When my wife and I first moved to Mexico almost two years ago, we were concerned that our monthly budget – which was significantly less than it was when we were both working full time back in the States – would require us to live a very frugal existence in Mexico. Nevertheless, we decided to give it a try to be able to enjoy our days on the sun-drenched beaches of the Riviera Maya.
To ensure that we were living within our means, we started tracking every single peso that we spent using a phone spending app. Each morning, my wife would divide the remaining budget by the number of days remaining in the month to determine our daily budget. We would then plan our daily activities to keep spending below that magic number.
I used to tell my wife that if we couldn’t live within our means in Mexico, we would have to return to the old country, get jobs and become responsible members of society again – and neither of us wanted that to happen!
Although tracking every peso probably sounds unnecessarily tedious to some people, it convinced us that not only could we live in paradise on that reduced budget, we could live very well on it.
We’ve become experts at living well under budget. Since we rarely spend the allotted daily amount, we often have surplus at the end of the month. We use the money to travel, buy something for the condo or just spend a couple of days being pampered at an all-inclusive resort nearby.
People often ask us how we’re able to do so much on a tight budget. One of the main reasons is that most of the businesses in this area will give us a significant local’s discount. For example, the discount at a restaurant will range from 10%-20%.
To be considered a local, most businesses will ask for proof that you live somewhere in the State of Quintana Roo. In our case, we just show them our Mexican driver licenses.
It’s even possible to get a locals discount at a resort or hotel; however, those special rates are generally only available during the low season (September, October, Early November), or when hotel occupancy falls below a certain percentage.
Since the savings can be as high as 50%, we take the majority of our staycations in the fall.
Let’s Wrap This Up
The concept of living within one’s means is foreign to most Americans because we’re so accustomed to buying things on credit and carrying debt. In fact, the average household debt in the United States is 112% of net disposable income.
When we lived in the States, we were definitely among that group. A large percentage of our income went toward car payments, credit card payments, and a hefty mortgage. When I think of how much money we wasted on interest over the years, it still makes me cringe.
In 2015, we decided to break the cycle by selling everything, paying off all our debt, and buying a small condo in Mexico with the money that was left over. We now live 100% debt free and we’re happier than we’ve ever been.