Why less is more

From a young age we are all conditioned to think that we should strive to squeeze as much out of our lives as possible - but what exactly should we be squeezing and what should we be focussing on?

Even though my parents were not particularly pushy, they always wanted me to do well in life and supported me all they could with that. They had done well themselves from humble beginnings. They had really “made it” when it comes to finances so wanted their kids to be as fortunate as them. I appreciate all of the support they have given me in life.

The first time I felt real pressure was in high school. I had just finished my last year at school and I was patiently waiting on my exam results being posted through the letter box - today was the day!

I remember my Mum shouting to say the post had arrived so I took the letter and opened it alone in my room. To my devastation, I had done really badly. I had not achieved the results I needed to get into the college course I had applied for. I went into a state of panic and was hysterical. Thankfully my Mum was really supporting but I was at a loss in terms of what I was going to do.

Fortunately I phoned the college and they were able to enrol me onto another course - not exactly the same but at least it was still an opportunity. This moment I feel defined the success I have had from then on. I managed to graduate from University with an Honours and Masters degree (passed with a First Class and Distinction respectively) and I have now gone on to be successful in my respective career.

This has been great and has allowed me to progress into a very good position but it would never have happened if I did not act on the pressure I felt from external forces. I needed the pressure to give me a “kick up the ass”!

However, I do feel pressure can be a bad thing and this is something we should be conscious of.

So going back to the title of this blog post, I feel you need to walk your own path. I used to feel pressure to fit inside a certain box and to live a lifestyle that matched with the salary / career choice that I made. Or at least to try and keep up with those around me - buying designer clothes, driving a nice car, the list goes on. However, over time and with the aid of finding the financial independence movement I have found that this is likely not going to serve me as well as it may seem on the surface.

If I am to build a life around the salary I make, it is likely to result in a scenario where I am trapped by the things I buy - where I do not feel fulfilled in life. I choose to do the opposite - well to a certain extent.

What I have realised is that for me to become free and have more flexibility in my life, I will need to make sacrifices. Now I do focus on the small things (e.g. limiting how many times I eat / drink out or buying groceries in the lower cost supermarkets vs the more expensive ones) but it is the big things that will make the major difference.

The biggest impact on me achieving my financial goals and retiring early is likely to be the choice I make in terms of where I live. Downsizing or living in a more humble property is likely to allow me to free up a significant amount of time much earlier.

I currently live in a 4 bedroom house which has 2 living rooms. I hear you saying - “this goes against everything you just said”. I realise this. However, not all is lost. The Mrs and I bought this property in 2021 and it may be that we stay here for quite a while yet but when the time comes we know what other options are available to us.

We don’t have kids and would otherwise live alone - 2 of us in this 4 bedroom house. So we made the conscious decision to rent a room out to a lodger. If we lived in a smaller property, it is unlikely that we would look to rent out a room. Therefore, having the larger property at this current time maybe isn’t such a bad idea. We pay the majority of the mortgage payments with the income we get from the rent from the lodger and we also benefit from the capital appreciation on the larger property value. Since we bought the place, the value has gone up by around £60,000 according to Zoopla. I know this is likely not that accurate and the current economic conditions would suggest property prices may be due for a slowdown but longer term we hope it will work out quite well for us.

The above doesn’t get away from two facts though (1) we would need to live with a lodger for the rest of our life if we wanted to reap the same benefits (2) the larger property results in significant bills / maintenance costs that should not be ignored.

At the moment, I am comfortable that we are trundling along fine but there will be a point where there is a cross-roads. Do we make the decision to keep the more expensive house or do we downsize and free ourselves in terms of time? The money (or things we own) vs time dilemma.

Probably by the time we are in a position where we would have enough money to retire early, the house equity we have built up alongside the capital appreciation of the house will be enough to buy a smaller property outright - significantly reducing our expenses. If you read this blog post, you will see that our current mortgage costs us about £9,300 a year which in rough terms would result in a £232,500 investment pot to fund (if you use the 4% rule). Now that is only the potential benefit from the mortgage payment but you would likely have benefits from home bills also (e.g. Council Tax / Electricity & Gas). From a rough check, the Council Tax alone could be £1,100 cheaper (assuming a 2 bed vs a 4 bed in close proximity to ours) which adds a further £27,500 saving. So overall, with just a few lifestyle choices, your early retirement “FIRE number” goal can be reduced by approx. £260,000!

I am sure there is a lot more I could do to make further financial optimisations in my life. It just needs a little ingenuity and willingness. Unfortunately too many people sleepwalk through life spending copious amounts to keep up with the latest craze whilst at the same time wishing their life was more simple / less stressful.

I continue to keep track of where we are at financially such that I understand the options available to us if we are willing to make a side step. The main conclusion is - it is your money (or what you do with it) or your life. For most of us, there is likely to be some tough choices - work that little bit (or it could be a lot) longer or make some sacrifices to allow you to spend your time on what brings you most value.

I personally value experiences and time more than I do money or possessions. As the saying goes, “you can't have your cake and eat it too”.

Don’t feel the pressure that is placed upon you by anyone that you wouldn’t listen to advice from. The only pressure you should care about is the pressure that you put on yourself. Live the life that works for you.

Simple living with less is often the better path. If you are not careful, all of these “things” you buy will start “owning you” - suffocating you from the life that may otherwise available to you. I personally couldn’t think of a better way to live my life than to live in a smaller property but where I was able to go on adventures into the countryside or pack packing to different countries but where I was able to do it a number of years (maybe even decades) earlier than could have been possible - well at least when I compare that to spending these years in front of a computer screen.