This is a guest post from former GRS staff writer Donna Freedman. She is currently a staff writer at Money Talks News, freelances for a number of magazines and PF sites, and blogs about money and midlife at

In January 2007, I wrote an article about being recently divorced, helping to support a disabled adult child and working toward a university degree in my late 40s. “Surviving (and thriving) on $12,000 a year” went viral as readers (including J.D. Roth) demanded to know how, exactly, I could do that.

A new career - slashing your salary

This post generated more reaction than any other article published that year. The editor kept asking for more, and within eight months I was writing for MSN Money full-time.

Oh, the irony: Having barely enough to get by turned into a decently paid job. (Which was just as well, since I had legal debt from the protracted divorce.)

On September 11, 2013, Microsoft laid off all its writers. A couple of hours later I’d lined up more work – but not much of it. Having spent 10 years on a dead run, I decided to give myself the gift of slowing down. Translation: At age 55, I voluntarily cut my salary by nearly 58 percent.

Between the MSN gig and a couple of others, I’d been looking at earning at least $85,000 (probably more) in 2013. Not bad for a job I could do from home in my jammies.

Now my limited liability corporation salary is $36,000 per year. After taxes and essentials – including self-funded health insurance, a Roth IRA, my share of household expenses and a couple of carefully chosen indulgences – I’m left with $164 per month.

Defining a rich life

Normally, I’m not the kind of person who reveals her salary. But just as I did back in 2007, I’m opening the ledger to let people know that living on less is possible. My hope is to reach those who:

Are feeling the economic pinch: Maybe you’ve been laid off, need to help your elderly parents, have had your own kids move back in or just generally feel stressed about the ever-rising cost of living.

Are afraid to retire: As those costs edge up, you wonder whether your Social Security and other retirement monies will be enough.

Are questioning their quality of life: Maybe you’re longing to work less or change careers but worry you can’t live well on fewer dollars.

Whether you decide to change your life or whether you have change thrust upon you, know that it is possible to craft a meaningful and even joyous existence on less money. A rich life is not necessarily determined by the number of dollar signs it contains.

That said, let me be clear: Willful underemployment is not for everyone. I couldn’t do it myself if I had consumer debt, kids (or parents) who needed help, a mortgage or student loans. However, some of my cost-cutting tactics could help you trim your own budget. The money you save can be used to build an emergency fund, attack any consumer debt, do home or car repairs, or set aside money for retirement.

Partners in frugality

My partner, DF, is the only person I know who’s just as frugal as I am. Neither of us are “cheap,” i.e., we don’t make choices that affect our health or the health/enjoyment of others. But we see no reason to overspend.

He owns the home we share and I chip in $500 a month. In some regions – but obviously not all – that would be my half of the rent or mortgage. (When I first moved back to Anchorage, I paid $600 a month to share a friend’s home.)

We don’t have a TV, so no bill for cable, Netflix or Hulu Plus. I cover the costs of Internet and a basic landline because I need them for work. Last year, I ditched my $80-plus monthly cell plan in favor of a burn phone from the discount store. It costs $2 a day if I use it; otherwise, it costs nothing.

I’m budgeting $100 for my share of monthly groceries. We don’t dine on breast of free-range quail marinated in organic acai berries with Sevruga caviar foam, but we eat pretty darned well thanks to frugal hacks like:

  • Sales and coupons (only amateurs pay retail)
  • “Scratch and dent” foods and the bakery outlet (multigrain breads and sandwich rolls for as little as 50 cents)
  • Cooking from scratch (we rarely dine out) and eating seasonally (no $7.99-a-pound cherries in January)
  • Using every part of the food, including making soup stock from vegetable scraps and pan juices
  • Gardening and, to some extent, preserving food
  • Wild foods people sometimes share with us: moose, salmon, duck, ptarmigan, even bowhead whale
  • Buying in bulk from Costco: 20 pounds of dried beans, 50 pounds of flour, giant vats of laundry soap

More life costs

The heat stays between 62 and 64 degrees during the day and a little lower at night. Since my workaday attire tends to be sweatpants and a bathrobe, I get along just fine. We often use the fireplace insert for auxiliary heat (and ambiance!), burning wood we get from cutdowns in the yards of family and friends. DF sweeps the chimney himself.

Since we live half a mile from a bus line, I decided against buying a car. This is a huge money-saver; according to AAA, the cost of auto ownership ranges from $6,967 to $11,599 per year.

I rarely shop because I just don’t care about clothes. Outside the house, I mostly wear thrift-store jeans and shirts. The last time I bought dress slacks was for a 2004 divorce court hearing (Nordstrom Rack, less than $30).

