Posts tagged Budgeting
Back to Basics: Making a Budget
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Ivan here.

In the previous post to this “Back to Basics” series, I talked about how millennials making $2,500 a month should allocate their paycheck.

To summarize, they should mentally divide their paycheck into three equal parts (~33% each):

  1. Rent and Bills Fund ($833)
  2. “Present Me” Fund ($833)
  3. “Future Me” Fund ($833)

Another way of thinking about this is:

  1. My overhead (i.e. fixed costs)
  2. My short term needs (i.e. money I need within 12-18 months)
  3. My long term wants (i.e. money I need beyond 18 months)

This is how things should look in the perfect world. Unfortunately, saying that the world is not perfect might be the understatement of the century. Most people aren’t even remotely rational or sane.

Source: https://fred.stlouisfed.org/series/PSAVERT

Source: https://fred.stlouisfed.org/series/PSAVERT

In 2018, the U.S. personal savings rate is 2.8% - a historic low. This is partly a symptom of our two-tiered economy where the rewards disproportionately benefit the top 40%, while technology and trade outflows decimate the bottom 60%.

The other part is people feeling too pleased and comfortable with themselves.

It’s been almost a decade since the last recession. We are now in the longest bull market in post WW2 history, where the value of most assets have been rising (eg. stocks, real estate, bonds), while consumer prices have been falling (eg. Amazon, airline tickets). “Dumb money” has entered the market in droves, peaking in December 2017 when cryptocurrencies hit their record highs. “FAANG” stocks are now being priced for perfection. Nothing could possibly go wrong, right?

This is my opinion, but there’s no better or more urgent time to start thinking about making a budget than times like these. In a market economy, rewards often go to the few at the expense of the many, because the many are typically unwilling (or unable) to take short term pain for long term gain.

Or to quote Warren Buffett: “Be greedy when others are fearful and be fearful when others are greedy.”


Making A Budget: What is a Budget?


A budget is the marriage between our aspirations and reality. It’s also an expression of our priorities. People in project management probably know this diagram:

pick two - fast, good, or cheap. You can't have it all.

Since resources are limited: fast and cheap won’t be good, cheap and good won’t be fast, good and fast won’t be cheap.

The same concept applies to your budget and paycheck.

Out of your financial needs, you should prioritize two:

  1. Overhead (Rent & Bills)
  2. Short term needs (Present Self)
  3. Long term wants (Future Self).

With the average millennial’s $2,500 a month after-tax paycheck:

  • High overhead and short term needs means punting on your debt and retirement and letting interest accumulate into your midlife
  • High short term needs and long term wants means living in an undersized apartment in an undesirable neighborhood (or even city)
  • High overhead and long term wants means living on cheap groceries and never eating out, traveling or shopping.

Now pick one.


The Fairness Argument: Millennials, Baby Boomers and Their Finances


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Jennie and I have seen the panic in peoples’ eyes at the mere mention of a budget. The conversation usually starts off with a question:

How can you afford to quit your 9 to 5 and travel around the world for over a year?

Our answer: a combination of privilege and having a budget that prioritizes a few things for a long period of time. Specifically, we keep our overhead way below what most are comfortable with, so that we can save for our long term wants without sacrificing the small pleasures that keep us going day to day.

For example, before we “graduated” to our $1,395 a month studio apartment in West Los Angeles, Jennie spent years renting a closet-sized room on the outskirts of Boston for $450 a month, while Ivan paid $650 a month (Canadian dollars) for a basement unit on the outskirts of Toronto. We made these short-term sacrifices by choice.

At this point, we usually get one of two responses:

  1. Denial: “I could never do that. That’s just not who I am.”
  2. Blame: “You’re privileged and definitely not the norm. Our system is rigged to benefit the top 1%. The most important thing is to fix the system instead of putting unrealistic expectations on ourselves.”

Jennie and I have had variations of these conversations with fellow millennials over the past two years. We empathize with these feelings because they’re based on kernels of truth.

But there’s a difference between what feels popular, good or just (i.e. the right thing to say) with what’s rational and productive (i.e. changing with the facts).

