3 expenses you should reduce immediately, according to Supersparer

The new Netflix documentary “Get Smart With Money” revolves around a group of “mentees” who are each assigned one of the four financial experts in the series for a year.

The high-earning couple Kim and John from the US state of Colorado also sought the help of savings expert Pete Adeney. And he should know: The super saver, also known as Mr. Money Mustache, retired at the age of 31.

John is a home husband and father, Kim is a psychotherapist and life coach for women, earning around $300,000 a year. Before they met Adeney, her monthly expenses were $13,000. “Every time we make more money, we spend more money,” Kim said. “I want to go to the other side of the spectrum and learn how to save. But we definitely need someone to help us.”

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The couple’s goal: to learn the be-all and end-all of investing and saving and possibly even bringing retirement forward by a few years. And indeed, at the end of the year that they worked together with Adeney, the couple could look back on a positive balance. The two saved a total of $8,000 a month. They invested the money they saved mainly in index funds and stocks.

The following three savings tips have helped you.

Amazon purchases

Adeney made it clear to Kim and John right from the start that they would need to save 25 times their annual expenses in their investment accounts before they could quit their jobs and retire early. “It’s not really your income that counts. It’s your spending decisions,” Adeney explained in the documentary.

The couple gave Adeney a detailed breakdown of their spending, which revealed that the pair smashes $2,000 a month on Amazon purchases alone. Kim admitted she bought clothes and toys for the kids as a “reward” after a long day at work. But she was willing to break the habit.

“I’ve definitely changed my attitude towards Amazon and shopping because we have a really solid goal that we’re working toward. Being able to retire in the next five, six, seven years is a far greater reward than anything I could buy,” Kim said. After three months, the couple was spending an average of just $168 on Amazon purchases.

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grocery shopping

Before working with Adeney, Kim and John spent $1,200 a month on groceries. “That’s banquet-level expenses for a small family,” Adeney told them. “It’s like feeding yourselves royally.”

Adeney showed them how to save money per serving when shopping in bulk for each meal. Indeed, after the first three months, the couple was able to reduce their grocery expenses to just $1,000 a month.

Adeney said he felt he needed to push the couple even harder to save on grocery shopping. But ultimately, he was confident that with the new mindset, their spending habits would improve on their own over time.

property

Kim and John made $36,000 a year in mortgage payments for their large home in Colorado. After nine months of trying to live as frugally as possible, they decided to cut back on their home expenses – which was by far the biggest expense.

“It feels like we’ve done a lot of simple things, like spending less on Amazon, shopping more consciously. So we decided to give up our home here in Colorado,” explained John. They plan to rent out their home in Colorado and use the profits to pay off the mortgage on their new, smaller home.

Adeney concluded, “The ultimate goal of money is not to have to think about it. If you spend little money, all other problems vanish.”

Disclaimer: Mathias Döpfner, CEO of Business Insider’s parent company, Axel Springer, is a member of the Netflix board of directors.

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This article was translated from English by Lara Hansen. You can find the original here.