Reader Case Study: Home Health Aide with Incarcerated Husband wants to Write Mystery Novels

Flowers from Robert

Ann is a 47-year-old home health aide living in Southern California. Her four teen/young adult sons live with their dad 10 minutes away, which enables her to spend time with them regularly. She is also newly married to her soul-mate, Robert, who is serving a Life Without Parole sentence in a California prison 300 miles away. Ann’s making major changes in her life right now, including earning her BA in English and preparing to buy a mobile home. She’d like our advice on how to stick to her budget, use her cash in the wisest way and work towards her goal of one day writing books and teaching English.

What’s a Reader Case Study?

Case Studies address financial and life dilemmas that readers of Frugalwoods send in requesting advice. Then, we (that’d be me and YOU, dear reader) read through their situation and provide advice, encouragement, insight and feedback in the comments section.

For an example, check out the last case studyCase Studies are updated by participants (at the end of the post) several months after the Case is featured. Visit this page for links to all updated Case Studies.

Can I Be A Reader Case Study?

There are three options for folks interested in receiving a holistic Frugalwoods financial consultation:

  1. Apply to be an on-the-blog Case Study subject here.
  2. Hire me for a private financial consultation here.
  3. Schedule an hourlong call with me here.
  4. Schedule a 30 minute call with me here

To learn more about one-on-one consultations with me, check this out.

Please note that space is limited for all of the above and most especially for on-the-blog Case Studies. I do my best to accommodate everyone who applies, but there are a limited number of slots available each month.

The Goal Of Reader Case Studies

Photo by Ann

Reader Case Studies highlight a diverse range of financial situations, ages, ethnicities, locations, goals, careers, incomes, family compositions and more!

The Case Study series began in 2016 and, to date, there’ve been 92 Case Studies. I’ve featured folks with annual incomes ranging from $17k to $200k+ and net worths ranging from -$300k to $2.9M+.

I’ve featured single, married, partnered, divorced, child-filled and child-free households. I’ve featured gay, straight, queer, bisexual and polyamorous people. I’ve featured women, non-binary folks and men. I’ve featured transgender and cisgender people. I’ve had cat people and dog people. I’ve featured folks from the US, Australia, Canada, England, South Africa, Spain, Finland, the Netherlands, Germany and France. I’ve featured people with PhDs and people with high school diplomas. I’ve featured people in their early 20’s and people in their late 60’s. I’ve featured folks who live on farms and folks who live in New York City.

Reader Case Study Guidelines

Happy Lunch!

I probably don’t need to say the following because you all are the kindest, most polite commenters on the internet, but please note that Frugalwoods is a judgement-free zone where we endeavor to help one another, not condemn.

There’s no room for rudeness here. The goal is to create a supportive environment where we all acknowledge we’re human, we’re flawed, but we choose to be here together, workshopping our money and our lives with positive, proactive suggestions and ideas.

And a disclaimer that I am not a trained financial professional and I encourage people not to make serious financial decisions based solely on what one person on the internet advises. 

I encourage everyone to do their own research to determine the best course of action for their finances. I am not a financial advisor and I am not your financial advisor.

With that I’ll let Ann, today’s Case Study subject, take it from here!

Ann’s Story

My Alter Ego

Hi, Frugalwoods community! I’m Ann, I live in Southern California and I’m a 47-year old divorced mother of 4 teen/young adult boys who live with their dad 10 minutes away. I see my sons regularly–except for the one who is in the Air Force. I am the treasurer of their Scout troop and enjoy it so much! I am a very detailed, organized person, and I find great satisfaction in keeping accurate financial records for the troop, plus I enjoy being around all the boys each week, even when my own two aren’t there.

I am newly married to my soul-mate, Robert, who is serving a Life Without Parole sentence in a California prison 300 miles away. We met through a pen-pal site and were married in the prison a year ago. It sounds crazy, but I would rather be married to him-in-prison than to anyone else out here. Our relationship is based on phone calls (now free!), texts (0.5 cents/text), hour-long video visits once a week if we’re lucky (free!), infrequent in-person visits (our goal is twice a year, or more if possible), and most recently and very excitedly, Facetime-like calls ($2.50/15 minutes).

Ann’s Job and Hobbies

My job is ideal for me: I care for an elderly couple, both with dementia, in their home (40 hrs/wk). The only drawback is that while I’m very fortunate it pays enough for me to live on, my budget is too tight.

