Al and I have set a goal to be debt free by the end of 2017. Basing our journey on Dave Ramsey’s Baby Steps, we want to achieve our debt free goal, so that someday we may “live and give (!) like no one else.” As personal finance has become a newfound interest of mine, I will be sharing a recap of our journey at the end of each month.
A Little Background . . .
Right before leaving for our honeymoon in New Zealand, I stumbled across Dave Ramsey's podcast. I knew we would be spending a lot of time in the car, so on a whim I downloaded several of the episodes. Well, we ended up listening to all of them ... on the very first day! We were hooked! And, we went on to download and listen to many more hours over the course of our trip.
If you’ve never heard of Dave Ramsey or his personal-finance philosophy, I highly recommend checking out his website, radio show and Total Money Makeover book.
Honesty, I never thought I would say that I enjoy listening to a podcast about personal finance each day, but I do! And every day that I listen, the more and more I am inspired by all of the people jumping on the Total Money Makeover train to get out of debt and more importantly, be in a position to not only enjoy life, but to also give generously.
Needless to say, we have been inspired to embark on our own Total Money Makeover in 2016. As I am almost certain this will be quite a journey, each month I plan to review our previous month's financial goals, describe what went well (aka Wins!), identify opportunities for growth and set new goals for the upcoming month.
Before I recap our first month, I feel it is important to touch on our debt situation, since a major part of Dave's Total Money Makeover philosophy is getting and staying out of debt. We started the year off with six forms of debt amounting to roughly $30,000 not including our house (Note: A reasonable mortgage is the only kind of debt Dave is okay with having). At the start of 2016, our debts included one car loan, two credit cards, three student loans and a personal loan for our house down payment.
1. Establish a set emergency fund of $1000
ACHIEVED - We opted to establish a 4-month emergency fund (see below for why).
2. Write and stick to our first joint budget
ACHIEVED - We need to get into a routine of better tracking our purchases (new goal!), but we did set up a budget and stick to it.
We had our first “financial meeting” as a married couple.
While driving throughout New Zealand, we helped pass the time by listening to Dave Ramsey which sparked quite a bit of helpful discussion about finances - wayy more than we had ever talked about money before. The same weekend we got home, we had our first financial meeting where we planned our account consolidation, set up our first budget and identified a plan to start our debt snowball.
We consolidated all of our bank accounts into a single joint account.
Out of everything we’ve done this month, I think this may have been the most helpful. Having everything in one place made it easier, not only to see what we had, but also to make financial decisions together. And, for the first time ever we started consistently referring to things as “ours” instead of “mine” or “yours” - talk about a relationship strengthener. :)
We set aside an emergency fund equal to 4 months of expenses.
After much debate, we decided to skip ahead to Baby Step 3 - Build an emergency fund of 3-6 months of expenses. Al made a valid argument that with recently-passed Wisconsin legislation (right to work and elimination of prevailing wage), there is a sense of even more uncertainty for the construction industry he is currently in, and therefore requested we set aside a fuller emergency fund, just in case. Although I would have loved to stick to the order of the baby steps - I have a tendency towards following rules - I ultimately agreed with Al, as we are still on track to pay off all of our debt within two years.
We created our first joint budget using EveryDollar.com
This was another major “WIN” for January. Once we had a single bank account, we could easily see our combined income and what our usual expenses were. After inputting all of this information into Every Dollar, we discussed, fine-tuned and agreed upon a zero-based budget for January. In other words, we identified where every single anticipated incoming dollar was going to go throughout the upcoming month. Not only did it open our eyes to where our money had been going (goodbye, unnecessary lunchtime Americanos), but it also showed us that we could easily have extra money to put towards debt without making a lot of major sacrifices … if we just stuck to our budget.
We paid off our two smallest debts - my credit card and Al’s car.
With the extra money we “found” after creating our budget, we were able to pay off our two smallest debts in our debt snowball. Our smallest debt was the outstanding balance for my lone credit card. Even though I’ve always paid off my entire credit card balance each month, I decided to go true Dave Ramsey-style and cut up my credit card after I paid it off. For the first time in 10 years, I am without a credit card payment! YAY! After combining our accounts and creating our budget, we also found enough “extra” money to completely pay off our second smallest debt, Al’s car. I had finished paying off my car last fall, so now we are sitting with two paid for cars! Double YAY!
We had our first "heated financial debate" as a married couple.
This is pretty self explanatory. Everything isn’t always rainbows and unicorns. We each have our own valuable opinions that need to be heard. And, I view this as an opportunity for growth in continually learning to be more effective communicators much more than setting a goal to argue less about money.
We’re realizing that our original 1, 2 and 5-year goals may take longer to come to fruition.
Al really wants a truck. I really want to explore the world. But we also really want to be debt free. We have no doubt in our mind that eventually we will buy a truck (with cash) and travel (with cash) but achieving these goals have been put on the back burner for the time being. Because … if you will live like no one else, later you will be able to live and give (!) like no one else.
Have you started or finished your own financial makeover? Leave a comment below and let me know what worked or didn't work for you!
If you follow me on Instagram, you may have already noticed more and more veggies sneaking into my daily eats.
That's because ...
If you're unfamiliar with the Whole30 program, I highly recommend checking out this overview from the creators, Melissa & Dallas Hartwig.
Essentially, the Whole30 program is a personal lifestyle experiment where you commit to eating lots of nutrient-rich foods like vegetables, fruits, lean meats, seafood and healthy fats for 30 days. You do eliminate some commonly problematic foods during this timeframe, but then systematically reintroduce them after 30 days to see if they have any impact on personal well-being. The program also emphasizes other facets of healthy living like smart physical activity, relaxation, quality sleep, smoking cessation, etc.
Although relatively strict, this challenge isn't meant to be lifelong. It's meant to serve as a tool to develop a healthier relationship with food and discover what foods make you feel and perform at your best.
And, Whole30 alum have reported AMAZING results(!) - ranging from lower cholesterol to less feelings of anxiety, and even less flare-ups caused by different autoimmune conditions. The following are just five of the many reasons why I choose to Whole30.
1. I eat better.
Plain and simple.
I have a history of going on major food jags and eating the exact same thing for many meals, and days, in a row – think months of peanut butter toast with sprinkles, broiled chicken breasts, or egg white scrambles with salsa. And no, not all at the same time.
With the Whole30 “rules” I find I push myself to eat more variety, more veggies and end up getting more nutrient-rich foods compared to when I don’t eat Whole30-style. So for me, it's a more balanced way of living.
2. I take better care of myself.
During the last couple weeks of 2015, Alec and I were blessed with the opportunity to spend 14 days taking in as much as we possibly could of our dream destination, the awe-inspiring New Zealand.
Slowly but surely I plan to share a snippet of each one of our adventure-packed days, but for now here is a quick overview of our 14-day New Zealand honeymoon.
Day 1: MSP to AKL via SFO
Day 2: Our First Day on NZ Soil
Day 3: The 12-miler known as the Tongoriro Alpine Crossing
Meal: Sweet Potato Soup with Venison Sausage and a Simple Spinach Salad
Move: 15 minute barbell workout
Meal: Oyakodon-Style Omelette with Frozen Mixed Berries
Move: 20 minute Yoga for Flexibility
Hey, there! I'm Emily!
is my life in (mostly) pictures.
I enjoy good food, dressing up, learning new things, planning, adventuring and living life in Minnesota.
Join me on my journey!
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