Looking through the windshield, millennials have it tough. Looking at the rearview mirror, baby boomers have had it easy. But it’s also true that everything looks easy with hindsight. The road ahead always looks dark and uncertain- for every generation, in every time period.  

Expecting to achieve the same results as our parents by doing the exact same things they did defies basic laws of markets and evolution.


The Biggest Misconception about Making a Budget


The biggest misconception people have about budgeting is that having one means denying yourself everything.

This may be true for people making under $37,000 a year, which according to MIT’s living wage index, is the minimum salary a single adult needs to live in San Francisco, the most expensive city in the country.

But not all of us live in San Francisco. And if you’re above the $37,000 threshold, having a budget is not only a realistic option, but a necessary one.

To say that a budget means denying yourself everything, we first have to agree on what “everything” means. Does “everything” include vacations to foreign countries? Drinking and dining out a few times a week? High-end gym memberships and yoga classes? Personalized chauffeurs that drive us to and from bars (Lyft/Uber)? Does “everything” include a cleaning lady (this is real. we’ve seen this) that comes twice a week to tidy up our one bedroom apartment?

Where does “everything” begin and where does it end?

 
aspirations vs reality budget
 

And that’s what a budget is for: to draw a line between our aspirations and reality.

By and large, millennials want a luxurious life, for a less than luxurious price, before we can realistically afford it. Because “everything” was what we’d imagined we’d be getting when we became adults.  

Ironically, sacrificing short term gratification for long term goals through a budget, is the most “adult” thing I can think of.


3 Tradeoffs We Made With Our Budget


Let’s bring it back to our hypothetical millennial. $40,000 salary, $40,000 in student loans, $2,500 a month paycheck, divided into three funds in the “ideal world”:

  • Rent and Bills Fund ($833)
  • “Present Me” Fund ($833)
  • “Future Me” Fund ($833)

Here are three ways Jennie and I approached this problem in the real world:

1. Underspend on overhead: keep rent & bills to
less than 30% of our after tax paycheck.

This means at a $2,500 monthly paycheck, around $650 was allocated to rent and bills. And we’re not talking hypotheticals here:

  • In 2014, Jennie made $42,000 a year. As recently as 2014, Jennie’s salary was $42,000 in a high cost of living city (Boston). She paid $450 per month for rent & bills to stay in a closet-sized room in a house shared with two other roommates.
  • In 2012, I made $58,000 CAD. My starting salary in 2012 was $58,000 (CAD), paying $650 per month in rent on the outskirts of Toronto, while my peers rented one bedroom apartments in the downtown financial district. We were consultants, usually traveling four days a week, and were rarely home.

If we had had $40,000 in student loans, we would’ve paid it off aggressively within three years. Instead, the extra savings went directly into our fuck-off fund and retirement. No debt and a fuck off fund allowed us to swing for the fences in terms of raises and higher paying jobs. Higher earnings in turn, funded our fuck-off fund, retirement and other long term goals. A virtuous cycle begins and gains momentum (this happens much quicker than you think). Meanwhile, our overhead stayed fixed on one year leases.

2. Underspend on depreciating items in favor of value add experiences

Jennie gave away her car to family and started taking the bus. The total cost of all the furniture in our home is under $1,000. We don’t have the latest technology in our home or in our pocket. We make little to no new clothing purchases outside of travel gear, clothes which will eventually have to fit into 40L backpacks.

In return, we traveled across America by Amtrak rail, held our wedding in Taiwan, honeymooned in Okinawa, attended the jazz festival in New Orleans, made business contacts in San Francisco, camped in Death Valley and Joshua Tree, spent quality time with family and friends in Taipei, Albuquerque, Denver, Boston, and San Diego.

For us, the small adjustments meant bigger returns on experiences that we love so much.

3. Planning months (or years) ahead for large purchases
so we don’t have to deny ourselves small ones

Our dirty secret: we divide the cost of large purchases across multiple months to absorb the impact.

We never mentioned this explicitly in our money diary, but we bought a $1,000 camera last year in July 2017 to bring on our RTW trip. Using an accounting gimmick, I divided that expense into two $500 items, and logged them in our budget under “Education & Investments” in July 2017 and August 2017. This “smoothed” out our spending, but more importantly, we did it because Jennie and I had already planned out this purchase eight months in advance - so we “freed up” $500 in the budgets of July and August to absorb it.

