avatarLiv Mello

Summary

The article discusses the author's journey to financial freedom and how it enabled a lifestyle of travel and personal growth.

Abstract

The author shares personal anecdotes and lessons learned about money management, which allowed them to quit their job and travel the world. They emphasize the importance of frugal living, saving consistently, and investing wisely, rather than relying on wealth or credit. The article suggests that a healthy relationship with money, prioritizing experiences over possessions, and delaying gratification are key to achieving financial independence and a fulfilling lifestyle.

Opinions

  • The author believes that a frugal lifestyle and careful saving from a young age contributed significantly to their financial independence.
  • They challenge the societal norm of accumulating material wealth, advocating for minimalism and meaningful experiences instead.
  • The author criticizes the overuse of credit, viewing it as a trap that leads to a cycle of debt and hinders financial freedom.
  • They argue that one's relationship with money is more important than the amount of money earned, highlighting the importance of saving and investing early.
  • The author values self-control and delayed gratification, seeing them as essential to avoiding toxic spending habits and achieving long-term goals.
  • They suggest that investing in oneself, such as acquiring new skills, is as crucial as financial investments for personal and professional growth.
  • The author encourages readers to reassess their spending habits, especially during times of crisis like a pandemic, to save for future opportunities like travel.

8 Money Lessons That Granted Me the Financial Freedom to Travel

Don’t let your relationship with money stunt your lifestyle.

Photo by Killian Pham on Unsplash

I know what people say about me. My nomadic lifestyle must be funded by rich parents. I don’t live in the real world. I’ve wasted a year and a half without a steady income, booking flights to “find myself.”

But I found myself a long time ago.

I found myself sending “Thank You” cards to family members who gave me ten or twenty bucks for my birthday, as my parents put most of it into a “magical” savings account that felt more like a sick joke. I found myself squirreling away paychecks as I wrote for the local newspaper during high school.

I settled on my father’s ultimatum — giving up my dream university and commuting to a state school 20 minutes from my childhood home, to forgo the eternal burden of college loans. I’d be lying if I said I wasn’t envious of my friends who gained ultimate freedom the day they moved into their freshman dorms. But I realize how monumental his rationale was to my life, post-university.

This decision, among others, granted me the financial independence to quit my job and visit five continents in nine months at the age of 27.

During college, I got an office job while living under my parents’ roof and rules, and continued saving money in the account that I now had access to. I checked my balance once a week. I loved watching the numbers rise. I paid, what felt like a small fortune, on a trusty Ford Focus that carted me around for ten years. Thelma is the only car I’ve ever owned.

After college, I packed Thelma up and moved into a humble apartment in Brighton. It was close enough to consider myself “living in Boston,” but far enough on the outskirts to afford rent. A year later, I got a new job and moved an hour and a half away from the city in order to cut my expenses in half. I started paying $350 on rent — and then $700 after my ex moved out.

By this point, I had become a stingy, full-blown penny pincher. I felt guilty when I ate out too many nights in a row or spent too much money on alcohol. I deprived myself of material items because an extra benjamin in my bank account served me more than a winter jacket with a zipper that zipped, or a car AC that blew cold air.

All along, I never thought to ask, “what am I saving my money for?”

Life, I suppose. The future. I didn’t have specific plans. I would continue living frugally in the same state I was born until the day I died. That’s what you’re supposed to do, right? A revelatory trip to California — visiting my cousin who had spent a gap-year backpacking Europe and another teaching English in Ghana — made me realize my entire view of the world was restricted to Massachusetts.

My relationship with money, and my aversion to spending it, had prevented me from living. But, it was the same frugal mentality that granted me the freedom to start.

When I quit my job and booked a ($240) flight to Australia, “finding myself” was the last thing on my bucket list. I craved spontaneity. I was looking for an adventure, the opportunity to step outside my comfort zone, beyond this crippling prudence. I needed to stop obsessing over the balance of my bank account and realize experiences were more valuable than figures.

I can’t help but get defensive when I read resentful comments on articles written by digital nomads like Kristin Wilson. Having rich parents isn’t the only way young people travel. Stingy parents who teach their kids the value of a dollar can work just as well. Plus, building and maintaining a website, filming and editing dozens of Youtube videos, mastering marketing, and endlessly promoting yourself to accomplish your dream of a location-independent income isn’t a walk in the park.

I am not, in any way, saying that everyone has the privilege or lack of inherent responsibility to afford long-term travel. I was incredibly fortunate to have parents who were financially comfortable and helpful enough to start my own savings account, and parents I can live with during transitionary times.

People always ask, “how can you afford to travel so much?”

To which I wonder, how can anyone afford to live in the States, pay rent, or own a house, car, or kids? Traveling doesn’t have to be expensive. After traversing the world for two years, I’ve spent less than half of what my friends spend, as they make a steady wage but pay the extortionary cost of living in America. Not to mention keeping up with a culture that considers a good time getting hammered on overpriced cocktails in bougie bars.

