7 Ways that We Made More Than We Spent This Year
By: M. Bernard Bloom
Tags: Stimulus, Saving, Investing, Spending, Side Hustle

Karolina Grabowska on Pexels

I begin this story with two disclaimers. Those being that this year is not yet over and the title is slightly misleading.

To clarify the former, what I am actually referring to is the period of time spanning from December 10, 2019, through December 8th of this year. My wife’s and my joint checking account typically issues statements between the 8th and the 10th of each month, thus our typical monthly expenses are not strictly tallied by the calendar.

Regarding the title, I suppose that the title “How $12,000 more is currently in our checking account than one year ago” is less catchy and vaguer. It is not as if my wife and I “spent” $127,000, or an average of $10,600 per month. I am Paying Ourselves First $16,000 this year ($10K for me and $6K for her) and, before the pandemic hit, I was still shelling out around $3,000 per month for our son’s college.

As you can see by the spreadsheet, there were six statements during which five figures or more made it into the account and there were four when “only” around $7,000 made its way in. Furthermore, there were two statements when less than $7,000 was withdrawn and there was one, with a good explanation when nearly $29,000 was*.

All in all, as a thoroughly middle-class family living in the northwest suburbs of Chicago, we have both suffered and benefitted from the pandemic in various ways.

One of the ways is perhaps the key to become a millionaire in the making.

When it comes to attaining wealth, there are literally hundreds or perhaps thousands of ways. But they all boil down to three simple things:

1) Make More Money

2) Spend Less Money

3) Make More and Spend Less Money

Expanding upon the above just a bit, it is also key to invest the difference. Make your money work for you instead of you working for it. All the reason why the dividends and capital gains that my family is collecting this month is My Favorite $12,000 of the year.

In keeping with practicing what I preach, despite the many hardships that we have endured this year, my family has spent considerably less in 2020 than in previous years and I, personally, have earned more. Two of the ways may never be repeated again, but they did transpire this year, and several or perhaps most of these may apply to you as well.

1. We Did Not Travel

To be honest, this one thing alone could just about explain the entire amount of $12,000 less leaving our account than making it in.

None of the four of us has left the State of Illinois this year, resulting in thousands of dollars less going out. Most of our family vacations cost several thousands of dollars, like the five grand that we spent within a matter of eight days last year at this time traveling to visit my father-in-law and his wife in Lake Havasu City.

Our daughter missed out on a much-anticipated week-long trip through southern California, a state that she has yet to set foot in. Our son missed out on an even bigger trip, traveling to Columbia (the country, not one of the 29 cities with the name in the US) for two weeks with his band. The four-day visit that I had scheduled with my son to check out UT-Austin was canceled, as was our one-week family vacation to Michigan’s Upper Peninsula. It is also likely that we would have traveled west for the week between Christmas and New Year’s, as we have done the past two years.

Altogether, these trips would have cost us somewhere in the neighborhood of $10,000 or more.

Not only did we not spend anything on travel, but we received a full refund for our daughter’s canceled trip, some of which I paid last year, and our son still has an $800+ credit with American Airlines that we will hopefully make use of in 2021.

Beyond that, because there were no true vacations this year, only sporadic days relaxing at home and off the clock, I cashed out the maximum amount of days that the City I work for allows — ten. Apparently, after various taxes and pension contributions are withdrawn, my days are valued at around $375 each ($445 before). Thus, an “extra” amount of nearly $4,000 was deposited into our account. Of course, I paid myself with much of those proceeds and also sent a little extra toward our mortgage, but I would have much rather have enjoyed a week in Austin with my son in late March, a week in the U.P. with my family in July and a week in Lake Havasu City via Las Vegas with my father-in-law.

But we did not have that choice, did we?

2. Our Virtual Graduate

The financial thing that I am most proud of is having saved over six figures for each of our two children while working regular middle-class jobs and being married to a stay-at-home mother.

It was no easy feat, but here in late 2020, I can share having paid in the neighborhood of $110,000 to $115,000 for our son’s private college education, with around $19,000 left in his account as he applies to graduate schools, and somewhere north of $120,000 in our daughter’s college fund as she explores her undergraduate options.

