2020 Budget and Lifestyle: Living on $7,000 a Year During COVID-19
It was unbelievable that we lived on $7,000 ($3,500 each) for a whole year in 2019. So, it’s incredible that we did it again in 2020! See how in 2020 we managed to keep our spending low despite the upheaval COVID-19 brought the world.
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Quick Links
First, before you dive into 2020’s numbers, we strongly encourage you to read How We Lived on $7,000 ($3,500 each) All-Inclusive for One Year. It’s not only an all inclusive look at what we spent in 2019, but it also exhaustively dives into our financial philosophies and goals. We consider it something akin to our ethos. Plus, it’s full of a growing list of frequently asked questions and tips!
Looking Back: Expenses Over a Decade
We commonly say that we’re where we are today not because one decision made, but thousands of choices made along the way.
While we came from different backgrounds we share many similar philosophies, including the way we think about finances. This made melding our finances, both in our goals and our day-to-day management of money, a simpler task than what some couples go through.
“We feel fortunate that we’re pulling in the same direction, rather than away from each other. ”
For those that know our story, we started traveling full time as digital nomads and house sitters in late 2016. However, our pursuit of financial independence, retire early (FI/RE) started well before that.
Between 2010 and 2016, we spent between $9,000 and $12,000 per year!
We’re naturally frugal and minimalist, so a small apartment (nothing over 600 sq feet!), furniture off of Craigslist, a few Correll dishes, a four piece silverware set, and a versatile but small wardrobe was just the life we wanted. In addition, we worked to minimize our expenses and our footprint by limiting our driving to under 5,000 miles a year, turning down the water heater, and taking bagged lunches to work (we still travel with lunch gear from Light My Fire who use bioplastics).
In 2017 all-inclusive for a year abroad we spent $16,000!
We’d thought about it and planned it for long enough! In late 2016 we sold and donated 95% of our belongings, turned over the keys to our beloved apartment and set off to explore the world.
A year later we’d been to 3 continents, 23 countries, and 60 cities. We’d had an adventure of a lifetime and never felt like we’d sacrificed our enjoyment or experience to save money. And, we did it all for just $16,000 (that’s all in for both of us)!
The 23 countries we visited during our first year of travel:
In 2018 our all-inclusive budget was $7,435.67!
We wrapped our year of traveling abroad and planned to come back to the United States. However, we loved our lifestyle so much that we couldn’t begin to imagine giving it up.
We took our love of house sitting and made it a full time job while we continued to work as digital nomads and travel throughout North America.
In 2019 we spent $7,000 traveling and living throughout the US!
We spent all of 2019 within the borders of the US and traveled full-time, visiting Alexandria, VA, Philadelphia, PA, Chicago, IL, Atlanta, GA, and New York, NY.
For context, here’s what Living on $7,000 for two people looks like:
$7,000 for two is equal to $3,500 a person for a year of living expenses.
$7,000 for a year of living expenses for two people is $583.34 a month.
$3,500 for a year is $291.67 a month per person, or $9.59 per person per day.
2020 in Review
2020 is a year that will define a generation. Many prospered, many struggled, but all of our lives changed dramatically.
“We consider ourselves incredibly fortunate to have made it through 2020 safe and healthy. ”
And, as we sat down to write this article, we struggled with how to write about our pursuit of FI/RE and our budget and expenses for the year in the midst of the challenges and suffering that so many around the world have and are enduring. Ultimately, we understand that love, happiness, and life must continue. It’s how we’ll make it through and the only way we’ll keep moving forward.
COVID-19 Impact
Beyond COVID-19’s obvious impact of social distancing, wearing face masks, washing our hands, and sanitizing everything we come in contact with, our pursuit of FI/RE while traveling and house sitting full time as digital nomads was put to the test several times throughout 2020.
London, San Francisco, Paris, New York City, Athens and more?! Trusted Housesitters has allowed us to travel the world on a budget, but more importantly given us an opportunity to make new friends and have cute and cuddly companions along the way. Sign up and start your next great adventure!
Digital Nomads
As established digital nomads, the pivot to remote work around the world was a different transition for us than most office workers. While Shannon missed the occasional days that she could go into an office and enjoy the many perks the company offers, we were already accustom to working from our laptops wherever we happened to be.
The big change for us was the significant increase in work for Shannon. Her project management role evolved into a program management one as she not only worked with a global team to transition to a virtual model but also worked with management to drive a change in direction and implement innovation within the business unit.
As one can imagine, her work hours grew as did her stress. All of which impacted the rest of our lives and our over all busyness.
She combated her stress with meditation and fitness and reduced her after hours work by shutting down her work devices outside of agreed upon work hours.
As many have struggled with finding a work-life balance during COVID-19 and working from home, here are a few tips we use:
No meeting days - Block out your calendar one day a week to put a pause on the seemingly endless virtual meetings so that you can get some work done.
Turn the camera off - It’s not always obvious, but being visible to everyone on the call for the entirety of a meeting can be wearing. So, if you’re not presenting, consider turning off the camera to give yourself a break.
Take breaks - Schedule 15-20 minutes on our calendar throughout the day to take a break away from your computer and work.
Stay in the ‘flow’ - Minimize interruptions by turning off your pings and notifications, putting your status to away, and blocking out time on your calendar to maximize your productivity.
The unexpected consequence of the global switch to working from home because of COVID-19 was a new level of understanding by others of what it takes to work remotely (efficiently, productively, etc.). Everything from developing a skill to keep life and work separate while being at home, to knowing how important reliable and truly high-speed internet is.
House Sitting
House sitting full time means that we don’t have a home base and we go from one house sitting job to the next.
