Putting Our Money Where Our Mouth Is

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I hope you get some ideas from this post that help you tackle your finances. This blog has been beyond cathartic for me, and I hope it’s helped a few of you. If you’re in a situation like we were (are), get serious about finding ways to fix your problem. Everyone’s situation is different, but I can almost guarantee you can find at least something in your spending habits that will help!

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We all have those friends who make proclamations that we can tell are destined to fail from the moment we witness said friend’s plan of execution. Here are a few of the more common ones I’ve encountered:

Musician

The Proclamation: “I’m going to get serious about pursuing a career in music, and be a Lead Guitarist for a metal band!”

The Execution: Purchasing of “the 100 easiest riffs in rock history” book from the used bookstore and practicing for 30 minutes a week in the garage.

The Result: Lead Line Cook at Chili’s.

Weight Loss

The Proclamation: “I’m going to dedicate to finally shedding these extra pounds and getting my summer body back!”

The Execution: Cookies.

The Result: Beaches are overrated anyway.

Acting

The Proclamation: “I’m going to make a legitimate run at finally being a serious actor.”

The Execution: Booking a commercial for a local Kia dealership in your hometown… in Iowa.

The Result: Iowa.

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There are lots of examples like this, but you get the idea.

So, when my wife and I decided to make the proclamation that we were going to do away with our debt and seek true financial independence once and for all, I was deeply concerned that we would fall into a situation like this where our intentions were pure, but our executions left much to be desired, and thus we’d be in the same mess two years from now.

As of this past Friday however, I’m now convinced we will achieve our goals. Trading in a car that I loved and put so much of my identity into (right or wrong) on a used economy vehicle has helped me prove to myself just how serious I actually am.

While this was the decision that ultimately convinced me, I thought it might be beneficial for some of you in similar situations to see what we’ve done since January of this year (2019 for those who might read this in the future) right up until now:

Credit Cards
When we started this journey, we had 12 (!) credit card and student loan accounts. Here is the breakdown of how we’ve tackled each:

  1. Toys R Us (29.99% interest) – CLOSED – Paid off. GONE!
  2. Bank of America (23.99%) – CLOSED – Paid off. GONE!
  3. Lowe’s (23.99%) – CLOSED – Paid off. GONE!
  4. Furniture Store (23.99%) – CLOSED – Paid off. GONE!
  5. Wells Fargo Loan (17.49%) – CLOSED – Scheduled payoff is September 2019.
  6. Care Credit (29.99%) – CLOSED – Scheduled payoff is September 2019.
  7. Macy’s AMEX (27.99%) – CLOSED – Consolidated to 12% Marcus account.
  8. Macy’s Store (27.99%) – CLOSED – Not a typo… we had 2! Consolidated to Marcus.
  9. Discover (14.99%) – CLOSED – Scheduled payoff 2020.
  10. First Tech PLOC (13.99%) – ACTIVE – No charges since January.
  11. Navient Private (7.5%) – NOT ACTIVE – Scheduled payoff is sometime before I’m 80.
  12. Navient Federal (4%) – NOT ACTIVE – Scheduled pay off is sometime before I die.
  13. Marcus (12%) – NOT ACTIVE – Not a revolving line. Scheduled payoff 2020.

In total, we have closed all of our accounts but 1, which is the lowest interest rate and has a very low credit limit, allowing us a safety net while we build savings. Of the closed cards, we have paid off 4, and will close out two more before the end of the year. We are going to work as hard as we can to have all of them eliminated by the end of 2021, or 2022 at the VERY latest. By the end of the year alone, we will have paid off close to $50,000 in credit card and student loan debt!

Not bad! So how did we do it? Keep reading!Read More »

Four Eggs on Six Figures

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I will not for a moment claim to have a life as hard as some folks do in this world. Not even close. So please don’t think that I don’t have perspective. I’m not looking for you to feel bad for me, but instead providing insight into the sacrifices that my family and I have had to make. I’m also giving you insight into just how badly we had “effed up.”