Foot issues means I do buy decent walking shoes, which I wear just about everyplace (including the opera). Sale price + online coupon + cash-back shopping means I pay $70 to $80 per pair – still expensive, but so is a podiatrist.

I use discounted gift cards bought on the secondary market to pay for haircuts, groceries, toiletries, movie tickets and home-improvement items. Sometimes I can buy the cut-rate cards through the cash-back site – frugal double-dipping!

Entertainment, travel and gifts (the frugal way)

Almost all Christmas and birthday presents are paid for with gift cards I got from rewards credit cards and a couple of online rewards programs (My Points, Swagbucks). This has saved me many hundreds of dollars.

Entertainment is another series of frugal hacks. It costs nothing to read, walk, listen to music, or play cribbage or Scrabble. In addition:

  • I write theater reviews for the local newspaper, which means two free tickets and a $60 honorarium.
  • For movies, I go on cheap Tuesday or hit the second-run house. I usually pay with discounted gift cards. If I write about movies for my website (e.g., “5 financial lessons from ‘Parsifal’”), the ticket becomes a business expense.
  • DF is a member of the Anchorage Museum; reciprocal programs let me visit museums in other states for free.

Like many people, I redeem frequent-flier miles and use travel websites to find the best deals. I try to house-sit or stay in hostels. Rather than rent a car, I use public transit and the Megabus. If I meet with an editor on the road, I’ll deduct a portion of travel costs.

My other regular treats are seven or eight haircuts a year and a monthly two-hour massage (no machine runs for 56 years without some maintenance issues). I also watch for massage specials.

But what about retirement?

Some pundits say you need more than a million bucks to retire; others say “nuh-uh!” Right now I’ve got a little more than one-third of that mythic million in several funds: a 401(k) from my newspapering days, a Roth IRA, some CDs and a brand-new 401(k) funded by my LLC.

I could be four-fifths of the way there by age 70 if I keep paying at my current rate and my funds keep growing at the current rate. Or maybe all of the way there, if each account performs like a bull-market boss. Or I could wind up on the wrong side of a market plunge, like those folks who retired shortly before the big bang of 2008.

There’s also Social Security plus a $550 monthly pension from my newspapering days. Other assets include:

  • Liquid savings of about $40,000
  • The annual Alaska Permanent Fund Dividend check (estimated at $1,800 this year)
  • The possibility of increasing contributions to my new 401(k)

Will all this be enough? No one knows. Just ask those 2008 retirees.

Quality of life: It matters

Here’s what I do know: I’m 56 and my partner is 63, and every day we read obits for people our age (or far younger) who succumbed to heart attacks, cancer or auto accidents – or, this being Alaska, to plane crashes, hypothermia, climbing accidents, drownings and bear maulings. Thus we have vowed to use a mix of frugal hacks and positive thinking to live the best life we can on what we have.

This plan could work really well. It could also be felled by illness, incapacity, recession or a complete drought in the freelance market. But we’re not going to let the what-ifs keep us from living while it is yet possible to live.

Neither DF nor I mind spending on what’s important to us: our families, music, theater, decent shoes, a piano-tuning (him), a blog domain name (me). But both of us are practical and inventive people who can find our way through most problems without opening our wallets. Right now we have everything we need and much of what we want, which is a blessed place to be.

The quality of our days matters as much as the quantity. It’s wonderful to meet him at the door with a smile and a kiss instead of the neck-knotting worry that I haven’t done enough work yet. I no longer spend four or five evenings a week online, ignoring the lovely man sitting patiently (but forlornly) in the same room.

The formerly constant stress is gone, replaced by something I couldn’t recognize. Finally I realized it was … happiness. It’s not that I’ve never been happy before. But I’ve never experienced it as such a consistent sweetness to my days. That’s worth a lot.

I once wrote that stability is a story we repeat to make ourselves feel better about staying exactly where we are. Suppose I had taken the first 9-to-5 I could get after fleeing an abusive marriage back in 2004? That would have been stable. (Maybe. Lots of jobs were lost after 2008.)

But if I’d done that, I wouldn’t be where I am now. Back then I was uneducated and emotionally broken. Now I’m a confident online journalist with a distinct voice and the chance to help others. E-mails like “I’m out of debt because of you” or “I’m back in school because of you” make me dance around the house in those sweatpants, yelping “This is why I do what I do.”

Do I miss the bigger bucks? Sure. Sometimes I wish I could send my daughter and son-in-law a $50 gift card just because, or buy treats for my great-nephews, or fly to the East Coast to visit family whenever I want.

But I’ll live. I mean that in the literal sense. While I’m fully aware of what I’m giving up, I’m much more aware of what I’m gaining. Love. Time. A job that makes a difference. In other words, happiness – so welcome and so wanted, even if it did take 10 years to get here. Now let’s see where the next 10 years take me.