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Life After Debt Series:
The "Life After Debt" series is a collection of monthly updates on how my journey to financial peace unfolds.
Check out the My Story page to get the details on how the journey started. Long story short, the journey started in July 2007 when I read The Total Money Makeover: A Proven Plan for Financial Fitness. I was only 26 years old with $104,616 in debt and no plan to get my life together. Little did I know that my financial life was about to change forever. Life without debt is different, but life's ups and downs continue. Stay tuned......
When the blog started, my intention was to track all the extra money I was able to earn in addition to my full time salary. As you may know, I lost my job about 3 months ago and now there is no such thing as extra income because every penny is truly counts. In the future income reports will return.
Throughout December my perspective changed as I tried to budget money in the same manner that I always had. On some level I did my fair share of mental accounting, classifying money differently because of it’s source, and it was starting to have a negative impact. In the first couple months of unemployment the larger sums of money were rolling in as final payment from my former employer. On day while budgeting it hit me that I was not on a stricter than expected budget, I had gone for making $85,000 per year to minimum wage.
- Previous Income: $4580 per month
- Unemployment Income: $1730 per month (62% decrease)
Needless to say the budget was cut to include: giving, food, housing &
utilities, gas for car, health insurance, cell phone, gym membership and pocket money. As long as nothing “pops up” everything can and will run smoothly.
This month there were “pop ups” that made it very clear that living on minimum wage was a more of a challenge than I had imagined. My headlight needed to be replaced ($150), my computer died ($282), dentist bill, eye doctor bill and I ran out of things in the house, like toothpaste. That “payday” I took care of everything until I ran out of money and dipped into the emergency fund for the computer. Most things got pushed to January.
I am so grateful for this experience because it has made me aware of how privileged I am to be the situation I am in and I better not mess it up. One would think having a fully funded emergency fund is enough, but it’s not. I don’t want to touch it unless it is absolutely 100% necessary. If push comes to shove I can always go back to donating plasma for extra cash.
Another realization that I came to is that as soon as I am in the position to start paying extra on my house I am going to be so gazelle intense about paying off the mortgage ASAP. At first the it was “cute” to want to pay off the house from my comfortable financial position making $85K, but now from the perspective of being unemployed it is a necessity. You see, if I didn’t have a mortgage payment I would have margin in my bank account to comfortable handle “pop up” expenses.
Once I pay off the house, I will NEVER have a mortgage payment again!!!
The Holiday Season
Christmas was spent in my home town with friends and family. I didn’t get much, but I got ALOT! The people around me gave me gifts I needed, like socks, or gift cards. The gift cards gave me the opportunity buy some things that were needed around the house as well as some nice to haves.
One thing I didn’t do because of the financial situation was buy and decorate a tree. I have always had a real tree growing up and so I think I need them now. This year I learned, if I had purchased a fake tree last year I would have had the experience of decorating the tree this year. I will take the experience over the real tree any day, so next your (if possible) I will buy a fake tree, so that I am prepared for years to come.
Let me tell you about my big win at Target! Several days after Christmas I was at Target spending up my gift card money when I came across the “70% off Christmas stuff” section. When you are a minimalist who likes nice things you make compromises with yourself. This minimalist LOVE shiny sturdy wrapping paper, so she only buys 1 roll at a time and she buys it on sale. I found a $10 roll with 90 sq ft for $3. It’s red, black, white and silver, so it can be used for any occasion. WINNING!
The future layout of my career is up in the air until the dust settles. I apply to jobs, study for my real estate exam, plan to finish the interview process for VIPKid and wait for the military to send me to training.
My heart and mind are really focused on pursuing real estate. The entrepreneurial challenge that lays before me is so exciting. The real estate industry is so robust I look forward to being a part of it. Expect to see posts about the journey to becoming a licensed agent and how I (try) to build a successful business.
The military will be accommodated as it happens. Trying to be time their actions is not beneficial. No matter how frustrating I am happy to serve!
Who isn’t excited for the New Year? I love planning and setting goals so her is a glimpse of some things I am looking froward to:
- Starting a year long Miracle Morning practice with my friend on the other side of the US
- Competing KonMari
- 3 weeks in Colorado Spring
- Reading 12 non-fiction books
- DIY spice drawer – got the supplies for Christmas (Thanks Mom!)
- Work really hard to have a success first year in real estate – got a special niche idea up my sleeve to build a referral network. (Gotta pass the test first)
- As an agent, I would also like to facilitate a group of new agents who get together to help each other grow
- Trip to Outerbanks
Thanks for being a part of my journey to financial freedom!
I hope that something in my story will provided you with hope, advise, inspiration and/or ideas you need for your journey.
What is new on your journey to financial freedom?