live like no one else

Our Debt-Free Story: Part 2 – Our Secret Weapon

September 1, 2014

This is Part 2 of a 3-part series. Be sure to read about Our “We’ve Had It!” Moment.

Welcome back!

At the end of our Debt-Free Story Part One, we left you hanging with us having our “I’VE HAD IT!” moment.

We were officially sick and tired of being sick and tired. We didn’t want to see hundreds of dollars being shipped off to Sallie Mae on a monthly basis. We were inspired to kick her to the curb using Dave Ramsey’s baby steps.

There we were, fuming with excitement, so what did we do next?

The budget.

We had our very first “Teixeira Budget Committee Meeting” on December 30th, 2011 to plan our January budget.It was quite simple back then. We grabbed a pencil, paper, and some envelopes for cash. (vital to all beginner budgeters…since when cash is gone it’s gone and it’s a built it “stop” to spending)

Looking back, it was actually hilarious since we fumbled our way through varying categories and were bad at estimating the cost of things. I think we budgeted $50 for groceries for the month. Yea…that needed adjusting! 🙂

Despite being bad at budgeting from the first go, we had tremendous amounts of zeal and passion for it. We were finally a team. We were on the same page. Nothing could stop us from getting that very first baby step done – $1,000 in a mini emergency fund.

We found a way to shuffle the budget around to compensate for our under-funding certain categories and over-funding others and by the end of January we had baby step one completed! We were on track to paying off our student loans within one year’s time.

We then turned our gaze towards that pile of debt. As the months crept by, we not only got better at creating a budget but also sticking to the budget! We found that the more realistic we were about our budget and stuck mostly with cash, we were having great success not over-spending or feeling guilty for the spending we did do. By cutting discretionary spending, it allowed us to begin throwing more lumps of mula towards our loans.

We cut our lifestyle. HARD. We wanted to literally live like no one else…so later we could give and live like no one else.

Here’s what I mean by cutting our lifestyle based on a typical monthly budget back then:

Blow money: $0
Entertainment: $5 (a couple red box dvd’s)
Restaurants: $0
Vacation: $0
Groceries $120
Gas: $50
Clothing: $0
Date Night: $5 (an ice cream cone to share)
Birthday gifts: $0
Vacation: $0

Obviously we had some fixed expenses like rent and healthcare but every category relating to our lifestyle was bare bones. It actually was barely enough. Sometimes we rode bikes to work when we were almost out of gas money. Or we would make pb&j sandwiches for days on end with baby carrots and celery on the side when we wanted to stretch the grocery funds. Or instead of buying a new mattress, we slept on a (clean!!) donated mattress from someone’s old RV.

Did we need to do this?

No.

We were squeezing thousands of dollars from our budget every month. We could have decided to be a little softer on ourselves. Seen more movies. Gone out to eat. Taken a road trip. Bought whatever we wanted at the grocery store.

But at what cost? Months and possibly years longer to get out of debt.

We wanted it done NOW. Our desire to become debt free was so intense we literally were willing to sacrifice everything but necessities to meet that goal. We would rather suffer a short but intense time of delaying gratification than several years of lukewarm spending/paying debt.

In March, we got tax refund and combined it to the funds we’d scraped up our of that month’s budget for an extra large payment towards the student loans. That is when we started to really feel momentum pulling us. Dave calls it the “debt snowball” since it starts small and over time gets larger and larger with more momentum.

We were officially weird and gazelle-intense. Friends and family thought we were taking things just a little too far….and that is exactly where we wanted to be! 🙂

The debt started falling rapidly and with every dollar thrown at it, our confidence and excitement grew. We quickly went from first-time fumbling budgeters to budget pros with a goal no one could stop us from reaching!

Stay tuned for next time as we talk about how we were able to beat our initial goal of a one-year debt payoff by nearly five months! And jump over to win a FREE Financial Peace University class membership!

Money

7 Paths to Financial Freedom in 2014

February 20, 2014

Many of you enjoyed the last post on 7 Ways to Go Broke in 2014. Or now you are mad at me for exposing that your habitual behavior will actually lead to your financial destruction over time. Sorry, not sorry. I wanted to follow up with that post by diving into what you can do to begin a path towards financial peace this upcoming year. We want everyone to experience this blessing.

How do you get started though? Below are 7 Paths to Financial Peace:

1. Acknowledge the problem in the mirror.

Anytime I can work in a dog photo, I am happy.

“I’m Starting With The Man In The Mirror I’m Asking Him To Change His Ways And No Message Could Have Been Any Clearer If You Wanna Make The World A Better Place (If You Wanna Make The World A Better Place) Take A Look At Yourself, And Then Make A Change…..” Michael Jackson

The first step in changing anything let alone your financial world, is to stop and ackowledge the problem: You. Personal finance is 20% head knowledge and 80% behavior. If you aren’t experiencing financial freedom, you gotta look at you and your behavior first. Therein you will find your problem. Owning that is the first step towards any healthy changes to come.

2. Attend Financial Peace University – FPU

This past Fall Jonathan and I coordinated our very first Financial Peace University class. It was awesome!!!

We had a group of about 35 people who met once a week for 9 weeks. In that time we watched videos, reviewed our budgets, had great discussions, and held one another accountable. This class is completely worth signing up for! Visit this website to find a class beginning near you today. And no, we didn’t get paid to host the class or to endorse it in any way whatsoever.

3. Read The Total Money Makeover

If you haven’t read this book…you need to. Get it here today. Super easy read with lots of inspiring stories to motivate along the way!

4. Begin walking through the 7 Baby Steps

Remember Doctor Leo Marvin from “What about Bob?” Possibly the world’s most hilarious movie. Well, his Baby Steps book has absolutely zero to do with the Baby Steps I am referring to.

Dave Ramsey’s materials will walk you through the 7 Baby Steps on the journey towards Financial Freedom. Walking up these steps is a lot of fun and are incredibly motivating.

5. Embrace the budgeting process.

The very first thing to do after you assess your financial situation and get a grasp on how much money you have and or owe is to set up a monthly budget and begin implementing the budget process. Why do you need a budget? Visit this blog post for a few reasons. Now, do you have to use software like You Need A Budget (YNAB)? No but we have chosen to utilize that tool and have completely fallen in love with it. Pen and paper, envelopes, budgeting apps, etc. are perfectly fine but you need SOMETHING to help you implement your budgets once you create them.

6. Learn how to say “No.”

This is pretty self explanatory. There will undoubtedly be 1,000 opportunities, desires, temptations, reasons, etc. to NOT follow your budget, attend FPU, read the Total Money Makeover, etc. Matthew Kelly once said, “If you can’t say no, your yes means nothing.” Or maybe he said, “You can’t say no unless you have a deeper yes.” One of those…but both are good and true. You will not haphazardly improve any area of your life. Saying “no” to lots of things that come up and “yes” to intentional decisions that will aide you in your goals will be vital to changing your life.

7. Live like no one else.

“Live like no one else so later you can live and give like no one else.” Dave Ramsey

Jonathan and I didn’t sell our Nintendo, eat rice and beans, tell friends no, or sleep on a donated RV mattress for nothing. We lived like no one else so we could live and give like no one else. We’ve already begun to see the effects of this in our life and are pumped to see many more ways down the road.

There you have it folks. PLEASE keep in touch with me if you begin implementing any of these! I would love to be your cheerleader, coach, accountability partner, etc. Whatever you need me to be, I will be it! 🙂