Post by John Miro.
Lately I've been bummed/stressed/anxious about money. That's because we just finished up our first month living on only one income.
My wife is/was a teacher, which means she can be paid over twelve months for work done over nine. Though it can be nice to get paid in a month when you weren't working, it is still a teacher's salary, meaning it is lower than it should be.
I don't know about all of you, but wedding season hit me hard this year. My brother and two best friends got married, and I was in each one. I also contributed a nice sum of money to a joint bachelor party we held. This unusually large amount has masked the true answer to the question of how we can survive and hopefully thrive on one income.
Needless to say, I'm in need of a morale boost, so I wanted to ponder all the money “things” that are going right in my life. What is a “money thing,” you ask? It's just a positive thing about my money situation, mainly called that because I couldn't think of anything better to call it. I could call it a money “victory,” but I don't feel like I've won anything…so that won't work…I could call them money “milestones,” but the powers that be keep moving the goalposts so I don't feel comfortable pegging my progress on this artificial course…so I'm going to call them “money things.”
1. Nice Salary and Pension
Yes, I am one of those evil government employees who has a pension. I also have a large salary, which means I may someday have a large pension. Usually when someone reaches a higher earning bracket, they tend to stay there, so I will likely have nice earnings for years to come. I am being intentionally optimistic here because it's my website and I'm trying to make myself happy (just kidding, but not).
2. We Are Debt Free
I know, I know…I talk a lot about us being debt free. This was the goal that motivated me to start this site and track my progress. Though I hated debt, it was fun to see it go down each month on my Excel spreadsheet (email us through the Contact Page if you want a copy). We sold our house a few months ago, meaning that for the first time in our adult lives, we didn't owe a penny to anyone.
3. My Wife Can Stay At Home
Numbers one and two above lead to this number three. Without them, three, four, five, etc would not be possible. Are you getting the clue (these money “things” are listed in the order we acquired or internalized them!) But that's not really important. So back to my wife. Even though we have the same household income we had before when we were both working, my salary and our debt freedom means that it is easily doable for my wife to take a year or two off to see our youngest daughter into kindergarten. Having her at home to help our daughters transition to a new town and new schools has been valuable beyond the measure of money.
4. Saving Big Money with FSAs
Saving money with FSAs may sound like a boring money thing, and it generally is. You know you are into your thirties when your have stimulating conversation with other adults about saving money with tax deferred FSA accounts. But the implications behind this seemingly mundane action are what I'm really getting at. Saving money in an FSA is an “advanced” tactic for me. It means that I've been able to get past Phase 1 (constantly paralyzed by the soul-crushing weight of debt) to Phase 2 (Debt Free and able to devote time to finding new ways to save or earn money). Most people I talk to don't understand how they work, but it is really quite simple how they work. Plenty has been written about how they work, so I'll just say that they've saved me over $1,000 this year, so they work great. I call them an advanced tactic because you have to be able to sacrifice less take-home pay for a bigger gain in the end, or otherwise known as being an adult and learning to control money impulses.
5. I Have a $20,000 Warchest
Many of have these quaint little things called “emergency funds.” The term “emergency fund” sounds so weak, like you've got a case of the vapors. I have a f#[email protected] warchest, not an emergency fund. Allow me to explain. Yes, I am worried about those unplanned expenses and job loss, but honestly I am more worried about lawsuits and litigation. In my job, I am involved in high level decsionmaking and employment actions, which could open me up to civil lawsuits or the need to hire an attorney. My warchest helps me sleep at night knowing that if some asshole or bureaucrat wants to mess with me, I'm going to fight back hard. The $20,000 I have in there is more than enough to handle most legal issues that could arise.
Having this warchest out of the way will allow me to move on to saving for other goals like retirement.
6. We Don't Have to Sweat the Small Stuff
Notice I said “don't have to.” That is just to clarify that sometimes I find my old habits and anxieties causing me stress over a five dollar sandwich or a three dollar coffee. The truth of the matter is that I no longer have to feel like I'm harming my family by having a candy bar or an impromptu lunch with a colleague or friend. We do have to regain cognizance of spending on things like restaurants, which can quickly decimate a monthly budget, but I am compelled to talk about the mental health benefits of financial security. Being able to shrug off the day to day incidental expenses is an important part of growing up.
7. We Budget for the Fun Stuff
Like my partner Crystal talks about on her site, Budgeting in the Fun Stuff, we make it a point to save money specifically for the purpose of spending it on something fun and awesome, specifically international travel. I've talked before about how I put debt freedom behind saving for a European trip, mainly because it was a priority to me, and trying to fool ourselves is the type of lunacy that gets us into money trouble. Last year we spent $4,000 on a trip for my wife and me to Croatia. Sometimes I think that I could have an extra $4,000 (more like $10,000 when you count all the trips over the past decade) in the bank, but would I like that person who has a few extra bucks but had not invested in being who he wanted to be? For me, I'd rather be the guy who will talk about a wealth of experiences than a wealth of money.
Sorry If I'm Gloating
I hope this doesn't sound like gloating, but I am happy and proud of the things we have accomplished. Thanks for allowing me to cheer me up.
I want you to see that there is a light at the end of the tunnel, and a nice little world waiting on the other side. It's a place where you don't have to sweat the small things, and can focus on the things that really matter. These “money things” are what make life easier…period. We can argue all day about money, morality and the like, but the truth is, capitalism is a system designed to keep a majority of the people working for a living and not plotting a rebellion, and it also gives you just enough of a chance to “make it” that it can be fun. It's the system we've got, and playing by the rules has got me this far…
What is “getting ahead?” Is it something we can ever attain. Getting ahead of whom? I guess they mean getting ahead of ourselves, because that is the only person you can constantly measure yourself against, and if you are always concerned about letting your “self,” or “yourself” down, you'll hit that alarm clock every goddam morning without snoozing, get your ass to work and be a true American.
“Getting by” sounds more my speed. As long as you can make it to the finish line with a gasp of gas in the tank, you win. Life is the only game where everyone wins, but only if you know how to stop living it and start living.
by John Miro