Commit. Plan. Take action.
I recently started a new series on the blog called Monica’s Two Cents where I answer questions from my readers.
A few weeks ago, I kicked off the series with a question about what to do with your old credit card.
If you have a question for me, I would love to hear it. You can fill out the form on the Contact page or send me a message via Facebook or Twitter.
We are continuing our journey to free you from debt by diving in to the much-loved topic of budgeting!
We have come a long way on this journey.
We started with a promise and getting your spouse on board. Next, we clarified your current financial picture and reviewed the checklist for a strong financial plan. Then, you got clear on your goals, started tracking your spending, and created your payoff plan.
But we’re not done yet!
Get ready to be inspired!
Every other week or so I bring you an interview about a journey out of debt for motivation that it is possible to live debt free.
Recently, I have shared Dontae and Laura’s debt free journey and Amy’s journey to financial freedom.
Today’s interview is one of my favorites!
Miriam Lilly is a 29-year-old young woman who paid off all of her debt so that she could stop saying “no” to opportunities and start saying “yes” to life.
Each month I bring you a recap of the previous month’s progress on paying off our debt. This serves two purposes — to keep my husband Mike and me accountable to our financial goals and to give you a look behind the scenes of our strategy for paying off our debt.
The purpose of this blog is to take you through the exact process that my husband and I have used to pay off more than $65,000 of debt in 11 months on a single middle class income.
To get you started on your journey, we began the process with making a promise and getting your spouse on board. Since then, you have calculated your net worth, reviewed the checklist to a strong financial plan, and written your goals.
Now you must develop a specific core habit to ensure your success.
Today I have another debt free story to share with you!
One of my favorite ways to research for the blog is to interview people who have paid off their debt or are on the path to become debt free.
It’s no wonder that these stories are some of my most popular posts. [Read more…]
Here lately I’ve been feeling pretty burnt out. I’m burnt out on work. I am feeling burnt out with friendships and daily activities. All in all, I am really feeling the need to unplug, take a step back, and just breathe. However, I always find myself feeling guilty for taking that time off. I should be working, doing this and that. That guilt got me thinking about how burnout affects other parts of my life and how to identify when that break is needed.
Signs of burnout can be different for everyone, but there are some common symptoms that many people experience. According to Psychology Today, if you are feeling any of these things you may be experiencing burnout on some level:
Burnout is not unavoidable. In fact, there are a number of things you can do to make sure you don’t run yourself ragged (I just haven’t been doing them). Mommy Thrives is a mom blog that has covered some great ways to avoid burnout that you should try and implement in your day-to-day life. Here’s a quick list…
Like I said, great ideas, but I have not been doing any of that. I’ve been feeling a bit drained recently and I began thinking about the last time I truly took time off for myself. When you look at the list above, I ticked just about every box. Getting things done has been difficult. Some days it is hard to focus on all of the things that need to be done. It impacts my mood, my productivity, and, at times, it has an effect on our finances too.
More recently, I have had a lot of trouble sleeping, which was the biggest sign for me. Normally, I sleep pretty well and get around eight hours per night. Over the last few weeks, however, I have been waking up multiple times throughout the night. The sleep tracker on my smartwatch says I average between 30 and 50 minutes of deep sleep per night (Woah!). Now, this lack of sleep could be contributing to the rest of my symptoms, but when it comes down to it, I am burnt out. Period.
My mom always says, “The only thing you have to get done today is what you get done today.” I laugh when she says this because I think of my to-do list, which is normally about a mile long. But, really, how do you start to recover from burnout? What do you need to do to climb out of it and come back to your regular duties actually feeling refreshed?
Healthline wrote a great blog post about burnout and how you might be able to best recover if you hit that wall as I have. Some of the suggestions include things like being firm about your boundaries and leaving work at work (two things I always struggle with). The blog also talked quite a bit about being in-tune with your own personal needs. On your days off, clear out your schedule and just relax. I’ll be honest, on my days off I’m usually running around checking even more things off my to-do list.
The Mommy Thrives blog mentioned mental health days and going on a hike. Hiking is one of my favorite things to do and I have not been on a hike since August 2019 (Yikes!). When it boils down to it, I’m not taking my downtime to truly tune into my personal needs or do anything I really enjoy. Instead, I’m thinking about all the things I could be doing.
Well, thankfully, I have a supportive husband who has seen this burnout coming from a mile away. He has been pushing me to do more things I enjoy and things to help my stress levels. I have started taking two yoga classes a week (which has been amazing) and in about a month we will both be unplugging for a long weekend at the beach. We never got our honeymoon and still actually have an Airbnb gift card from our wedding two years ago, so we will get one night free. While I’ll still have a month of work to do in the midst of this burnout, it is so nice to know I have these things to look forward to, to help me re-center.
Readers, how have you been able to recover from burnout in your own life? What tips do you have?
With recent career changes and a few months without a second income, we have been looking at ways to improve our finances. Like many other people during the pandemic, we experienced job loss and decreased wages last year. The loss in work pushed us to move sooner and make changes. One thing we settled on doing to help improve our situation was selling back debt that is no longer serving us. Here’s how we are doing it.
