Debt Free Journey: Our Why.
Friday, January 25, 2019
So, whats our WHY? Simple. Our kids. Our future. We want to start setting good examples for the kids to follow so that they can better manage their finances and hopefully not get into as much debt as we are in. Since the kids have been born, they have been the driving force to everything we do. We think about how we're setting them up for their future. We want better because of them, for them, for us. We also want our net worth to be in the green and no longer in the red. We're fed up with paying for interests and having financial lenders take our hard earned money. We want financial freedom.
Sometime in the summer of 2018, after I finally checked out Dave Ramsey's "Total Money Make Over" book from the Libby app (which is connected to my local library card). It came at a time where I would panic month by month because I wasn't sure if we would be able to make payments on my student loan. Its what got me wanting this lifestyle change. Ive been wanting to read this book for a while and I went on a reading frenzy over the summer. Im glad I did because it has led us here. I've read several "money/financial advice" types of book before, but would never finish it. I think I was just fed up with living paycheck to paycheck and our debt was slowly consuming me. We've been living on a single income since Tristan was born, and have over $50k in debt and it stressed me out constantly. And before reading Total Money Make Over, I thought I was handling our finances just fine. Not even close. He makes a decent enough amount of money that it should sustain a family of 4. So where does our money go?
I was ashamed that I've let us accumulate so much debt, because majority of it is my student loan that I put on deferment/forbearance year after year since I graduated back in 2014, and my reasoning was because I didn't have a stable job. It was such a stupid reason because I did have a job, I just wasn't getting paid much, but my mindset was different then. "I'll pay this off once I get a better paying and stable job." And would spend the money on something that only gave me instant gratification. So what happened to the stable job I was hoping to get? Nothing. I became a stay at home mom. After having had a baby one after the other, I knew making monthly payments would be difficult. I didnt make quite enough from my small photography business to pay for my loans monthly, so I paid when I could, and I didn't feel like it was fair that John would have to pay for it since it was my loan, but he was always willing to. Everything up until I became a SAHM, Ive paid off on my own if it was just under my name. I guess I didn't want to be labeled as a "dependa" (if you're military, Im sure youve heard that word before!) My student loans weighed me down, and I knew I had to figure out a way to rise above it.
After doing a little bit of research and setting up a game plan, I excitedly brought up the idea to John. His response was "I was waiting for your lead. Whats the game plan?" I guess it made sense, since I did handle most of our finances. I love that I didn't even have to do my presentation to get him on board, he was immediately all for it! I think we both knew we needed this, just didn't know how to discuss it because we've never really laid out the amount of debt we had. We kind of just live day to day thinking we were ok, surviving. I told him, things would have to change and we would have to cut back and make small sacrifices, "baby steps" and he was totally on board. So we went all in. Before you go on this debt free journey, you and your partner both have to commit 110% and both have to understand and be on the same page about where and how you want this to go. As Dave would say "Gazelle Intensity!" You cant go in this lifestyle change with one foot in, you gotta give it your all because the first few months was the hardest. Change is always hard at first, but before you know it, it just becomes second nature.
"Stop trying to keep up with the trend!! Live below your means." If I only had this same mindset and drive then, I could have easily started paying off my student loans, but admittedly, materialism and consumerism got the best of me (us). Ya know, trying to "keep up with the Joneses!" and what was trendy and in. I feel like we could have prioritized and managed our money better. I cant remember where I read it, but someone once said "You cant keep up with the Joneses. You know why? Because they are either LUCKY or BROKE." Of all the stories and books I'd read, most of them say that you wont even recognize a millionaire if he were walking next to you because a lot of them (i think unless you're a celebrity) live below their means. They don't drive the fancy brand new cars, live in massive homes (read The Millionaire Next Door by Thomas J Stanley). So there's a better chance that not, that the person driving that brand new lambo, if they weren't born into wealth, are in debt. Growing up I used to think that if you had all the fancy name brand stuff, luxury cars, big houses that you were rich. Crazy rich! And I was a bit envious. I was wrong. Unless they were born into wealth, or they were the Kardashians (heck even they might be in debt!), most of these people were in debt. Am I still envious now? HELL NO. It has shifted my mindset in a whole different level.
Its funny because now that John is a chief and making a little more than he was, we finally decide to cut back on our lifestyle. It took us long enough. It was a change we needed badly. Ya kow "live like no one else, so that later, we can live like no on else." If you read Dave's book, you'll understand that quote! Now we truly understand the term "live below your means." Just because we got a raise, it didn't mean we had to raise our lifestyle either. I often hear people talk about "Man, I cant wait to land a 6 figure job, so I can finally afford a bigger house, this car, that car." Im not going to lie, I probably have thought this way. I think after all this, we no longer want to fall in that path again. We want something? Fund it ourselves.
