Reality Check- We bought a lot of stuff

This was perhaps the best thing that could have happened to us- a reality check. This post had started completely different. We felt that we did really good last year especially with our clothing and heeling purchases. Guess what that didn’t happen.

The Past

When we started working I was very much interested in getting myself a shoe collection to rival Carrie and a decent set of clothes to go along with my clothes. I did manage to deck out way better than I do today. Washing clothes was a big chore without a washing machine so before I outsourced the chore I would rather buy a few pairs than wash stuff. I had left home with a suitcase and the day and the day I shifted to our first married homes I had a huge taxi full of stuff. This was after I had thrown away quite a bit of stuff.

Once we moved to Hyderabad being married caught up to us and as we started to travel more buying clothes seemed like less of a priority. This does not mean we never bought clothes, far from it. This was around the time when online market places has risen their cheap heads and we enjoyed shopping form our bed quite a bit.

Past year

However both of us were under the impression that last year we had been good kids who did not waste a lot of cash on clothing various parts of our body. Oh how wrong we were. Once we sat down to count clothes and shoes bought we came to following total

Mr. S

2 Tshirts

1 Trouser

1 pair of shoes

1 piece of ethnic wear

Total- 4 items

Mrs S

3 Tops

2 Jeans

2 pieces of ethnic wear

1 pair of shoes

Total – 8 items

It might not sound that bad with just 12 items bought under various heads, but it is way more than I was under the impression we bought last year.

The Bottoms Problem

The worst part is both the jeans I bought just didn’t work and gave up due to my perfect (absent) thigh gap and I am in the market form some new ones. The pairs of shoes we bought are working great for both of us especially in rains. The pouring ruined my comfy leather shoes before we invested in crocs. The ethnic wear was for a close friend’s wedding and since we don’t wear or use them often older ones didn’t fit or were missing a component or two.

You know what I did above? This is something we have both been doing a lot lately and most of us can easily be accused of. I am making excuses. A lot of above are real facts and situation which needed some expense at that time but not all of them.

Fighting my own excuses

When the jeans gave away around December I was left in a lurch with just one pair of trousers to go with everything I wear to office. Around this time we were on a drive to save maximum amount we could and we were both feeling we can do better. I did not run out to buy another pair right away. Instead thanks to some health related changes and some weird coincidence I has lost a good amount of weight which meant a few older clothes started fitting again. As I write this I am wearing a top I bought way back in 2012 and hadn’t worn in last at least 2 years.

I also started to wear whatever kurta pajama fit me, to office. These usually require ironing two things instead of one in the morning and there are no pockets,so I hardly wear these.

But this time I was not making excuses and had decided to postpone any purchases off to next FY (our office subsidizes office wear for a certain amount each FY).

Future Plans

I now plan to go through my closet once more, purge things which have un-mendable holes or stains and things which I can’t fit into. Next step is to mend things which can be mended and then decide if I am really running low on clothes.

In last few weeks I was gifted a considerable sum as gift cards for a big chain. I can use it to buy clothes for free or I can buy stuff I think I need for my house (which is probably just want) or I can give it to someone as a gift or exchange it for cash with someone who is going to shop there anyway. To be true I was not considering any of these options a week back. Till then we were martyrs who hadn’t bought anything in one full year.

This does not mean that there are no clothing purchases in near future especially if I keep on losing the huge amount of excess weight I have on me right now.

This is not just about our clothes. This feeling of martyrdom and complacency extend to more areas of our life like eating out and cooking. I have been feeling like shit and the job has suddenly become quite tiring of late. We work half days on Saturdays which means only one day to sleep in. this means none of us is really in the cooking mood especially for something to carry to lunch. We have spent a small fortune on eating out in past few months.

I am someone who strongly believes in not killing oneself for every tiny penny and some days did drain us so much that we could barely eat takeout before we crashed. This is not true for a lot of days though, days when we have been busy watching something online or playing one game or another.

It extends beyond clothes

Eating out is one of the biggest drains on our income and has definitely affected our savings rate. We both love food and it is really difficult to not feel like you deserve a relaxed evening when you have been working your ass off for over 10 hours. It is also equally stupid to define every indulgence as I deserve it because I did that.

If we look deeper I am sure we can find other things where excuses have crept up on us. Thankfully we are not making excuses like ‘… it is expected of us to do …’. To be fair we have succumbed to multiple such lines from our parents which drive us nuts. Thankfully we are not making these excuses to ourselves.

