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Creating Freedom Through Financial Independence


Early Retirement Objective: Kill Your Bills

September 22, 2017

Now that we’re back into the swing of things, let’s get back to the all-important topic of saving.

I’m not sure if you’ve noticed, but my articles tend to be focused around either saving or investing.

Mindset is critically important, and so is lifestyle decisions.  In fact, they’re all intertwined so much that they all blend in to become the saucy category of Saving.

There’s a damn good reason I focus on saving and investing.  Because it’s the one-two-punch combo, that knocks your opponent (mandatory work) out cold.


‘Rocky’ your way to Early Retirement

Each ‘Round’ is a year, for this Early Retirement boxing exercise.

In the opposite corner, our opponent (mandatory work) is sizing us up.  He’s a formidable opponent.  Many people never challenge him.  Most just accept his dominance in the boxing ring of life, and never question his rule.

Just quietly, I always thought he was a bit of a punk, and there had to be a way of giving him a good old-fashioned beat-down 😉

You just need to have a strategy!

Now, this opponent of ours (mandatory work) would be happily slugging away at our face for a good 50 rounds, from age 20 to 70.  But ideally, we want to knock this sucker out in less than 10 rounds.  It’s possible, but it’s not easy.

If you train hard and are dedicated to developing your solid one-two-punch combo, of saving and investing, then you can do it.

Sure it may take longer for some, who haven’t built up the same level of financial strength yet.  But it sure as hell works, given enough time.

And there’s no need to drink raw eggs and punch carcasses though (like Rocky), this is a financial fight!

I was so fixated on beating this opponent (perhaps too much), that I focused on him from morning till night.

Like going for a real heavyweight title belt, I sacrificed much time with my partner because I was training so hard (working night shift, overtime, learning strategies), but in the end the dedication paid off and that sucker was knocked out before the 10th round.


When it clicked…

Along my Early Retirement journey, something changed for me.

One thing just took a while to ‘click’.  And when it did, the expected time to our Early Retirement was cut down by at least a few years.

It was this…

Our level of spending was directly responsible for the amount of time we needed to work.  The amount of investments we needed, and the time it was going to take.  All related back to this one thing, our spending.

It might seem like stating the obvious, but as I’ve said before, sometimes I’m a slow learner.

Until then, I just accepted “this is basically what our expenses are, and this is how long it’s going to take to retire early.”

After the connection between spending and compulsory work became so obvious, spending definitely lost some appeal.  I began looking at everything we spent our money on and questioned it.

Was it worth it?  Did we need it?

Essentially, everything we spent money on, had to be worth giving up a portion of our life for.  Since really, by working and spending, that’s exactly what we’re doing.

What we found is, many things simply weren’t worth spending our freedom on.

You’re not spending your money, you’re spending your freedom.


Attack Mode

I went into a frenzy looking for ways to improve every area of spending, to bring early retirement closer.

There seemed to be ways to optimise everything.  Every little category could be made more efficient.

Think about it… a small amount of improvement in every single area you spend money on, adds up to an enormous amount.

I wrote about this in detail in my post – It’s All About the Increments, Baby!

Our strategy was to first write down where all our money went.  Some people have it all tracked on a spreadsheet.  Good on them I say, but it’s not for me.  I’ve wanted to do it many times, but I’m far too lazy for that.

But the point is, you need to know where it goes first, so you can improve on it.

Truthfully, many people have absolutely no idea where their money goes.  If you’re not sure, just go through your online banking transactions, and write down all the places it went over a period of a few months.


Next step.. break it down!

At this point, you should have a very long list, of all your weekly, monthly, yearly expenses.  It makes for some scary, but interesting reading.

Strangely, what I found is the large but infrequent expenses like car rego and maintenance, seem like a lot when looked at as a weekly total with your other car costs.  And small but regular expenses like coffee, take-away food and phone bills, look huge when measured on a yearly or 10-year basis.

The next step is to go down the list, one item at a time, and think about a way you can optimise it. Better yet, kill it off entirely!

Remember, if you somehow had no bills, you would be free for life.  But alas, we live in the real world and we have bills.  So it makes sense to minimise the bills, and therefore, maximise the freedom.

In the spirit of an older article, treat your household like a business and go on a bill-killing rampage, to improve your household profits.


The real-life conversation

In my experience, the typical scenario goes a little like this…

Someone gets excited about the prospect of early retirement and having the freedom to spend their time how they see fit.

They next learn that Savings Rate is King, and become disappointed.  They say they can’t save, because they have too many bills.

That’s fair enough.  But my answer would be “well get rid of them!”

Yes, it might sound like I’m being unsympathetic or unrealistic.  And maybe I am.

But from where I sit, many of the bills are optional.  And many of the remaining bills can be reduced to minimise the damage, and maximise your savings.

The average household could probably cut their spending in half, as we did, if they simply work on improving their finances and make some changes.

It shouldn’t feel like hard work, or painful to make changes.  It should feel empowering and motivating, to change your entire future and the life you’re able to live, just by optimising your spending.