Along with John's promotion, we are also fortunate that John's rate in the military allows him to receive re-enlistment bonuses. John was supposed to buy a Toyota Tacoma (the truck he's been wanting for a while) after he started getting his E7 pay, but since we've decided to go on this journey, he willingly said it can wait. He recently re-enlisted at the beginning of the month and got a generous bonus, and we put a portion of it towards debt, and the others into our 3-6 month EF, and certificates. Being on the same page and understanding that little sacrifices like this will be worth it in the end is what keeps us going. Long term goals > instant gratification is now carved in our minds. This mindset has helped us walk way from impulse buys and wants and stick to what we need. Don't get me wrong, we still have fun. I have a 'Fun Money' category in our budget plan, along with Vacations, which I will discuss in another blog post, but our budget planning now allows us to plan better and do better without having to tap into money we don't own. We've also been more conscious about what we buy and bring in the home (this could partly be because of Marie Kondo, if it doesnt spark joy, it doesnt belong in our home. Haha!)
** Please note that not everyones journey is the same. Find out what will work best for you and your family. Be consistent. Im writing about my journey to hopefully shed some light and motivate you. Im no financial advisor, FAR FROM IT. But take our journey, and make it your own. I have added several people on instagram in the debt free journey/debt free community and it has been such an inspiration and motivation for us because we know with hard work, consistency and drive.. financial freedom is possible. I wish you the very best on this journey of yours, and thank you for following along on ours! Stay tuned for more! **
After doing a little bit of research and setting up a game plan, I excitedly brought up the idea to John. His response was "I was waiting for your lead. Whats the game plan?" I guess it made sense, since I did handle most of our finances. I love that I didn't even have to do my presentation to get him on board, he was immediately all for it! I think we both knew we needed this, just didn't know how to discuss it because we've never really laid out the amount of debt we had. We kind of just live day to day thinking we were ok, surviving. I told him, things would have to change and we would have to cut back and make small sacrifices, "baby steps" and he was totally on board. So we went all in. Before you go on this debt free journey, you and your partner both have to commit 110% and both have to understand and be on the same page about where and how you want this to go. As Dave would say "Gazelle Intensity!" You cant go in this lifestyle change with one foot in, you gotta give it your all because the first few months was the hardest. Change is always hard at first, but before you know it, it just becomes second nature.
"Stop trying to keep up with the trend!! Live below your means." If I only had this same mindset and drive then, I could have easily started paying off my student loans, but admittedly, materialism and consumerism got the best of me (us). Ya know, trying to "keep up with the Joneses!" and what was trendy and in. I feel like we could have prioritized and managed our money better. I cant remember where I read it, but someone once said "You cant keep up with the Joneses. You know why? Because they are either LUCKY or BROKE." Of all the stories and books I'd read, most of them say that you wont even recognize a millionaire if he were walking next to you because a lot of them (i think unless you're a celebrity) live below their means. They don't drive the fancy brand new cars, live in massive homes (read The Millionaire Next Door by Thomas J Stanley). So there's a better chance that not, that the person driving that brand new lambo, if they weren't born into wealth, are in debt. Growing up I used to think that if you had all the fancy name brand stuff, luxury cars, big houses that you were rich. Crazy rich! And I was a bit envious. I was wrong. Unless they were born into wealth, or they were the Kardashians (heck even they might be in debt!), most of these people were in debt. Am I still envious now? HELL NO. It has shifted my mindset in a whole different level.
Its funny because now that John is a chief and making a little more than he was, we finally decide to cut back on our lifestyle. It took us long enough. It was a change we needed badly. Ya kow "live like no one else, so that later, we can live like no on else." If you read Dave's book, you'll understand that quote! Now we truly understand the term "live below your means." Just because we got a raise, it didn't mean we had to raise our lifestyle either. I often hear people talk about "Man, I cant wait to land a 6 figure job, so I can finally afford a bigger house, this car, that car." Im not going to lie, I probably have thought this way. I think after all this, we no longer want to fall in that path again. We want something? Fund it ourselves.
Along with John's promotion, we are also fortunate that John's rate in the military allows him to receive re-enlistment bonuses. John was supposed to buy a Toyota Tacoma (the truck he's been wanting for a while) after he started getting his E7 pay, but since we've decided to go on this journey, he willingly said it can wait. He recently re-enlisted at the beginning of the month and got a generous bonus, and we put a portion of it towards debt, and the others into our 3-6 month EF, and certificates. Being on the same page and understanding that little sacrifices like this will be worth it in the end is what keeps us going. Long term goals > instant gratification is now carved in our minds. This mindset has helped us walk way from impulse buys and wants and stick to what we need. Don't get me wrong, we still have fun. I have a 'Fun Money' category in our budget plan, along with Vacations, which I will discuss in another blog post, but our budget planning now allows us to plan better and do better without having to tap into money we don't own. We've also been more conscious about what we buy and bring in the home (this could partly be because of Marie Kondo, if it doesnt spark joy, it doesnt belong in our home. Haha!)
** Please note that not everyones journey is the same. Find out what will work best for you and your family. Be consistent. Im writing about my journey to hopefully shed some light and motivate you. Im no financial advisor, FAR FROM IT. But take our journey, and make it your own. I have added several people on instagram in the debt free journey/debt free community and it has been such an inspiration and motivation for us because we know with hard work, consistency and drive.. financial freedom is possible. I wish you the very best on this journey of yours, and thank you for following along on ours! Stay tuned for more! **
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