Finance

Our Personal Journey Part II

Oh, man! I’m not even sure where to start because this was such a crazy, hard, eventful year for us. If you didn’t read Part I, it’s right here.

 
I’m so grateful to have him by my side. We do everything together, even the hard stuff.

Okay…

Once all of our debt was paid off, we had options. I was going to stay home with Elizabeth. However, getting rid of my salary and benefits, we knew it was going to be tight. But, this was something Brent and I both wanted for our family.

We were living in an 1,100 square foot home that had been purchased at the height of the real estate bubble. Brent was renting the house when we met, and when the owner decided to sell right before we got married, we chose convenience and decided to buy it with the idea that we would turn around and sell it a year or two later and then buy the house we really wanted…and then the economy crashed, and we were stuck!

 
Our first home

Our baby girl was born at the end of July, right as I received my last paycheck…

And when August hit, we didn’t know what hit us!

Phase 2 of our financial strategy

During that year (I always keep time according to school calendars- August through July), our small group decided to do a 13-week FPU study. Brent and I seriously considered not going. It cost $150 to get all of the materials needed (which was an excessive expense considering our situation). We figured since we already understood the pay cash for everything and avoid debt mentality, there wasn’t much more we could learn. THANK GOD we decided to go. That $150 was the best investment we’ve ever made! FPU is where we learned all of the practical day-to-day as well as long term stuff that really propelled us forward. We learned how to complete a zero-based budget, what kinds of insurance we actually need, the best ways to save for retirement, the best method for purchasing a home, and the list goes on.

One of the very first pieces of homework given in the class was to create a budget with your spouse. Ha! While we were living the cash-flow life, Brent and I had never really sat down and put our budget on paper. It was still just an abstract idea.

Brent admits now that he was terrified of completing this exercise with me because he honestly didn’t believe everything would add up (even though we were somehow miraculously making it to the finish line each month).

The whole point of the budget is to assign every dollar of income a place to go. It’s not just for bills. It’s what you plan on setting aside each month for savings, clothes, hair, dentist, medication, toiletries, eating out, vacation, car repairs, education…and the list goes on and on and on. The budget template is a FULL 3 PAGES LONG! It accounts for EVERYTHING!

So…we reluctantly sat down. And started. We filled in all of the things that had to be paid: tithe, mortgage, utilities, insurance, gas, food, etc.

Any money we had left over we used to sparingly fill in blanks for “secondary necessities.”

And then we were out of money.

We had zero dollars for the fun stuff: eating out, going to the salon, entertainment, vacation, etc.

To give you an idea of what our budget looked like, we were able to allot $320 a month for food. Let me tell you, I became the coupon/bogo queen. But we did it! I went from walking the grocery aisles, dropping whatever I pleased into my cart to writing a detailed list and walking around the store every week with a calculator to make sure I didn’t spend over my weekly allotment of grocery money. We were never in need and we learned how to be creative and not waste.

Other ways we cut corners:

  • I started dyeing my hair out of a box, which saved about $50 a month (I continued to do this for the next 5 years which saved us around $3,000 total)
  • We had already cut cable, but that alone saved us approximately $100 a month (by the way, we still don’t have cable and over all the years we’ve done without it, we’ve saved around $10,000 just by not having that monthly bill)
  • Brent picked up any side jobs he could
  • I sold stuff we didn’t need on eBay
  • If we needed new clothes or shoes, we shopped either second-hand or at Target. Sometimes I found deeply discounted items at boutiques or department stores.

And people wondered why we couldn’t just go out to eat last minute or join them on vacations. To do that, we would have needed the credit card because there wasn’t enough cash. But at this point, we were sold out on the vision our life could be if we put in the hard work on the front end. You see, a lot of people play in their early years and then they have to pay for it later on. We want to pay on the front end and play later.

But it was easy to start feeling sorry for myself. I’d see pictures or hear stories of people taking nice vacations, going out to eat, buying new cars, shopping until they dropped, or getting pampered at the salon. Brent would always remind me that we don’t know what another’s financial situation is. Some of those people might look like they are doing cool things, but they very well could be up to their eyeballs in debt. Some of those women might HAVE to work to keep up with that lifestyle. Even in my deepest pity party, I would agree that I wouldn’t trade the financial peace I was experiencing for all that stuff. Besides, our lifestyle wouldn’t be like this forever. That was our mantra when I started to feel sorry for myself: IT’S NOT ALWAYS GOING TO BE LIKE THIS. We are putting in the hard work and self-discipline now so that we can play regret/stress free later!

In a moment of total transparency, once we finished our budget sheet, I looked at the amount we were tithing (10% on Brent’s gross income), and I deep down wanted to pull our tithe so we could fill in some more blanks or at least expand some of the ones we had. God would understand, right? But, I also knew deep down that God would provide for us and bless our faithfulness. So, it stayed. And he didn’t fail us.

A New Home?

I’m a dreamer, so even in the midst of us having no breathing room in the budget, I started looking at real estate online. The market had bottomed out so it was both cool and quite depressing to look at homes twice the size of ours in a nicer neighborhood for less than what we paid for our little apartment-sized house.

