“It’s Only Crazy Until You Do It” – Nike
As mentioned in my last post….I’ve been a bit busy launching our podcast; so, our second quarter update is a bit late… But it is well worth the wait, I promise.
One of the most important bits of advice I can give to anyone else who is trying to build wealth – pay off debt, save more…spend less…any of these things or all three… TRACK WHAT YOU ARE DOING! Why? Because it is a loooooong road sometimes. There will be times when you are certain you are doing horribly and that you haven’t made any progress. Overspending, under-saving. But if you track and periodically come back to the numbers, you can see your progress and, I promise you, it’s not as bad as you think.
It’s the daily, small incremental changes that add up and compound and lead to big results. But you are not always going to see them. You are not always going to FEEL them. To see them, to know you are making progress, you have to know where you started and review your steps along the way.
And let’s be honest, sometimes, we are not doing the things we need to do. The road to financial independence is not easy. It’s hard to be on level ten all the time. If you have a record of your progress, you can not only go back and use your previous wins as motivation, you can assess what you need to fix or where you have let a bit of lifestyle creep work its way into your life.
One of the major commitments Curt and I made when we began to journal our progress with this blog was to be transparent. We have flubbed things up, more than once. We have let our budget get a bit loosey-goosey sometimes. We made purchases we probably shouldn’t have. We let our chaotic lives get the best of us and settled for convenience over financial responsibility. And I bet you have too. And if you haven’t, man! That’s great! You should be extremely proud of your commitment. That’s not sarcasm, that’s the real deal, hands in the air, admiration.
The reality is – life happens. And that’s ok. Just shake it up, learn, and move on.
So, my second piece of advice is…remember this is YOUR journey. Your journey is not measured by anyone else’s. You are in competition with no one. This is about where YOU begin and where you are going. As long as you are focused on your future – that dream you have for yourself and your family – that will be your ultimate destination. And when you arrive? It’s going to be glorious. But if you keep looking at the progress of others and worrying that you are not keeping up, you are going to waver and drive yourself off a cliff. You will never get to where you want to be. So, stay in your lane!
Got it? Good….now we can move on to the good stuff. (wink). But one final thing, we share this information for one reason only. And that is for your encouragement. We started in a place that, even now, can feel unsurmountable. The purpose of our sharing our journey is to show others that it IS possible. Even when you are standing at the bottom of the mountain, looking up, and the road to the top seems an impossible task. It’s not. Trust us, it’s not. You can do this. Just make a move. Put your financial plan together and get to work, one foot in front of the other. Just begin.
Without further adieu, here is the stuff ya’all came for.
In our previous post, A Year in Review, we reported some of our overall gains at the beginning of this year. Here are the highlights:
- Reduced grocery budget by half (We were spending over $2500.00 a month before **cough** cough*)
- Paid off and/or reduced debt and expenses for a total monthly savings of: $3186.00
- Through a combination of debt pay off and increased savings we increased our overall net worth by $46,689.00. (A negative net worth, so a significantly LESS negative worth!)
- Opened additional retirement accounts for both Wendy and Curtis and began funding them.
Now for the update. Below are the additional areas of progress made since January of 2018:
- Paid off credit cards
- Sold trailer
- Sold my precious Lola Beetle (sobs)
- Paid off small student loan
- Consolidated/Reduced Wendy and Curt’s student Loans
- Paid off a couple of cell phones
These additional changes resulted in another $1321.00 in monthly savings. Overall, for the year and one month we have been on this journey, we have reduced our fixed monthly expenses by over $4500.00 a month. That figure does not include the cuts we have also made in our discretionary spending (i.e. food, fuel, fun money, clothing etc..).
$4500.00 a month! That’s pretty phenomenal! So, what have we done with that money? The decreases in our spending have allowed us to pay off some of the debt, but also increase our saving rate. At the time of this writing our saving rate is at about 38%. Which, considering we started at about 5-7%, that’s spectacular. The other thing it has allowed is for me to transition careers. As a lawyer, I have been a high income-earner for many years. Going in to Real Estate, which allows be to be at home with my sons, has also meant that income is no longer coming in predictably – at least not yet. So, part of this over-all reduction has allowed me to make this shift.
When we no longer have the burden of debt hanging over our heads, when we have savings, we provide ourselves with options. And, for me, more than anything else, being able to be more “present” in my son’s lives has been the greatest benefit of this Financial Independence Journey.
I hope you have found this information valuable – but also, that you can apply some of what we have done in your own lives so that you too can build the future you want for you and your family.
Stay tuned next week when we discuss the gains we have made in our net worth.
Love and Prosperity,