Other benefits will come immediately.  When you have less bills, you feel lighter, more relaxed, and generally happier.

That’s because you have less commitments, your earning requirements are less, alleviating any pressure you have to keep earning that higher salary, just to stay afloat.

The feeling of freedom increases as your bills decrease.



You may surprise yourself at what you’re able to achieve.  Despite being a long-time saver, even I was surprised at the improvement we made.

Since we kept on reviewing our expenses every 6 months or so, we kept finding things we could improve on.  This became a powerful habit in itself.

Our spending level dropped over the years, and our savings rate increased.  Importantly, our time-frame to early retirement reduced as well.  We needed much less in investments to cover our now-reduced bills.

Amazingly, I can’t help myself but continue this habit, so there are more savings to come in the future.

Admittedly, much of the future-savings involves moving house first, so it’s quite a few years off.


Learning from others

The strategy of killing your bills, or at least improving them, systematically, one at a time, really works.  It’s exactly what we did!

You could say it’s more of an attitude to how you approach these things that matters more, rather than just some simple number-crunching.

I will try to have a balance of both on this blog.  Because ultimately, everyone learns differently and some messages are received better in different ways.

Sometimes it just takes repetition, some persuasion, and a bit of practice to let the lessons sink in.  It does for me!

This article is more about the general approach in my thinking, as opposed to the details.  I think that’s important though.  The ‘why’ is usually more powerful than the ‘how’.

In school and work, I was frustrated when shown how to do something, if I didn’t know ‘why’ I was doing it.

And since I’ve become fascinated with the world of investing, I want to know how great investors think, not just what they do.  The thinking and reasons behind the actions are important.



There are plenty of specific savings ideas in the works for future posts, but not right here… this is a ‘thinking’ article.

Besides, almost every single service, insurance, grocery item, product, trip, car and phone plan can be improved upon quite easily.

Unfortunately, this requires people to have some level of flexibility.  It’s the first major hurdle I come across.  It means changing what you’re doing now and finding new ways of doing things.

For some people, it’s just too hard to make any changes.  And without making any changes, things simply won’t change for them.

After reaching Early Retirement, I can honestly say that our most valuable behaviour was being flexible.

If we weren’t willing to change anything about the way we lived before, the things we valued, our true priorities in life, or what we purchased… then we simply wouldn’t have ended up getting anywhere at all.

We would still be working all week, with no end in sight.

As will some folk who read this but continue on doing the same things they’ve always done, and not make any changes… even though they know they really should.

To achieve something different from the masses, you need to do something different from them.

Here is the bill-killing process:  List everything.  Kill some things off completely.  Improve others.  Make the changes.  Repeat at least once a year 🙂

And remember… flexibility equals freedom!


6 Replies to “Early Retirement Objective: Kill Your Bills”

  1. “For some people, it’s just too hard to make any changes. And without making any changes, things simply won’t change for them.” <—– This is the reason so many people 'can't' save more.

    Great article! You are absolutely right that the less ongoing expenses you have, the less money you need to make to cover them. Seems simple but as soon as people get used to a certain level of comfort your words above come into play.

    Get uncomfortable – change your life!

    1. Thanks Miss Balance. Yeah that’s the thing… once we become accustomed to living in a certain way, anything else must be deprivation, right?
      Lifestyle inflation is an upwards spiral that often sends your finances into a downwards spiral.

      If we do nothing different today, why would our future be any different from today? 😉

  2. Ooh, I really like what you said about how it’s not money we are spending, instead it is our freedom. You are so right, and putting it in such words shine quite a different light on it. In fact, I might just pitch that to my husband – he is always going on about how money is not important but is freedom important?

    We definitely succumbed to lifestyle inflation – every year as my pay increased by that little bit, I didn’t attempt to squirrel that away. I just went with it and of course it disappeared.

    Now that we have started tracking our expenses, spending definitely takes on a whole different level of thinking. Instead of thinking “ooh where can I put this in the house?”, it’s more “Do I really need this? Is there something else I can use that I already have?”

    1. Awesome idea Pia, he may then see it differently. Very true, it’s not about accumulating money for money’s sake… it’s all about what it does for you – ie. get your life back and do what’s important to you. When you remove money from the picture, we get to choose how we live our lives based on whether something is meaningful and enjoyable, not just to pay bills.
      Great way to think!

  3. I’m one who sees most of our bills as necessary. I’m also a slow adapter to change. I see my process as shaving, shaving, shaving over multiple cycles. I could drop all of our insurance today, and in 10 years time (+ returns – inflation) we could have gained a year. Unfortunately I’m just not comfortable with that and the possible consequences. I’ll work to reduce premiums, maybe consider dropping some in the future, but hard core isn’t the way we want to go. Well just keep on chipping away at it and accept that 10 years won’t happen for us because we aren’t willing to deal what it takes.

    1. That’s a great approach, to keep chipping away. Just to regularly review expenses and see whether they’re needed or not is excellent.
      I’m sure you guys will do very well over time. It’s a process after all, and by focusing on it, you’ll surely be making dramatic improvements to your future 🙂

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