Monday, June 27, 2016

10 Year Reviw - Part I (The Beginning)

Mr. Sam and I will be celebrating 10 years of marriage this fall.  As a result, I'm starting to think about what we've accomplished, together, in those 10 years.

We started our financial journey together, before we got married, but January 2007 was the beginning of our effort to pay down our unsecured debt and implement a debt free life.  The journey was mostly inspired by the fact that I wanted and needed a new car, but did not want a car payment.  It was the summer of 2006 and my car, then a 1999, had hit expensive repair time.  I had made some repairs to it and it was calling for more repairs and I was fed up.  So, I was doing some internet research and I came across a Dave Ramsey article about car payments.  I read some more on Dave's web site and I later checked out one of his books from my local library and read The Total Money Makeover.  I read some other books as well like The Millionaire Next Door and others.

We were in the middle of getting ready for our wedding, so I did not have time to implement the plan.  Instead, over the December holidays of 2006 (after the wedding and honeymoon), I reread TMM and we started working the plan.  We began with Dave's baby steps which we also modified a bit as we moved forward (side note, my husband is a lapsed Catholic and I'm not religious, while Dave's books and message can be a bit preachy we just ignored those parts).

We began 2007 with a financial reckoning.   First, we combined our assets and our combined net worth was $807,539.  We were holding real estate valued at $1.27 million dollars (that changed dramatically the next year).  Our retirement savings was at $216,184.  We had the $1000 emergency fund already covered (TMM baby step one).

Second, we had a lot of debt.  We had $679,520 in mortgage debt, our primary home, three rental properties and a piece of land.  And, we had $50,946 in unsecured debt, $27,000 for Mr. Sam's student loans (MBA) and the rest credit card debt.  So, we began 2007 with TMM baby step two, pay off all debts but the mortgage.  We had added up all our debt, we had a chart showing interest rates, minimum payments and totals.  I took over paying all the bills (prior to marriage I paid our joint bills and my bills, but Mr. Sam handled his own bills).  So, we began working the debt snowball.

More on debt later, I also want to look at where we are, 10 years later, with careers, education, family life, savings, real estate, car habits, etc.