This One Tip Will Get You Out of Debt and to FI Faster Than Any Other

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By spending less, you’re “eating better.” You’re not wasting your money on dumb purchases that you really don’t need, just as you aren’t filling your face hole with Ding Dongs and lard.

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I have done a LOT of research over the past 10 months. I have read books and blogs, listened to podcasts, attended seminars, watched YouTube videos, and met with one incredibly trustworthy and knowledgeable financial planner.

Here are just a few of the books I’ve read:

  • Rich Dad, Poor Dad
  • Start Late, Finish Rich
  • The Automatic Millionaire
  • The Millionaire Next Door
  • The Simple Path to Wealth
  • I Will Teach You To Be Rich
  • The Latte Factor
  • The Total Money Makeover

Podcasts I have (or continue to) listen to:

  • Bigger Pockets
  • Choose FI
  • Motley Fool
  • The Money Guy Show
  • Mr. Money Moustache

You get the idea.

I have spent the better part of a year listening, absorbing, planning, and evaluating how to get out of debt, and how to get on the road to financial independence once and for all. It’s why I’ll pay off over $50,000 worth of debt this year alone, and it’s why I have a plan to be totally free of credit card debt by the end of 2020.

In the process of doing this, I think I’ve hit on something big that I want to share with all of you. Once I understood it, it changed my life totally, and given me the understanding of the mindset I need to really achieve my goals.

The one thing you need to do to pay off debt and achieve financial independence is…

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Today Was a Good Day on the Road to Financial Independence

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2019 has already proven to be the most stressful, gut-wrenching, slap-to-the-face wake up call that we could have ever received, but by the end of this year it also has the potential to be one of the most fulfilling and personally rewarding ones we ever lived through.

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If you’ve been following this blog for any period of time, you know my situation. If not, here is a very brief recap:

At the start of 2019, my wife and I came to full terms with our debt and the stinky butthole of a situation we had gotten ourselves into. We sat down and added everything together and found that we had $126,310.77 worth of combined credit card and student loan debt.

On top of this, we were paying out close to $3600 a month more in bills than we were bringing in from income. We had absolutely zero in savings, and we were very much at risk of losing our home that we had just purchased in June of 2018.

Since then we have been scrambling to stay afloat, at times barely even eating to save money. We have taken side jobs such as my wife’s now steady gig caring for dogs via Rover.com, and targeted our debt with every ounce of energy we have.

Today I wrote checks for $23,347.12, $1,660.84, and $2763.12 to pay off and close 3 more accounts.

It was a very good day.

If you haven’t been paying attention to the graphic on the right, here it is in it’s most updated form:

debttracker

The devil is in the details though, so keep reading to see exactly how the numbers break down…Read More »

Student Loans – Not All Hope is Lost!

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There are SO MANY STORIES I could tell about AIS, but I’ll save them for some other time. The point to all of this is that I walked out of that school with almost a perfect GPA, which in most schools should mean that I had a portfolio good enough to land me a decent entry level job. At AIS it meant that I had shown up, stayed mostly sober throughout my classes, and (most importantly) had paid my tuition. That was all it took to get almost straight As.

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Disclaimer: I’m going to share a link to a resource I found that might help me finally get rid of my student loan debt. It’s called Borrower Defense, and it is through the U.S. Government Financial Aid department. I AM NOT SELLING ANYTHING HERE, PEOPLE. You should know by now that I’m not a bullshit artist. This is a legitimate group, run by the U.S. Government, and you can research before you read any further if it makes you more comfortable. I’m simply sharing it because I had never heard of the service before, and so I’m sure there are others who haven’t either.

I also want to be abundantly clear that I am currently in the process of seeing if this works for my situation. I could be rejected, and be right back where I was when I started the process. I have no stats on how many people this has or hasn’t worked for, but it’s zero cost other than the time it takes to fill out the form, so I kind of figure you don’t have much to lose.

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I attended the Art Institute of Seattle (AIS), where I majored in Computer Animation. Despite going to college a bit later in life, I still had very little frame of reference as to what college should cost, nor what a legitimate school operated like. Prior to AIS, my only college experience was a year at a state run university, but I was 18 and couldn’t have given less of a poop about paying attention to my courses, let alone how that very legitimate school operated.

So I missed what were undoubtedly bright red flags raised by the AIS at the time, because I frankly just didn’t know any better.