In return for long term planning for large purchases, we never have to deny ourselves smaller ones. Whenever we have a craving: for tacos, chocolate, a fizzy drink, coffee, donuts, macarons, bubble tea, the occasional take-out etc, we never have to “check our budget” to see if we can afford it. Even if we go slightly over-budget in some months, who cares? Buy it, log it, and move on. Micromanaging small transactions wastes precious time and headspace - and it really isn’t our style.


Finding Your Budget Sweet Spot


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There are many variations to a budget that can be tailored to the things and experiences that matter to you. Jennie and I aren’t saying that our way is the “right” way.

But the common thread of all budgets is that something's got to give. And if you sweat the big, uncomfortable things (you know, the material things we tie unnecessarily to our self esteem and identity), the small things take care of themselves. 

In our case, we said to ourselves:  "fuck paying overhead and let’s live for the now and for the future. If we have to live in squalid surroundings or tight studio apartments, then so be it. At least we'll have each other." 

That was more than we could’ve hoped for after six years of long distance.

After reading this, some might be disappointed that I haven’t provided any answers on “what to do.” Fortunately, that’s not the point of this series. Nobody can tell you what to do, or convince you to do something you’re not ready for. Money is less a math problem, but an emotional & psychological one.

The only thing we can control is an awareness and understanding of each trade-off we make. We need to construct a budget that takes into account those trade-offs: between overhead, our present self and our future self. Finally, we need to ask ourselves whether we can learn to live with the end result.

Because perfection is the enemy of the good.



Mindfulness: Tune Out the Noise

Daily Origami is a way for us to record our off the cuff thoughts, feelings and observations about the world around us. Published every weekday, Monday through Friday.


Jennie here.

Last night, I broke my headphones. They were my fourth pair in the past twelve months. Each cost under $10.

Headphones on my mind

The next morning, when I declared to Ivan that I was going to buy a new, (slightly) more expensive pair of headphones, he called me a mindless consumer (Editor’s note: Ivan was upset that Jennie was online shopping in the middle of a brainstorm session for this blog). It was enraging and also not true. I’m equally as budget conscious as Ivan and I have the history to prove it.

But even though I’m careful with our budget -- there are a few things that I’ll never deprive myself of. There are many things I can live without in life but a pair of headphones has now become so deeply ingrained in my daily routine, I can no longer productively function without them.

Since I was little, my headphones were my solace, my safe space -- or at least it helped me create one. The moment things got stressful or when my parents started arguing, I could always depend on them to drown out all the sadness and frustration.

It’s like I’m in my own little world and nothing else exists but the music or podcast or story.

And in our noisy world, there’s freedom in that.



One Girl's Journey To Financial Independence

Jennie here. 

As a first generation Vietnamese-American growing up in Albuquerque, New Mexico, I didn’t have a lot of money growing up. Both my parents had to work full-time minimum wage jobs just to support me and my three siblings. Then in the mid-90’s, my dad got laid off from his factory job and my family fell on hard times. We even had to go on welfare just to make ends meet. 

Based on these experiences, I realized from a pretty young age that I was going to have to fend for myself. And if I didn’t figure something out fast, I’d be stuck in the same cycle of poverty and financial dependence for the rest of my life. So at 14 years of age, I applied for a special work permit and got my first job as an ice cream scooper for Cold Stone Creamery.

I remember the company policy at the time required all Coldstone employees to sing for their tips. Ah, isn’t childhood trauma fun?  

 

I can assure you that they're dying on the inside.

 

Looking back on my humble beginnings, there were three pivotal moments in my life that set me on my journey to financial independence: 

1. Paying My Way Through State College (With Zero Debt)

1. Paying My Way Through State College (With Zero Debt)

1. Paying My Way Through State College (With Zero Debt)

Before graduating in 2011, nobody in my family had ever gone to college. And that could have easily been my path. When I was 14, my parents sat me down and told me that they couldn’t afford my education and that I would have to figure something out for myself. 

