1. Hey, Penny. Where do I begin? First, you’re doing awesome. In terms of saving as a percentage of income, you and Mr. P are definitely one-percenters. Second, I think graduate degrees for teachers are a scam. I’d much rather see a salary bump based on tenure alone and not an advanced degree. Get tenure, get your bump. But maybe I’m wrong? Do you learn anything in graduate school that you couldn’t learn from reading the leading education journals? Third, I’m with you. Pay off that mortgage. Mrs. Groovy and I have been mortgage free for ten years now. The security from knowing that our house won’t be in jeopardy if both of us lose our jobs is priceless. And, finally, four, Mrs. Groovy and I don’t really make a distinction between saving and spending. We spend one hundred percent of our income. We make a distinction between two spending categories, though: freedom and consumption. Any money we put into increasing our net worth (Roth IRAs, 401(k)s, HSAs, home improvements, etc.) is money spent on freedom. The rest of what we spend–food, utilities, car repairs, dinning out, vacations, etc.–is considered consumption. Right now, a little over fifty percent of our income is spent on freedom. I hope this helps. I know it’s a weird way of looking at saving and spending.

    • Uhhh…if by weird, you mean awesome, then I agree. That’s a fantastic way of looking at saving (spending on freedom!). As for grad class, it’s consistently inconsistent. We have both had some courses where they’ve really changed the way we teach. But we’ve also had some that…didn’t. I’m working on my National Board certification now, and that’s been way more beneficial. It’s basically an intense scrutiny of your own practices (videos, reflections, etc.). It’s a two-year process, and I don’t get nearly as much as I would get for another degree in terms of pay. But I’m getting a lot more in terms of how I teach my kiddos!

      • I absolutely love The Groovy’s two spending categories! Why does it need to be more complicated than that? 😀

        I don’t really have a distinction between the two and I’m very lucky that it hasn’t been a problem. I generally just let cash build up in my checking account and lump it into long term investments after the cash balance gets over a certain $$$ amount, but with the lifestyle change coming up, I’ve been using a savings account at the same credit union as my checking account, so it’s been fun to watch that saving account grow even if it only earns 1%. But I have to pay rent on Tuesday so I had to transfer some from the savings account back to the checking account because my paycheck doesn’t come in until Thursday. Have I made myself a paycheck-to-paycheck person completely by accident? I feel like I’ve probably made my money management more complicated than it needs to be. Whoops.

        You’re doing fantastic. Much better than I did last month, that’s for sure.

        • I suppose I get frustrated because it seems like it isn’t long-term savings. But it really is, right? It’s gobs of interest that I’m shaving off. And when it comes to grad school, it’s raises in the future. And since that’s literally the only way to get a pay increase, we have to take those opportunities!

          • It absolutely is a long term investment! You get rid of a portion of that interest the minute that you make the payment. And of course the pay raises in your future.

            I feel like you are Super Woman with working, blogging and studying for grad school. Mad props to you.

          • That’s so kind of you to say, TJ! Everyone has such full plates. I try really hard to recognize that in others. I don’t always give myself enough credit. So this helps 🙂

  2. You ARE doing awesome. And I agree with you on so many things. I think we’re in similar places right now. If we can just get our mortgage gone… think of the possibilities! I’m all for education (especially if it gets repaid), so I guess I disagree with Mr. Groovy on that one (but that’s speaking from the person that only got hired because I have a Masters degree… and not remotely in the field I work!… The advanced degree allowed them to hire me without any experience in the field, so it’s worked out for me). Increasing Mr. T’s 401k contributions was precisely because I wanted to make a better distinction between saving and not spending. 🙂

  3. I know what you mean–though we live about half our income, we are throwing a lot extra at the mortgage right now, giving away a certain percent, and saving toward kids’ college, as well as investing money in retirement accounts. So our savings rate gets a bit hard to nail down sometimes. We feel that if we’re meeting our early pay off and investing goals, we aren’t going to fuss over creating zero-sum monthly budgets. In fact, we seem to spend less this way.

  4. That’s a tough call. I find that even when I don’t spend, somehow that money disappears if I don’t move it into savings or put it towards my mortgage or financial goal…I do think you can’t really have one without the other though!

  5. I thought you were going to go in a different direction and talk about how if you see some pair of shoes you want, but then you don’t buy them, have you just “saved” money? Or if you buy something on big discount, have you “saved”? And even though that’s not the question you were asking, I’ll answer it anyway: NO! You’re not saving just because you didn’t spend, or spent less than you might have. 🙂 Haha.

    I think it’s awesome how much you guys are saving, especially given that you don’t even plan to retire early. It sure seems like you’re working with a pretty optimized budget, you’re rocking it on the house payoff, and you’re funding your retirement at strong levels. I dunno… it sure looks like you’re saving to me!

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