Trin and Bonnie in the sunset

Financial Independence Without Ever Writing a Budget

I am financially independent and financially free. Early retirement became a reality to me at age 43, but I have a confession to make, something I’ve never actually admitted before: I have never written a personal budget.

Yes, I know, I know. Isn’t that supposed to be rule #1 in Good Financial Practices 101? I’m not knocking the value of having a budget or even saying you shouldn’t have one. But there is something that is far more important than a budget if you want financial independence and financial freedom.

What Is Financial Freedom

First, let us define financial independence and financial freedom. It is not the freedom to spend with abandon on anything you want. That’s called filthy rich. Financial independence is having savings and assets that generate enough passive income to cover your expenses (and inflation).  Financial Freedom means you also have enough set aside for the unexpected like a knee surgery or an extra splurge like a dive trip to swim with sharks in CoibaIt is the freedom to move through life without being a slave.

Something I learned before earning my first dollar was an ancient proverb written by a King in Israel. He said, “The borrower is servant to the lender.”

The borrower is servant to the lender

Modern-day slavery comes in many forms. It could be that job we hate but have to keep to pay debts. Maybe it is the constant worrying about bills. It can even be the constant chase for money itself.

Financial freedom allows individuals to take opportunities to live a life of meaningful pursuits.

In his book, Made in America, Sam Walton describes how, after having already built his empire, he wondered about the pursuits of his children. He hoped that since he had built financial independence for them that maybe one of them would dedicate their lives to the good of mankind.

Financial freedom allows us to help others in need, making life rich indeed.

What is more important than a budget?

OK, so what is this key ingredient that is more important than a budget? It is our mindset about money.
Our view of money determines how we spend our money much more than a budget ever will. It’s about how we think about money, and how we approach spending it.

A budget says how much I CAN spend on something.  A mindset of savings asks how much I SHOULD spend on something.

Forget about what your next-door neighbor has. Forget about the exorbitant prices your friends pay at fancy restaurants. The average credit card debt in the USA is over $15,000.  The debt slavery facts are incredulous right now. If you don’t want to be in that boat you have to be different.

Car with a blue door a path to early retirement
Our Honda Civic. I loved that car. It was comfortable and never had a mechanical issue.

Before my early retirement, I confidently drove up to my corporate office in an ancient beige Honda Civic that sported one blue door.  In fact, that car is part of the inspiration for our blog name. I parked between the BMWs and Audis. My friends got a kick out of my car.  I bought it for $2,600 cash.

Live Outside Their Box

I think you will find that most people won’t look down on you for having inexpensive clothes and cars. There will be a few, but they are the ones who would probably find a way to look down on you no matter what you do. So ignore them and live your life outside their box.

There is nothing wrong with nice cars and nice clothes but understand what you are sacrificing in the future for them.

Telica Volcano
The crater on top of the Telica Volcano in Nicaragua. The places living outside the box can take you!

A Mindset of Patience

The mindset is about saving. It is thinking about money as a tool for your freedom and not just something to spend on every want and need. It’s a mindset that says, “There is no way I’m spending $5 on this bottle of water when I know I can get it for $1 down the street.”  It’s a mindset of patience and willingness to wait for something better.

I once sat in someone’s living room listening to them talk about how they could not afford their prescription medication for that month. It was $20 and she simply had no money left. Before I could offer to help there was a knock on the door. There stood a guy from Schwan’s selling really expensive ice cream. She pulled out her credit card and bought $50 worth of ice cream. That $50 could have paid for her medication and the same amount of ice cream from the grocery store. She could afford her medication, she simply chose to spend it on something else.

Honesty about Actual Need

Do you really need that brand new car? Most cars depreciate about 19% within their first year.  That $20,000 car will lose almost $4,000 in value after its first year.  That’s a trip to the Galapagos or almost what we spent on our first year of travel.

As you can see, my priority is travel.  This is primarily a travel story blog after all. But insert your goal. Have a goal. Where do you want to be financially?  Think about the long-term goal next time you head down to the mall.  Would you rather have that new outfit now, or pay off that student loan and be financially independent?  Maybe you had set aside money for clothes in your budget – that doesn’t mean you need to spend it all. Possessions break, deteriorate, and fade away. Money is only a tool.