And then I came across a short sale in a nice neighborhood that needed a lot of work and plenty of upgrades, but it had a ton of potential. There was even a fenced-in back yard where Elizabeth could play and where we could eventually put in a pool some day. Every once in a while, I’d check online to see if it was still on the market. I showed Brent the pictures, and he agreed it would be a perfect home for us, but the truth was, we couldn’t sell our current home to be able to buy a new one.

 
The picture of the house I saw online

But, I was in love, so we started stalking it. We drove by multiple times. The neighbor had a spare key so he even let us inside to see it. Ugh! It had the potential to be my dream house (with a lot of work). AND IT WAS TENS OF THOUSANDS DOLLARS LESS THAN WHAT WE HAD PAID FOR OUR FIRST HOUSE!

So I started praying. It was a long shot, but hey. Like I said, I’m a dreamer.

We figured if we could rent out our first home, we, by some miracle, could buy it. Knowing the bank would deny our low offer on what was already a short-sale, we went ahead and put an offer in anyway. I was afraid the bank would be insulted and not even counter-offer us. That was December.

I began praying every day. We only wanted what God wanted for us. If this wasn’t the right move at this time, we wanted God to slam the door in our faces. We didn’t want to follow our hopes and dreams off a cliff.

If you don’t know anything about short sales, it’s basically a waiting game. The bank will review your offer on their timetable and it can take anywhere from weeks to months to over a year.

So, I prayed.

And prayed.

And prayed.

Every.single.day.

I forced myself to pray for God’s will to be done, not for my human, selfish desires to come true. It can be a hard thing to avoid treating God like a genie in a lamp, but I knew his way was best. I told him I would be content, even if his answer was “no.”

A New Chapter

During the spring, I got a call from my former employer, telling me that my replacement had suddenly quit and they needed someone to come teach for the rest of the school year. But, I wasn’t interested. I had chosen to be a stay-at-home mom and that’s what I was going to do. I suffered from depression that year. Not because of our finances. I was depressed from the stress of being a new mommy and feeling like I wasn’t right for the job. I had not taken to mommy-hood very well.

 
I smiled for the camera, but it was a tough adjustment for me

But I was committed to staying home that year.

Later, I received another phone call asking if I would consider coming back just part time.

Nope. Not interested.

I received an additional phone call asking if I would come in to teach just one class, first thing in the morning, four days a week, just for the remaining months of the school year. I could bring Elizabeth with me and one of the ladies in the office would take care of her. It was such a small commitment. I decided that it might be good for me to get out of the house.

So back into the classroom I went. Four days a week for an hour a day. I taught my class and then came home and had the rest of the day with Elizabeth. Going back to work made me feel energized and started eating away at my depression. I was having actual conversations with people instead of being trapped at home all day (as an introvert, this was, unfortunately, my doing). This was the healthiest I had been since staying home. I honestly felt like it made me a better mommy. After a while, I considered going back into the classroom fulltime, and started praying about if that was what God had for us. Brent supported the notion if it was what I wanted to do. I called the school and was told the full-time job for the following school year was mine if I wanted it. So I prayed some more, and once I felt at peace, I signed a contract.

The End of the Waiting Game

Back to the short-sale. There was nothing but silence for almost 6 months. We were then told that our case was being reviewed. At the end of June, we received some shocking news. The bank didn’t want to counter offer. They accepted our initial bid and wanted to close in 30 days.

There was just one more hurdle: Since I didn’t have a salary yet, we would have to get our mortgage approved on Brent’s salary alone. On top of that, Brent and I agreed we would only buy the house if it was a 15 year mortgage as opposed to the traditional 30 year mortgage.

Miraculously, because of our (non)debt to income ratio, we were approved! The 15-year mortgage monthly payment was only a few hundred dollars more than the 30, which was perfect!

We also secured renters for our first home during this time so we were headed for closing only days before I had to return back to work full-time that August.

We found a wonderful in-home nanny to keep Elizabeth while I went back to work, one of the conditions to my returning (I personally would have rather stayed home than put her in day-care).

I’m so thankful I was able to stay home with Elizabeth her first year and wouldn’t trade it for anything. We learned a lot about what we really need in life versus “wants.” We learned how to be smart shoppers. We learned true contentment and delayed gratification. We learned to fully rely on God. With my new working status, coupled with the raises Brent continued to receive for his hard work, we were able to expand places in the budget and start trucking along toward some of our new goals…

And this continued on steadily for 3 years until I received terrible news.

But, that’s part III.

If you desperately want something, you’ll sacrifice and do what it takes to make it happen. One of the first steps to financial freedom and reaching your goals and dreams is knowing what the blueprint of your financial strategy looks like. If you’ve never written a budget, it’s the first step to making a game plan. It might be scary. You might be spending more money each month than you’re bringing in, but facing that hard reality is what will bring about change.

 

Those guardrails may be difficult to get used to and in some cases even be painful, but remember, IT WON’T BE LIKE THIS FOREVER. You’re working now so you can play later!

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