We loved hearing all the feedback from Part 1 of this series! Honestly, when my husband first told me to write about “debt-free living”, I wasn’t sure many people would be into it. Most bloggers today are posting “home tours”, where they post pictures of their uber-chic, amazingly decorated and perfectly feng shui-ed house.
We all read those posts and think,
“Wow, why can’t my house look like that?“.
Then, (if you’re like me) you check where they link some of the furniture pieces or decorations, look at the prices and say,
“Oh yeah, that’s why my house can’t look like that.”
I’m just being real with you guys: we don’t have the prettiest home, but that’s because we have life goals and we know that our finances need to line up with those. So, #priorities.
Here we are, in the real world, adulting so hard and talking about living debt free. In Our Journey To Debt Free Living – Part 1, we told you about a time when we made a great decision to hold back on purchasing some new floors and fixing some aesthetic issues in our townhouse. We decided that those things were “wants”, not “needs”, and they could wait.
Two Cars vs One
Well now, in Part 2, we’re going to tell you about a not-so-good decision we made in the first couple of months of marriage.
We each brought a car into the marriage. Aaron had a Nissan Altima lease (for his business) and I had a Jeep Liberty in which I was upside down in my payments. My Liberty was becoming a bit of a burden on us, not just because we were upside down on the payments, but also because it was starting to have some engine issues. We didn’t want to start paying to fix things in it because we would just be putting more money into something that we are already paying too much for. So, we decided to look for another option.
Aaron has always wanted a truck. I kid you not – if he was not working, he was looking up trucks. Haha. So we started looking for trucks and we found a pretty killer deal at the end of the year for a RAM that was like his “dream truck”. It was gun metal gray, sounded super manly, had all the fancy features and bells and whistles. He LOVED it. The pups LOVED it. I even LOVED it.
It was the right decision to get rid of the Liberty, but it was not the right decision to get that RAM. We had stars in our eyes that blinded us from the amount of money we had to pay to get into it. And we were still upside down. Not as much, but still. Did I tell you how much we loved that truck? Haha.
We had it for 5 months. Somewhere along the lines, we remembered our next goal: to buy a second home. Why you ask? We want to invest in good assets and build those assets to where eventually they are making money for us.
Say hypothetically you find a house for sale at a killer price. You purchase it and your mortgage is something low, like $600 a month. It needs some renovations, but you live in it and make them as you save money for them. Then you get it ready to be rented. Houses near you are being rented for $1,000. With a mortgage of $600, you’re looking at $400 a month in your pocket and someone else is paying off your asset. That house is a great investment.
As we’ve been living in our current townhouse, we’ve been making renovations with the goal of it being a rental soon. All the while, we’ve been keeping a lookout for another place that will be a great investment. When we finally found one, our lender said that Aaron needed to get rid of the RAM payment because it was limiting our qualification.
We went to the dealership in hopes of trading it in for something with a smaller note and eliminating the negative equity we had. No luck. Well, no luck on anything we actually wanted, haha. So we were sitting there thinking that we had exhausted our options and then I thought, “Well, do we really need two vehicles?”
I told Aaron, “What if we just had one car?”
And it was like a new sense of empowerment came over us. We don’t need two vehicles right now. For some reason we felt trapped again, thinking the only way to get rid of the RAM payment was to trade it in for something cheaper, when selling it completely would obviously be the best for our budget and having one car actually wouldn’t even be that hard! Freedom! No second car note at all. Amazing.
Guys, getting used to having one car has actually been a piece of cake. I mean, we realize that not every season of life will be like this, but right now, all it takes is just some extra communication and coordination which is awesome for our relationship. We want to remain a one car family for as long as we can. The amount of money we are saving monthly not just from our note, but insurance and gas, is amazing! And cutting the RAM from our budget put us in just the right spot for our next investment – more on that in Part 3 😉
Other Ways To Cut Costs
I wanted to share some simple and effective ways that we have found to cut costs and tighten our budget.
- Costco Membership: we have saved at least $150 a month since we started shopping in bulk at Costco. One example: we used to buy body wash for about $3 for a bottle that would last us 2 weeks and four months ago, we bought a case of body soap for $12 and we’re not even halfway through the case.
- Splitting Meals At Restaurants: this has helped not just our budget, but our waistline too 😉
- Cable And Internet: Aaron is great at this – if you call them and ask them for a deal, they will give you one because they don’t want to lose you lol.
- Home Workouts Instead Of Gym Membership: we do Insanity videos at home and it’s one of my favorite parts of our day.
- Shopping For Car Insurance Yearly: Aaron shops for car insurance every year and always finds a better deal with someone else.
- Shopping For Better Electricity Rates And Cell Phone Plans: same, Aaron does this well. You would be amazed at how much money you can save when you shop the competition.
We hope you enjoy reading up on this new little series. We would love to hear your thoughts and some ways that you have found to live debt free! Share them below in the comments.