I love to read novels (I just read Frankenstein for the first time), knit & crochet (I am currently working on two bedspreads), watch movies/tv shows (especially ones that make me laugh), and photograph my life. I am a homebody. 😊 Color and bright natural light are my lifeblood. Robert would also add that I love to “organize my colored pencils” (I’m probably too organized, ha ha!).

Robert and I are currently writing a children’s chapter book based on a nightmare he had as a child. He has always thought it was a story deserving to be told. It is slow going, since we are limited by 15-minute phone calls, but we are hoping it will supplement my income and pave the way for more books. We are writing for a middle-school audience and are almost at the targeted 20,000 words. We make an ideal team–he is the creative genius while I provide the structure and details for his ideas. I think I would make a very good editor!

Ann’s Goals

One of my Boys

My goal is to be financially independent so that I never have to worry about money. I find the Meyers-Briggs personalities very accurate, and my personality (INTJ) becomes stressed when forced to think about everyday things. Since living on my own, I have found this to be very true! I am always carrying around financial worry. I am terrified of being destitute someday, especially with recent rising costs. When I was first hired for my job and found out I’d be making $25/hr and realized this would cover my expenses, I felt an incredible lightness! I hadn’t realized the extent of the burden I was carrying until it was gone. But then prices started inflating and the fear came back.

I moved and started sharing living expenses with a roommate in August, which has helped ease the financial burden. However, I’m still trying to recover financially from August between the moving expenses (the movers were only supposed to cost $400 but ended up costing $1,284!) and losing 8 days of work due to having Covid (40% of my monthly income!). That’s another drawback to my job. Because my couple are elderly with pre-existing conditions and suppressed immunities, I have to stay home the full 10 days if I have Covid. So I still wear a mask EVERYWHERE, and I’m so anxious about getting it again.

I am also starting a side hustle with two vending machines. It will give me some mostly-passive income, as well as provide a job that Robert can take over in the hopeful event he is paroled. Laws are changing, he has been in for more than 20 years, and he is now considered “elderly” at the ripe old age of 52, so we are hopeful. It will be very good for his parole packet if he has a job ready for him to come home to. He has the personality and skills to excel in the vending industry. I do not, so that’s why I only have two machines.

What brings you to submit a Case Study?

My Oldest Son

What feels most pressing right now is that I’m not making enough money. I make enough to cover my basic expenses, with very few frills. And I’m not even paying for health insurance right now. I need advice on where to further cut my expenses (I have made great strides in that this past year!) and how to STAY ON BUDGET until I can earn more. I am subsisting with MediCal, which I hate, but it’s free, and since I have medical conditions and monthly prescriptions, this is a necessary evil right now.

I truly love my job, but working as a CNA/HHA will never pay much. I am VERY fortunate to be making $25/hr. Last year, I was earning only $17/hr working at a healthcare facility and the year before, I was earning a meager $15/hr as an administrative assistant.

Ann’s Desire to Write

I want to boost my earning power, and since my ultimate dream job is to work at home from my laptop, I’ve started earning my BA in Creative Writing. My best-case scenario would be to write successful mystery novels like Agatha Christie! I plan to go on to earn a Master’s as well, because then I can teach at the community college level, ideally online classes. Having homeschooled my sons for so many years and having taught an English class for other homeschoolers, I know I love teaching.

With a bachelor’s in English, there are also online positions available to teach English to foreign students. My plan is to stay with my elderly couple until I earn my BA, then find an online job using my degree, but staying with my couple part-time, because I really love them. Then I can start classes for my MA. After that, I should be able to work and earn enough for my financial goals. A benefit of working from home will be that I won’t have to retire until I want to, as I can keep earning money as long as my brain works despite what my body may decide to do. I plan to keep up my medical licenses, as I love eldercare, and it is something I can do part-time, even just a few hours a week if that’s all I want to do. I will always be able to find work since eldercare is a dependable, recession-proof source of income.

Ann’s Plans to Buy a Home

Robert’s Home

My roommate and I have decided to separate (our lease is up in September), so I’m in the process of looking for a mobile home to buy, since I recently found out that I can! Hopefully when I update this post, it will be from my very own nest. I’ve been pre-approved for a $130k mobile home loan with a maximum monthly space rent of $1,000. My combined monthly payments cannot exceed $1,650.