Do you need a brand new couch or would one off of craigslist be just fine? When Trin and I purchased our first home, our living room consisted of a couch I made from Trin’s single bed before we got together.  Using some 2x4s that the previous homeowner left behind in the garage, I built an orange couch. About a year later, we happened upon a furniture store going out of business. We found a brand new leather recliner couch for $250. We took it home that day.  Our wait saved us a lot of money, and we kept the nice day bed for the spare room.

Orange couch
Built out of an unused mattress, scrap wood, sheets, and dollar store items. All for $25.

The mindset is sometimes sitting on a crate for months till you find a good deal. It is buying cars with cash and not taking a loan for anything except a primary home. It is delaying our wants and refusing to pay top dollar and huge interest rates.

Extreme Savings

I never had a budget because I started my working career with a simple goal: Save for college and get out debt-free. I began working at age 14 and saving every penny. No budget for planned expenses was needed. I didn’t plan to spend on anything that wasn’t absolutely necessary, just save.

My shoes wore out and were not replaced until duck tape could no longer fix the large holes in their soles. At the end of each school year, I walked around the dorms buying up used books that were required for my course study the following year. I hitchhiked to work. I graduated debt-free.

It became a habit to save. It was all I was used to. I was happy and out of debt. I saw no reason to change the habit. While I went to the extreme to get out of college debt-free, I don’t regret a moment of it. I’m also not saying that you have to go to such extremes to reach your financial independence, but are you willing to sacrifice a bit now for freedom later?

piggy bank save for financial freedom

Another Secret

I have another secret. There is something else I don’t usually talk about. It is something very important when it comes to finances. That is the importance of giving. Even during my toughest years giving was a habit. I’m not teaching a health and wealth ideology. There are no scientific stats that will say if you give a specific amount of money, you will get a certain percent back – this is an incorrect view of giving.

It is the mindset about money that is important. A mindset that sees money as a tool to do good in the world. When you give away money, it is gone. You may never be wealthy but you will be rich in soul. Giving changes us. Giving money, giving love, giving time, it is fulfilling. Isn’t that the end game anyway that everyone in the rat race is searching for – to be fulfilled?

This week, Trin and I watched the movie There Will be Blood. It is about an oil tycoon who, on his path to millions, killed a friend, used a child then abandoned him when he was no longer useful. He ended up wealthy beyond measure with absolutely no love in his life and no happiness. His heart was like a stagnant pond from which nothing flowed. I found it incredibly sad. This is an extreme case, but the point is, if we live only to satiate our own desires, we end up with most of them being unfulfilled.

Giving money helps us keep a proper perspective on finances. People often say, “Money is the root of all evil.” I wholeheartedly disagree. The original proverb says that it is the love of money that is the root of all evil. Money is not the issue, it is the mindset about it.

Financial freedom begins with understanding what we truly need, having the patience to wait for what we want, and being wealthy in our soul by giving.

What is money to you?  Post your thoughts in the comments below.

Financial Independence without ever writing a budget

Retirement may not be your goal, but financial independence provides the freedom to pursue whatever goal you may have.

35 thoughts on “Financial Independence Without Ever Writing a Budget”

  1. This is such good truth you shared here. Truth that leads to freedom. I’m going to share it with my kids!! I wish I learned those principles long ago. I graduated college debt free in 95 but started making “poor” financial decisions a few years later. Thankfully I’m on a good path now.

    1. Thanks, Jeff! I certainly made my share of mistakes along the way. I might just do a post someday about them as well so others don’t make the same mistakes.

