*25k net, I make over 30k gross. Even with a small income, your net worth can increase.
It is that time of year again. Time to reflect on all the achievements and failures of the past year and learn what changes can be made for the upcoming year.
As some of you know, I am a Ph.D. student. These numbers mean that over 40% of my income has gone to debt repayment and growing my net worth (click here to learn how to calculate it). Call me crazy, but I live in Sweden where my taxes are utilized in ways where I do not have to worry about if something detrimental happens to me. After paying the equivalent of $100.00 USD annually, my healthcare is free for the remainder of the year. No need to worry about bankruptcy. However, I do have to pay for the biggest ticket items in a budget – housing, eating, and transport.
I want people to know that it is possible to pay off a lot of debt on a low-income. Yes, this means I had to cheapen or cut a lot out of the budget. For instance, I re-lowered my phone bill, as I am always looking around for cheaper options. That is the great thing about competition. For this reason, I have never had a phone contract because if I find a better option I will move to that. My transport bill is cut to 0 for 6 months out of the year when the weather is nice. Let’s be real, I live in a cold place.
So, when it is warmer I cycle, and when it drops to 35 F I begin to take the metro. This is ~$180 USD for 3 months of use. The great thing about cycling is exercise, however, my grocery bill does go up slightly because I eat more during this period.
In April I moved from the city center and cut my rent by more than half. I was paying ~$800.00 USD and now I am paying ~$320.00. I am only 5 stops away from the central station as opposed to two.
Instead of having the luxury of my own apartment, I have opted to live in subsidized student housing and sharing a kitchen with 9 other people. Fortunately, I only have to do this for a short period of time (until the end of my Ph.D.).
I now get my groceries delivered which prevents me from mindlessly spending and only buy according to my list. Fortunately, I am able to get free delivery so that is not an additional expense to worry about. Another change with my grocery budget is that I no longer buy meat unless it is on sale. The majority of my meals are vegetarian, I have always been a flexitarian since I have generally opted for the vegetarian options. Having my budget set up like this means I am able to spend, at most, $100 USD a month on groceries.
It is these kinds of sacrifices that I am making. However, 60% is going towards my living, housing, transport, and discretionary expenses. Which is a little high, I think.
I will be trying to lower it to 50% overall and increase my net worth by 12k in 2020.