I know a condo is a better investment, but I will be happier in a mobile home—it is unattached, and I’ll be able to have my own outdoor space. Also, there are literally no condos in my county in the range I’ve been approved for ($250k max). My financial advisor approves, as the important thing is to stop wasting money on rent. I will use my non-retirement account (which is now at $68k) as the down payment and for the cash flow necessary when buying a new home (since there are always expenses).

I am very new to being in charge of my own finances and it has been a trial by fire. In my previous marriage, my ex-husband managed all the finances. I was blissfully ignorant of everything except the money I received for groceries and my personal expenditures. But I have a good financial advisor whom I trust and whose advice lines up with what I read on Frugalwoods and hear on the ChooseFi podcasts. His advice is to withdraw nothing and let my investments grow, while doing my best to contribute $6,000 into my Roth IRA each year (the max allowed). Right now, I’m not contributing anything, but that is something I want to do.

The Feast or Famine Cycle

Still Life with Oranges

Another thing that feels very pressing is my shopping problem. For my entire adult life, I’ve never been able to stay on a budget. Shopping is my coping mechanism when life gets stressful. I have a feast or famine way of dealing with this. I start out with the best of intentions, sticking closely to my budget, but when I feel stressed and overwhelmed, then I OVERSPEND—generally on things I was denying myself while I was being so good, and then some. And then I feel so wretched that I am even stricter with my budget, which of course starts the whole cycle over again. I am also this way with eating.

I know that if I was in control of my spending, I would have built up my cash cushion already. I have been using a budget program to budget my expenses this year, and it has been really helpful in curbing the mindless overspending. However, I can’t seem to control the emotional spending.

What are the best parts of your life?

Still Life with Handspun Yarn

The best parts of my current lifestyle are spending time with Robert and my boys, my English classes, and my job. I love my husband–he’s a wonderful man, not at all like the stereotypical prisoner. I really enjoy my boys and I’m sad I miss out on being with them every day. I know I could live much cheaper somewhere else, but I don’t want to move away from them. Writing satisfies something within me, and I’m very excited by the idea that I could earn a living doing it. And I truly have the best job! My couple adores me, their family values me, and my co-workers are wonderful people.

What are the worst parts of your life?

The worst part of my current lifestyle is not having enough time. I am working full-time, schooling part-time, starting a small business, and trying to buy a home and move, on top of making sure I have regular time with Robert and my sons. I have regularly scheduled time with my two youngest boys, and Robert and I talk on the phone in the evenings after I get home from work.

Where Ann Wants to be in Ten Years:


  • To have no money worries!
  • To be well on my way to financial independence, with investments in real estate.


  • To have a cat or a small dog and to be working from home, living on my own (with Robert!)


  • To be a successful writer—working from home and getting paid for my writing.

Ann’s Finances


Item Number of paychecks per year Gross Income Per Pay Period Deductions Per Pay Period Net Income Per Pay Period Annual Totals
Ann’s job 26 $2,000 taxes: $314.22 $1,686 $43,836
Robert’s contribution 12 Monthly. He can sometimes contribute more, but this is the fixed minimum I can depend on. N/A $207 $2,484
Annual Total: $46,320
Monthly Subtotal: $3,860

Debts: $0


Item Amount Notes Interest/type of securities held/Stock ticker Name of bank/brokerage Expense Ratio Account Type
Traditional IRA $310,440 Passive ETFs LPL Financial 0.06 Retirement
Non-Retirement Account $68,797 Down payment + move-in costs LPL Financial 0.06 Emergency
Roth IRA $25,770 Passive ETFs LPL Financial 0.06 Retirement
Checking Account $14,764 0 California Coast Credit Union n/a Cash
Savings Account $11,343 Earmarked for tuition. This will be enough for my Bachelor’s degree. Should I put this towards my down payment, and then use my extra monthly cash to pay for school? 0.05% California Coast Credit Union n/a Cash
Business Checking Account $1,018 I am starting a small side hustle with two vending machines. This is my business checking account. 0 Union Bank n/a Cash
Stocks $579 Just for fun. Not planning to sell! Originally worth $700. 14 different stocks Robinhood n/a Fun experiment
Total: $432,711


Vehicle make, model, year Valued at Mileage Paid off?
2020 Honda CR-V Hybrid EX $27,842 ~30,000 yes


