Monday, March 7, 2011
Image via WikipediaIn 2007, when Will and I were about to become debt-free, we started planning our first trip to Europe. As two young adults who grew up in tiny Kentucky towns, nothing seemed as far-fetched as traveling to Europe, but being debt-free, we figured we could make it happen. And we did. Without the teachings of Dave Ramsey and the prodding of some good friends, we wouldn't have made that trip, nor would we have made the following trips...and the trips we continue to take today.
But there's a secret no one tells you when you start the debt-free journey and learn to become a responsible adult: Staying out of debt is just as difficult as getting out of debt.
Since 2007, we've had a lot of ups and downs as every young couple does. But one thing that's remained a constant is our ability to pay cash for everything we buy with the exception of our home. And sometimes, my inner four-year-old is throwing the biggest fit you could imagine.
You see, right now, we're in the middle of some major life changes. Some of them we anticipated; some we didn't. In early 2010, we finally got our retirement contributions up to 15% after saving up our fully funded emergency fund and then saving to buy our first home and making some needed repairs to that home. We were so excited...and then reality hit.
Will needed to finish his degree. So we started cash flowing it. But slowly...ever so slowly...we began to eat into our emergency fund. Things we would normally cash flow—car repairs, minor home repairs, etc.—became emergencies because we were fighting the tide of tuition and retirement. Last fall, we put our Roth IRA contributions on hold. We're still contributing to retirement at work up to the match, but we felt a whoosh of relief when that extra chunk of money wasn't going out the door at the same time we were trying to write big checks to the university.
Now, Will is approaching the completion of his degree either this fall or next spring. With that on the horizon, we're still saving for other larger goals, including another trip to Europe because we don't know when we will be able to return after this one is done. There is an end in sight. We know how much we need to make these goals happen. We know how much we need before we can start our retirement back up at its full 15%. Still, it's frustrating. Let me explain why.
When you become debt-free, you expect that there will be this sudden influx of cash—that you're not going to worry about money anymore. That simply isn't true. You still have to live on a budget, live within your means, plan for emergencies, and plan for your goals. There will be unexpected roadblocks. And while all of your money went out the door in debt payments before, now all your money goes out the door to fund your future. It's learning to live like an adult at the most basic level, and I am grateful we learned the lesson early. But sometimes, particularly times like this weekend when I had a four-year-old tantrum over something we simply cannot afford to do right this second like I want, it's hard to say no...to remind yourself why you're on this journey.
It's hard when you watch your friends buying things you'd love to have or taking vacations you're salivating to take, but they're doing it on credit and you're not. It's hard to want that new(er) car, but you've sworn you'd never have a car payment again. So you look at your ol' Betsy in the driveway and remind yourself that if you save for 10 months, you could upgrade in car if you really wanted to.
I think the biggest key is breaking your goals into manageable portions. Like Dave says, you eat an elephant a bite at a time. Right now, Will and I are trying to eat the elephant. It's just taking longer than I want it to, and my inner four-year-old isn't very happy. I know we're making good adult decisions. What no one tells you is that the four-year-old doesn't go away; it just takes leaves of absence. If you can control your impulses, you can control your money. It really is just that simple. And whether you're working on getting out of debt or already out of debt, controlling your impulses is always going to be a challenge.
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