Let’s face it, being in debt sucks. It sucks a lot, in fact. For us, being $140,000 dollars in debt really, really sucks. But, that doesn’t mean that we have to live at home with our parents, take a job we do not want and/or hate, and never do anything fun. While the aforementioned is an option, it is not ours. Instead, we live in Taipei, travel, and love our lives. Considering our extreme amount of debt, we think that anyone can do what we are doing. Is it always easy? Hell no! Is it worth it? Hell yes! Obviously, when doing this, though, you have to learn to do things like budget, and this post hopes to show how we do it in our particular situation teaching English in Taiwan.
As you have probably learned at some point in the past, whether in a high school or college class, budgeting can be done in a couple of ways. The most complete and effective way is to keep a complete record of your earnings in a table and/or other document, map out your expenses day by day or week by week, and decide what savings and/or spending money you can have accordingly. This is an intensive and complex undertaking. Anyone can do it, certainly, but it is not easy and requires dedication. Being Internationally in Debt, we have to do this in some way, shape or form, but there are some easy hacks we do, and you can too, to help conserve money and pay off our debt.
First and foremost, decide how much money you need to pay off your bills and/or save and get it away from you. Far, far away from you. The easiest way to do this, and how we do it, is to send it to a separate bank account back in the US or separate from your main account (e.g. savings account) that is used to pay off debts, student loans, credit cards, etc.
Now, as a reminder, we live in Taiwan. Here we are paid monthly. Therefore, we have to live off of our paycheck for an entire month before we are paid again. This creates challenges and makes budgeting all the more important. It also makes sending the money needed for bills or for savings to another location all the more important.
Why? Well, when you have to budget for an entire month, including rent, utilities, day to day spending, etc., things can become complicated. But, if you get the money you absolutely need away from you and, then, budget with the rest of the money you have available, it forces you to live within your means. We can say from experience that leaving the money in your bank account you use for everyday expenses puts you at a much higher risk of dipping into it if you, for example, decide to go on a bender and drink heavily for a weekend. Getting the money out of your reach allows you to more fully understand and visualize how much money you have for rent, food, emergencies and leisure. For example, if you have to pay about $150 US dollars a month in student loans, $25 in credit card debt, and want to save about $125 dollars for the future or for emergencies, that means you have to send away about $300 (or about NT$ 10,000). If you make NT$ 60,000 (US$ about 2,000), that means you are left with about NT$ 50,000 for the whole month to live off of. That is way more than is necessary for comfortable living in Taipei, so it can be adjusted accordingly, but you get the point. Using this method, the money needed for those absolute necessities is placed aside, and you are forced to budget with the remainder. Easy.
Secondly, if you are too lazy to fully budget and map out your expenses per week, daily, etc. on a sheet of paper, we have another easy hack. Set aside how much money you are allowed to spend per week, and use no more than that. This is very quick and easy to accomplish.
Let’s use the number from above and say that you make NT$ 60,000 (US$ 2,000) a month. (Quick disclaimer, as a teacher in Taiwan, most jobs are going to pay you by teaching hours and, thus, your pay changes month to month. A down month, August and February most notably, your pay may be much lower, so you will have to adjust for this accordingly.) You sent away your NT$ 10,000 (about US$ 300) to pay for bills and keep for saving, and now you have $50,000 left. Your apartment costs $12,000 (US$ 400). (Again, this is going to vary depending on where you live and how much you want to pay. Our place is about this much and is very nice, we think, but you could find places for much cheaper in other places in Taipei.) Your utilities come out to about $2,000 a month (again, amounts vary depending on season). That leaves you with $36,000 to spend for approximately 4 weeks, or about $9,000 a week. We’ll tell you right now, with that amount of money per week you could live like a king, In fact, in our experiences and with the way we live, that would be kind of hard to spend, unless were to go to a bar and get out of hand…
Regardless, we try to spend about $5,000 per week, but have gone as low as $3,000 (about US$ 100). (We have to send home about NT$ 40,000 a month just to pay for our debts, so the amount we try and spend a week is most likely going to be lower, maybe much lower, than you may use.) That comes out to about NT$ 20,000, per person, over the four weeks, and that leaves a surplus of about NT$ 16,000 that can be used to travel, extra savings, bigger payments on your loans (always a good idea), or wiggle room for emergencies. In conclusion, this form of easy budgeting can be done in just a couple of minutes, requires only a little, simple math, and requires no pesky documents. Easy.
Moving on to a much more specific topic, avoid bars as much as possible. Drinking in Taiwan is not nearly as cheap as living and eating is. In fact, it is probably about the same or more expensive as it is in the US. But, when you take into account that you make much less money than you would probably make per month in the US, it makes it relatively more expensive. This is not to say that you can’t go out and have fun, but you just need to be smart. Expat bars are expensive, relatively, and cutting them out of your budget can help you saves heaps. Instead, find a bar that is all-you-can-drink. These are relatively common in Taipei, and can cost as little as NT$ 500 (US$ 15). The added bonus, or possible added problem depending on how you look at it, is that you can get really drunk! Another way to drink and stay on budget is to just go to a convenience store and drink there, or go to a local park and drink. In Taiwan you can drink in public! Take advantage of that and the warm climate and enjoy the outdoors with a nice cold beer or glass of gaoliang (you’ll have to try that one on your own). Easy.
Indeed, there are many simple ways to budget your money, live abroad and still pay off mounds of debt. These above are by no means all the ways, but they are a start. In the future we hope to bring you more insight and hacks that can help you, too, travel and/or do what you want despite the crush of debt. Stay tuned!
If you have any other hacks, ideas, or comments please tell us below!