Our relationship with money starts at a young age, and society’s glorification of designer clothing, expensive cars, and houses — which take a lifetime to pay off — doesn’t help shape our belief of what’s important.

Having a healthy relationship with money means you know how to make sacrifices. What you want and what you need are placed in two separate mental brackets. When you only spend money on what you need, you enjoy the occasional splurging you deserve even more.

These lessons solidified my frugal relationship with money and have allowed me to travel indefinitely.

Photo by Štefan Štefančík on Unsplash

Act like you’re broke, even if and when you’re not.

My parents never sat me down for a lesson on frugality. If they had, I probably would have brushed off the lecture as awkwardly as I did the Birds and the Bees. Living frugally was something I witnessed day-in and day-out of my childhood and early adolescence.

My sister and I grew up in a small house that fit the four of us comfortably, but sneaking out of bed at night required knowing exactly which floorboards didn’t creak to conceal our whereabouts. When my mom took us thrifting, she would hem and haw over a $12 dress she’d eventually put back. “I’ll buy it when it’s half off,” she’d say. I watched as my dad stalked the house looking for lights left on in vacant rooms. He once sat down at the dinner table with a roll of toilet paper and instructed us on how many squares were necessary for a number one versus a number two. Even this bathroom humor sunk in.

As I grew up, our family took maybe six vacations and we didn’t go out to eat often. When my dad bought a cabin cruiser one summer, we all gasped in excitement. He returned it after two seasons because we didn’t use it enough. We had the money for these things — as my dad made a comfortable wage as a goldsmith — we just didn’t feel the need to spend it.

The more simply we lived, the simpler it was to live.

My parents worked hard and adapted to the salaries they made, learning to live within their means. They valued our connection and closeness as a family over material possessions and superficial experiences. We were middle-class but it always felt like we had less. This taught us to save for the things we needed or truly wanted in the future.

If you don’t have it, you can’t spend it. Period.

I didn’t take ownership of my savings account until college. Even then, it never really felt like something that was mine. It was there for emergencies or a distant future I hadn’t planned yet.

Money doesn’t burn a hole in your pocket. Money is the patch for life’s holes.

According to a survey conducted in early 2019 by Freedom Debt Relief, nearly 80% of Americans had debt and one-third of them said it would take more than three years to pay it off.

Credit is a trap, a system designed to trick people into spending money they don’t have so that they’ll end up owing even more in the future. If you don’t have the money now — and you won’t have it by the time your next credit card payment is due — do not spend it. Unless it’s an absolute necessity. I apologize to anyone who might take offense to this article. It’s not targeted, nor is it oblivious to, unemployed Americans struggling to make ends meet in our broken, socio-economic climate.

A little credit card debt now becomes even more later. This vicious cycle gets people into deep financial trouble. It also puts you in a position, similar to college loans, where you’re constantly trying to catch up, which is concerning if and when an emergency arises. Obviously, you should always try to have more money in your savings than you do in debt.

One thing I didn’t learn was the importance of owning a credit card and using it correctly. Three years ago, I was denied multiple apartment leases because I was credit invisible. They didn’t care that I had zero debt or a nice savings account. Get a credit card and use it on routine purchases, like groceries or gas. Treat it like a debit card and pay it off as soon as possible to build credit and avoid late payment penalties.

Photo by Nicole Geri on Unsplash

Lowering your financial outgoings welcomes the opportunity for epic outings.

In Kim Coupouna’s TEDx Boulder Talk, The Joy of Less, she asks an important question, “why are we so afraid of having less?” She concludes through personal experience and research that the hunt for more is an insatiable pursuit. Having less is not only easier to achieve, it’s more rewarding.

When I started traveling full-time last year, I eliminated nearly all of my financial outgoings besides health insurance and a phone bill. I moved out of my apartment, sold or donated my furniture, retired my car, and minimized my possessions so I could fit everything into my childhood bedroom.

This disinterest in materialism helps me justify spending money on meaningful experiences.

Detachment is a central concept in Zen Buddhist philosophy. According to Wikipedia, Buddhists believe that when a person overcomes their desire for things, they reach a “heightened perspective.” This freedom from desire translates to a release from suffering. In short, if you do not crave more, you’ll always be happy with less.

Since February, I’ve been living out of a carry-on suitcase and I haven’t worn half the clothes I packed. The clothes I wear and the things I own have never improved my experience of the world. Even when I look or feel my best, I’m no happier than I am wearing the same t-shirt for the fifth day in a row. It’s just more baggage.

Your relationship with money is more important than the amount of money you make.

Just as a millionaire can go bankrupt, the middle-class can get rich. You should never let your current rank on the social hierarchy discourage you. My savings account began small, but grew steadily and then quickly when I started making a decent wage. I have a Bachelor’s Degree in Writing & Communications, so you can imagine I’ve only ever made a laughable salary in the grand scheme of things. Still, I’ve saved more money than friends who have made higher salaries, straight out of college.