Item Amount Notes
Rent $1,461 My half
Groceries $200 Only food
Text & face messaging w/Robert $200 Sometimes over this amount.
Robert’s discretionary spending $200 He uses this for things he wants me and our household to have, so he doesn’t have to wrestle the purse strings from me to be able to do it.
Ann’s discretionary spending $185 Clothing, shoes, yarn, home dec., etc. (I have a hard time sticking to this amount.)
Gas $175 My work is 26 miles away. Car averages 37 mpg. Last fill-up was $4.759/gal.
Eating out $125 A way to bond with my boys, and I need some breaks.
Robert’s food packages $100 He can have 4 packages a year ($300/pkg.), letting him take a break from state food.
School books & expenses $100 I am estimating this, as I’m just starting and not sure how much my books will be. This also includes CEU classes for renewing my licenses.
Savings–>Visiting Robert $100 Driving to see him costs about $1,200, if I am unable to trade shifts at work for the days I miss. If I can trade, it costs about $600.
Auto insurance $86 Through Wawanesa
Supplements $75 Some are necessary for my health conditions.
Utilities $65 My half (sometimes it’s less)
Savings–> Cushion $58 Goal is a month’s income. Right now it’s at $1060.86. Extra income goes here. I get overtime and holiday pay often (I earned an extra $600 take-home in November), BUT I’ve been trying for most of the year, and I just can’t get it there. I do have $2000 saved (Dave Ramsey’s Baby Step 1), but I want this cushion on top of the $2000. (The extra $600 this month covered my over-budget expenses.)
Electricity $54
Car maintenance $50 I know next-to-nothing about cars, so I take it in for almost everything. My good-with-cars brother has the same car, so he helps me remotely with the easy things.
Household supplies & HBA $50 From TP to mascara to vacuum filters.
Compassion International $38 Sponsoring a child in Rwanda
Internet $33 My half
Covered parking spot $30 My half (not an option–it’s the only way to have two parking spots at our complex)
DMV registration $27 $318 due yearly
Robert’s treats to me $25 He likes to have the ability to give me special food/meals that I otherwise wouldn’t want to pay for.
Birthday gifts $25 Xmas gifts are out right now for financial reasons, but I would like to have an envelope for those.
Chuze Fitness $25 I just joined, because I love exercise classes and the gym is 1/2 mile away, and historically, exercise classes work best for me to be consistent with exercise. Right now, I’m not exercising at all.
Cell phone service $17 Mint Mobile
Haircut $15 $30 every other month
Xmas cards $10 Yearly. I like to send nice photo cards.
YouTube Music $10 Very important to me. I use it almost constantly when I’m not working.
Renter’s insurance $8 Through our complex
Amazon Prime (student) $7
Netflix $7
Microsoft $6 Yearly
Goodbudget $5 Yearly (my budgeting program)
McAffee $4 Yearly
Parking permit $2 Yearly (for the complex).
Apple $1 My cloud space
Monthly subtotal: $3,579 Almost exactly my monthly income.
Annual total: $42,947.76

Credit Card Strategy

Card Name Rewards Type? Bank/card company
Chase Sapphire Preferred Travel Chase Bank
LL Bean Website money (I’m currently working towards a $300 down blanket for my bed.) Citibank
Kohls n/a Capital One, N.A.
I only use one credit card at a time, to focus on the rewards. I pay it off completely each month.

Ann’s Questions For You:

  1. How can I further cut my expenses while I’m in school these next few years? And how can I sustain this budget?
  2. How can I eke out $6,000 a year to put in my Roth IRA?
  3. How can I control my shopping problem?
  4. How should I pay for my Master’s degree?

Liz Frugalwoods’ Recommendations

Ann’s oldest son

I want to thank Ann for sharing her story with us today and congratulate her on all of these exciting life changes ahead!

Ann’s Question #1: How can I further cut my expenses while I’m in school these next few years? And how can I sustain this budget?

While I agree with Ann that her income is low, it’s also true that she’s managing to live on it. That’s a huge win! Plenty of folks don’t break even every month and doing so is an accomplishment all on its own. So take some praise here, Ann: you’re making it work! Would it be easier if she had a higher income? Of course! But since that goal is potentially a few years away, her inclination to spend less makes sense.