For starters, I was given a hard sell in my portfolio review. I was told that my work was good, but just good enough to put me on the bubble of missing out if I didn’t choose to sign up for financial aid that same day. “Classes were filling up fast!” They told me that they couldn’t guarantee I would get in if more talented students applied later, so it would be best if I signed up for government assistance that day. But I shouldn’t worry, because they had on-staff people who could take care of all of my paperwork for me, and I just needed to sign! What a deal!

The second red flag about the portfolio review occurred to me many years later. Reflecting on what I presented at the time, it was at best some pencil sketches and maybe a single painting. AT BEST. It was certainly not enough to get me into a truly legitimate art school, and in hindsight I’m not sure it could have gotten me into the pre-school finger-painting class at my local YMCA. Yet they were very encouraging and told me I had true talent and they could see massive potential.

The final red flag of the recruitment process came when the portfolio reviewer (recruiter) told me that AIS had one of the highest industry job placement rates in the country. This was another one that I didn’t understand the magnitude of until years later when I spoke to a former AIS professor who told me that the school’s job placement rate included “art jobs” at places like Kinko’s, because it was copy and print and technically fell into a commercial art category.

Then there was the school itself…Read More »

Being in Debt Does NOT Make You a Dumb*ss. Staying in Debt DOES!

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My ability to attain a relatively successful career meant that I probably wasn’t a flat out dumbass, regardless of what my wife might lead you to believe. My inability to manage personal finances, however, meant that I was undoubtedly ignorant in regards to the subject.

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I was the first male in my family to graduate from high school. Truth be told, I had a half-uncle who graduated high school about 6 years before me, but I’m choosing to ignore that to make for a better story.

Side Note: Yes I said my uncle graduated high school six years before me. My grandfather re-married very late in life and had a child with his new bride. Don’t ask, folks… it’s Smalltown, USA.

So like I said, I was the first male in my family to earn my high school diploma. My dad dropped out either his Sophomore or Junior year, and I’d be surprised if my grandpa made it much past the 8th grade. They were taught that school was for chumps, and the moment you had identified a career, schooling had served its purpose.

Yet both my father and his dad were incredibly bright. My dad still has an amazing knack for Marketing, even though I doubt he’d know that is what it’s actually called. He knows he’s good at “selling people stuff,” but could give two sh*ts about the terminology or psychology behind it. Both he and my grandfather started highly successful businesses, despite their lack of formal education, and both took chances that I to this day don’t have the courage to take.

So I didn’t have a lot to live up to in terms of expectations. If I had dropped out of high school early, I’m sure my parents would have been slightly disappointed, but it wouldn’t have been the end of the world.

While my older sister blazed through both high school and college earning a 4.0 degree at both along the way (along with things like Class Valedictorian, President’s lists, scholarships, and the like) I maintained a rock solid 2.5 GPA, mostly due to sports and… well… not really caring about school.

Again… I didn’t have much to live up to.

I did manage to graduate high school, and then attended one year at university, dropped out thanks to a job offer from my father, and later in life returned to get a degree and several certificates. In all, I’ve probably completed around 6-7 years of post-high school schooling of some kind, and now have a successful career in videogames.

Take that, weirdly-young half uncle!Read More »

When Trying to do the Right Thing Financially Bites You in the Ass

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If you make it to the bottom of today’s post, there is a reward for you! True story.

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My wife and I are in the process of refinancing our house. When we bought the home a year ago, it was about as painless of a process as buying a home can be. There was some grunt work on our parts, but by and large it was what you would expect; chasing down bank ledgers, getting statements, providing numbers, signing papers, etc.

This year we wanted to refinance. It has only been a year, but the interest rates have dropped enough that it meant freeing up some cash each month that we could then focus on debt in the short term, which was critical given our situation.

What we have found is that the process of refinancing has been FAR more imposing than the original purchase. Not only has it taken months of work to make it happen, but it has also required me to provide what seems to be the same information several times over.

At a certain point in the refinance process, I was also working on getting some debts consolidated at a much lower interest rate (%29.99 > %13.99), but before I did this I asked our loan officer if this would affect anything. I was told it would be fine, since my credit rating was already verified and the interest rate of the refinance was locked.

Smash cut to Thursday morning when I got a call from the same loan officer asking me why there was brand new debt on my profile. I remined her that it was the consolidation loan, and here response was, “Well, Dave, you personally took this debt consolidation loan out, and when you had originally asked me about it, I thought it was to consolidate your own debt. Instead you used it to pay off debt that was in your wife’s name, hence it now shows as new debt on you, and thus we probably can’t secure the loan for you at this time.”

Let’s unpack this for a moment:Read More »