budgeting and keeping track of expenses can be vital

Geographic arbitrage, or how I live on $1,000 USD a month (or close to it)

Frugality is achievable.

Ever since I read “The 4-Hour Workweek” back in 2009, I got infected with the idea of geographic arbitrage: the notion that I can live just as comfortably for a lot less if I just found the right location. (Also, a quick disclaimer: that’s an affiliate link – the proceeds are used to keep this blog running.) It’s pretty ironic that I ended up moving from one of the cheapest towns, Reno, to super-expensive cities like Seattle and Toronto while brainstorming ways to make geographic arbitrage work in my favour. (Now that I’m in Canada, I must add extra “u” vowels to random words, like “favour” or “neighbour.” Hey, I didn’t make the rules.)

Theoretically, you can find the cheapest trailer park in the South (rural Mississippi?) and get your own place for, I imagine, $200 per month or so. I’ll be honest: I have no idea what life is like in a trailer park, and I’ve never known anyone who lived in one, so I’m not going to perpetuate any stereotypes or make any assumptions. Who knows, maybe, if you find the right location (ideally, outside the hurricane valley), and get a good deal, and befriend the neighbours, everything might work out perfectly. In that case, this blog has done its job, and you’re welcome, eh.

If, on the other hand, you want to live in your own apartment… When I was about to move to Canada, I had two options: Vancouver or Toronto. I never lived in the northeast before, so I decided to see what Toronto had to offer. Both cities are equally expensive: in Toronto, you’d be lucky to find a rental basement apartment with a tiny window for $1,300 CAD ($1,056 USD as of this writing). If you add the cost of parking, car insurance, periodic car maintenance (lots of rust from the road salt, especially in the winter), you’d be looking at another $300-$400 CAD each month. That’s what I like to call “no bueno.”

I’m a researcher by inclination, and I like to look up random things – my life would be a whole lot more boring if Internet weren’t around. One day, I decided to look up the cheapest rent in Canada. Much to my surprise, it turned out all the cheapest rentals were in Quebec. Digging deeper, I learned that Quebec is the only province with rent control. There’s a small caveat here: if you move all the way to Nunavut (which very few Canadians do), you can get 160 acres for free, assuming you make certain investments, set up a homestead, etc. However, if you’re not willing to reenact Stardew Valley in the far north (though I must admit – that is very tempting), then Quebec is the best place to save money on rent. 

Next, I had two choices: digging deeper, the cheapest cities in terms of rent were Sherbrooke  and Quebec City. Sherbrooke is a small college town where $380 CAD (or $309 USD) can get you a one-bedroom apartment with all the utilities and internet. Quebec City is the second-cheapest place in all of Canada, with $595 CAD ($483 USD) for the same kind of apartment. It was tempting – very, very tempting – to just run off to Sherbrooke and enjoy college life in that strange little town. (Much like Pierce Hawthorne on NBC’s Community.) However, after doing some googling, it became apparent that Quebec City is much more lively, not to mention a lot more picturesque. (No, really, just look at it!) This was one of those times where frugality clashed with common sense: frugality is achievable, but you must also consider the disadvantages: Sherbrooke is much tinier and, apparently, less lively than QC. Even though QC’s price tag is 56.6% higher, the quality of life is a whole lot better.

Either of those options would be cheaper than what I was paying in Toronto: $1,200 CAD for a tiny studio with no air conditioning, and where the landlord threatened a $1,400 fine if you set off a fire alarm. (That was not an ideal setup, but I had little choice when I rented it.) I was also paying ~$400 a month for parking and insurance, or $1,600 total. After leaving my job in May, I realized I didn’t really need the car anymore, so I sold it and never looked back. In terms of mandatory recurring spending (rent+car), I ended up slashing my cost by 62.8%, from $1,600 to $595. Not too shabby, eh? 