Anytime a person wants to spend less, I encourage them to comb through their expenses and categorize each item as Fixed, Reduceable or Discretionary:

  • Fixed expenses are things you cannot change. Examples: your mortgage and debt payments.
  • Reduceable expenses are necessary for human survival, but you control how much you spend on them. Examples: groceries and gas for the cars.
  • Discretionary expenses are things that can be eliminated entirely. Examples: travel, haircuts, eating out.

This is always an illuminating exercise because we can’t know how much we can save if we don’t know our categories. This is also, by the way, why I encourage everyone to find a system for expense tracking that works for you. I use and recommend the free tracking service from Personal Capital, but there are plenty of other options on the market (affiliate link).

Below is this categorization exercise for Ann and it assumes that all Robert-related expenses, which total $625 per month, are fixed and non-negotiable.

This is an austere, bare bones budget, but it illuminates Ann’s baseline. In other words, this is potentially the lowest amount she could spend every month. I eliminated everything Discretionary and reduced everything Reduceable. From a quality of life standpoint, I can’t say I recommend this. But from a saving money standpoint, this is the most aggressive way to go about it:

Item Amount Category Proposed Bare Bones Amount
Rent $1,461 Fixed $1,461
Groceries $200 Reduceable 200
Text & face messaging w/Robert $200 Robert 200
Robert’s discretionary spending $200 Robert 200
Ann’s discretionary spending $185 Discretionary 0
Gas $175 Reduceable 100
Eating out $125 Discretionary 0
School books & expenses $100 Fixed 100
Robert’s food packages $100 Robert 100
Savings–>Visiting Robert $100 Robert 100
Auto insurance $86 Fixed 86
Supplements $75 Reduceable 50
Utilities $65 Fixed 65
Savings–> Cushion $58 Reduceable 0
Electricity $54 Fixed 54
Car maintenance $50 Reduceable 30
Household supplies & HBA $50 Reduceable 30
Compassion International $38 Discretionary 0
Internet $33 Fixed 33
Covered parking spot $30 Fixed 30
DMV registration $27 Fixed 27
Birthday gifts $25 Discretionary 0
Robert’s treats to me $25 Robert 25
Chuze Fitness $25 Discretionary 0
Cell phone service $17 Reduceable 17
Haircut $15 Discretionary 0
Xmas cards $10 Discretionary 0
YouTube Music $10 Discretionary 0
Renter’s insurance $8 Fixed 8
Amazon Prime (student) $7 Discretionary 0
Netflix $7 Discretionary 0
Microsoft $6 Discretionary 0
Goodbudget $5 Discretionary 0
McAffee $4 Discretionary 0
Parking permit $2 Fixed 2
Apple $1 Discretionary 0
Current Monthly Subtotal: $3,579 Proposed New Monthly Subtotal: $2,918
Current Annual Total: $42,948 Proposed New Annual Total: $35,016

At this bare bones budget level, Ann would be on track to save an additional $7,932 per year. This would answer her second question of:

How can I eke out $6,000 a year to put in my Roth IRA?

She could easily take $6k of that saved $7,932 to put into her Roth IRA and still have $1,932 leftover.

Ann’s Question #3: How can I control my shopping problem?

Paper cranes

While the above bare bones budget solves Ann’s first two questions: how to save more money and how to find $6k to invest in her Roth, it likely makes question #3 more of a problem. The challenge I see with this budget is that it’s extreme and miserly and would likely catapult Ann into that feast or famine mindset she mentioned she’s fallen victim to in the past. It seems a middle ground will be more sustainable for her (and anyone) for the longterm.

To that end, I encourage Ann to perform this same exercise with her expenses. She may have different categorizations for each item and different proposed new amounts. What I like about this format is that you can set a goal for how much you want to spend each month and then work backwards to figure out how to get your spending to align with that goal. I can’t tell Ann (or anyone else) what she should spend her money on or what her priorities should be–only she can identify what she values the most. If Ann is able to eliminate anything that doesn’t fit the criteria of being a highest and best priority, her goal should come into sharper focus. She’s already done the hard work of tracking and listing all of her expenses–now she just needs to reckon with which ones matter the most to her.

At work

This feast or famine mindset is a familiar one for a lot of folks. We severely restrict ourselves and then binge in the opposite direction because we feel deprived. The goal of sustainable, lifelong frugality is NOT to deprive yourself–it’s to create a tenable balance between treats and savings. I call it ‘luxurious frugality‘ because the hope is that you’re able to create a budget in which all of your needs are met and enough of your ‘luxurious wants’ are also met. Thus, you’re able to feel abundant as opposed to deprived.

