How I Live on Less than $40,000 Annually: Kai from California

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Mt. Diablo is not far from Kai’s home, which he and his wife bought in 2013 via a short sale. Later on, he used a severance package to pay off the mortgage.

My name is Kai, and I live in Concord, California. I’m 41 years old and married, with two kids, an 11 year-old daughter and 10 year-old son.

Like Len, I’m an engineer by training; I also have an MBA. Today I’m primarily a stay at home parent, but I’m currently doing community non-profit work too. My wife works in marketing for a cosmetics company in San Francisco.

I was born and raised in Los Angeles, but moved to the San Francisco Bay Area after graduating to work for corporate America. I left the corporate world in 2014 when the older one was in first grade and younger one was in Pre-K. We made good money, but we were paying other people to raise our kids and teach them different values than ours.

Except for a very short period of my life, I’ve always been financially responsible. My wife and I both grew up very poor, which influenced our low-cost lifestyle. Thanks to that — and diligently saving — I consider ourselves to be financially independent, although my wife plans on working for another year or two. Or so she says.

My Expenses

I use a spreadsheet to manage my finances. The breakdown of my expenses is as follows:

We have a nice home, which we bought in 2013 via a short sale just after the market bottomed; I saw a deer and a bunny running outside this morning. Our home has 5 bedrooms and 3.5 baths in 3168 square feet. The property tax is currently $9375 per year. The short sale was a roller coaster experience; the offer was made around Mother’s Day but we didn’t close the transaction until early November.

While I was working, my salary paid the bills, while my wife’s went to the mortgage and extra payments. Eventually I got laid off, however — so I took advantage of my severance package to retire the loan.

We don’t drive too much. I have a 2007 Mazda5 with about 120,000 miles on it, and my wife drives a 2013 Honda Fit with 35,000 miles. We bought both of them new. Buying new cars is the one expense that I disagree with my wife on, but I refuse to fall on my sword for this.

For entertainment, I primarily focus on reading, staying active in the community, and playing Pokemon Go.

My Savings

Over the years, we have saved and saved and saved. The stock market has also been very kind during the past decade and our living expenses are very low. As a result, during that time we have been able to gradually accumulate about 50 times our annual expenses in pre- and post-tax retirement savings accounts.

Closing Thoughts

My son is a coin collector. We just looked at his coin collection this morning under a microscope. I was showing him steps from Montecello and the Lincoln Memorial. On one of his field trips I chaperoned this year, he found a silver mercury dime on the sidewalk from 1908. It’s his favorite coin.

When we go to the supermarket, he always looks at the Coinstar machines. Apparently, they don’t take pre 1965 quarters and dimes — instead they get shunted back to the change return. He’s found maybe five silver coins in the change return in the past year.

We were playing Pokemon Go last Sunday at the mall and he found over $5 in change from change returns. He was quite excited — the boy loves his coins!


If you’re like Kai — a household CEO who is successfully making ends meet on roughly $40,000 per year or less — then I’d love to hear from you! Contact me at and be sure to put $40,000 in the subject line. If I publish your story, you’ll get a $25 gift card, or an American Silver Eagle!

Photo Credit: Oleg Alexandrov

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