So for the next four years, I worked my ass off through multiple part-time jobs while attending high school. Unfortunately, by the end of those four years, I still couldn’t afford the $20,000 out of state tuition fees, even though I had good enough marks to get into more ‘prestigious’ schools. 

I had only two real options: go to the state school in New Mexico, or take on student loans to go to a ‘better’ school. If growing up poor had taught me one thing, it was to avoid debt at any cost.

So that was how I came to attend the University of New Mexico. 

Looking back, this turned out to be one of the best decisions I ever made for the following reasons:

  1. I received several state scholarships and financial aid for simply being a resident of New Mexico (and for good grades).
  2. I could commute from home and save on fixed costs
  3. I came out of school not only with zero debt, but with a surplus of cash

I mean, when you really broke it down, how much should students really be paying for a certain ‘brand’ of education? 

 
 

 Outside of maybe Harvard or Stanford, is any school really three times better than your average state school to justify the additional cost? And is any of that worth the financial servitude? 

2. Self Funding my Study Abroad Experiences in Japan (twice!)

2. Self Funding my Study Abroad Experiences in Japan (twice!)

2. Self Funding my Study Abroad Experiences in Japan (twice!)

Studying abroad in Japan had been a lifelong dream of mine since high school, and when I have a dream, I’m damn well going to fight to turn that into a reality. 

I ended up studying abroad in Japan twice.  

The first time I was 16 (and extremely broke). So I started cold calling local businesses and doing my own research on available scholarships. Within six months, I had scraped together enough money and applied for the Youth For Understanding summer program. I didn’t even tell my parents that I got accepted until after I booked my flight out of the country. Where I grew up, people just didn’t see the value in travel the way I did. So I just didn’t bother to ask for permission. 

My second time to Japan was to Kyoto in 2008 on a different scholarship that I had clawed my way into. And that’s where I met Ivan (my husband).

3. Moving to Boston with no money, family, or connections and hustling my way to my first salaried position

3. Moving to Boston with no money, family, or connections and hustling my way to my first salaried position

3. Moving to Boston with no money, family, or connections and hustling my way to my first salaried position

After college, one of the toughest challenges I faced was finding my first full time job. It was made more challenging by the fact that I had moved across the country to Boston, a city where I had no family, few friends, and no professional network. I even had to get a $2,500 loan from Ivan just to stay afloat, while I worked part-time jobs for temp agencies (an underused resource) and Club Monaco (ah, retail). 

In the meantime, I talked to everybody. Customers, co-workers, friends of friends three times removed. I cold-emailed people in industries I wanted to work in and invited them out for coffee. 

Then one day, I was on a flight back from Toronto visiting Ivan and was sitting next to a woman who turned out to be an account executive at a well-known market research firm. We chatted and kept in touch. Next thing I knew, I ended up interviewing for two positions and got offered my first salaried job as a cyber-security researcher! 

So What Have I Learned?

You can only connect the dots looking backwards.
— Steve Jobs

Today, I’m living and working in Los Angeles directly because of that first position in Boston, having followed my mentor to a new cybersecurity start-up based in the West Coast. 

 

Ivan and I are debt-free and are saving at least 45% of our income towards a bigger dream of a sustainable and nomadic life abroad. One of the biggest things I’ve learned so far in this journey is to always bet on yourself and to never stop chasing a bigger dream.

Because that’s what freedom’s all about.

5 Reasons We Want to Travel (and Live) Abroad

How dull it is to pause, to make an end,
To rust unburnish’d, not to shine in use!
— Ulysses, by Alfred, Lord Tennyson,

Ivan here.

The only fate worse than death is spending a lifetime waiting on the sidelines. Ironically, that’s the exact situation I found myself in a year ago, as I tried to navigate the Kafkaesque bureaucracy of (legally) immigrating to the United States.  

Before that dark place consumed our lives, everything was going according to plan. Jennie and I were lucky. We both landed decent paying jobs straight out of college, her in Boston and me in Toronto. While we weren’t thrilled about working for corporations, we made the best of our situations by building one of the most unassailable f*ck off funds imaginable

We were also working towards a very specific goal: to sign the marriage paperwork within a year, and start the US immigration process in the second

That’s when US Citizenship and Immigration Services happened, and a process that should’ve taken 10-12 months ended up taking 17 because of lost paperwork, a government shutdown, and garden variety incompetence. 

