The New Year for most people means New Year resolutions. This is your year to get in shape; financially that is. This year I am starting this blog to share what I have learned from reading various books and pulling myself out of debt. I want this to help you do the same thing and help you achieve financial freedom.
I will discuss things that apply to the everyday family, and the single person as well. Help yourself by reading everything you can about your finances and understanding them. Many of people I've talked to simply don't know were to start. Well wait no further....
I start by telling you my story. I have been in debt since I was 18. What I mean by that is, ever since I was able to get a credit card I thought that money was mine and that I could spend it whenever and however I wanted. I spent most of my early 20's buying cool clothes and an SUV with all the extras. I always felt that if I had these nice things, people would see me and say "Look at that guy, he is in his 20's and has all that, he must be smart and successful." It made me feel good, but while I had all these nice things and great dinners, I hated to pay that bill at the end of the month.
If only people knew that I was living paycheck to paycheck. I was working a job not a career. I thought that once I started my career I would make more money and still be able to live this lifestyle and have money left over. I was seriously wrong. Once I did start my career and started making more money, I just increased the way I lived and soon I was back in the same spot; living paycheck to paycheck. But one day, like most people in life, I met my wife and started to realize that I was not as bad off with money as I thought.
My wife had a really nice car and spent more on her hair than I did on dinners every month. She also had a 4 year old at that time that wore nice cloths and went to preschool. She made more money than I did and had more debt than me, so I looked good until we got married and then we had a lot more debt together. With 2 car loans, student loans, 5 credit cards, all the best cable stations and services we could buy, eating out almost everyday, etc. We had a plethora of debt and needed to find a way out.
After I found that my wife was pregnant and realizing that we were in more than $40k in debt I thought I would try and save more money and get ready for the new little one. I knew a guy at work that had a really nice house and drove a really crappy car, at least it was to me. So I asked him if he saves money or budgets? What he told me would change my life and confuse me at that time. He told me that has a very strict budget but doesn't really have a traditional savings account. The money he saves is for specific things and when he isn't saving for those things he only has a few thousand in the bank. I figured this guy can't help me.
He went on to tell me that he invests about 20% of his salary. I asked him how many credit cards he had and he said none. He told me he had only had one credit card and will never have one again. He was excited to tell me these things and went on about how all of his cars were payed for and that he was paying cash for his wife to go to college. Now, I knew how much money this guy makes because we worked together and had the same position and here he was, completely debt free except for his mortgage. I asked him to teach me everything, and he did. And the best thing he ever taught me is that if I really wanted to be financially independent that I needed to read, study, and really stick to a budget. So that's what I did and before I knew it, in a few months iI was 1/3 out of debt.
This blog will be a list of resources and strategies that I used to get myself out of debt that you can apply to your own life to do the same for you.
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