Wednesday 26 June 2013

Living on half salary: first month

half salary, living, tough

As I previously have mentioned in an article I´ve been forced due to liquidity problems as well as insolvent clients to my company to step down to half salary. The first month is almost over and it will be interesting to see if I can transfer some cash to the stock deposit or not. As soon as I get my salary I directly transfer everything above 2k € to the stock deposit. I think it is important to make sure to put aside money for oneself as the first thing one does each month. Once that money is gone from the account I am forced to adapt my spending thereafter.

This first month has been pretty extreme because already in my normal life I have very few expenses. I hardly ever drive my car and always go by bicycle to work, I turn off all electrical things when I leave my house, I almost never eat in restaurants and almost always prepare my own food, I also almost never go shopping.

The only thing I saw that I could cut were three things:

  • Decrease the food bill even further. Not very easy but do-able. My usual bill has been 200-250€ in total per month including everything.
  • Decrease the partying. Very easy! I´ve been going out every week which costs maybe 50€ per weekend. It is cheap in Berlin! But still that mounts up to easily 200 € per month.
  • Decrease the dating. I´ve been dating a lot lately and I am old school so I pick up the bill but this can be significantly decreased in two ways. Go more for quality instead of meeting everyone not only for purpose of relationship but also for the purpose of seeing new people. Skip that! Make the first date more quality in terms of seeing, talking, walking, activity instead of spending money on food or drinks or cinema. I think my bill there has been an additional 200€ per month.
 My fixed costs are around 1000€ per month including food 200€ for the food. Then with the partying and dating I was easily at or even above 1500€ per month in costs.

Since I did not really know how it would be this first month I went pretty extreme:
  • Started a diet which cuts my food expenses to 100€ per month. 100€ saved in food expenses. However I can not do this each month because living on 500 kcal per day is not ideal...
  • No partying at all. This means that I saved at least 200 €.
  • Very little dating. I would say my costs was also here cut by half so down to 100€ per month.
 In total I should have saved 400€ this first month from my otherwise "fixed" costs. So I instead of transferring 1500€ to my stock deposit I should be able to... even on my half salary to transfer 400€ so that I can build up that cash quantity of 10% that I wanted to have. Next month I can maybe only save 300€ due to dropping the diet thing but always better than nothing and maybe things will be better than I thought. We shall see!

There are however some additional future question marks... two weddings... vacation... hmmm... I guess I will be forced to be creative to keep the wheels turning!

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