Frugality

Before I got married, I wasn't frugal. In fact, I spent a lot: eating out, traveling, etc. However, I had an modest townhouse in a well-developed suburb of Chicago, where the property tax was relatively low.

Then, I got married and my wife is sort of the opposite. She likes to travel once in a while, but she doesn't like to eat out often, or spend money on experiences. Her main expense priority is having a nice house, and spending money on the house.

We bought a nice, large, relatively new house, at the outskirts of the Chicago area - where suburbia meets farmland, and the farmland is losing. The disadvantage is higher taxes due to demand for infrastructure creation. Our property taxes were high when we bought the house, but still went up 23.6% last year, due to an exploding demand for schools. This means that my mortgage payment (principle + interest + taxes) is about 3 times what it would be at the townhouse.

Now that we have a 15 month old son, we really don't go out to restaurants,
movies, or travel too much. My wife stays at home, so she tries to cook most meals, to keep us healthy.

So I realized that we are pretty frugal. The three of us live in a large house, live off one paycheck, and still save a lot.

But, I just went thru some numbers and realized that wow! We ARE pretty frugal (except for the house):

1. My net pay is my gross minus insurance, taxes, 401K, and commuter (train) benefit.

2. 45% of my net pay (34% of my gross) goes to the mortgage.

3. I then save 21.6% of my net pay (this is in addition to my 401K, which is accounted for).

4. So, we live on 33.4% of my net pay (25% of my gross)!!!