Happy New Year everyone! 2018 is finally here and it’s that time again to set goals for the year. I know, I know… most people give up on their new year’s resolutions by mid-February, so why do it anyway? The simple answer is… it’s hard to accomplish anything if you don’t set goals. The key to successfully achieving your goals is to set SMARTer goals that are Specific (with a clear purpose), Measurable (for tracking progress), Attainable (and actionable), Relevant (consistent with our purpose and values), and Time bound (deadlines give procrastinators like me a sense of urgency). With that said, below are my New Year’s resolutions that will help my wife and I achieve financial independence.
Save more than 50% of after-tax income
Inspired by Physician on Fire’s live on half challenge, this goal will help us attain financial independence faster. I know it’s doable because I have been “living on half” for most of my adult life in order to rapidly pay off student debt. I did this by living like a starving artist during residency, then living like a resident as a young attending. No lifestyle inflation creep here (except our home, but that’s okay, because we love it). In addition to housing, other big expenses include transportation, food, clothing, and travel. Below are some actionable resolutions to help minimize these expenses and optimize life.
Avoid buying a fancy new car
Follow the 1/10th rule for car buying. This is easy for me because I was never a “car guy” and I never really cared about what I drove as long as it took me from point A to point B safely. I was never into driving a fancy car for the perceived social value of impressing others either. I know I’m cool whether I drive an expensive car or not. My wife and I drive reliable cars that are more than 12 years old and completely paid off (no car payments), and with minimal maintenance expenses. In fact, my wife is incredibly proud of her car’s missing hubcaps and bullet hole because it gives her street cred. Plus she doesn’t have to worry about where she parks it! At some point, we will need a newer car. Fortunately, the Tesla Model 3 still allows us to follow the 1/10th rule and it aligns with our values of bettering the environment.
Eat out less than three times a week
The plan is to keep our food budget to less than $500 a month. I know this is attainable because from January to March in 2017, we were able to manage a food budget of less than $300 a month. And it wasn’t like we were dumpster diving or ordering from the dollar menu at McDonald’s. Quite the contrary. In fact, we ate very well and extremely healthy. We did it by rarely eating out at restaurants. Instead, we cooked fresh, (mostly) organic, whole food, plant-based meals at home. No processed foods, junk food or animal products. It may sound extreme and difficult, but my wife and I found it to be very easy and rewarding. Anything can be easy when you make it a habit that becomes hardwired into your lifestyle! To this day, we still eat a whole food plant-based diet (plants are not expensive!), but our food budget increased to $600 a month because we go out to eat more. Thus, to achieve our food budget goal, we aim to eat out to less than three times a week. Don’t worry, we are not as extreme as this guy. Plus we actually enjoy cooking at home.
Refrain from buying new clothes
My wife and I are doing a “no spend challenge” on clothing for ourselves. Since I’m an anesthesiologist, I literally wake up and show up to work in basketball shorts and a T-shirt (Southern California winters are not cold). On arrival, I immediately change into hospital-provided scrubs. I wear the same uniform every day. I never have to think about what I am going to wear or worry about sporting the freshest threads to impress people. It’s a great feeling. Even when I go out, I pretty much wear the same thing: jeans, t-shirt, and sometimes my favorite grey hoodie. Okay, so it’s easy for me, but what about my wife? It may be hard to believe, but she is even more of a frugal minimalist than I am. She is the rare woman who does not like spending money and hates shopping with a passion. I’m one lucky dude! Her closet only consists of clothes that she wears regularly. She follows the “less is more” and “simple is the new black” mantra of the minimalist fashion challenge, Project 333. As you can see, achieving this goal is an easy one. We already have more clothes than we need. And if we absolutely needed something, we can always borrow or buy clothes secondhand.
Continue to travel for pennies on the dollar
We love to travel because it’s fun and often life-changing. I am a frugal travel hacker and points junkie who loves to plan trips that maximize travel while minimizing costs. The past few years, my wife and I lived it up as a dual income couple with no kids while still saving a lot of money. We traveled the world in style, often using airline miles to fly first class and using only points to stay at amazing 5-star resorts. The life of frugal luxury is so good! Now that we are expecting our first child, our travel habits will likely change. Nevertheless, we are making it a goal to continue traveling and to share the joy of travel with our child (much like my parents did for me). Traveling with a child can be expensive (and I hear it can be a challenge too), but I plan to keep our expenses down by continuing the points and miles game. Eventually we would love to slow travel with our child(ren) and take extended long trips that add even more value to our life.
Decrease clinical time to 40 hours a week
With a child on the way, I am decreasing my clinical hours significantly with the goal of spending more time with family. Since graduating from residency, I have averaged about 50+ hours per work week. Back then, the goal was to make as much money as I can to aggressively pay off student loans and save for a down payment on our house. Done, and done. Now, our priorities are different knowing that our child will need our time, love, and attention. You can always make more money, but you can never make enough time for your kid(s). Fortunately, my wife’s employer allows her to take two years off for maternity leave and still hold her position as an attorney. While my employer is not as generous, I do have the luxury of cutting hours significantly, which I definitely plan to do. Decreasing time at work will also allow me more time to pursue my various passion projects. Perhaps I can even work on creating more streams of passive income. When you have free time, the possibilities are endless. Ultimately, my main motivation is to spend more time with family.
Get at least seven hours of sleep a night
This is a tough one. I know it will be a challenge when the little one comes. My wife and I managed to pull it off in 2017, but life with a newborn baby this year will definitely change our sleeping pattern and schedule. Even if we find it difficult to consistently sleep at least seven hours a night, it’s still a worthwhile goal because sleep is so important. Sleep plays an important role in our physical health, mental wellbeing, happiness, and productivity. We will try our best to get our needed rest.
Maintain a clean home and living environment
My wife and I make a conscious effort to keep our house clean, clutter-free, and with minimal toxic chemicals. We have a system that provides clean drinking water through reverse osmosis. HEPA filtered air purifiers and thirty indoor plants work hard to keep the air we breathe free from dust, toxins, and allergens. Most of our furniture is made with natural fiber without flame retardants. The floors are vacuumed regularly. Dirty shoes are never worn in the house. My wife makes our own cleaning products, toothpaste, skincare products, deodorant, and other DIY products to avoid potentially toxic chemicals. By not preparing, cooking, or eating animal products we minimize our exposure to common food-borne diseases. Plastics are minimized to avoid endocrine disruptors like BPA. We are committed minimalists with little to no clutter. Okay, you get the idea. We are clean freak hippies. Nevertheless, we believe it is a worthwhile goal to maintain a clean lifestyle to optimize our health and the wellbeing of our children.
Manage baby-related expenses
The baby industry is huge. And similar to the wedding industry, products are often overpriced. Fortunately, my wife’s coworkers and friends have donated a lot of the baby products we will need. The only new product we would likely need is a new car seat that provides excellent protection. We are not intent on building an elaborate nursery or buying a ton of baby toys. Achieving this goal shouldn’t be difficult for us.
Exercise and meditate daily
This one is easy because I kinda already do it. Just not consistently. This month I challenged myself to do one hundred pushups and one hundred sit-ups a day while going to the gym at least twice a week. Last year I dropped a significant amount of fat and gained strength doing similar challenges. Combined with healthier eating habits, I expect to improve my fitness and physique even more this year. I also plan to recommit myself to meditate every day. Meditation has so many awesome benefits and it’s a great “work out” for the brain. Being mentally healthy and physically fit will help me improve productivity, increase happiness, and allow me to enjoy the journey to financial independence even more.