Long story long, here is the grand total of my expenses over the past month:

Expense Total One-time or recurring?
aquarium $106.19 one-time
rent+phone+debit card $684.40 recurring
coffee shop + eating out $119.27 recurring
frivolous software $116.87 one-time
transportation $12.05 recurring
groceries $263.60 recurring
home repairs $2.86 recurring
entertainment $21.46 recurring
car stuff $12.00 one-time
dumb recurring expense $11.30 one-time
bureaucracy $92.83 one-time
Eventbrite $42.23 recurring
Twitch equipment $91.61 one-time
     
Total: $1,576.67 $1,276.55 USD
     
Total recurring expenses: $1,145.87 $927.75 USD
Total one-time expenses: $430.80 $348.80 USD

Right now, my big ongoing project is to see if I can limit my monthly expenses to just $1,000 USD. The exchange rate always fluctuates, but as of this writing, $1,000 USD = $1,231 CAD. I’m measuring each month from the 18th to the 18th (not 1st-31st), simply because that’s when one of my usually-empty credit cards is due, and that makes it convenient to crunch the numbers. I spent the month of 8/18-9/18 moving to Quebec City, buying furniture (more on that later), and generally setting up my new base of operations. This past month was a bit more laid back, though I still had a couple of expenses that won’t reoccur in the future: it cost almost $100 to apply for the local driver license, etc.

I also splurged on some software: Luminar AI – a one-time purchase instead of paying a monthly subscription fee for Adobe LightBox. (I try to improve as a photographer with my old Nikon D5100 camera, and this really helps someone with my lack of editing skills.) The other purchase was Diablo-2 Remastered, a fun video game I used to play as a teen. There’s a small caveat here: I made my video game obsession profitable when I sold rare in-game items on a third-party site for $220 CAD, so in a way that was actually an investment! Ditto for the $91.61 spent on a shiny new webcam and microphone to set up my own Twitch channel. (Disclaimer: those are also affiliate links. Gotta pay the bills, eh?) I’m very late to the Twitch party, but if people are willing to pay to watch me play slightly outdated video games, who am I to say no?

One unusual expense is my aquarium: in a fit of boredom, I bought a 20-gallon aquarium on Facebook Marketplace right after I moved here. It required quite a lot of extra equipment, and those little fishies are about $5 a piece, but I think I’ve got it all settled at this point. (My guppies, Fichonne and Fishmael, say hi!) My grocery shopping is less than $10 per day (and I’m curious how low I can get it without making my life miserable) – I hit up the local grocery store once every 7-9 days and scoop up whatever is a) delicious and b) mostly healthy and c) on sale. 

Before someone asks, “but GL, what about dating and going out?” – I got it covered! That’s where the coffee shop + Eventbrite expenses came from, and eating out (and enjoying Netflix) can also be a group activity. Getting mildly philosophical here, but it’s important to find a partner (or an interesting person to date, at the very least) who shares your values and your approach to spending. In the past, I used to go out with people who would deliberately run up a $100 tab every time we went out, and I dated those who viewed shopping as a must-have recreational therapy. They were not any more fun to be around than those who like hiking, and long walks, and fun conversations – or maybe our values were just that out of whack.

On a lighter note, the “dumb recurring expense” line item is the monthly Planet Fitness membership that I could’ve sworn I cancelled last year. Apparently, it stayed very sneaky and hid in my bank statements all this time. Ho hum.

Keeping track of even the smallest expenses can be vital.
Keeping track of even the smallest expenses can be vital.

And so, if you take out all the one-time expenses like the driver license or the software I bought, my grand total for 9/18-10/18 was $1,146 CAD or $928 USD. Of course, the actual total (with all those expenses) was a bit higher ($1,577 CAD or $1,277 USD) but this is only the beginning. Just to make sure I don’t become a complete miser, whenever I end the month under $1,000 I will go out and spend the remaining amount on something I wouldn’t have bought otherwise: a giant bottle of locally brewed cider, an extra fancy meal, etc. Gotta keep things fun, eh?

Frugality is achievable, though sometimes it requires you to move to the edge of the world, to make strange choices, to hold yourself accountable. It would amuse me greatly if more lean-FIRE enthusiasts (or this blog’s converted readers!) followed my example and moved to Quebec City, to set up a like-minded community. Even if that doesn’t happen, though, I hope my example inspires you, or at the very least gives you something to think about – or plants a seed in your mind, the same way the 4-Hour Workweek book did for me all those years ago.

What do you think? What was the most interesting and unusual thing you’ve done to cut your monthly expenses? Or is there something you’re planning to do in the near future? Sound off in the comment section – your input is always welcome!

Good luck,
GL

Leave a Reply

Your email address will not be published. Required fields are marked *