It is such a weird thing, life catches up to you and you miss a step without realizing what has happened. Last night was another such realization. I haven’t been at the top of my health lately and it has become a constant source of stress for me. Last night however I had to cook and finish off the perishable food we have in the fridge before we leave for a vacation. Suddenly it did not feel as difficult as it had been previous weeks, once I started.

Have you ever been under a strong belief about yourself or your belongings and have been proven wrong?

The Way November Went

November was almost near October in terms of spending but a lot better in terms of comfort. The memory foam mattress we spent on in October is finally rewarding us with great sleep. Overall it was one expensive month, with a lot of changes both in how we look at things and actual changes which will affect our lives in the long term.

We spent around 27000/- this month apart from rent and mortgage. We also managed to put in a decent sum into our investments as we talked about in our previous post. This was probably the first time since we started on this quest that we timed the market.

This month’s high expenditure was in line with visiting family and being a 4 member household for a major part of the month. A lot of taxis were taken, restaurants were visited and gifts were exchanged. However we believe this is something which will happen at least once a year and will allow us to narrow down our actual annual expenses.

We cut on other expenses so that we can spend on things which matter to us like family. But to say that there were no frivolous expenses would be a lie. We could have cut corners or simply bought cheaper stuff. In most cases that would have resulted in a lengthy conversation which neither of us wanted to be a part of. After you are married for over half a decade you realize there are certain things you can simply not get through to your family. Picking your battles is the way to go!

November also marked a milestone for us and we surpassed 5% of the amount we believe we would require to retire. To be clear this is only in our actual investment not including our home equity or gains on our investments. It has been almost 6 months since we started our first investment in June and both of us believe we are on track. However we are looking at reducing our expenses even further. We plan to be a part of the Uber Frugal Month challenge started by Frugalwoods on their site and our aim is to keep out budget under 10K. However anything below our current estimate of 16K is a blessing.

Though we have been able to keep our actual household expenses with in the budget there is a clear upwards trend and in last three months. This has been a result of mandatory spending (passport renewals and health checkups) and increased household size, but we are not completely off the hook.

One of the major expenses which we could simply not justify was a midnight buffet at an inflated cost with a friend. The food was good but none of us walked out satisfied. It contributed to 6% of our monthly expense and was something which we wold want to avoid in future. Our solution is to host a few dinner parties which will cost us far-far less and we won’t have to wait till 12 in the night to get fed.

We have realized that we are spending far too much on food than required. We established this by not buying any vegetables except for coriander (technically it’s an herb) and green onions in last two weeks apart from staple trio. We have not gone hungry either; instead we have been using what we have already bought. For us one batch usually works for 2-3 meals for each one of us.

One of the things which have helped us achieve this is meal planning and prepping over the weekend. Most Indian curries reheat very well. We cook a bigger batch and pack in separate containers so that when we leave for office lunch involves picking up a box. The week we have all the food ready, cuts down our lunch costs by at least 25%. Since we still buy rotis from our lunch lady we still spend that much. Not only the cost since we know what we cook with and how we are in better control of what we eat. If you are looking at packing your own lunch then this is definitely a way to go about it. If you are ok with rice as your starch in lunch then you are in even more luck. Its way too easy to prep rice for the week, just pop it in fridge or freezer and then reheat or thaw using your office microwave.

For December we are looking to rationalize our expenses and become more efficient in our day to day jobs. We are travelling again for a week in December and are planning to throw a house party for our team on New Year ’s Eve. We believe it will be quite cost effective instead of going out as well as allow us to celebrate in safety of our house. More than that, I love cooking and none of us are averse to entertaining. This party will serve as a dry run for a few other dinner parties we would like to host instead of going out to eat ourselves.

No post about this November can ever be complete without a brief on how we coped with demonetisation. We actually fared quite well. We usually transact electronically and our credit card is our trusty companion (paid full every month). We did however stand in queues but were able to withdraw enough to provide cash for family and ourselves. But the biggest surprise was reduced crowds in the malls on weekends. We had in past spent 20 minutes in the checking out queue to get groceries but this time it was a breeze.

Our investments have fluctuated through the month as markets dipped up and down. Right now for us it is a game on waiting and watching as our money works for us. That is definitely the benefit of a long term plan.

