Sometimes you need to find new friends on the path to financial freedom

Resistance by friends to your budgeting and saving may be strong. In my case, I can think of several occasions when I was either insulted, told I was cheap so I wasn't worthy of a relationship, or worse. It is time for another story.

A friend of mine, at least I thought he was a friend, who I know had trouble grasping the concepts of frugality so that one could save money for whatever, had asked me to join him and other friends to celebrate Saturday, the 15th of September (grito de independencia). We had gone out before with and without other friends so I thought it would be fine.

There were several of us and we had a decent time, but I think I would have enjoyed myself as much watching a movie on the computer. I bought three drinks and relaxed a little. As we left around 4 in the morning I could tell that my friend was in a bad mood.

 He started to complain to the others about how I bought inexpensive shoes.  I had told him one day many months ago how I had bought new dress shoes at the mall near the apartment for about 500 pesos and I casually mentioned that my last tennis shoes were 200 pesos in the market. That day he mentioned that he knew of a place where I could get very good tennis shoes for 400 pesos of better quality and I had said yes, I was interested. Many months later he hasn't accompanied me to go buy them. We had actually scheduled a day to go shoe shopping once and he left me waiting for his call. That didn't however stop him from telling them how cheap I was early Sunday morning. Obviously cheap tennis shoes aren't going to last very long, but for 1/3 of normal price  I don't really care if they'd only last a few months.

I don't remember all of the conversation, but  I commented that I am careful with my money because I'm saving money to buy my house. Instead of saying ok, not having my own home yet, was again held against me.  It seems that you aren't supposed to save money and you are supposed to magically own while maintaining an above one's means lifestyle!  The topic then changed for a few minutes.

Supposedly we were all going to go have supper at 5am somewhere. When we arrived at a bus stop, one of them said that I was inviting them to supper. I guess all my efforts to save part of my low income makes them think that I'd buy a meal at an undisclosed location for people I had just met (my "friend" had friends I hadn't met join us).  Then several others repeated that statement that I'd pay. Here in Mexico, inviting someone means you pay the bill. I said no and then one of them said that my Spanish was very bad (even though I'm fluent). It was clear that he was offended because I wouldn't invite them a meal. Of course, they didn't invite me any drinks or anything earlier.

I keep discovering that the people who accuse me of being cheap and ask me to "invite" them things are people who never buy me anything not even a subway ticket.

I didn't respond to his insult since I didn't see the point. I normally don't have a desire to argue or fight especially about stupid things between 10pm and 9am. I'm much rather relax, have a good time, or sleep. Instead of fighting back, I retied one of my shoes.  Then one of them said they didn't feel like waiting more for the bus and they started walking toward the undisclosed all night restaurant. Since it was only a few seconds after the insult, I decided to cut my losses. They went one way and without a word because I was angry, I crossed the street to take the same bus route going the opposite direction home.

I was hoping to get a text message or a message in Facebook asking what happened or if I was ok, but instead I got nothing.  I can interpret this in several ways. One is that my friend is jealous that I'm saving money now and trying to reach a goal. Another is that he's a very low quality friend or at least very inconsiderate. Finally I can accept that while I might join him sometime in the future to a bar, that that's about the extent of our friendship and that it is time to find friends who are happy that one is trying to improve his situation.

If you have been saving money for your future whether you are saving for your first home or your retirement, don't be surprised to find out that your friends are less than supportive even when they have more money than you do.  Sometimes you need to find new friends on your path to financial freedom!

The pleasure of investing for your financial freedom

I'm a long way from financial freedom, but I've noticed a change since I started my switch from saving to investing. There are many definitions for saving and investing so I'll give you my own.

Saving is putting money away without earning interest or earning significantly less than inflation. Saving for me is Emergency fund money or any other money in cash or anything that pays less than 3%. Why 3%?  Current inflation here is about 4.7% (officially). Your typical bank savings account, money market account and certificate of deposit would be savings.  Savings are important. If you have no savings you need to save first and then you can invest.

Investing for me is putting money in stocks, bonds, and any other investment that earns near, at, or above inflation in any case it should earn at least 3% to keep up with "ideal inflation".

Anyway, I had paid off my credit card in 2011 (My previous savings got spent during the recession), and saved up my emergency savings for 4 month's expenses and then I started researching and found how I wanted to invest in a mix of stocks and direct bond purchases earning 4-6%.  I put 3/4 of my emergency funds into those so I'm down to one month of expenses in cash.  I'll probably keep it like that for the near future since my cash earns no interest in the bank. I just keep that there as I might need it tomorrow/real emergency money. The refrigerator could stop working or something else might come up. Still I hate to see the purchasing power drop due to inflation.  In fact yesterday, I noticed that two things I enjoy went up by one peso each.

Yesterday, I got the first bank statement for my new bank account that includes investments. Although only a small part of it was new money from last month's income, I felt just as good as if I had bought a pizza or new shoes.

Every Thursday when I see the new cetes and bonds assigned to my Cetesdirecto account, I get a little excited that I made another small step closer to my goal of financial freedom.  New shoes wear out, and  pizza gets eaten, but investments make you more money.

I've started to ask myself how many 20 or 30 year bonds I'd need to buy a pizza every month with interest or something else I enjoy. I suppose once I start getting dividends I'll do the same thing.

If you haven't yet, start saving so you can start investing for your future. Even if you don't want to retire early, you'll find uses for that new investment income.  Saving isn't fun, but investing feels great!