I cannot believe it has been a year since the start of this project. As I have said many times over, it has been a year of incredible highs and unimaginable lows but being fortunate enough to sit here today, writing the outcome(s) and having the hindsight and perspective is by far the richest benefit. Now, let’s cut to the chase
Part I: Short-Term Goals
Goal: pay off Brent’s $300 credit card
Outcome: Success & Failure
We did pay this down but then we wound up using it. Ultimately this is Brent’s only line of open-credit and it helps to improve his credit score. We were advised not to close it out altogether and while we paid it down significantly we did wind up using it here and there. So, while we failed in the goal stated above we achieved in paying down this debt and learned better use and management of it as it no longer sits maxed, or almost maxed, out.
Goal: Pay off Charlotte’s medical debt
Goal: Pay off personal loan
Part II: 2013 v. 2014
Cost of Living: For most making the transition from renters to homeowners is terrifying and not always cost-effective. The one argument that cannot be disputed is that with homeownership, one is investing rather than simply paying “the man” every month. This makes a purchase of this magnitude much easier to digest; especially for a cheap skate like myself. However, for us there were many more perks to buying a home. We were able to lower our primary cost of living by more than a 1/3 which has been a huge help in building a savings. Being a homeowner also means that we are able to manage every logistic. Sometimes renting come with bills and fees in one lump sum, up front this may seem like a “deal” but when you aren’t able to see the detailed cost you don’t really know if you are actually getting what you are paying for. We have better control now of every cost which makes money management that much easier.
Groceries: I have always been a stickler for lists, of all kinds, but especially grocery lists. I do my best to abide by all of the “grocery laws.” Don’t go to the store hungry, never go without a list, stay off the end caps, shop your pantry first, etc. but throughout the years it hasn’t always been easy. Admittedly, it has taken much trial and error but I am happy to report that we have accomplished maintaining a regular monthly grocery budget of $300 max. This is $75 a week for a family of 4 for all meals. Luckily, in some months, February being a prime example, we are able to come in a bit under this only spending about $265 for the month. Before this project we could have easily spent anywhere from 300-500$ a month in groceries because we weren’t paying close enough attention to our expenses. Although I admit that in addition to the strict planning, it has been more than helpful that we are officially now beyond baby food and diaper days.
Entertainment: Openly, our biggest issue we didn’t even know we had, was the cost of the little things. We were racking up hundreds of dollars without even realizing it. By implementing monthly budget freezes every couple of months, and strict budgeting every month we have confidently tackled this issue, and won! We have saved upwards of $250 in any given month by closely managing our “sporadic swipes.” Although learning about when local freebies were available was a plus…come on, April!
Student Loans: As many of our peers this is a number that is hard for us to grasp. We are buried beneath what seems like never-ending student loan payments. One thing that did add to our bills in the past year was my student loan which had been in deferment. By taking on a minimal payment I can say it still feels like we don’t even make a dent in our student loan and interest costs, but we have paid it by about $600 since last April and we continue to pay Brent’s down as well. Successfully we have paid off over $5,500 in Brent’s loans. Cutting our student loan debt by a small fraction in the past year.
Phase III: Savings
Let it be known uprooting your life and family will drain every penny of savings (or at least it did for us) but- we had a plan and without risk there is no reward. I think I have shared that it was last year the day after my father’s passing, while my step-mom laid on life support in ICU that our bank account went into the negative. I realize in these types of circumstances money should be one’s last concern, but when you have a family to care for it just felt like one hit after the other. We had used all of our savings to get by as our life began in Raleigh but we weren’t quite at the point of the upswing. That is until this project. Taking a close, scary look allowed us to grab hold of the reigns and gain control of our financial situation. A year later we have built a savings account of over $800 (a number that is minuscule to some but is huge for us) and continued to contribute in smaller portions to both of the girls’ savings accounts. We have managed our bank account and began saving and budgeting for experiences with our family. A personal goal moving forward is to eventually to return the goodwill and share the love of friends and family that has been shared with us. So, slowly we are trying to carefully calculate expenses, save up and give back as we can. I realize that this will take much longer than we anticipate but what better way to share our life and experiences than work to pay it forward?
Ultimately we went from $0 to something. Maybe not much to some, but a lot to us; and something we are continuing to contribute to and hopefully (God-willing) are able to build. The most beneficial rewards we have gained is that of compromise and understanding. Brent and I are finally on the same page finding balance between working hard and enjoying life. Something much easier said than done. We want to provide experiences and make memories with our little girls and some are done at no expense in the comfort of our home and others come with a cost but one we are absolutely willing to pay.
In short, since this little project’s start date, we have worked to eliminate close to $7,000 in debt, lowered our bills by 30% from one-year ago and something worth noting, we have actually lowered our living expenses 55% (yes, over half!) from the cost we were paying in VT while increasing our combined annual income by 68%. Our savings may not be much but it is a foundation. Needless to say it hasn’t taken very long for us to see that while the transition was a hard choice to make, it was the right one. Regarding building a savings, this is something that takes a lifetime and as you all have seen sometimes we have to take a few steps back to take of things to then move forward again. I am happy and excited to say this little project of frugality doesn’t end today, I have so much more to learn. So yes, it will continue and so will this blog; but for today, March 1 with our next monthly budget freeze in full-effect, I am happy to say we are well on our way and I look forward to seeing where we can/will be in 2015.
The journey continues…