Code Red?
This is a Financial Freedom Update post. Each month I report the status of my journey towards more financial freedom and reflect on my progress. To learn more about financial freedom please see my Think Week 2021 post where it all started.
In terms of financial freedom this month was a disaster. And the next four months will be even worse. But in terms of personal experience this fall will (hopefully) be amazing. So far I’m good with this trade.
Results
I saved -18% of my income in July.
Yes that is a negative number. I spent more money than I made. Not something I aspire to do often. And not something I have done since I started this financial freedom journey.
Not only is this the first time I’m in the red: this is the first month I’m below my 50% goal. And I’m well below at that.
| Category | Percentage of expenses |
|---|---|
| Transportation | 41.68% |
| Home | 20.73% |
| Personal | 23.87% |
| Food | 6.32% |
| Health | 2.55% |
| Union | 1.44% |
| Utilities | 1.21% |
| Other | 1.15% |
| Gift | 1.05% |
Sabbatical
The big expense that caused a deficit this month was a flight ticket and a few other travel expenses (insurance, a few days of accommodation booked). I have 3 months off work from September and I will spend most of my time traveling New Zealand.
I’m super excited to go but as this is an financial freedom update I’ll keep it to the finances. Starting September 1st I won’t have any income for 3 months. Sounds a bit scary but this is one of the reasons why I started saving a large part of my income: so I have freedom to do things I want.
And what I want right now is an adventure.
Travel Expenses
Traveling to the opposite side of the world is not cheap. Especially not when the opposite side is New Zealand. Not exactly a low-cost budget destination.
So I have debated this decision for a while. But after my lessons learned this summer I feel good about my choice to loosen up my travel budget.
I won’t be super strict with spending over the next few months. Instead I want to just enjoy this experience. Of course I’ll still try to spend my money wisely. But I’d rather come home having spent too much than too little. I don’t know when I’ll get an experience like this again and it would be tragic if my trip was defined by a small budget.
August (… and the uncertain future)
Next month I’ll likely spend a bit more on travel preparation. I still have a few expenses to cover: vaccination, a train ticket, more insurance, and a couple of items.
And to make things even more unsteady: I’m moving out of my apartment. So add a few more expenses to the equation.1
All in all, my situation is not exactly stable. This is all my own doing and I look forward it. But it also means that my monthly finance reports will have bigger swings than they have had in the recent past.
August will be my last somewhat normal month before I go on sabbatical. I plan on continuing these reports but they will naturally look a bit different in the months to come.
Expect to see more red numbers 😉
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I’m saving on rent the 3 months I’m on the road. But as I’m starting to learn, moving can be expensive. I have wanted to move out for a while and so this was a good time to do so. I still believe it will be a net positive as I won’t have an empty apartment collecting dust while I’m away. But it would not be worth it if I did not also want to move to another apartment. Not for just 3 months away. ↩