I did not pay the entire $3,000 per month from our current income but typically transferred $500 less per month than the current payment from his 529 account. A topic for other stories, to make use of the American Opportunity tax credit, the first $4,000 paid in a year is eligible, those funds cannot originate from a 529 account, which already enjoys tax-free status on its growth.

That out of the way, I had been paying $500 or more per month than what I transferred from his college account for the past four years, resulting in a $5,000 annual net loss in our checking account.

Not only did our son graduate this past spring, but once his college went fully virtual in April, we wound up receiving a credit after he and the other students were ordered to move out of their dormitories*.

For the last six weeks or so of his college, I was paying only $318 per week as opposed to the $3,000 per month that I had become accustomed to.

Most months, I paid in the $3,000 range for our son’s college.

Besides not traveling at all in 2020, no longer paying so much for college, even though it is quite possible that I will be shelling out north of fifty grand next year (topic for yet another story), obviously provided a financial boost when it was much needed.

3. Not Taken to the Cleaners

Would you believe that when I first began my career, I wore a dress shirt with a tie five days per week?

Upon my first assignment to night narcotics court way back in 1993, I was assigned to court one night per week in two out of three weeks and three nights per week every third week. I detailed my experiences as a PO in a way-too-long tome appropriately titled the same. I had to wear a suit those nights and several times per week once assigned to day court.

During my first many years as an economic developer, I also wore dress shirts and ties on most days. I recall nervously venturing to go tie-less on Fridays about ten years ago, which eventually led to going without them on most days.

I recall being asked to make $5 donations to local food pantries for the right to wear jeans to work five or six Fridays per year. We would have to wear the sticker showing that we did.

These days, I wear jeans and casual shirts five days per week, only wearing slacks and dress shirts once or twice per month throughout the pandemic on days when we had important in-person meetings and at City Council meetings that were held live sporadically this year.

Thus, the story that I was set to write in March about being “taken to the cleaners” was put on hold, first referenced here.

It was leap year day, February 29th, the last time that I picked up clothes at our dry cleaners. I was outraged at the $42 bill; my cleaners having raised their prices once again to around $2 per shirt.

As I mentioned, I have been wearing dress shirts for many years and recall paying a dollar or less per shirt throughout the nineties and early 2000s. So, when I see the price more than double over the years, inching up by a dime or two per year, it begins to add up. On another note, our daughter often purchases fancy clothes via Depop and similar sites, many of which wind up being dry-cleaned only. Since those also end up added to my order, I witnessed my monthly dry-cleaning bills creep up from around $20 per month to more than twice that.

Prior to the pandemic, that is.

Little did I know that I would not set foot in the dry cleaners again until later this month when I intend to drop off the ten or so dress shirts that I have worn since March prior to my thirteen straight days of either working from home or taking days off.

I know all too well that the dry-cleaning business is a dying one. Where we live, nine out of ten are owned and operated by moms-and-pops of Korean descent. Having become fairly close to my own cleaner after going there since 2001, she has shared many personal stories of her family with me, as I have with her. Also, having been an economic developer for a mid-sized suburban community, I have witnessed first-hand the closing of three dry cleaning businesses in our town since March, all owned by Korean couples.

In one instance, I had to gain access to the closed strip center unit from the landlord to assist those whose clothes were left on the racks after the business owners had vacated the premises. It was not the first time that I had provided that service and it undoubtedly will not be the last.

I can only hope that I do not have to contact anyone to help me gather my own clothes from a closed business once I have dropped those ten shirts off.

How much have we saved by not taking our clothes to the dry cleaners this year? It is not an exact number, but I estimate it at somewhere between $40 and $50 per month since early March, or possibly up to $500 less spent.

4. We’re Less Gassy

I have noticed that we have not been filling up the gas tanks on our two cars as often.

I worked exclusively from home from mid-March through the end of May and after returning to our City Hall with regular days and hours for several months, we are back to working from home some of the time.

My wife is a lunch supervisor at the magnet school that both of our children graduated eighth grade from, and the school has gone back and forth from hybrid to completely virtual. As of now, she is laid off once again, thus does not currently drive to and from the school every day.

