In the 3 years since we have been married, my wife and I have accomplished a lot financially with some important new year’s resolutions. When we were first engaged we had nothing to our names other than some pretty significant student loan debt. It hasn’t been easy. We’ve scrimped and saved and made a lot of sacrifices, but slowly and surely we’ve advanced ourselves financially. Saving wasn’t easy.
We employed a bunch of different methods – most notably we did a couple of “financial fasts” where we committed ourselves to not spending a single unnecessary dollar for an entire month. Not only did it help our pocketbook, but it also help put into perspective what is and isn’t necessary. Sometimes we just get into the habit of buying things. Eating food out, small things that we “need” or want, and eventually all those little things add up. Doing a financial fast is a great way to “reset” your wallet. I highly recommend doing one – especially right after the holidays!
As a result of all the hard work that we’ve put in, we’ve been able to achieve quite a bit financially. We saved up and purchased an almost new vehicle outright – something that a lot of people our age are simply unable to do. We did a lot of research on the vehicle ahead of time, make sure that we weren’t getting a rotten deal, and invested a lot of money into a vehicle. In the long run, it will get us ahead financially as we’re not burdened by large maintenance bills or car loan payments.
We’ve also been able to pay off a lot of debt. When we were first married we had a total of 6 debts to pay off. At the beginning of 2013, we’ll be down to just 2. They are some of the larger debts that we have left, but we have so much joy and confidence from paying off a bunch of the smaller loans that I feel we’ll be able to tackle the last two in the next couple of years as well. It’s a great feeling to be done with a debt, both mentally and financially. This method of paying off debts – from the lowest balance to the highest balance, is something that is often referred to as a “debt snowball”. It’s not quite the most efficient method (paying off highest percentage loan first makes the most financial sense), but mentally it makes a huge difference as you start seeing the progress that you’re making immediately.
Finally, this year we bought a house. This is a gigantic milestone for us, as it is the first property that we’ve purchased. It’s wonderful to put down some roots and really invest into something that is yours. All other rental places we’ve lived I’ve had such a hard time investing time and money into our living conditions as I know it is only a matter of time before I have to leave or have it taken away from me. When I bought a home, however, I can tell that everything that I put into my house to make it better, whether it be some paint or replacing the flooring or simply things like some light fixtures, will not only make the space more pleasant to live in, but when I go to sell or rent this place in the future, I’ll be able to get a great return on that investment. It makes all the time and effort that I put into the home worthwhile, and not just from a financial perspective. Best of all, we’re done paying someone else’s mortgage off. All the money that we’re sending to bank is partially going towards paying off the mortgage and building equity so that in a few years if we are able to sell our property for as much or more than we purchased it for, we’ll be making a profit and getting to keep some of the money that we’re paying the bank every month.
All in all we’ve been very happy and successful financially over the last year, and we’re looking forward to the wonderful progress that we can make over the next.