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Meet the extreme savers, on a mission to retire early

The Frugalwoods and the Saving Sherpa have big dreams of financial independence and the savings strategies to get them there.

Justin Taylor, the Saving Sherpa, in his Arlington kitchen, which has no stove or dishwasher, which helped him get below-market rent.
Matthew J. Lee/Globe staff
Justin Taylor, the Saving Sherpa, in his Arlington kitchen, which has no stove or dishwasher, which helped him get below-market rent.

Ever dream of escaping the rat race, but feel too chained to your job or, more to the point, your salary? In 2016, Elizabeth Willard Thames and her husband, Nate, managed to do it, buying a 66-acre homestead in rural Vermont for $389,000, where they’re now raising their two children. The couple saved aggressively to reach their goal of living in the woods, charting their financial progress online as The Frugalwoods, starting in April 2014. And they did it not while living in a Thoreau-like cabin in the forest, but first as renters and then homeowners in bustling Cambridge — where, Thames says, saving money was actually easier in some ways than it’s been in Vermont.

“There’s an assumption that living in the city is inherently more expensive, and to an extent that’s true,” she says, especially for housing. “But when you look beyond housing expenses, there’s a lot of things you can optimize and save on.”

By slashing expenses — notably by eating out just twice a year and  buying only used goods, including a 19-year-old car — they managed in 2014 to sock away more than 70 percent of their income, while paying a mortgage on a house. Granted, they had high-paying, professional jobs, a privilege Thames readily acknowledges. They would not comment, but my back-of-the-envelope math suggests their combined income that year topped $200,000. Earning more is one way to boost your savings, but frugality is an equally powerful financial tool that can yield immediate results at almost any income level.

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The Frugalwoods’ non-mortgage spending was less than $1,100 a month, for instance.

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They did it by adopting techniques from the FIRE movement (an acronym for “financial independence/retire early”), which can help almost anyone reevaluate their spending habits.

FIRE isn’t necessarily fuel to get rich, but to live below your means, so you can build up savings. Living on less means needing less money, in perpetuity. And whether you’re angling for an early exit from the workforce or simply want to shore up your finances, it turns out that high-priced Boston can actually help you in your money-saving endeavors.

Partly because we have access to alternatives like public transit, walking, and biking, Boston-area residents spend less on transportation than the average American household, reducing a huge drain on most families’ finances. When they were renting in Cambridge, Thames and her husband got by with no car at all. They spent nothing on parking, maintenance, insurance, gas, and excise taxes, giving them thousands more dollars to bank a year. In Vermont, by contrast, they needed a second car, with four-wheel drive. (They also needed yard equipment, after not owning so much as a rake in Cambridge.)

Urban density also ensures enough competition to keep prices in check on many goods and services, Thames says — including food, another big budget category. Groceries aren’t expensive, she says, “if you know where to shop.” Their Vermont home, meanwhile, has limited options nearby, and Thames now pines for the fresh produce and rock-bottom prices she used to find at her local Market Basket. “I miss it every day,” she laments.

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Fellow frugalist Justin Taylor, an active-duty Air Force officer who lives in Arlington and blogs at Saving-Sherpa.com, leverages that supermarket competition to keep his grocery bill down to an astonishing $60 or so a month. Using an app called Flipp, he quickly scans weekly ads for Stop & Shop, Star Market, and Market Basket — typically, one of the three will have meat on sale, he says, and from there, he can figure out the rest — buying in bulk when he sees an outstanding deal. “It’s not going to go bad in my freezer.”

But when the average Bostonian spends over $260 a month on eating out or takeout, big savings opportunities come from simply preparing meals at home. To that end, Taylor says, you want to make food prep as easy as possible — because, like a workout, the best cooking routine is the one you’ll actually do.

“Cooking for yourself is obviously a great financial move, but you won’t do it if it’s hard or complicated or annoying or time intensive,” Taylor says. To avoid meal-prep burnout, Taylor cooks big batches of food all at once and tosses ready-to-eat leftover portions in the fridge or freezer, ensuring he has to cook only a couple of times a week. He’ll make entire meals in his Instant Pot to limit dirty dishes.

That last bit is extra important, because while Taylor and his girlfriend pay well under market rent for a spacious, updated two-bedroom apartment in Arlington, “it doesn’t have a real kitchen,” Taylor says. There’s a sink, but no stove or dishwasher. Taylor makes do with a countertop oven, a hot plate, plus the Instant Pot, and still manages to prep at least 10 meals a week in his “odd little kitchen” — a small price to pay, he says, for the $700-a-month or so discount he gets on a typical Boston-area two-bedroom. It helps him get closer to his goal of being financially independent by the end of 2022.