How did your investments fare in the uncertain times of these past few weeks

Organic on a Budget in India- Slash the Grocery Bill

Organic food has started featuring more and more in our staples and other grocery options. Over past three months we have consciously tried to include most if not all organic food options in our dietary chain. There are two main questions which I had before we got on the organic bandwagon.

  1. Can you even taste the difference, is there a difference?
  2. How much will it increase my budget?

The answer to above questions is yes and not much respectively from our last three months of experience.

The truth is most organic produce is expensive, and in many cases twice the price of generic store brand. Another truth is that a lot of that price is because of fancy packaging of the product. When we decided to switch our regular grocery items for organic options we were lucky to find a major promotional sale on a brand. That allowed us to get a few supplies (which we are yet to run out of) for quite cheap. If you go back and look at this expense report you would see our haul and we have been adding to the pantry little by little.

We are yet to go over our budget because we bought a lot of organic food options. This was a major surprise for me because I was really sure we would easily triple our monthly expense. Here I have to admit we are short of organic options for a lot of things we eat especially pasta and noodles which is am sure I can’t make at home. Instead of talking generally let us talk about the specifics.

Buying less = wasting less=spending less

Organic Staples which will last us over 3 months. Total cost- ~1150/-
Organic Staples which will last us over 3 months. Total cost- ~1150/- (and a few regular food)

We like most people out there love shopping, but unlike them we go extra mile to find a few deals. This meant we were buying a lot on cheap prices, but the fact that we were eating out a lot (see our June expense report) meant a very small portion of this was actually getting used. This meant a lot of wastage and a lot of food unwillingly donated to the pests and bugs of the house.

We now buy only enough so that we consume it in next 2-3 months for dry staples and week or so for fresh produce except dairy. Dairy lasts a lot longer if you buy the right kind and store it right. Our grocery bills are right where I would like them and include a lot of ingredients you would probably not find in most Indian kitchens like Asian sauces, balsamic vinegar, olives etc. We also buy pasta, noodles, tortillas and more which add to the grocery bills in big chunks.

No Sugar- not even Organic

We are both savory people and enjoy savory food and beverages more than their sweetened counterparts. Though we enjoy aerated drinks every now and then they are never a part of our monthly grocery haul. Not only does this shave off a bit from our grocery bills it has also reduced a lot of junk from our diet. We also consume less than half a kg of actual sugar between the two of us in a month. For this year the store near us is running a promotion for free sugar every first 1000/- you spend in a month. We send this to the ‘rents and have been transferring the savings to eating real organic food.

No junk food= more money for real food

You will notice very few potato chips will ever have organic written on them and those which do, come at a great price. We have of late reduced our consumption of snacks and any saving gets transferred to eating organic actual food. To be true we still have a long way to go to completely get the junk out of our food but the reductions we have made are clearly evident in our budget and food habits as well. My next goal is to make some snacks ourselves using our organic supply just to know what goes into our bodies.

Research the hell out of everything

Organic food is expensive till you are buying it from anywhere. The only way out of higher prices is to grow/farm it yourself or to research the hell out of the products. Our research and curiosity (as with anything financial) has helped us keep the costs down as well as find organic produce when we thought none existed. Like the organic milk we stumbled upon while browsing the aisles of the supermarket. With the offer on the milk it came out way cheaper than our current non organic UHT milk. Similarly yesterday I discovered that one of the bigger online grocery shops have their own brand of organics which is 10-20% cheaper than the branded ones we bought last few months.

Grow Organic Yourself

Like making our own snacks growing our own food is something which I am currently looking at with great interest. Today’s task is to scout our apartment’s terrace and see if we can put in place a few plants there. My currently rewarding exploits are in organic sprouts. I have been growing them successfully to quite good lengths from organic mung beans I brought. Barely an hour a week allows us to munch on these for snacks or include them in our meals multiple times. To be true you might hear about a boutique sprout shop soon.

All of the above will help you not just eat organics on cheap but they can be implemented to simply reduce the grocery bills whatever the eating habits might be. If you have better solutions for us to help us lower our bills and eat better (especially if I can use it in India) that would be awesome.

We made mistakes, thankfully we know better now

We have learnt and most importantly unlearn a lot of financial truths over a very recent small period of time. A lot of financial mistakes were made; rectified and right course was sought. I have written about frugal life a bit but this post is focused on financial decision and not saving percentages.