Our daughter is one of those students who has not done as well with virtual learning as she did in-person. Nonetheless, we opted for her to face less risk of catching coronavirus and she has been attending school virtually on the new laptop that we purchased for her during the past few months.

One thing she does not do is drive to and from her school.

As I mentioned, our son graduated from college this past spring. He continued with one of the college bands that needed a high-quality trumpet player, but that band also no longer meets in person due to various members having come into contact with others who have tested positive. Thus, the two days per week that my wife or I were driving him to and from the college are also over.

We simply do not drive as much.

It would be one of the harder expenses to quantify, but I would estimate that our family has spent a few hundred dollars less this year than usual on gasoline.

5. A Scruffy Guy

Just as I used to wear dress shirts with ties for around the first twenty years of my working life, so, too, did I diligently shave every morning.

I had tried electric razors a few times, but perhaps because I always bought the cheapest ones available, they did not work very well for me.

Thus, I have purchased razors since moving up in my career from a P.O. to an economic developer in the fall of 2000.

Good razors are not cheap.

Over the years, I have moved from the super cheap plastic single-blade razors that cut my face more times than I could count to the Bic Hybrids with multiple blades. With coupons, you can purchase replacement blades for less than a dollar each.

My almost-full-year supply of Bic Comfort razors purchased early this year

As few as two years ago, I would use one of these blades twice and then toss them in the trash. In trying to become more frugal, I decided to stretch that to three days and then later, to four. I would try to get away with being scruffy on Fridays, and nobody seemed to notice or care.

I always keep a spare razor or two in my desk at work, so if I learn of an important meeting, like with the Mayor or a potential investor or new business, that I am required to attend on short notice, I can retreat to the washroom and emerge clean-shaven with none the wiser.

During the months of strictly working from home, I did my very utmost to remain positive while others around me sank in and out of depression. I, myself, feel as if getting out of bed in the morning is a major undertaking as I listen to the grim reports on my alarm clock radio.

I did not shave at all for weeks at a time throughout April and May but wound up doing so every so often as my face became itchy. I never really got past that itchy stage.

I am the father of a heavily bearded young man, but Because Reasons, I intend to remain clean-shaven for several more years.

But these days, I am only fully shaving twice per week (I shave my neck in between) — on Monday and Thursday mornings. Mondays because I am scruffy as hell after the weekend and report to work in person that day. After working from home and not shaving on Tuesdays and Thursdays, I return to the office in person and clean-shaven on Thursdays. I still go scruffy on Fridays.

Therefore, after having gone through a package of a dozen razors per month for many years, the same amount may last twelve weeks or more. It may have only saved a hundred bucks or so throughout this year, but it is nevertheless nice not to spend so much on them.

If you add in that I went four months for the first time since the late eighties without getting a haircut, and that my son has not had one since February, we saved another chunk of change with that. My wife and daughter both go to salons where their stylists charge four or five times as much as Great Clips, where my son and I go, and they have gone far less often as well.

6. Two Big Boosts

Reducing our spending on travel, education, gas, dry cleaning, and razors did not make up this difference alone.

This year, we received two financial boosts, both of which may never come again.

After fifteen long years toiling for a very difficult city to attract developers to, I received a five percent longevity bonus.

When I knew it was coming, I had made big plans on why we would spend, yes spend, much of it. Our home very much needed some improvements then and still does now.

Six months later, none of the funds have been allocated as of yet. I paid myself a little extra with some of the funds, paid off a fairly high credit card bill as I would have anyway, and transferred most of it into savings.

Part of the almost-$12,000 that found its way into our account between June 9th and July 8th was around $4,100 from this bonus. $3,000 of that was transferred into savings on July 7th.

Back in April, like many Americans in our income range did, we received a direct deposit of $2,900 from the IRS when the stimulus payments were made.

Also like many Americans, after investing an “extra” $300 for my wife and myself that month, I transferred $2,300 of that into savings.

Should I remain at my current place of employment for four-and-a-half more long years, there is only one more longevity bonus and only a $2,000 one at that. After taxes, it would come out to around $1,600 and, God willing, as a fifty-four-year-old at the time, even though it would be wise to top off some investment, I sure would love to go on a nice getaway with my wife with all that and more.