  2. Bonnie I don’t think I could agree with you more about this subject. I have never felt that I had to keep up with the Jones. My truck is a 2004 and our family SUV is a 2005. Both were bought with cash and both are great vehicles. You can tell what is important to someone by looking at what they spend their time and money on. It is easy to see that travel is important to you and Trin. From my first job of mowing grass I saved money and have continued throughout my life. We don’t have any credit cards and pay cash for purchases. I don’t like to pay others to do things that I can do and what you learn to do so you don’t have to pay someone is amazing. I am not ashamed to call myself cheap. When I take the family to a restaurant (which isn’t often) my kids know they are getting water. I am not going to spent $2 or $3 on a drink (there are 6 of us that could be almost $20). I am fortunate to have a wife that agrees (or maybe excepts) this way of thought. It is one of the things I hope to instill in my kids. Great article. I enjoy reading about your adventures. I am glad I had to privilege to meet you and Trin. I hope we cross paths again.

    1. Mowing lawns was my first job too. It’s a great first job. We can both be thankful for awesome spouses. It helps when both have the same view of finances.

      I’m honored to have met you as well and hope to see you again next time we are in the states.

  3. I found this to be so refreshing, I have tried budgeting and well, spending plans really, and they are a total PITA. I got the money I have for FIRE the old old fashioned way (inherited), but I still am a saver and believe in stealth wealth and I can be pretty frugal sometimes too. And sometimes I want what I want, and as I’m reading your article here, that’s sorta what it’s all about. I don’t need a fancy car or a really expensive home or fancy clothes, but if there is something I really want I pretty much can get it. I get teased my my daughter all the time for picking up change and always looking up a discount or deal. I used to be one of those extreme couponers, and I knew how to get the deal and lots of very inexpensive products with a coupon and a sale, but now I really don’t find joy in doing all that and minimalism is much more my thing now. That saves us money too when we really see how much of something we really need. I am really finding FIRE is more about living within the means I get each year, hope the inheritance grows for later retirement when I might really need it, or if I don’t, I hope to pass it on and give my kids a chance a pretty good retirement one day too. Thanks for your prospective on budgeting, it’s sorta where I’m at on the subject too.

    1. Very cool. Thank you for your perspective and input. I pick up pennies from the street as well. 🙂 It sounds like you have also found this as a comfortable stress-free way to live, without debt. Yes, sometimes we all want what we want and it is different for all of us. It’s nice to be able to afford to splurge once in a while.

  4. Oh, we are so on the same page with this! I am also financially independent although I love my job so much I have no intention of stopping. After all, the more books I write, the more streams of passive income I create. I achieved FI through aggressive investing in the stock market during my forties, a policy that I aim to continue. I don’t agree that the love of money is the root of all evil, but other that that I’m totally on board with what you’ve said in this post. Happy travels!

    1. I love that you are doing what you love. It is awesome to see people realizing and living their dreams. I also enjoy having friends and comments that don’t necessarily agree with everything I say. It makes for great conversation. Being challenged is how I learn and grow. 🙂

    1. Thanks! Yes, I remember thinking as a little kid that when I was too old to get out of my rocking chair I wanted to have great memories to rock back and forth to.

  5. Wow! What a great and inspiring blog Bonnie. Yes, you should do one on the mistakes that you made as well. It is hard to admit to our mistakes but yet that is how we grow. Sometimes just hearing about the mistake that someone else made and then seeing how they corrected it or what they learned from it helps others along with the struggles that they are having.

    I totally agree with everything that you said. The “love” of money is the root of all evil. Nothing wrong with having money as long as you don’t Love it. You can tell where someone’s priorities are by the way that they are living. And yes, everyone has different priorities. There are no right or wrong ones but rather just making sure that you are living within your means. Credit cards are such a problem and something that people should avoid having unless they have extreme control when it comes to using them.

    Keep up the great blogs and enjoy life and your travels. Love you guys.

    1. Thank you Jackie! The mistakes I think will be the focus of my book and how to crawl out of them. I kinda interpret the “love of money” as the selfish love of personal gain above the love of anything else. Like you said I don’t see anything wrong with having the money or even enjoying it. For me, it’s more of the mindset of it and how we handle it.

  6. I love this post!

    Our mindset about what we should spend is extremely important.

    Just because we have $10,000 available to spend on a car for example, doesn’t mean we SHOULD spend that much. we could possibly spend half of that or even a quarter of it like you did on your car, and we’d have all of that extra money to use for other purposes, such as saving for retirement.