Let’s start with our financial mistakes:

No research

Both of us pride ourselves on our researching capabilities so it was very humiliating to realize what a fool we have been for last 5+ years. Seriously I have been kicking myself a lot lately. If you have ever thought, that the option before you is quite comfortable and will take away a lot of work; STOP and research it’s real cost to you. We realized if we hadn’t course corrected we would be donating pay checks at one financial service provider or the other. Paying out of our pockets simply because we did not know what options we had is not just stupidity it’s financial suicide.


Did you know that there is an option to buy mutual funds directly from the AMC which run the fund and not through DEMAT providers, distributors and advisors. It might not have been a very easy thing to do earlier but over past few weeks since we invested in our very first index fund we realized we had been paying a huge variety of fee. This is definitely not a variety I like especially since it can be resolved with nothing but a few minutes of your time. Here’s a brief view of varied fee you would typically pay for a single mutual fund transaction over and above the actual comission.

Transaction fee: varies from 100-150 Rs for lumpsum purchase and 30Rs.-1.5% for SIPs. A few providers don’t charge you anything once you rice above a certain threshold. Here’s an example from ICICI.

Service Tax: yup you pay additional tax on the fee that you are charged to buy the fund through the service provider.

Commissions/higher expense ratio

If you buy through any agent you are liable to pay a commission, but most of us believe it is a onetime commission paid when you buy or sell. Now this is where we are wrong, most DEMAT providers get trailing commissions. In short as long as you hold the fund you bought through them they are getting a commission. If you do use the personal advisor or other such facilities there might be a good reason why you would not feel bad about parting with your money.

We on the other hand were always involved in our own researches though not always the right criterion were used but we knew what we wanted to buy and for how much. W paying so many fees just feels wrong.

Not investing in Direct funds

I had no clue that there was an option to buy mutual funds under direct scheme. This means that you are buying directly from the AMC and are therefore not required to pay for a distributor’s cut. Remember we did our own research and just used the Demat account as an easy place to buy funds this option would have saved us a lot of money.

For example in the clip below from OROWealth the saving vs. regular is the difference between buying a regular vs direct mutual fund.

Direct Funds

If you are confused as to how much of a difference this would make imagine loosing 2250/- for every lac you invest every year. If your investment funds in 10s of lacs or is above 1 cr the fee becomes significant. Money lost on a fund of 7lac in a year is currently more than what we spend per month. I don’t see the point of missing out one month’s sustenance every year.

Buying wrong funds

There are so many ways of saving tax and tax saver mutual funds are one of them. I thought they are the best ever tax instrument since you get a good rebate while you buy a mutual fund. Now I know that is not the case, why you ask. Remember the fee I talked about, they are too high for the tax shield/saver funds. Also PPF is one of the better ways to save tax and diversify your investments, which I will discuss a bit later.

I am sure you would have guessed who I bought those finds through.

Listening to advisors even those who call themselves your friends

Like someone said yesterday over at MMM forum no good deed goes unpunished I trusted a friend and found out I was a fool. He might not have started off with the intention of giving me shoddy advice but that is actually what he did, and all of that for some commission. Needless to say, I won’t be taking advice from someone any time sooner. It is quite possible, that he really believed in the product he sold to me around 5 years ago. I have learnt to research the hell out of suggestions after dubious results from following the suggestions of someone who was a trusted colleague and an advisor.

The biggest mistake ever

I love shoes and am not ashamed to say so. When I started working I would buy shoes every week thankfully I could not buy them full price yet so I took advantage of sales all around us. Mr. S on the other hand would not spend a penny if he did not have to. Result was he had over a lac saved in first year of our jobs and I had barely a few thousands. I was almost always in debt, only the lender would usually be my then boyfriend now husband. This did not change till we began travelling more and more. Now every shoe I bought was a night in a faraway place I was dying to visit.

The biggest change in our money outlook happened when we were moved to the expensive city. With rent three times of what we were paying in the previous city, higher taxes on every shit and no real raise we had to do something or else we would have never been able to equate our loan*. In fact we would have been eating from our savings very shortly.

Had we taken the approach we now have to our finances and running our life we would have definitely been far closer to our goal.

*We equated our loan but rerunning our calculations made us realize there is a much better way of using the money. I will probably write a post about it soon