[This is a really long post about finances, our finances in particular, and so if talking about money makes you feel icky, come back next week. I'm writing this for me, because it's time to get shit back in control.]
We're breaking the cycle. Again. For the third time in the six years Adam and I have known each other we've had to take a long look at our choices, at our decisions, at the way we live our lives and ask ourselves if we're making smart financial decisions.
The first time we did this was when we moved to Olympia together and this blog was born. I hadn't had a job in 6 months, and the job I finally did find was part time and paid $10 an hour. Meanwhile, Adam was working to get a hold on his out of control credit card debt, and, did I mention we'd bought our first house? Needless to say funds were super tight. So tight our weekly "splurg" was we'd get a take-and-bake pizza from Papa Murphy for dinner on Friday. CRAZY KIDS! But we did it. After two years of financial diligence we had paid off a huge chunk of Adam's debt, retaught ourselves to think about needs and wants, and had become a debt tackling team.
Then of course we moved to Alaska and for a year things kind of fell apart. We'd sold one car to get to Alaska, and after a year of sharing that one car I couldn't take it, so we bought a second one. We'd moved to a place so foreign to our previous lives we truly gave most paychecks to REI to outfit ourselves with the items needed to both stay alive in -20 degree weather, but also thrive. Our first year we acted financially irresponsibly taking all these amazing trips, had people visit, and my god the charges racked up. But I don't regret it because the things we did I'll never forget, but lord have mercy by the time we got to year two we needed to have a talk with ourselves once again about "needs" and "wants".
So we read Smart Couples Finish Rich chapter by chapter, together, doing exercises from the book and talking through each step. That damn book was probably the smartest thing we did together that year. I finally opened a 401k, something I'd resisted because I didn't make very much and the idea of taking anything out of my measly paycheck had been hard to swallow previously. But I did it, and now when I look at my 401k balance all these years later I kick myself for not doing it sooner. The book helped me wrap my mind around pre-tax income and all that delightful financial nonsense. We decided the best way to tackle debt was to stop doing it separately, and start doing it together, so even though we weren't engaged yet, we joined our finances. Adam's once trusty mega spreadsheet of bills and debt reduction now included BOTH of our debts and problems, and it was a scary beast, but we were finally doing it together.
Our commitment that year to "needs" vs "wants" is why when we got engaged in May of 2012 we did it with a $40 ring we bought together at Nordstrom. You're hearing me right. I wore a fake ring. We "needed" to get engaged, we "wanted" a fancy ring, and we "needed" to be financially smart more than I "needed" something real. I wore that $40 fake ring for about 7 months until the money was actually there to buy the ring I wanted. It was the smartest financial decision we made all year.
That year we also bought a white board and wrote down each paycheck that came in, and what needed to be bought with this one, and the next one, and any incidentals coming in because although we had the super-duper debt reduction spreadsheet Adam had made, there's something about looking at a whiteboard in your living room every day that reminds you who you owe this week that really convinces you that you don't need to eat out this weekend. We created a savings account not attached to our main checking account where a tiny little $50 went each paycheck that we couldn't touch. We called it safety money. We put a plan in place to pay off the truck, and holy shit you guys, we actually did it, WE PAID OFF A CAR!
But, you know how this story goes, after two years in Alaska we moved to Chicagoland. That car we'd paid off didn't matter anymore because we had to sell it, and I tried to make it another year with only one car like I did that first year in Alaska, and I just couldn't. The world of only one car payment was short lived and I brought Gretta the Jetta into our lives. Our first year in Chicagoland was a financial mess. We got married in July of 2013, I had knee surgery in October (which is no cheap thing let me tell you!), and on Thanksgiving of the same year we bought a house in Chicagoland. We still own the house in Olympia too by the way. It's $50,000 under water and the rent we get from it is about $600 less than the mortgage payment each month. Thanks for asking.
So here we are. It's June of 2014 and the classic first year of a move for us is over. Apparently the way we do this is the first year we move somewhere new it's impossible to stick to our plan. All the progress goes out the window as we try to get settled, explore, meet people, try things. Our learnings and teachings and fucking financial common sense goes out the window and at the end of the first year we have to sit down and take a long good look at ourselves and wonder what the fuck we're doing.
We own two homes. Have two student loans, two car payments, two dogs that seem to go to the vet more than any dogs in the world, and enough credit card debt to choke a person. And we did this to ourselves. And, we're the only ones to get ourselves out of it. We've started saying no, which sucks, but is needed. To meals, to a trip to the city, to a rendezvous unless the cash is in hand. Today. Right now. We sit down every Friday night and pay the bills together. See the damage. Make the plan. It's the most horrible way to start each weekend and we vacillate between one of us being depressed afterwards, and one of us being the "we can do it" cheerleader. We know better than to even begin paying bills without stiff drinks in hand.
We are back to being accountable for each and every thing bought at the end of every day. Was it a "need" or a "want"? We're staying home, and buying smart, and if you don't have the cash in hand it's not happening.
We have plans. We want to have kids. And we can't do that unless we've got this under control. We make too much money each month to scrape by like this week by week.
I'm putting it out there so there's another place for me to be accountable.
We can do this.
We've done it before.
We'll do it again.