    1. Thank you, so glad you enjoyed it! I see so many questions from others that ask, “What percentage of my income should I spend on a car?” My response, as little as possible! 🙂

  7. Operation Husband Rescue

    I love that you donate your commissions. I’ve never seen that anywhere else. That’s very admirable!

  8. Money for Meaning

    Bonnie, thanks for listening to our podcast interview with 2 Frugal Dudes, and your positive comment about us not needing a budget. We’re totally in agreement! Having a mission and purpose in life for how to serve others through our unique talents, and having real goals we’re working toward, make a budget unnecessary. Love this article! That’s a similar theme of our book “Money for Meaning: Philosophy for a Life of Extraordinary Freedom”. Will you be at FinCon this year? I lost it when I saw the Honda Civic – that’s the same car I drive, but I have rust on my driver side door…maybe the next door will be blue!

    1. Thanks for the read and the comment! We travel quite slow and plan to be in South America for another year. So the first FinCon for us wouldn’t be till 2019. Honda Civics are great cars even if they have a little rust. 🙂

  9. Great post. I was shocked by the $50 ice cream story. It actually reminds me of people I know who buy experience cars but can’t afford to put gas in it.

    1. Thanks! I don’t think she was even aware of why she could not afford her medicine. It always makes me wonder what things in my life might be so blatant to others but I am blind to.

  10. It was so nice to meet you yesterday. I’m sincerely enjoying reading some of your posts. They are truly inspirational and provides a lot of food for thought. Your life and adventures are amazing! The reason behind the name blue door with your car is fabulously creative. Thanks for sharing your blog with my mom and me. Safe travels to you and your husband!

  11. Pingback: Breaking the Broke Mentality - Money Matters - The Most Rewarding Life

  12. Pingback: Do you really need a budget to reach Financial Independence? | Project Palm Tree

  13. One thing I’ve found is that having that well stocked emergency fund removes a lot of the worries that other people presumably have. We don’t have to worry about how to pay the bills or buy food etc if for whatever reason I stop getting paid, and it means we can remain calmer and not as stressed about the situation, financially at least.

  14. Hi Bonnie, I came across your blog via a camping Facebook group the other day. I love your attitude and outlook on life. My husband and I love to travel, something I hadn’t really done until I met him in my late 30’s. I have had a budget for years, I think its a great way to work out where you are spending and what you can afford to cut back or change. It has allowed us to set savings goals, which will see us head off later this year on our lap of Australia for a minimum of 12 months.

    Hubby and I have always been the ones looking for that bargain, we buy mark downs at the supermarket everytime we shop. I love rummaging through op shops (hubby is still coming around to this ha ha). We do our research before we purchase most things to try and get the absolute best deal. I love saving money.

    I love my sister dearly, but its hard to believe we are related when you look at our differing attitudes to money. She has the most amazing expensive clothes, jewellery and handbags. Drives a very expensive car, they go to fancy restaurants several times a week. Even if I had the money, I could not justify spending it they way they do. I would much rather be debt free and have financial freedom to do what ever please. I was a single mum for 10 years and like to think that i have instilled the same values in my daughter. She likes nice things too, but knows that buying pre loved, she can still have her LV handbag at a fraction of the cost of a new one. Me, I don’t need LV at any cost, don’t understand they hype

    1. Thank you Jenny for the thoughtful response and for sharing your experience. For the vast majority of people, a budget can definitely help manage expenses and is highly recommended. I think part of the reason I might have gotten away with it is that for so long I had a scarcity mindset and had a hard time spending anything. Thankfully it all worked out for the good. 🙂

      The lap of Australia is an epic journey and one of our favorites. I’m so happy to hear that you are going for it.

      I think it is very common to have siblings with very different views on money. It’s always an interesting result, especially when having grown up in the same family. My brother-in-law loves name brands. Trin will wear a shirt he found on the street (after it is washed of course). The difference is stark but they grew up in the same family. The great thing is my brother-in-law and Trin are the same size so Trin gets the hand me downs. We love it.

  15. Win-win for Trin, unfortunetly my sis and I are different sizes, not that I would have anywhere to go in her beautiful fancy clothes and shoes *lol*

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