When it comes to another stimulus payment coming our way, I am not holding my breath and would urge you not to, either. Better to create your own stimulus check, which is the final of these seven points.

7. Hustle Much?

If you are not engaging in a side-hustle, you are getting left behind.

At least that is the way it seems to millionaires in the making and those who subscribe to the FIRE movement.

Even middle-aged guys like me who hope to “retire” someday are best served by generating income above and beyond what we make at our day jobs. It is a well-known fact that you will never become rich only by working for someone else and on a salary. As a government worker bee since 1993, I have been a salaried employee for over twenty-seven years, so I know this to be true.

While not an overly impressive amount, I cleared roughly the same amount that the first stimulus checks were made out for, $1,200, after selling dozens of my books and a number of shirts on eBay.

This not only made my wife a little bit happier as my hoarding habits were curtailed throughout this pandemic year but after setting about half of it aside to (what else?) pay myself first a little extra early next year, we are happily spending around $500 taking turns picking where we order out from every three days or so through the end of this year.

Even though the four of us, plus my Baby, are hunkering down at home this month, that does not mean that we cannot try to have a little bit of fun and together time while doing so.

I truly, truly want to expand upon my side hustles. I have long wanted to start an eCommerce business but, I’m being honest, my fear of failure and not wanting to dive head-first into something that I may soon lose interest in is holding me back.

Sure, I would love to become one of those “Here’s how I made an extra hundred grand” guys, but my tendency towards a scarcity mindset rather than one of abundance and my general middle-class mindset have held me back for quite some time.

But that does not mean that you cannot.

No matter what it is that you are currently doing to make a living and pursue your dreams of becoming a millionaire, the internet has completed changed the way we work and fortunately, has made things far more flexible than they have ever been before. With jobs, careers, and side hustles at our fingertips, there has never been a better time to start earning money on the side.

We Have Spent More on Some Things

Perhaps another story for another day, prior to the pandemic, we had only purchased face masks once or twice, prior to a painting project or sanding something down.

I do not even want to know how many boxes of face masks that my wife has ordered and I have paid for since the pandemic began. It has definitely cost as much or more than the amount we have saved through reducing our purchases of things like razors, gasoline, and coffee on my way to work.

But if a few hundred dollars’ worth of masks can save us or a loved one from a potentially fatal illness, those are dollars well spent.

We have also spent a lot more on groceries this year and, I suspect, from patronizing local restaurants frequently through carry-out.

But, for the most part, we have spent less this year than in previous years, and coupled with my longevity bonus and the stimulus check, we may just be nearing the end of one of those infrequent years when our family’s net worth increases.

What About You?

Besides some catharsis that benefits me by writing and sharing, this story will most likely make me a buck or even a few. Altogether, I hustle up enough to buy a cup of coffee or two per month through my writing efforts but plan on increasing that amount in the very near future.

But that is more than enough about me.

What about you?

I would bet that, like us, there may be several things that you spent less on since the Coronavirus began its rampage through the country and world this past spring.

Most of my friends and relatives earn too much to have received stimulus payments, but the vast majority of us do not. Have you also received some stimulus money? If so, did it simply help you eek by for a month or two or did you invest it or put it into savings as I did?

Are you comfortable traveling yet or, like us, have you been hunkering down at home this year and not spending anything at all on travel?

Finally, have you not only read and thought about generating some additional income through side hustles or passive investing but actually taken tangible steps towards achieving that?

Again, you are not a true millionaire in the making unless you have several sources of income above and beyond what someone else pays you to toil for on an hourly basis. Like one of the wisest money sages ever, Warren Buffet has famously said, “If you don’t find a way to make money while you sleep, you will work until you die.”

Do not settle for trading hours for income your entire life. It can be done if you attain executive status, but it is highly challenging and stressful to become wealthy that way. Better to use a combination of outsourcing and passive income streams to become more like Warren and make money while you sleep.

If you remain bogged down in the reading and thinking stage, like I am, there is no time like the present to formulate your plans for taking action (seriously one of my next few stories) as the calendar turns to a new year.

Thank you for reading, Be Well, and may you, too, take in more funds than what leaves your account next year.