My favorite tactics for getting to this place of luxurious frugality entail frugal substitution and the ruthless elimination of things that aren’t priorities.

Here’s that idea fleshed out in a post I wrote a few years ago titled, How to Create Sustainable Money Habits:

Identify: Think through your typical day/week and identify every juncture at which you spend money.

Disrupt: For every money-spending event you identify, make a proactive plan for how you’ll eliminate or reduce that expense.

For each of these spending junctures, figure out if you can: 1) eliminate it entirely; or 2) utilize frugal substitution. (You can also perform this exercise via spreadsheet with the above expense categorization approach).

Here are a few examples:

    • Frugal substitution: bringing your lunch from home rather than buying it out
    • Elimination: cancelling a gym membership you’re not using
    • Frugal substitution: buying a dress to wear to a friend’s wedding at a thrift store instead of new
    • Combination elimination and substitution: not drinking alcohol on certain days/weeks to reduce your expenditure in that area

With frugal substitutions, we’re not giving something up, we’re just doing it more cheaply. Ann’s utilization of the MVNO Mint for her cell phone service is a perfect example of frugal substitution (affiliate link). She’s not going without a phone, but she’s spending only $17 a month on service, which is drastically less than most Americans.

The line items I encourage Ann to investigate first are Robert’s discretionary spending, her discretionary spending and eating out–those three items total $510/month ($6,120 per year). Again, the goal is not to berate yourself or feel guilty; rather, it’s to interrogate if the return you’re getting on these expenditures is worth it.

Ann’s Question #4: How should I pay for my Master’s degree?

Happy Living Room Arrangement!

I want to pause here to talk about Ann’s pursuit of a BA and MA in English. Firstly, you don’t need a college degree in order to become a writer. You just have to write. While an English degree certainly provides useful techniques and tools, it’s not a requirement to become an author. To that end, I encourage Ann to discern if her goal is to write novels or teach English.

→If the real goal is to teach English, then yes, degrees are required.

→However, if the real goal is to write books, a degree is not required and getting one is potentially slowing down your writing progress.

If the goal is to write books, Ann should utilize her time to write books as opposed to sitting in a class and doing coursework.

I also want to pull apart the threads of Ann’s competing goals:

  1. On one hand, she has identified that she wants to earn more money.
  2. On the other hand, she has identified that she wants to write books.
  3. Unfortunately, #2 is not very likely to make #1 happen anytime soon.

I think most of us will agree that finding a remunerative career as an author isn’t something to hang a financial plan on. I write this as a published author who got paid to write this book a few years ago. It was a grueling, challenging process and I can think of at least 1,000 easier ways to make money.

Write because you love to write, not because you think it’s going to make you rich (or even pay the bills).

Backyard Puffball

As a fellow writer, I’m not trying to rain on Ann’s dreams here, I just want her to be crystal clear about the fact that an English degree and writing books are not great ways to make money. There are A LOT of aspiring writers with English degrees who would be thrilled to make the $25/hour Ann currently makes. And Ann already knows that writing can happen anytime, anywhere–it doesn’t need to be within the confines of your “full-time job.” Plenty of novelists hold down day jobs while working on their craft in their spare time.

Jumping back to the discernment question, if the goal is to teach English, then Ann needs to have a very concrete plan for how that will be accomplished. As it stands, the BA and MA are a tough financial proposition since there’s not a clear trade-off for increased income.

Here are the questions about teaching that I encourage Ann to explore:

  1. What income can she expect as a teacher? It might not be much more than $25/hour.
  2. Will she also need a teaching certificate or degree in order to be hired as a teacher?
  3. Can she be hired as a community college English teacher, as she noted, without prior teaching experience?
  4. Ann mentioned teaching English online to English language learners and I’m almost 100% certain you do not need a degree in English to do this. Ann already has a college degree and that’s likely all that’s needed. I strongly encourage her to explore all of these avenues.

Bottom line: if getting a BA and MA isn’t going to measurably improve your earning potential, it’s a very expensive gamble.

Holistic Financial Overview

Let’s do a complete rundown of Ann’s assets and see where things stand.