Saving a little now saves a lot later. And the earlier you start, the better.

JP Morgan Asset Management released a chart to confirm. If you start saving early by putting your money in an investment channel with significant interest, you can exceed those who save more but start later in life. As you can see below, Susan started investing her money at a younger age than Bill, giving it more time to multiply. Chris started even earlier and continued consistently throughout his lifetime, which reaped the most reward.

Chart by JP Morgan Asset Management

Putting away twenty bucks or a hundred dollars at a time seemed pointless until it started adding up. I celebrated my first $500, and then five thousand. Once I gained the knowledge of high-yield savings accounts, my money started making money of its own. Every account starts at zero. Small achievements lead to big gains over time.

Delaying gratification eliminates toxic habits.

Instant gratification is a tempting evil. Material items entice us, as we’re bombarded by intelligent marketing through social media advertisements, TV and radio commercials, billboards, and magazines. We see how material possessions are valued by the rich and famous, but buying into the rat race — when you’re not financially lucrative enough to afford the lifestyle — is only going to leave you in a hole.

Instant gratification might feel good in the moment but it’s no friend to your future self, who might be surrounded by fancy things but can’t scrounge up next month’s rent.

According to Britannica, delaying gratification helps us practice necessary virtues such as self-control and willpower, which are applicable in other aspects of our physical and mental health. Binge-eating is just one example of instant gratification leading to negative results. Don’t forget the significance of moderation. Financial security is more satisfactory in the long-run than instant gratification.

Photo by Laura Chouette on Unsplash

Material objects might fill your house but they will never fill an emotional void.

The term “retail therapy” enables and condones the toxic behavior of compulsive shoppers. In my personal experience, people who spend money superfluously are often struggling to find meaning or happiness in their lives.

A psychologist from New York and the author of To Buy or Not to Buy: Why We Overshop and How to Stop, April Benson says that one reason people overshop is for control. While they might lack control in other aspects of their lives — in their relationships or at work — they hold the power to make purchases that will temporarily distract themselves from the bigger picture. This is why credit cards can be so dangerous for compulsive shoppers. They seem to think that owning the newest iPhone or getting another manicure will fill that void, but initial euphoria typically dies out, turning into guilt and even more anxiety.

No matter what our financial standing or spending behavior, money affects our psychology. Retail therapy blinds us from the root of our problems, and cannot fill emotional grievances. You need to get to the root of your emotional void. Is it discontent at work? An unfair salary? A broken relationship? Is it your body image? Location, or lifestyle? Using your money wisely means spending it on psychological therapy, or a new hobby, or moving to a new town, or self-care. These long-term resolutions are more meaningful and sustainable than instant gratification.

Keep track of how much you’re spending and what you’re buying.

I knew I was an adult when I started an Excel spreadsheet to track my expenses. I had columns for gas, groceries, rent, personal activities, alcohol, toiletries, material possessions, etc. Keeping track of my spending allowed me to make changes and better use of my income. Writing it down encouraged me to budget.

Hunkering down in Mexico, my cost of living has decreased significantly. The United States puts its citizens in a position to fail. According to America’s Debt Help Organization, the more educated you are, the more debt you have. Higher education is a huge expense, a top cause of debt, and while it leads to higher income, higher income leads to higher spending. It’s a vicious cycle. The more I travel, the more I realize there’s more than one way to live.

Investing in yourself is just as important as investing your money.

I realized this last year when I attended the Digital Nomad Cruise, a conference of 250 location-independent freelance workers from all over the world. We all had one thing in common. Every person, regardless of occupation or expertise, had invested time into themselves in order to obtain the skill-set that allows them to work for themselves. They watched coding tutorials for fun and helped friends with creative projects for free.

Believing in yourself and utilizing personal time as a learning opportunity is key to gaining professional freedom. Messing around with useful tools, such as photo editing and graphic design, helped me evolve professionally. I now sell the skills that I once considered a hobby.

Conclusion: The time to start saving is NOW.

Traveling during a national pandemic is irresponsible and nearly impossible, especially for US citizens. While this article may seem irrelevant to individuals who don’t have savings, it might come at the perfect time. A silver lining of quarantine is that our typical, everyday spending has decreased significantly. My sister, for example, hasn’t filled her gas tank since March. That’s over $1,000 she’s tucked away in the last five months.

If long-term travel is top of your bucket list, and you don’t have dependents or debt or other responsibilities holding you back, it’s not too late to change your relationship with money and start saving for when the world opens up again.

If you’re willing to sacrifice your wardrobe or the comforts of home, then you can certainly budget and justify spending some of your hard-earned money on new experiences around the globe.

Money
Personal Development
Travel
Life Lessons
This Happened To Me
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