Merriam-Webster’s dictionary defines the state of being mindful as “bearing in mind, aware, and inclined to be aware.”
I’ve previously shared how mindless I was in my spending habits. I paid my bills and spent the rest.
This might sound like I was being responsible. I didn’t have credit card debt and I was up-to-date on my bills, but I was mindlessly spending the rest of my income. There wasn’t a true goal or purpose with my spending.
Once that direct deposit hit, ideas of investing and building wealth were far from my mind. If I wanted to eat out, I did. If there was a sale going on at a department store, I was there. Spending on things that today I understand really didn’t mean much was the norm.
When I discovered the FIRE community, financial independence retire early, I didn’t increase my income or reduce my living expenses at first. The first question I had to answer was, “Where’s my money going?” I had to really evaluate and understand what I was doing with my money.
What FIRE blogs and podcasts taught me was that being mindful of your money was key. Sure, I cut some living expenses. I paid off my car loan and the remainder of my student loans but the missing piece was to give every dollar I earned a purpose.
Being mindful of consumer choices is important. I had to drastically take inventory of how much I was spending on food, travel, home decor, stationary, make-up, shoes, and the list goes on. Did I really need 50 pairs of shoes? Even more, did I really need that many high heels when I could wear sneakers to work on most days?! I’m not that fancy.
I love to get dressed up, sure, but it just doesn’t happen that often. I had over two dozen handbags and rotated through just a handful. The accumulation of stuff was a cause of mindless spending and boredom. It was common for me to spend an afternoon at the mall just to kill time. Sometimes while driving to the supermarket or to run an errand I would take a detour to the local Marshall’s or Ross just to check if there was anything cute. I had no reason, no need just curiosity.
As I reflect on my spending and shopping habits, I’m embarrassed at how wasteful I was. Certainly, there were things I purchased that I loved and in fact, still own but most of it is long gone. Maybe to have been worn less than twice. Some things were never worn at all.
Although those who are pursuing financial independence and early retirement are criticized for extreme frugality, I am forever grateful to what the FIRE movement taught me about money. As a Latina growing up in a lower-income neighborhood, I never dreamed that I could accumulate wealth. It was never a thought in my mind. I never imagined what it would mean to have $100,000 in the bank. Or have even considered that I could one day have a net worth of a million dollars.
There’s a lack of financial education, financial equality and a plethora of systemic issues that we can’t ignore. Without financial literacy, generational poverty will continue. Without a change in the system, the cycle will continue. I’m striving to start a new cycle for my family. Generational poverty will end and generational wealth begins with me. This is my story. This is my NEW family legacy. I have a long way to go but I know that this time it will be different.
Many of the financial books available didn’t quite reflect my money story. I didn’t have a ton of debt, so I misunderstood this to mean that I was doing well. In some ways I was, but the truth about wealth and generational wealth wasn’t clear to me. It wasn’t something I knew about and let alone considered. I didn’t have an inheritance waiting for me and I wasn’t going to be an heir to a huge fortune.
The FIRE movement taught me a new definition of wealth. Wealth isn’t simply defined by diamonds, luxury cars, and private jets. Wealth was peace, security, and financial freedom. Repeatedly, I heard how aware everyone was about waste and intentional spending. Spend unapologetically on the things that mean the most to you. Cut ruthlessly on the things that don’t bring you joy.
You won’t hear criticisms from me about purchasing luxury goods. If you have the money and you are meeting all of your financial goals then do it! In fact, it wasn’t until after I cut my frivolous spending, tripling our household savings and investing and about 2 years on the FIRE journey, that I purchased my first luxury bag.
In many ways, I was frugal but also had a poverty mindset. Being mindful of spending money has helped me be more intentional about spending and purchasing choices. Today, I’m mindful and intentional about spending, saving and investing money.
Recently, I was inspired to lead an Instagram Challenge. I partnered with Maria, from the Handful of Thoughts blog, to create themes to make talking about finances less taboo and guide people to be more mindful about money. The challenge starts on March 2nd and ends on March 8th.
Follow the #mindfulmoneyweek on Instagram I’m excited to see what conversations will be initiated. We asked everyone to use the #mindfulmoneyweek as they document their money journey for the next seven days. What can we learn about our money spending habits?
I’ll update this blog post at the end of Mindful Money Week.
Income can be divided into two categories, earned income and unearned income. Earned income is…July 16, 2020