A shot from Terry Gilliam's 1985 film BRAZIL, a dark comedy about living in a dystopian, bureaucratic society.          

It was around this time that we first started talking about a round the world trip. Initially, we were just joking around, imagining a life where we’d leave everything behind for a nomadic lifestyle. But after the immigration debacle, we turned dead serious. After six years apart and 17 months squirming in bureaucratic limbo, we had lost our sense of humor. We dreamed about a life without restrictions. The ability to come and go as we pleased. 

In short, we were tired of waiting. 

As two ruthlessly practical, Type A personalities, we immediately started planning and setting goals. We would save $40,000. That was going to be our cushion. In the meantime, we’d also try to generate $2500 a month in remote income to make a sustainable living abroad. 

We promised ourselves that we would be gone before September 2018. That’s one of the main reasons we started this blog. To keep ourselves accountable. 

There will be no Eat, Pray, Love up in this bitch.

We’re not traveling to find ourselves. There will be no Eat, Pray, Love up in this bitch. On the contrary, we understand ourselves too well to be restricted by mortgages, kids, and to be tied down by a mountain of things we could live without. More than anything, we just want to be ourselves completely, and to accept no compromises for what we want. 

So when friends ask us why we want to travel, here are the five reasons we give:


1. Because discomfort is the best education

2. Because standing still is moving backward

3. Because we enjoy the challenges of new places, people, and things

4. Because life’s too short, time moves too swiftly to allow ourselves to be governed by the wishes of others

5. Because years from now, we don’t want to look back On a life not lived


Do you ever wonder what your life would be like if you took a slightly different road? Don't waste time wondering.

Start today.  

The Life-Changing Magic of a Fuck Off Fund

Ivan here. If you’ve been to a bookstore recently, chances are you’ve stumbled upon Marie Kondo’s international bestseller The Life-Changing Magic of Tidying Up

Do you enjoy flushing your toilet and thanking it for a job well done? When you brush your teeth in the morning, do you look at your toothbrush and ask yourself, “does this spark joy?” If so, The Life-Changing Magic of Tidying Up is the book for you.

But you know what’s even more magical than tidying up? What will literally change your life and open your eyes to all that this world has to offer you? 

Having a Fuck Off Fund.

So lay off those bath salts, stop talking to inanimate objects, and embark on a magical journey towards financial freedom. 

Something tells me we’re not in Kansas anymore.
— Dorothy, Wizard of Oz

What is a Fuck Off Fund?

The Fuck Off Fund is hardly a new term and is pretty self-explanatory. It’s a sum of money you keep in your savings account in case you need to tell someone to fuck off. This could be anyone (or anything) from an abusive boss, a bad relationship, or a dead end job.  

Basically, the Fuck Off Fund serves as your first line of defense. It’s the antidote to late-stage capitalism. The match you use to set fire to Lady Fortune’s stupid wheel. More importantly, it's an invitation to an exclusive club called Freedom. 


The Fuck Off Membership Tiers

 
 

Did you know there are actually multiple levels of financial freedom? Here’s the rough breakdown:

1. The Basic Fund

At least 6 months worth of living expenses. This provides insurance for life’s small to medium sized emergencies. Everyone should have a basic fuck off fund. 

2. The Premium Fund

Debt free + 6-8 months worth of living expenses. Insurance for even the most catastrophic emergencies. 

3. The Domestic Fund

8-12 months of living expenses + enough to cover the moving costs to live and work anywhere in the country. For more info on this, check out our 20-Something's Guide to Starting Over.  

4. The International Fund

A full year’s living expenses + enough to travel and live abroad doing work you’re passionate about, from any country where you can legally get a visa. 

