Money as a youth: When I was 12 I wanted to be a photographer when I grew up, so I saved everything I could for what seemed like an eternity to buy a digital camera (Which is now quite obsolete, I might add. 3.4 megapixels was unheard of at the time.). From that experience I learned a lot about self discipline, but only if I had a goal. It did not however make sense to me to save money unless it was to buy something specific.
19 and Single: I had a job where I was making decent money, and I had very few expenses. I felt like I was pretty rich, but I very easily found places to spend my money. (Isn't that always the case?) Each time a paycheck would come in, it would pretty much be gone by the time my next check came. One thing I thought I needed was a car. I thought that would make me more of an adult or something. So, with a co-signer, I took out a loan and bought a pretty nice car, especially considering I was only 19. Did I need THAT car? No. Did I need ANY car? Probably not. But, I had a lot of fun.
Enter Marriage: By this point (I am embarrassed to admit this) I think the only savings about I ever had was the one my parents started for me for college. Rory had a little bit better grasp on things. It was because of him that we started saving money. It was until that point that I didn't understand saving money unless it was to buy something specific. First it was a small emergency fund. Then he agreed that we could save for me to buy another camera (An SLR. It shouldn't go obsolete any time soon.). After we bought the camera, I was hooked on saving. I would get a little natural high every time we deposited into our savings account or saw it earn interest. It was then that my mother first introduced me to Mr. Dave Ramsey.
I'd heard my mom talk about Dave Ramsey and The Total Money Makeover before, but being SO knowledgable, I kind of brushed it off. She lent me the book, and that is when everything really changed. I learned about the Baby Steps to Financial Freedom and it all seemed so simple. (Much like what you'd find in One For The Money) I told Rory about it, and after some convincing, he agreed to give it a go. The first step is $1,000 emergency fund. I think by this point we already had that or were very close, I'm not sure. The second step is the debt snowball; pay off all of your debts accept for the house. This one took more time. We both bought cars with loans before we were married and we decided to put everything extra penny we could on them to get them paid off. It was difficult, I'm not going to lie. But once they were both paid off, oh my goodness, what a relief. We weren't having a hard time making those payments, but thinking about how much money we were paying every month just on interest made me sick. It was so nice not to have any payments.
Around the time we were about to finish paying off the last of our debt, the office where Rory worked closed and he was out of a job. I really don't know what we would have done if we hadn't started when we did to pay off our debt. Soon Rory found a different, lower paying job. We were able to pay all of our monthly expenses since we were out of debt by that point, but things were tight for a few months until Rory found the job he currently has. This was 2009 when the entire financial world fell on its face. We consider ourselves very lucky and very blessed that Rory was able to find a job so quickly and that we were in the position we were. This situation however was just enough of a scare that we both decided that we would do everything in our power to be prepared for whatever comes our way and we'd never go in debt for anything like a car or use credit cards.
Since first being introduced to Dave, I have read a number of books on personal finances. The Richest Man in Babylon, The Millionaire Next Door, Rich Dad Poor Dad; these are all fascinating books to me. I've become a big budgeting nerd. I love to figure out exactly how much I am paying for each diaper. I am fascinated with compound interest. I love talking about money too. I don't care to talk specifics (how much one makes or how much they paid for big ticket items), but I think that it is good to talk about financial goals and ideals. I know that I bore Rory half of the time when I show him things I've learned, but he can talk my ear off too about physics stuff and I think he appreciates the effort.
And a photo of Miss Fifi:
Any thoughts?
4 comments:
Jeff loves talking about money. You two really should be best friends. I've never saved money in my life, and I couldn't tell you if we have any savings right now. I think Jeff comes home and tells me the bank account status like pretty much every day, and for some reason I never actually hear it. As long as we can afford Jamba Juice every day, and sometimes twice, until I'm not pregnant anymore then I don't need to know any other details.
The Richest Man In Babylon is still my favorite...but I do need to read/learn more about Dave Ramsey. Good for you guys being debt-free! That is awesome...and a goal I am working towards. Even with the truck :)
I left this on another post, but I'll say it again. I think Joe was the guy who gave you the crappy advice about the house. And I agree now that we are Graduates of Financial Peace University, that it was crappy advice. We are wishing now we were out of our house so we can start saving. You guys are awesome!
Sounds like you might consider studying to be an accountant someday, when Miss Fifi doesn't need you to be home all the time. They get to work with nerd numbers a lot.
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