You may be thinking to yourself, “There is no debt that serves you.” However, when it comes to the debt we have had to take out to further our careers, it was serving us in a way. You may remember my husband’s tool debt from his time in the shop as a mechanic. When the pandemic hit, the shop he was working for downsized, and he was one of the newest employees, so he was cut.
This put us in a position where we had to continue paying for tools that weren’t being used as well as a storage unit to keep them in. It was a major drag on our finances overall. Eventually, because we no longer had that second income, it became impossible to keep up with the monthly payments. So, we started looking at our options.
At first, we looked at selling the toolbox and some of the tools to help pay off the debt. Once again, the pandemic made this pretty impossible. No one was looking to spend thousands of dollars on a toolbox when a lot of other people were out of work too. Eventually, the account went into collections early this year as we continued to look at our options.
After discussing the issue with the company we are indebted to, they said they would be willing to buy back some of the items he had purchased and subtract the total from the amount owed. While this didn’t completely get rid of the debt we have, it did get the storage bill off our backs. It also decreased the amount we owed by $7,500 when all was said and done.
We didn’t get rid of everything either. They wouldn’t buy back used tools. So, my husband still has everything he needs in the event he wants to return to working in a shop or wants to do some side work as a mechanic. So, the security of having the tools for the job is still there.
For now, it also gets the monthly bill off our plate. Obviously, the amount in collections will still need to be paid off, but the $400+ monthly bill is not weighing on us at this very moment. We can shift our focus to paying off some other items, getting things caught up, and then settling with the collections agency later on in the year. For us, that is a win.
Readers, have you ever sold back debt like we did?
Any time there are big changes in our lives, the financial planning aspect of things gives me a bit of anxiety. I begin to think about every penny we will need to make the new shift in our lives go off without a hitch and, guess what? Things almost never go to plan. Not exactly anyway. So, we have had to put some thought into how to prepare for big life changes headed our way.
In a few weeks’ time, I hope to be able to share some positive news with you all on the blog. There are some HUGE changes coming our way. They are also changes that will involve some financial planning and saving on our part. As you know, we recently moved into a new home. On top of that, we’ve been going through even more changes that will impact our family in a big way.
Thankfully, my husband recently got a new job. He is able to work from home with me now and his income will greatly assist with these changes. We are aiming to get a substantial amount of money saved and then looking to double up on our debt payments. Hopefully, within the year, we will have our car 100% paid for (that is the goal anyway).
Since we have started planning for this big change coming up in our lives, it got me thinking about how others prepare for big life changes. Of course, there is nothing that works for everyone but there are several common ideas and things most people do when they are prepping for something big.
Depending on what kind of change you are preparing for, the steps to get there will look different. If you are preparing to buy your first home, you will be making some financial sacrifices and also spending a great deal to get ready for that. If the changes you are making are more personal in nature, like quitting cigarettes or getting sober, your steps will look different. However, each of these tips seems to be applicable across the board.
When it comes to how to prepare for big life changes there is no “how-to” guide. You need to find what works best for you mentally, emotionally, physically, and go with that. It may not look the same as what worked for your friends or family, but if it works for you, that is all that matters.
Readers, how have you gone about preparing for big life changes? What was key for you?
A lot of people in the debt-free community (especially if they are Dave Ramsey followers) believe you have to choose between investing or paying off debt. This black-and-white thinking could potentially be holding you back from larger financial goals though. You don’t have to choose. You can do both. Here’s how.
Any time you come into some “extra” money it is difficult to decide where it should be allocated. When your finances are the main focus in your life, like it is for many of us, it is hard to decide whether you should be investing in your future or focused on paying off debt.
The answer to this question will vary from person-to-person and family-to-family. After all, personal finance is personal, right? If you still hold a lot of debt, no you shouldn’t be thinking about making any investments right now. Focus on getting your high-interest debts paid off and then shift your gaze to making investments for the future.
For us, our main focus has been paying off debt. I’ve had people ask, “Why aren’t you investing yet?” I always thought to myself, “Well, because I still hold a lot of debt.” That does not necessarily mean you can’t invest though. In fact, in some cases, your return on your investment may benefit you more than paying off your debts. That is a rather unpopular opinion in debt-free circles online though.
Now, that isn’t to say that you should drop down to minimum payments on all of your debts and throw the extra cash into an investment portfolio. You have to go about it the right way.
So, how do you invest while simultaneously paying off debt?
Investing and paying off debt are both good uses of your money any way you look at it. However, you want to be sure you are making the most of every penny. At the end of the day, paying off your high-interest debts will provide a better return on your money than any investment you will make. Make a list of your debts from highest to lowest interest.
The key is to look at interest rates versus your potential return. If the return you’d be earning is higher than the interest you are paying on your debts, make the investment. For example, if you hold a mortgage loan that has 5% interest but your portfolio return is 10%, the investment may be the better decision for you. Unfortunately, for the most part, investments are not always that straightforward. Something that is performing well this year may not be next year.
Many people use investments this way to come up with the money they need to pay off their debt more quickly as well. If you think you can earn in the stock market in a way that will further your debt freedom goals, do it! But you really need to put thought into the numbers before making that move.