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In my very first post on this site, I talked about not being able to afford to buy my son a piece of pizza at a lacrosse game. I mention that while this is not unheard of for many families around the world, it was just plain silly that I couldn’t do so given my six figure salary.

I’ve had several people ask me just how bad things got, and just how close my wife and I were to a financial catastrophe when things hit rock bottom in January. I think some like to see just how far we’ve come and encourage us to keep going, and frankly I think a few are just buttholes who want to revel in how far down the drain we had swirled.

“I knew they bought a house they couldn’t afford.”
“Well what did they expect? They ate out 5 nights a week and bought new cars every other year!”
“If Dave could just stop buying television sets for a minute, they might have the money to pay the bills!”
“How can you be that fiscally irresponsible?”

Buttholes aside, I do think it is important to share our lows. If this blog is only about the highs and wins, it doesn’t really do anyone any good.

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Tangent: I’m now actively recruiting for my new band, Buttholes Aside, and we are looking for a bass player. Must be willing to wear spandex. Serious inquiries only.

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My wife and I need to be reminded of those lows, and reminded of the sting of those lows, even if we have made tremendous gains.

Trust me when I say that last part was by no means boastful. I can see that stat tracker in the column on the right just as well as you can, and I know we have a LONG way to go, but allow me to explain how far we’ve come…Read More »

Find Someone Who Knows Their Sh*t, Then Shut Up and Listen

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It’s odd when you think about it: We were smart enough to know we needed someone with more experience in this area than we had, but at the same time we were dumb enough to throw almost all of his advice out the window.

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Quick Note: Things are going well on this New York business trips in terms of me keeping up with the posts. The bad news is that I don’t have my art software and/or tools with me, so you get no fancy images at the top of the post today. I’ll add them retroactively when I get home this weekend.

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We are very fortunate in that my wife and I have an Uncle who has been a Financial Advisor for the better part of 50 years. About two years before we hit our financial crisis, we reached out to him and asked for help in getting things in order. I think we had realized that we had kept the debt monster in the closet for far too long, and it was about to kick down the door and eat us in our sleep.

Our Uncle is a fantastic human, and so not only did he agree to sit down with us, but he agreed to provide long-term guidance free of charge.

Think about that for a moment: A person who is financially sound –wealthy in fact– with a healthy list of very successful clients, was 100% willing to provide guidance to us at absolutely no charge, and do so with no set end date. We could use him until we felt secure.

Pretty baller.

So we met with him and he started to advise us on a financial strategy. Up until that point, our investing knowledge consisted solely of blindly throwing money into a 401k each month and not much else. He started teaching us about diversification, opening up a Roth IRA, building a stock portfolio, and more. He also told us that we were making some silly mistakes with our money, such as throwing all of our cash into a vacation, versus saving part of it, even if it meant putting the vacation off a few months longer.

This man told us how to kill the monster in the closet.

We then promptly went out, ignored all of his advice, smothered ourselves in BBQ sauce, and laid down in front of the closet door and patiently waited.Read More »

A Fun Approach to Being Broke

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“So this blog serves the purpose of creating what I feel is valuable entertainment, but it’s also a coping mechanism for me of sorts. After all, if I really stop to think about the fact that I have  OVER ONE HUNDRED THOUSAND DOLLARS in credit card debt, I’ll probably just pass out. However if I think about having that same amount of debt, but then see a cute little drawing of a guy with a shovel… It can’t be that bad right?”

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First things first! As you can see, I’ve removed the stat tracker from the top of this post showing how much credit card debt I have remaining, and I have instead moved it over to the fancy new graphic on the side bar to the right over there.

I felt like it was cluttering up my posts to have that sucker at the top of each post, and since the numbers really don’t move from day to day, it was often just a stagnant piece of information that felt better served to the right.