Since the main reason homeowners need house sitters is travel related, many sitters were left with an empty calendar when sits were canceled and new travel plans weren’t being made. Thankfully, we had a very different fortune, as many of our house sits were extended by a week or longer. One was even extended by two months!
And even though we limited ourselves to a single region (to stay near family), we continued to find and book new house sits throughout the year. We can’t say for certain, but we have to think it may have something to do with our thorough profile and application, as well as four years worth of extremely positive reviews. In the end, whatever the reason, we know not all house sitters were as fortunate, so we’re incredibly grateful!
Travel
We initially took off in 2016 with the intent of traveling Europe for a year. We’ve been at it for over four years now and haven’t regretted it one bit.
With just a 36L backpack apiece we love the freedom we have to get up and go whenever and wherever we want. Between our love of travel and our inherent minimalist nature, we treasure our experiences more than we do our ‘things’.
With that context in mind, we’re sure you can imagine that we’ve had our moments of stir craziness during COVID-19!
To minimize our risk of exposure, for most of the year we opted to remain regional and stayed near family on the west coast of the US. So, we didn’t travel as much as before, but when we did we wore two masks, sanitized everything top to bottom and chose not to eat or drink in an enclosed space (including airplanes) because it would require taking our masks off.
Whether we’re on an airplane (rare these days) or going to the grocery store, we now travel well equipped to reduce our chances of contracting COVID-19.
Financial Independence, Retire Early (FI/RE)
Financial independence, retire early (FI/RE) for us is a two pronged approach. On one side we work to spend less money, and on the other we work to make more money.
2020 was a year of financial devastation for people around the world (take a look at the unemployment rate). It was also a year of financial prosperity for others (take a look at the stock market).
“For us, when it came to earning it wasn’t exponential, but we did do better this year than last. ”
And with that, we’d like to take a moment and talk about giving. Helping others who are struggling and giving an opportunity to those that otherwise wouldn’t have one is important to us. Finding organizations that do work that resonates with you is important. For us, one of those organizations is Flyte, which “works with students in underserved communities to promote the benefits of travel, education, and cultural awareness by funding overseas educational programs”.
When it came to spending and lifestyle in 2020, we lived life as we usually do. It’s normal for us rarely eat out because we cook our meals at home, we house sat full time, and we didn’t need much in the way of restocking supplies (clothes, gear, etc.) this past year.
We spent shockingly close to the same amount in 2020 as we did in 2019 (seriously, jaw dropping similar dollar amounts!), however, the distribution of where we spent our money in 2020 was a bit different.
We can’t recommend enough that you take a moment to read How We Lived on $7,000 ($3,500 each) All-Inclusive for One Year. It’s not only an outline of what we spent in 2019, but it’s full of frequently asked questions and tips. We’d like to think of it as something akin to our ethos.
Read on for more on how we spent our money last year and the comparisons to 2019.
Our Expenses in 2020: $7,000!
Overview
2020 was a turbulent year with many new challenges. We kept focus on our pursuit of FI/RE and were fortunate to be able to continue house sitting full time.
Our methods for reducing spending that worked in years past still hold true to this day. If you’re looking for tips on how to reduce your own spending or dial in your budget we detailed our best tips and advice in Practical Tips on How We Lower Our Expenses by Category.
If you’re skeptical of being able to live on just $3,500 apiece for a total of $7,000 a year, we don’t blame you, but hope you’ll read our answers to your questions with an open mind. And, if you simply have questions on our philosophies and how we do it, we’ve answered and continue to answer questions at the end of How We Lived on $7,000 ($3,500 each) All-Inclusive for One Year.
As we did in 2019, we tracked and included every dollar spent for the year as we make every attempt to be transparent.
Where Our $7,000 Was Spent by Category
Where Our $7,000 Was Spent by Month
Comparing Budgets: 2019 to 2020
Our expenses in 2020 totaled a surprisingly similar amount to expenses in 2019. Interestingly though, where we spent the money each year was a bit different.
We decreased our cell phone costs with Google-Fi by switching one of our phones to a data only SIM.
Because of COVID-19 grocery store shortages we spent a bit more on groceries at the beginning of the year.
We also had an increased grocery bill because Shannon wasn’t traveling for work or going into the office, which means work wasn’t supplementing a portion of her meals anymore.
We spent less on travel and sightseeing because of COVID-19 safety measures and precautions.
We’re relatively healthy so we purchase low premium, high deductible health coverage. Unfortunately, we had to visit the doctor a few times this year, including a trip to urgent care, which meant more costs in our medical category. Despite that, our choice for a high deductible health plan still worked in our favor.
Our business expenses increased in 2020 because Sergio expanded his consulting services to include the ability to remotely view or control mobile devices.
We lowered our personal care and clothing category this year because we simply didn’t need to buy much more gear. We’d replaced a lot in 2019, so we were good to go for 2020.
Here’s the comparison of 2019 to 2020, broken down by categories:
2019 compared to 2020, in monthly averages:
Final Thoughts
Despite the world events of 2020, financially we had a very good year, for which we’re incredibly grateful for!
If you have questions, if you want to read more on our financial and lifestyle philosophies, or if you want to pick up a few tips on how to tighten up your budget, we highly recommend reading How We Lived on $7,000 ($3,500 each) All-Inclusive for One Year.
“If we had to sum up all of our tips and our methods of how we live the life we love and spend so little, we’d have to say it’s about... being intentional.”
All of our choices and actions are thought out with an end goal in mind. For us the end goal is freedom, and financial independence, retire early (FI/RE) is our vehicle.
Whether you agree with us or not we truly hope that you’re intentional in the life you make for yourself!
And along the way, don’t forget to laugh, have gratitude, be kind, and of course smile!
Update: We were featured on the Business Insider for your $7,000 budget two years in a row!