A vibrant city also means there are plenty of things to do. And while buying tickets to see our beloved sports teams or world-class performing artists can feel like hooking up a vacuum hose to your wallet, there’s no shortage of free activities around town. From film screenings and lectures to author readings, concerts, and arts festivals, “there is so much free entertainment in a place like Cambridge or Boston,” Thames says. For example, Massachusetts residents get free admission to Harvard museums on Sunday mornings and Wednesday afternoons, the Institute of Contemporary Art is free Thursday evenings, and in the summer, Berklee presents hundreds of free performances.

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Taylor also keeps an eye out for free events and workshops, some of which include complimentary food or beverages. “Just last week I went to an event at a premium outdoor clothing store where we learned backcountry camping skills while being served cocktails and local beer,” he says. “Free!”

The Frugalwoods — Elizabeth Willard Thames, her husband, Nate, and their two children — in Vermont.
From Elizabeth Thames
The Frugalwoods — Elizabeth Willard Thames, her husband, Nate, and their two children — in Vermont.

Another way the Frugalwoods were able to cut costs was buying everything used, a feat made far easier in a major metropolis. Thames misses the “phenomenal” used marketplace in Boston, from active Buy Nothing Project Facebook groups to well-stocked thrift stores to the legendary curbside bonanza of Allston Christmas, when departing graduates leave furniture and other goodies behind.

Having kids doesn’t have to increase spending as much as you think. When the Frugalwoods welcomed their first child at Mount Auburn Hospital, they got nearly all their baby gear used, too. “A big piece of it is letting go of perfection,” Thames says. “Who cares that your kid has a gorgeous matching nursery? The parents do. The kid does not care. So the goal is save money now on the things that don’t matter — clothes, furniture, toys — so you can use the money later for things that really do matter.”

That gets to the heart of how and why to cut spending mindfully. The starting point is to track your spending for a few months — every last dollar. Pen and paper works, or a free budgeting app, or you can use a credit card for all of your purchases and simply review your statement at the end of the month.

“Know what you spend, know where you’re spending it, and then go through . . . every single thing you spent on, and ask yourself if it was worth it,” Thames says. This can be tedious and even embarrassing, she admits — you may be startled to see in dollar amounts just how much you spend on Lyft rides or burritos in a month. But you need to know where your money is going, and whether you’re happy with its itinerary.

Taylor likes to ask people what they had for lunch the previous Tuesday, a detail they can’t typically conjure. Then he asks them to recount their last memorable event or trip. “I see their eyes light up as they begin to tell me all about it,” he says. The point of cutting your spending, he says, isn’t to deprive yourself of the things you love. It’s to “focus your spending on the things that make you light up, and cut out the excess spending on things you barely even remember.”

Jon Gorey is a frequent contributor to the Globe magazine. Send comments to magazine@globe.com.

CUTTING BACK YOUR SPENDING

There are no secret formulas to saving money — we know what our big expenses are, so all we have to do is spend less on them. The question is, can we do it consistently? Here’s a rundown of ideas to try in four big expense categories. Remember: If you eliminate something and it makes you miserable, you can always add the expense back.

Housing

 Get a roommate. While not for everyone, if you can share your living space, there’s perhaps no quicker way to slash your housing expenses and utilities.

 Live small. Bigger homes cost more to rent or buy, but also to heat, cool, and furnish. Could you live without that extra bathroom or garage bay?

 Save energy. We spend over $4,000 a year on utility bills. Ease up on the air conditioner in summer, turn down the heat by a degree or two in winter, and add insulation or make other energy-efficient upgrades.

Transportation

 Own one vehicle. Car payments, insurance, gas, parking, and maintenance easily add up to thousands of dollars a year. Can you or your partner bike or take the T to work?

 Buy cars used. New cars depreciate rapidly, so buying a used vehicle is one of the best financial decisions you can make.

Food

 Eat in more. Learn a few easy, go-to meals you can cook at home: If you eat out with any regularity, preparing more meals at home is one of the most dramatic ways to save money. Pack sandwiches or leftovers for lunch, and brew your own coffee to take into the office.

 Buy store brands. The generic versions of products you buy often may not meet your expectations — so revert back to the name brand for those items — but keep buying the ones that don’t disappoint. If you pay 50 cents less on 10 products every week, you’ll save more than $250 a year pretty effortlessly.

Entertainment & Shopping

 Cut cable. The average cable TV package cost $107 a month in 2018, not including Internet service. Try pulling the plug on paid TV for a few months, filling the gaps with streaming services, and see whether you really miss it. If you do, your provider may offer you an enticing deal to come back; if not, you could save hundreds of dollars a year.

 Buy used. It’s not always possible to get what you need secondhand, but it’s worth trying. Instead of instinctively turning to Target or Amazon when your kid wants a skateboard or you need patio furniture, check thrift stores and local Facebook yard sale groups first.

 Go no-pro. With so many minor league and college sports teams in the area, it’s easy to catch an exciting game without paying pro prices. Plus, take advantage of the many free student concerts, arts festivals, and museums Boston has to offer. — J.G.

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