Friday, January 22, 2010

Living With Money

For the first time in my adult life, I am earning money that I get to keep. I finished off my student loans last October, paid for my U.S. trip in November, and have since started building my first-ever cash reserve. It feels strange, no longer having a designated recipient of my money (student loans). I have no car, mortgage, or credit card payments, only savings and investment accounts.

With this 'freedom' comes a new experience: real disposable income. If I wanted to I could buy the fancy camera I'd really like to have, or travel to South America, or stay in a nice hotel during the Tokyo Marathon. I could do all of those things and still save. Being debt-free with no immediate financial goals opens doors I've never peered beyond before.

Of course that's not my lifestyle and I have no intention of adopting it. I have made a few different choices since November that cost me money, namely acquiring a cell phone (arguably a cost-saving move) and a girlfriend (not a cost-saving move), but otherwise my month-to-month expenses remain quite low. I think one interesting point is that I don't see this job and its benefits as a permanent lifestyle, so I am saving with anticipation that I will again find myself in the world of poverty (the U.S. government's extremely generous definition of this is earning less than $11,000/year - something that, before Japan, I had only not achieved once). When I was having a blast hiking the Pacific Crest Trail, I remember figuring I could do that for about $10/day. That is the same price as a dinner here. These are the sorts of things I pay attention to. If I thought I had a promising work future it wouldn't be a big deal to elevate my standard of living. But I don't want to work, so it is irresponsible [to my future] to spend like I'm making what I'm making.

I wonder, though, if I will [un]consciously change? I know in looking back at who I was when I arrived here (really cheap!), I've already stepped quite a few rungs up the ladder (though I think this is actually more in my mind than my spending habits, see: wealth effect). And now that I no longer have the financial goal of paying off my student loans, it's an unprecedented prediction to say I won't relax my savings. I hope I don't because I think I have invested many years developing sustainable spending habits, but who knows if I'll change my mind?

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