1) Cash: $27,125

Diary-Free Truffles from Robert

Between her three checking and savings accounts, Ann has $27k in cash, which is fantastic! At her current spend rate of $3,579 per month, she’d ideally have an emergency fund of $10,737 (three month’s worth) to $21,474 (six months’ worth). She’s over this amount, but I think that’s fine since she plans to move in the near future, which is a notoriously expensive endeavor.

→Action item: move the cash to a high-yield savings account.

Ann’s cash is underutilized at the moment since it is earning 0% or 0.05% in interest. She should explore moving her cash into a high-yield savings account, such as the American Express Personal Savings account, which–as of this writing–earns 3.40% in interest (affiliate link). In that account, in one year, her $27,125 would earn $922 in interest! That’s free and easy money!

2) Retirement: $336,210

Between her Roth and traditional IRAs, Ann has $336,210 in retirement investments. Let’s see how this measures up against Fidelity’s Retirement Rule of Thumb: 

Aim to save at least 1x your salary by 30, 3x by 40, 6x by 50, 8x by 60, and 10x by 67.

Since Ann is 47, let’s go with 5x her salary, which is $260,000 ($52,000 gross salary x 5). By that metric, she is on track. The caveat, however, is that Ann has identified that her salary is too low and her budget too restrictive. In light of that, she’ll want to keep an eye on increasing this number as her income increases to a more comfortable level. Her inclination to max out her Roth IRA every year is a great one and I encourage her to work towards that. For 2023, the maximum contribution allowed is $6,500. Note that this jumps to $7,500 when you’re age 50 and older.

→Action item: Determine her Social Security benefits


Ann should also figure out her anticipated Social Security benefits by following these instructions on how to retrieve her earnings tables from (the government’s Social Security website). Her anticipated Social Security will form the crucial baseline of her retirement income.

3) Taxable (aka non-retirement) Investments: $69,376

My understanding is that Ann intends to use most/all of this for the downpayment on her mobile home, so we’ll consider this money already earmarked for that.

A Note On Mobile Homes

Since Ann plans to buy a mobile home, I want to include a few notes–which she may already be aware of–but I’d be remiss not to mention. My primary caution here is about mobile home parks and their different administrative structures.

Questions for Ann to ask:

  1. What is the HOA (home owner’s association) fee or park fee?
  2. Who owns the park?

This second question is especially crucial since, ideally, you want to buy a mobile home in a park that’s owned by either a non-profit or a cooperative made up of the residents. If a park is instead owned by a for-profit entity, park fees can be hiked dramatically over time. And despite their name, it’s expensive to move a mobile home, so you’re essentially restricted to staying in the park you bought into. Thus, if the park fees dramatically increase, you’re stuck with these fees. Plus, if you try to then sell, the value of your home is reduced because buyers will be deterred by the high park fees. The best way to mitigate that risk is to buy a home in a park that’s owned by a nonprofit or cooperative.


  1. A Current Project

    Perform the expense categorization exercise outlined above and play around with the proposed new amounts to spend each month:

    • Identify which items are priorities, which can be eliminated and which are ripe for frugal substitution.
  2. Identify where to save the $6,500/year to invest in your Roth IRA.
  3. Ensure you’re creating a sustainable frugal budget that won’t lead to deprivation and the temptation to severely restrict and then binge.
  4. Spend time discerning if the goal is to write novels or teach English:
    • If the real goal is to teach English, create a concrete plan for how to get hired and know the anticipated salary and requirements (teaching certificate, teaching experience, etc) in advance.
    • If the real goal is to write books, then the degree(s) are not required and are potentially slowing down your progress.
  5. Write because you love to write, not because you think it’s going to make you rich (or even pay the bills):
    • Ann needs a practical and realistic plan for supporting herself and writing books is not a stable route to that.
    • Income will likely need to come from somewhere else while the book writing happens in the off-hours. Many authors have followed this path to great literary (if not financial) success!
  6. Consider moving all of your cash into a high-yield savings account.
  7. Keep your eye on your retirement investments and ensure you’re growing them as you grow your income.
  8. Determine your anticipated Social Security income.
  9. Research the park fees and park ownership structure of all potential mobile homes.
  10. Update us on all the exciting changes you have on the horizon! We are cheering you on!

Ok Frugalwoods nation, what advice do you have for Ann? We’ll both reply to comments, so please feel free to ask questions!

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