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Don't keep score by how much you make; keep score by how little you spend
by Jamie Fristrom on 10/28/13 01:56:00 pm   Expert Blogs   Featured Blogs

The following blog post, unless otherwise noted, was written by a member of Gamasutra’s community.
The thoughts and opinions expressed are those of the writer and not Gamasutra or its parent company.

 

Yet another mistake to avoid when going from Corporate to Indie - which ties into some of the other mistakes I've written about, like hubris and team size - is spending money.

BlogIndieSpendingLeaderboard
(I suck at this game. But I'm getting better.)

I suppose this depends a bit on why you went indie. If you decided to become an indie game developer to see if you could make a lot of money, then you could throw some money at it to see if it sticks and then go back to your high paying corporate job and it would end up costing you less in the long run. (Or there's that one in a thousand chance you actually make a ton of money, in which case, again, spending money might be a great investment.) But if, like me, you decided to go indie because you wanted your freedom, because you wanted to stop working for The Man, then read on...because spending less money usually means spending more time, and for me that's great, because I want to prolong my indie adventure as long as possible.

Lately I've come across the blog of Mr. Money Mutache and I really like the cut of the guy's jib. We're kindred spirits in a lot of ways - saved up quite a bit, quit our jobs before the crash, started businesses that didn't work out so well, have families, and try to keep our spending frugal. But Mr. Money Mustache spent less than half as much as me each year and has thus been able to maintain his financial freedom while I am going to have to either increase my indie revenue or go back and work for the man again. If I had been like MMM after I quit, and the Fristrom-Pascual family had really tightened our belts, we could keep doing this indefinitely even on the average indie salary of $25K / year.

Put another way - there's two ways you can make your indie game development company viable: making more than you spend or spending less than you make.

People tend to focus on the first. But the second works too, as heroes like Jason Rohrer show.

There's lots of advice and ways to cut costs on your game development (work from home; use hardware that's a couple years old; use free software; pay only with rev share) but that's a tiny part of the picture, right? The real cost is the cost of supporting yourself and your family.

And Mr. Money Mustache has a lot of good advice on how to keep that down. I highly recommend checking him out and other frugality websites. 

But here's some of the stuff I'm doing lately. (Better late than never.) I switched from using Quicken to using You Need A Budget last year, kind of by coincidence, and because You Need A Budget puts the Budget part front-and-center I suddenly realized with embarrassment just how much the Fristrom-Pascual family spends each month. It also didn't let me pat myself on the back just because I'd had one good month out of several, which Quicken did. I'm not even going to say what our monthly budget was because it's so embarrassing - I'll just say that even though I thought I was being frugal, I was still acting like I had my Activision salary.

One thing we did even before I discovered MMM: every line item on our budget that was optional?We cut that in half: Date night. Restaurants. Fun Spending. Even Groceries. The kids' extracurricular classes (Sofia was in a highfalutin' dance class that, in hindsight, was for rich kids. It's Boys'n'Girls club classes for you now, Sofia.)

Turns out it was easy. The only target we couldn't hit was groceries, but we did get it down from over $800/month to $550, which, from what I hear, is pretty impressive for a family of four in Bellevue. But even there, there's still room for improvement. We could eat oatmeal more often, and I don't really need two six-packs of beer a month ... and I've quit drinking coffee before, I could do it again ...

After we'd done that, our monthly budget was starting to look reasonable. I patted myself on the back and said that was probably as cheap as we could go. (Because, you know, Jason Rohrer's lifestyle looks so out of reach it gives me that why-even-try feeling, like when I look at the highest scores on the Geometry Wars leaderboards.)

But that's when I came across Mr. Money Mustache (via You Need A Budget, btw) - and realized there was so much further we could go! There's still some big ticket items we can take care of!

There's No Such Thing As The Fastest Code? How about: There's No Such Thing As The Cheapest Budget. (I bet even Jason Rohrer looks at his monthly spending and thinks, "We could really cut back here." sometimes.)

We can get cheaper health insurance. (The ACA has prodded us into doing this anyway...turns out the kids are eligible for Washington's Medicare.)

And wait! Why do I have disability insurance? I was talked into this years ago. "What if you lost the ability to earn an income, Jamie?" That would be tragic sure, but my particular disability insurance doesn't just cover my ability to earn in income, it covers a whole bunch of stupid shit. And I was paying $2000 a year for it. Basically, unless I lose both my hands or my sight or my mind, I'm still going to be able to do what I do, and that's pretty darn unlikely (and if it does happen, I'm sure my extended family will rally around to help us), so - screw the disability insurance. (I still have life. That's a lot cheaper.)

