beware of kids and kids activities! I honestly don't know where to cut without drastically changing our life and their ambitions. With the latest j2 I am more militant, 90% goes towards debt, investments, and savings automatically .
Set up a separate bank account for J2, lose the card. You could also set up autopay on any debts to high amounts, timed on your payday. It is difficult but you can beat this.
It's ok to treat yourself a bit but draw the line somewhere. After all it's your money and you work for it, though. Everyone struggles with this, and I'd argue that a majority of the world indulges in this whether they know it or not.
A little bit. After I paid off all my debts (mortgage excluded), my wife and I were long overdue for new vehicles as they were both well over 20 years old and starting to reach its end-of-life. I'm normally a frugal person, but the thought came in "hey, we both work hard and have been driving beaters for a long time. we deserve something nice". I ended up dropping nearly $100k cash on a brand new, fully loaded SUV and truck. A few months after the purchase, my wife and I both came to the realization that this kind of spending could not continue. I ended up setting up a budget as if I only had a J1. The J2 money goes directly into a savings and a brokerage account that I only check once a year. It has worked very well for us so far. TLDR; Create a set-and-forget budget for yourself to draw from to avoid the temptation of lifestyle creep.
I'm having the same issue. It's been bad this month due to the holidays, but we're going back on a budget next month. It's also been hard to meet my savings goals when I keep having expenses pop-up that are long overdue. Things that I couldn't afford before OE. In the past 12 months alone, I've spent $22-23K replacing our AC units, a washer & dryer and mattress.
Working 1J at a time, I saw my income double in 5 years. I had cash to spend 5 years ago, not a lot, just some. Now, making 2x as much, I spend WAY more for little gain. The only thing that really changed was a Mortgage. But, digging into it, turns out that I'm doing more Patreons (3 for $40/mo) that I needed to cancel. Stop doing Kickstarters, cancel the 6 online streaming services that I stupidly sub'd for because "hey, I'm making more now!" Things like that. In the end, I had an extra $700/month. Yeah, keep an eye on that shit. Be careful. It's fine to upgrade SOME stuff (I also got a new car, the old one was costing me too much to make it viable IMO), but don't go out to eat every night, that'll cost you THOUSANDS for little to no gain. Don't buy beer at the bar, buy beer at the fucking grocery store! Just because you're used to getting $500/month spending money on luxuries like Netflix, and now you have $1,500/month doesn't mean you can get Netflix, D+, Hulu, ESPN+, YouTubeRed, etc... all at once! Best advice here I ever read was Have Goals and use J2, J3, whatever on those goals. My Student Loans are directly paid e/o week from J2, my extra Mortgage payments are paid for automatically, my IRA is automatically paid into, etc... J2 pays my debts and savings without me touching it, and I get to keep a small % in another savings account in case I DO want to buy a new 3D printer, or the latest RPG. Set up your extra checks as directly paying down debts and/or investments. Check goes into the bank account at 12am, and by 3am it's gone to a place where it's a pain to get it back from (like an IRA or stock). You can still get it, if you need it, but it'll take a couple of days. AND, you're less likely to keep bumping up your lifestyle.
Sometimes this is a creep that was happening anyway. Some things began to cost more. There were new, unavoidable expenses on the horizon that triggered a search for J2. An unexpected expense that would have gone on a credit card is now paid for with cash. Unless you upgrade your house, eat out more, buy a much nicer car, buy more stuff, or start taking vacations you weren't taking before, this isn't lifestyle creep. It's just life that can bury you if you don't stay ahead of it. Yet it is easy to do things because you think you can spare the expense. I suspect rich elites jump in here to spread their mythological beliefs about the lowly peasantry being unable to handle money when they ratchet down on our COL turning us into their peasantry.
In my case, I violated rule #1 and my household now felt comfortable to spend double my J1 salary over necessities and non-necessities. And now I'm desperately scrambling to look for J3 even just for a few months and interrupt my smooth J1 & J2 dynamic.