I used to love it for an entirely different reason. Now I love it because I get to sock away as much as possible for the things we WANT to do!
I always hesitate to write about this stuff because I worry that someone might think I’m bragging about where we are financially. I assure you, we have nothing to brag about. When compared to where we would be had we started this when we got married, we’re more than $300K behind. And I say that with all honesty. Had we only invested $500 a month for the first six years of our marriage, we would have had $49,464.00 at that point. Once Matt joined the Army, had we not bought a house and had to pay the stupid tax we had accrued over the previous six years, we would have been able to add a lot more to that, and over the past seven years it would have grown to a whopping $343,236.00! (See this site to use Dave Ramsey’s Investing Calculator.)
Before, I looked forward to pay day because we desperately needed the money for our basic needs. While we were paying off debt I looked forward to pay day so I could watch our debt total shrink. Ever since February of 2011 I’ve looked forward to the 1st and the 15th so I could watch our Fully Funded Emergency Fund grow. In that time we’ve had to do some major work on both vehicles as well as replace one altogether. We also veered off the path with intention to take advantage of the fact that we live in Europe for a limited time. I am not sure Dave would approve, but we made the decisions for each trip with clarity and peace and absolutely no regrets. We would have delayed all these trips until our FFEF was in place were we to live here for another ten years, but with only three years, we wanted to take some trips while we could. We did, however, limit the number of trips and the expense of each trip. I am not getting to see Greece, Spain, or Poland, as I would have loved, but I picked the most important ones and am very content with what we have been able to do.
I write this now because today we reached a milestone that is only big in my mind. I don’t think it’s exactly a massive number in comparison to what many have. It’s not six months of our Emergency Fund but, rather, four. But the figure is so much fun because it’s round and crisp and something I would have NEVER imagined having 10 years ago!
We have hit the $10,000 mark!
Money we will not touch unless there’s an emergency, and needing a new camera or guitar is not an emergency. We’re not celebrating this event with a new purchase or a gift, but really, just soaking in the peace that being obedient and smart with our money brings.
And we made a decision to pause our FFEF to save for Italy, the one trip that we’re going to splurge on. We’re going to see many cities and eat a lot of delicious food. We hope to visit friends who live there and see more in 14 days than we can even begin to imagine!
I have decided to be transparent with this Baby Step for two reasons.
1. To let those of you who are feeling overwhelmed with debt know that it’s possible to get out from under it and to make a complete change in your finances. It’s hard, but so worth it. I have said this so many times before: I knew that it was going to feel great getting out of debt but I had no idea how great. Sort of like I knew I’d love my first born son before I had him but I had no idea how great my heart would swell with love when they put him on my chest seconds after he was born. Financial peace is not as huge as having a baby, but having financial peace and passing that on to that baby and his brothers… unbelievable and priceless.
2. To beg those of you who are just starting out in life to go through FPU or at least follow the principles. Don’t borrow money. If you buy a house, follow Dave’s guidelines for buying within your means. I actually remember hearing about this guy who says that borrowing money, even to buy a house, was not allowed. I wrote him off at that time and basically shot myself in the foot. Shows how much I know. If I had listened to him I’d have $343,236.00 in my Emergency Fund instead of $10,000! And just for the fun of it (and because I’m a nerd), I let the Investing Calculator do the math for me. If I had had $49,464 at the sixth year of marriage, then invested what we do now from that point until we were 65 years old, our grand total in investments would have been $15,409,811.26. And that’s with never increasing what we put in per month from what we can do right now.
I can assure you all those dumb purchases during the first few years of our marriage were not worth fifteen million dollars.
Newlyweds. Singles. College students. High school students, for that matter. Ask yourselves, “Is being ignorant of the facts that are there whether we like it or not worth fifteen million dollars? Are the meals out and the trips we can’t afford now, but will be able to afford later, worth fifteen million dollars?” I’m at the point where I can look back and say that they weren’t worth it.
I know I run the risk of judgment from both sides: Those who have a lot more in their emergency funds may laugh at our piddly ten thousand. If you have more than me, good for you. That probably means you were smarter, worked harder, and made less stupid mistakes. I don’t envy you and I don’t want you to be punished for your success.
Those who haven’t started their journey to financial peace may think we’re just lucky and have been given a break. The one thing I say to that is that there are people on Dave Ramsey’s podcast who make considerably less than we do and get out of their debt and live to tell about it. There are people who make considerably more than we do and get out of their debt and live to tell about it. It’s not about the income or the debt… it’s about your mindset and your goal. Sacrifice to reach your goal and you’ll experience financial peace!
You can judge us from either side of the road if you want. That’s your stuff. I only have to answer to God for my stuff and I’m willing to be transparent if it helps ONE family go from fear to peace regarding their finances.
Disclaimer: I have received nothing for this glowing review of Dave Ramsey’s method of getting out of debt. Well, I received a lot of peace and joy out of becoming debt free but he’s not paying me to talk about this. I just want all my friends to know this peace.