As I was making the little graphic of the dude with the shovel on that chart, I got to thinking about whether or not my approach to debt is the right one. I don’t mean in terms of what I’m paying and where, but more in terms of the fact that I’ve created a semi-sweet, light and fluffy blog about effectively being broke.

I pepper the tops of posts like this one with fun little illustrations, and then spend several hundred words talking about just how close I came to losing my home and putting myself and my family in a really ugly situation. It can be quite the contrast!

Humor has always been a defense mechanism for me. When I get nervous, or when I am put in tense situations, I tend to crack a lot of jokes… usually of a self-deprecating nature. It’s something I’ve done since was a kid, and continue to do often as an adult. So if you ever happen to be in a situation with me where I am obviously desperate in my attempts to make the group I’m with laugh, chances are it’s because I feel WAY outside of my comfort zone.

I was up in the mountains once and had a guy pull a revolver on me and two of my friends. True story. We were driving up to a keg party in the mountains, and as we crested up over a hill in my pickup, there he was on horseback, pistol drawn, pointing it directly at my face. He then told us that his son had put his pickup in a ditch about a mile up the road and needed to be pulled out. The gun was just a “motivator” as he called it. To make a long story short, I was so scared and cracked so many jokes as a result that by the end of the night both the son and the father were standing at a campfire with us drinking beers and laughing.

Again… defense mechanism.

So as you can imagine, when it comes to writing a blog chronicling the really dumb situation I put myself in, I try to find to add some levity.Read More »

Tuesday Tip Jar: How to Save Money When You Suck at Saving Money

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One of the problems is that the money is so damn accessible now. I’m old enough to remember pre-internet life where if you wanted to put money into savings you had to physically drive your car to a bank and deposit it with a paper deposit slip. Usually while someone stood next to you smoking a cigarette and talking about the latest episode of Magnum PI. If you wanted to withdraw from your savings, you got back into your Trans-Am, popped in an REO Speedwagon cassette, and drove back to the same bank where you filled out a withdrawal slip and took your money out.

Starting Credit Card Debt (01.01.19): $126,310.77
Current Credit Card Debt: $109,570.87
Total Paid Off: $16,739.90
Income Going to Savings: 2%

[06.27.19 Update] – Just got an email from Marcus saying my new APY is 2.15% and not the 2.25% called out when I wrote the post below. Make sure you check their site for the latest rates before signing up.

I suck at saving money. Growing up I lived in a household where if we made $15 bucks that month, we spent $15 bucks that month. If we made $1500 bucks that month, rather than just spending the $15 that we managed to get by on the month before, we instead spent all $1500. My family didn’t really save money, and for the past 25 years, I haven’t really saved money either.

One thing I want to be clear about is that I do have some money in a 401k account. On this blog I often talk about having zero money in savings, but when I say that I’m referring to my standard savings account.

Part of the problem for me was always ease of access to my savings. I’d put $500 in savings and tell myself I was NEVER going to touch that money unless it was due to some unforeseen emergency. Two weeks later AC/DC would announce a world tour and I’d think, “Well I need to see them. They are getting pretty old, and this will probably be their last tour. This really is basically an emergency.”

Once at the show, I’d buy a t-shirt, food, pay for parking, and of course buy a pair of those light up plastic devil horns to wear. Can’t be the only one in the crowd without plastic devil horns on after all.

So I’d pull that $500 bucks right back out, and have it all spent in a matter of two weeks. The next month I’d start all over again, each time finding some kind of “emergency” to spend things on.

One of the problems is that the money is so damn accessible now. I’m old enough to remember pre-internet life where if you wanted to put money into savings you had to physically drive your car to a bank and deposit it with a paper deposit slip. Usually while someone stood next to you smoking a cigarette and talking about the latest episode of Magnum PI. If you wanted to withdraw from your savings, you got back into your Trans-Am, popped in an REO Speedwagon cassette, and drove back to the same bank where you filled out a withdrawal slip and took your money out.

In other words, it took a fair amount of work to get your money in and out of savings, and thus once it was in, it tended to stay there.Read More »