Posts tagged “Debt free

Budget and Marriage: They lived happily ever after.

If you don’t want to read my sappy Valentine’s day message feel free to skip to the second paragraph. ūüėČ

This one is for Keith, who deserves way more than $25 a paycheck spending money. He never complains. He is happy with a 50 cent Valentine’s Day card and a Reese’s Peanut Butter Cup. I know I drive him completely crazy when he helps hang pictures on the wall and they have to be perfect. I get mad when he dries his hands on the towels that are “just for looks.” I steal the covers to the point where he had to get his own blanket. I have watched him eat food that was so burnt it looked like charcoal. Yet, he still tells me thank you for every meal I cook. Even grilled cheese. He is still opening my door eight years later. He is, by far, my biggest cheerleader in life. He spoils me in ways money can’t buy. I am absolutely crazy about that man and I couldn’t imagine my life without him!

Now for the real post!

Budget and marriage. Can the two words even be in the same sentence without argument? I think they can. I would go further and say they can compliment each other. Even lift each other up.

I am not a financial expert. Nor a marriage expert (if there is such a person, ha!) In honor of Valentine’s Day I would like to share some of the successes Keith and I have experienced, most of which started out with a failure. We have had our share of arguments but none about money. This is what we have learned.

#1 Spend Fair

When we began budgeting together a few months after getting married, we added a category to our budget called “personal spending money.” We had no idea how precious this would become to us over time! No matter how much money we each earn, we have always been allotted equal amounts of spending money. There were times when my paycheck was bigger and there were times when Keith made more, now I don’t have a pay check at all but we have always maintained equal spending money. This money can be used to buy anything special we want that is not in the budget. I’m currently using mine to build a greenhouse and he has his eye on a nice flashlight. There is no accountability to our spending money. I don’t count his and he doesn’t count mine. We both know it has to be something we¬†really,¬†really¬†want in order to spend our precious money on it. Having personal spending money also gives us the funds to buy each other gifts for special occasions. Without this category, it might feel awkward to buy each other birthday, Christmas or Valentine’s day gifts out of the joint checking account.

I have really struggled with transitioning to being a stay at home mom. One way that Keith shows me that what I do at home is important is by maintaining equal spending money. He has never once suggested that he should get to spend more money because he earns it. What could really be a sore spot in our marriage has instead become something that shows love and value to each other. We started out getting $50 spending money out of our biweekly paychecks. When we went to one income, we cut back to $25 each. The fact that Keith was willing to cut his spending money in half to allow me to stay home with our daughter made me feel so loved and valued.

#2 Redefine the word DATE

When we were dating, Keith mostly paid for everything. We used his gas to go places, he paid for our meals, and he purchased tickets to events we went to. I enjoyed those times but I didn’t give the cost much thought. I didn’t feel¬†the money leaving his wallet each time we went out. Once we combined our bank accounts, I¬†felt it! Everyone talks about how important it is to continue to have a date night, especially after having kids. I agree, but we have changed our definition of the word date.

Keith planned a really special date the second time we went out. At first I was really creeped out. He took me star gazing in a field. He had a really elaborate plan that involved pints of ice cream, moon pies and milky way bars. He won my dog over with a bag of treats the first day. It took me a little longer. The whole story is for another post completely… anyway… This week, I had a coupon for a pint of Ben and Jerry’s ice cream. I picked it up for $1.25 and hid it in the back of the freezer. I decided to do a remix of the date after Audrey went to bed Friday night. I slipped out the back door with a sleeping bag, ice cream, 2 spoons and the video baby monitor. We ate ice cream on a sleeping bag under the stars in our own backyard and talked about our day. You know what? That’s a date! It doesn’t have to require paying a babysitter or spending $50 on dinner and a movie! Becoming creative in our ideas of dates is actually romantic! We now have a mutual respect for¬†our¬†money so when one of us takes the time to plan a date that works well within our budget it is a reminder that our relationship is important in this moment and that we also have respect for our financial future together.

#3 Saving for Retirement 

No, saving for retirement doesn’t exactly sound romantic. Hear me out though. Isn’t there something sweet about a white haired couple walking hand in hand? Making the effort to save for our future reminds us that we married for life. Keith and I like to talk about our plans for when we can retire and spend our days together. We may be on the road in an RV traveling to AKC agility events with our dogs (we just learned there was such a thing this weekend… again another post), eating breakfast at Hardees every morning, or just sitting on the porch waiting on our grand babies to come for a visit. Dreaming about our retirement days helps remind us that we both want the same thing. We are a team working toward the same goal! However we decide to spend our retirement days, I don’t want to spend them worrying about money!