5. The Fuck Off Lifetime Status Club

Enough savings in the bank to cover one year's living expenses from interest and dividends alone, doing whatever you like, and answering to nobody except the law and your own mortality 

For example, if you’re comfortable spending $30,000 a year, divide that by a conservative 5% annual return and you get a fund of $600,000. If you don’t mind living in a smaller city, town or in the countryside, you could achieve lifetime fuck off status on much much less. 


5 Steps to Building Your Own Fuck Off Fund


1. Figure out your minimum expectations

Make a list of everything you need each month in order to (a) survive and (b) be reasonably satisfied with your life. The fewer Rolexes and mansions you have on this list, the cheaper you can buy your freedom. 

2. Track your actual spending for 3-4 months

Be honest with yourself and figure out where you stand today. How far are you from your goals?

3. Make a realistic budget 

A budget is like a marriage between reality and your aspirations. A reasonable budget means you don’t end up eating ramen by the end of every month. And don't try and compare yourself to others. Do whatever works for you (so long as you're doing it better than the person you were yesterday). 

4. Set up a separate savings account

This savings account should be out of sight and out of mind. Don't open it with the same bank where you keep your checking. 

5. Set up automatic transfers

Set it up so that a certain percentage of every pay-check goes into your savings first. If you don't have a Basic Fuck Off Fund yet, you should be holding off on non-essential purchases until you've achieved that minimum. Having the patience to buy your freedom first is worth infinitely more than the new (insert name of status seeking object here) you don't really need.  

And remember, over time, you need to make sure the balance of your Fuck Off Fund keeps up with your increased monthly spend. 

July Money Diary: How Much Does It Cost to Live in Los Angeles?

Jennie and I live a fairly frugal, minimalist lifestyle in Los Angeles, but this hasn't stopped us from enjoying ourselves. This money diary shows readers how much it costs for two married, twenty-something millennials, with no kids, to live in the City of Angels.  


Ivan here.

We use the app GoodBudget to track all our expenses. The app uses an envelope budgeting system, where you set up a budget for each category. At the beginning of every month, each "envelope" is filled and you subtract your spending.

We prefer GoodBudget over Mint because the app forces us to log every expense manually. Why? We believe that the process of saving money should be made easier and spending should be made harder. Logging our expenses as they happen help us make more conscious choices. And we never get blind-sided by our bank statements or Mint app. 

The app also has a great reports feature that breaks down our expenses by category. Let's take a look at our spending for the month of July. We think it's a pretty good representation of what a typical month looks like.  

Expenses for the Month of July (2016)

1. Rent and Bills ($1709.62)

Our fixed monthly costs. This is how this envelope breaks down:

  • Studio Apartment: $1,400 (including all utilities and parking)
  • Phone Bill: $150 (for a six line family plan. We take care of the bill.)
  • Internet: $55 
  • Gas & Household Essentials: $100-150

$1400 is a little on the high end for a studio apartment, but we live in an expensive part of town that's just a 10 minute commute to work. Usually you can get a studio for about $1100-1200 in other parts of LA. In our case, we value our time much more than the savings. LA rush hour traffic is no joke. 

Think about it. One extra hour a day sitting in traffic means you lose almost 24 hours every month. That's the equivalent of taking close to two weeks out of every year. Would you pay $2000 a year to live 3% longer AND save yourself a lot of unnecessary stress? You bet we would. 

2. Eating Out & Entertainment ($328.68)

We go out a little under two times a week and try to keep it under $50 a day (with the exception of birthdays and anniversaries). This is a warm-up for when we eventually go on our round the world trip in 2018. If we can do $50 a day in Los Angeles, we can make it pretty much anywhere (outside of maybe Western Europe and Scandinavia).

3. Groceries ($305.27)

We buy in bulk at Costco and Trader Joe's, with occasional trips to an Asian supermarket. We don't go out of our way to cut back on groceries and it always works out to about $300 a month. 

4. Savings, Education, Investments ($232.87)

The title is a little misleading (we don't save just $232 per month). This tracks the money that we use to invest in ourselves. This includes things like books, registration fees for courses or exams, tools/electronics for work etc. In July this was mainly website and domain registration fees plus other costs related to starting The Origami Life! 

5. Miscellaneous ($156.53)

Morning coffee runs, afternoon ice cream and midnight snacks go here. Sometimes it's the little things that make life worthwhile. 

