Our Financial Year of Living in South Korea

So dear Reader, here we are. Reviewing how our year in Korea went financially – with 10 months of that being Our Brat Experiment where we were trying to reduce our expenses so we could increase our savings as much as possible. Regular readers of this blog will know that soon after beginning Our Brat Experiment we realized that we were going to reach our dream savings amount for the year and so we started pushing for our dream-dream savings number…. So let’s see if we got there 🙂

To new readers of The Brat Experiment: Husband and I tracked every single won that we spent (while living in South Korea for a year) on a fantastic app called Money Lover. The app was synched to both of our phones and meant that it was very easy to see where all of our money went (which was not always pleasant!). I then reported on our spending weekly and wrote up a summary of our spending for each month. You can check out our Korean weekly spends and other monthly summaries in The Numbers section.

To start with let’s look at our actual spending for the 10 months (April 2016 – February 2017) of Our Brat Experiment:

36) total monthly spends

It’s interesting to see our biggest spends were our first month and last month. The first month was because we were simply tracking our expenses when we first began Our Brat Experiment and hadn’t started trying to reduce our expenses yet. And that last month was overseas travel and once-off expenses like posting boxes to New Zealand. So maybe the lesson is that moving countries is expensive?! It is clear though that our spending profile is heavily influenced by overseas travel expenses as this graph shows:

36) local vs overseas spending

The peaks in the first graph perfectly match the red peaks in this second graph. And the importance of our overseas spending is really highlighted if we look at what percentage we spend in each category:

36) Percentage spent in each category

Overseas travel is our NUMBER 1 biggest expense (at least in Korea where we didn’t have to pay rent because it was included in our work package!). So definitely, no more underestimating or trying to ignore how much our overseas travel costs us. Our local and overseas travel combined is almost 40% of our overall spending… so clearly travel is REALLY important to us. Which is fine. As long as we plan for it 🙂

Lastly, in terms of our spending habits, this graph is nice to see the flow of things over time within each category:

36) Amount spent in each category each month

The whole point of looking at our spending behaviour is so that we can hopefully increase our savings (or amount of money we have to invest) so let’s look at our income, spending and savings for each month that we were in Korea:

36) Income, spending & saving

Some points on this graph:

  • Husband and I were both earning very well in Korea (we both had 2 years work experience in Korea, Husband’s a qualified teacher and I have a Masters so we were both in the top bracket of earners for second-language English teachers) so this is not reflective of what everyone can earn in Korea
  • We did not have to pay rent but we did have to pay building management, gas and electricity fees
  • The first month of Korea we got reimbursed for our flights and we got a small settlement pay out
  • The last month of Korea we got our normal salaries plus a bonus (about the same as our normal salaries) and our flights home
  • Because we hadn’t started Our Brat Experiment in March I’ve assumed that we spent all the money that we earned in March
  • We didn’t spend any of our February income in Korea because we flew out of Korea on Monday 27th (those few days’ expenses in Korea after the 25th I included in Month 10)

Which then brings us to the whole point of this post: what percentage we were able to save each month 🙂

36) Percentage saved

The graph definitely reflects the inevitable ups and downs of any long-term, attempting-sustainability journey… With some wonderful highs and disappointing lows… especially that 25% for Month 10. But that right there shows how far Our Brat Experiment has brought us – 25% is an amazing savings rate for a month (especially compared to our savings rates before Our Brat Experiment)! But it’s not really great if you judging yourself using hopeful, FIRE (Financial Independence/Retire Early), savings-focused tinted glasses!

So what was our overall savings rate for the year? Our overall savings rate for the year of 53% 🙂 Which translated into us miraculously saving our dream-dream amount AND being able to fund a 6 week road trip of South Africa!! 🙂 🙂 🙂 🙂 Worth the small sacrifices we made throughout the year? Absolutely. ESPECIALLY because it really didn’t feel like a sacrifice 🙂

What an incredible year it has been, dear Reader. We are still completely flawed by how much a little intentionality could drastically impact on our spending habits and so the amount that we were able to squirrel away. So now onto the next steps in Our Brat Experiment:

  1. Seeing if we can reduce our spending so we can save a significant amount (aiming for a 40% savings at least!) in the real world i.e. in New Zealand where we have to pay rent and tax and have a car etc
  2. Actually starting to invest our money…. (so that compound interest can start working its magic!)

So exciting, scary times ahead, dear Reader. And I’m so excited to have you all along for the ride 🙂

                        Xxx

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