Do you have any other tips for budget and marriage?

Our debt free story

I have tons of ideas to write about… I promise, I just can’t think of one right now! Actually, I can think of about 50 but choosing one to be the first is harder than it seems. The reason for starting this blog is to share with people how my family of three lives a debt free lifestyle on one income of $30,000 per year before¬†taxes. No lie. So I guess the best place to start is the beginning of our story. How we became debt free.

 

Keith and I started dating on February 19, 2010. He picked me up in his red Dodge Ram 1500. We went to a movie then rode down muddy dirt rodes in 4 wheel drive. No, I’m not kidding. ūüėČ

 

I had just purchased my first foreclosure the year before and was about $84,000 in debt. I financed the house at 100% for 30 years. It was a good deal,  since the house was worth about $100,000.  Right? Wrong.  Fast forward 3  years and I had begun to realize that paying over $4,000 per year in interest on my home loan had almost eaten up any potential profit. By this time, Keith and I were getting more serious but he was dead set against living in my house. The solution? Sell the house before I was completely in the hole. It took about 4 months sitting on the market to sell but I wound up with a $16,000 check and living back in my old bedroom at my parents house at 28 years old. How humbling.

 

Keith and I were spending more time together than apart so we decided to combine our resources and house shop together this time. Including the money Keith had saved up himself, we had about $40,000 combined and set out to look for another good deal. We bought the worst house in a decent neighborhood. We snagged it for $67,000. This time we only financed $30,000 for 5 years. The total interest on the life of the loan was quoted at around $3,000. My parents gave us hardwood floors for a wedding gift in place of paying for a big wedding (our wedding cost about $500.) His parents bought the paint and a new refrigerator. Then we could do everything else the house needed a little at a time. With both of our incomes going toward the house, this should be a breeze. We¬†should¬†have tons of money leftover each month! Um, wait… what happened to our money? Oh, here’s the Lowe’s receipt or should I say box of receipts?!? In our zest for fixing up the house we had gotten a little swipe happy with the debit card and in three months of married life had saved $0.

While sitting at my desk at the bank where we had our loan, I started to look at numbers. If we could put all the remodeling plans on hold and focus all of our funds toward our debt, we could cut the life of our loan in half! The ugly white vinyl kitchen floors and new couch would have to wait. I text Keith. He was totally on board. We made envelopes for all the categories we needed. Each pay check, we stuffed the envelopes and put everything else straight on the principal of the loan. We also found this cool spreadsheet for paying off debt and started taking turns coloring in the boxes. Coloring was never so liberating. Suddenly things we were saving up for could wait and the money went straight toward our debt. We could split a plate at the Mexican restaurant then our leftover eating out money could color another box! Our excitement spread like wild fire. A year later, our church offered a class on finances called Financial Peace University. We were already paying off debt but knew we could still benefit from the class. We learned so much more about things like insurance, retirement, the joy of giving and most of all what the Bible has to say about money. During the class Keith came to me and said he wanted to sell his truck. The big, red, loud 4 wheel drive truck that we had went on our first date in. He drove a small truck to work to save gas so the truck wasn’t really a necessity but it did have sentimental value to us. It was worth around $2000 which would cover what we owed. It sold within a few days. Keith came to the bank the next day and we paid off our house! It took us a total of 17 months! We had enough money left to split a plate of Mexican food to celebrate. I’ll never forget pulling into the drive way of our house that day after work. Everything about it looked exactly the same as it did that morning when I left but the way I felt about the house had totally changed. It was¬†Ours.

Fast-forward to today. We are still debt free. We still stuff our envelopes with cash on pay day. I’m a stay at home mom to our 2 year old daughter. We live in our third foreclosure, a farmhouse on almost 4 acres. Cows are our next door neighbors. We have 2 dogs, a cat, chickens, goats and dream of adding other animals. We have about 1,000 projects still left to do but we are learning to be patient and wait until we have the money to pay cash for them. We shop at thrift stores, consignment and yard sales. We sell things on eBay. We don’t have television service. We have learned to live differently in so many ways that I want to share our experiences with you. We probably are weird but it works for us. We are happy.

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