6. Life Happens ($54.40)

Unexpected expenses. These are the things we didn't budget for. Usually around $50-100 a month. 

A 20-Something's Guide to Starting Over
We shall not cease from exploration, and at the end of all our exploring will be to arrive where we started and know the place for the first time.
— TS Eliot
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Ivan here.

Los Angeles is our sixth city in ten years. This means that on average, we move to a new city every twenty months. With any luck, we plan on being on the move indefinitely. It’s how we like to live.   

To us, moving is living. I joke with Jennie that the day we decide to settle down and buy a house may as well be the day we pick out our own coffins (I prefer maple, she likes bamboo.) Or as Woody Allen puts it in his film Annie Hall, “a relationship, I think, is like a shark. It has to constantly move forward or it dies.”  The last thing Jennie and I need is to have a dead shark on our hands.

While you can certainly ‘move forward’ without changing zip codes, it’s a special kind of thrill to be able to physically hit a reset button. It’s like flipping over a Monopoly board when the game has dragged on for too long. Therapy.

Over the years, we’ve gotten pretty good at starting over. Here’s a rough guide to this simple art:

1. Recognize when it’s time

There are no hard and fast rules, but it’s usually time to make changes when your days become virtually indistinguishable from each other. Sun comes up, sun goes down. Sunday starts looking like the inbred cousin of Saturday.  

This requires introspection: what is it that you want out of life? What are your goals? Are your routines getting stale? Are you starting to feel stagnant?

We try to keep in mind that time is the only currency you’re always spending that can’t be replenished. When you find that you’ve grown numb to time's passage, getting punched repeatedly in the face is preferable to feeling nothing at all. 

2. Plan Your Exit

If only in your dreams, you’ve already traveled to the city you’d love to wake up in.  Here’s your chance to make that a reality. That said, as hard-core planners, we don’t believe in making follow-your-heart, impulsive type moves. 

Spoiler alert: you know that movie The Beach starring Leonardo Dicaprio as the young dreamer who decides to go searching for the perfect beach, even though the guy who tells him about it ends up committing suicide five seconds later? Yeah, do the exact opposite of that. Get your ducks in a row. Have a game plan and plan on following through with it at least 6-12 months in advance. 

                                                                       Don't be this asshole. 

                                                                       Don't be this asshole. 

3. Make a Moving Budget

Moving is expensive. Between flights, a security deposit, first/last month’s rent and new furniture, you’ll need a minimum of $5000-7000 in start-up costs to move to a new city. A good rule of thumb is to track your expenses for a month and multiply that by six. That’s your emergency fund. Then plan to save another $2-3k on top of that. 

4. Keep Your Relationships

In the digital age, your relationships shouldn’t be crutches that keep you from doing the things you want. Outside of the person you’re going to be living with, you don’t really have to compromise on anything. Distance has given us a new perspective on the relationships that actually make a difference in our lives, and those are the ones we make the extra effort for. 

5. Ditch Your Things

We regard possessions as major inconveniences, which is why in preparing for each move, we sell or donate all our cheaply purchased furniture and purge everything that doesn’t fit into two large suitcases. 

If you’re moving to a city that doesn’t require a car, do yourself a favor and get rid of it. Cars are the worst (more on this in a later post). Having the luxury of ditching yours is often enough to justify your entire move. 

6. Take a Scouting Trip

Scouting your destination beforehand can really give you a leg up. More importantly, it’ll help you avoid the costly rookie mistakes in your first couple of months.  You’ll be surprised how much you can learn in just a weekend if you tackle it with a purpose. Ask questions, meet people, get advice from locals and simply walk around the different neighborhoods. 

7. Savor the Countdown

Life is strange. Nothing makes you fall in love with a city more than when you’re about to leave it. Starting over isn’t about running away, it’s about giving you a new appreciation for the here and now. 

8. Start a New Life

The first few months should be a balance between exploring new things and developing a routine. It’s kind of like jazz -- you improvise over a steady rhythm. Exploration gets you out of your comfort zone and a strong routine eventually gets you to where you want to go.

For us, that's everywhere.