And Cathy and I have a rule to make sure our businesses are actually businesses and not hobbies that sometimes pay for themselves - whatever they make the previous month, the most we allow ourselves to spend on them the next month is half of that. (This is more important for Catshy Crafts than Happion Labs - I've always been cheap when it came to game development, prefering to invest time over money.)

And, hey - how about we cut all those optional line items in half AGAIN? And get cheaper internet? And cut back to one disc at a time with Netflix? And lower the heat? And turn off the freaking lights and television when we leave the room? Now our budget starts to look less embarrassing: we've cut our spending by over 30%!

What else can we do? We can refinance our home loan. We can sell that second car. (We almost never both drive somewhere different at the same time - that $500/year in insurance+maintenance is an astronomical Per Use cost.) We can ditch our smart phones. (Wait, MMM gets $10 iphones? We'll have to look into that when my current contract is up.)

And the weird thing? Giving up these luxuries is inexplicably making me happier. I don't know why - maybe I've genetically inherited my mom's stoicism and just didn't realize it until now - or maybe it's because I get a kick of moving up on the how-little-we-spend leaderboards. Anyhow, so far, it's not a hardship.

Long and short of it is, if we can cut our spending by 30-50%, we can be indie 30-50%...or more... longer. Rock.


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Comments


Peter Eisenmann
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- Basically, unless I lose both my hands or my sight or my mind, I'm still going to be able to do what I do -
Exactly my words!

It's cool that you were able to cut costs like you did, but if you've got a family who is used to higher standards of living, they have to be very supportative to accept making cuts just so you can follow your dream.

Lance Thornblad
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Precisely what I was thinking. I'm going on four years myself of "following my dream." I'm fortunate to have an understanding girlfriend, but I do feel guilty sometimes about not being able to do certain things like going on trips.

Only thing I can think of to say is - don't forget to live life!

Jamie Fristrom
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Totally! The big optimization we're looking at now is moving. That would be a major change and I'm not sure I can ask the family to do that... but maybe.

Senad Hrnjadovic
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Thanks for the very interesting read, I will have to read about some things you mention in it.

What stuck with me most was that giving up on luxuries made you feel happier. I think that no matter what your income is, doing this has its benefit. :)

Lance Thornblad
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Agreed. It's a good idea to plan ahead while you're still earning that "Activision income." That way you start with a financial cushion.

Jason Rohrer
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Good stuff here!

The thing about luxuries is that they're mostly empty pleasures, especially after they are over.

ESPECIALLY buying something. That is pretty much only pleasurable before it is consummated. Shopping around, dreaming about holding the coveted item in your hands, etc. Gosh, ain't that the best? Then, after you bring it home and unbox it (see unboxing videos on YouTube---they're like shopping porn), and the thrill wears off, you get a kind of let-down, empty feeling.... so you move on to shopping for the next thing.

A tighter budget often means you end up saving up for one coveted item much longer, which essentially just drags out the good part. Maybe call it tantric shopping?

And going out to eat is way better while you're on your way there then while you're on the way home. It never tastes as good as you thought it would (unless you go to a very special place, in which case you're going to be spending a heck of a lot---I'm talking about the spur-of-the-moment eating out). You just feel better when you cook your own stuff that you are used to eating. And learning to cook the stuff that you used to eat at restaurants (like Indian, or Ethiopian, or even sushi) is super fulfilling.

Anyway, the one tip that really helps in my family is that we each (my wife and I included) have a monthly allowance, and we each get to spend that money on whatever the hell we want to spend it on, no questions asked. I'm even allowed to lose mine at a poker table if I want.

This allowance can be small, and really doesn't hurt your budget much, but it permits each person to save up for things over time, or take otherwise-unjustifiable classes, or buy Magic cards, or whatever. It eliminates arguments about what is justifiable, and simply makes everything "fair".

By the way, I REALLY like the idea of reigning in expensive, almost-job hobbies. That's an amazing idea, and exactly the kind of stuff I like to discover. It's really a game designer's approach to managing life, isn't it?

Jamie Fristrom
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Jason saw my post! That's awesome. Thanks for taking a look. You're an inspiration.

Esteban Desbois
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To me, the most interesting thing here are the comments.
The article (very nice btw) is about trying to stay indie by cutting your fees.
The comments are about how spending less money makes you happier.
Symptomatic?

Dusty Hunsaker
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Thank you for introducing me to Mr. Money Mustache. Although I have followed some of the principles since I worked for my own money, it has permanently changed my life (after just one week). Good luck with everything in the future.


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