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I’m usually one to jump right into a post but I feel like I need to give a little background on how our 8 financial rules came to be.
My husband and I married just weeks after graduating college. We were young, in love, and ready to start our life together—and broke. I had already accepted a position as a nurse in an ICU and was scheduled to start after our honeymoon, and he was still on the hunt for a job.
On our marriage license, his occupation is listed as “unemployed” and, oh, how it hurt his pride. Bless his sweet heart.
Shortly after we were wed, he started working for a pharmaceutical manufacturing company full time with the occasional overtime. We were overwhelmed initially with the amount of money we had coming in. It wasn’t a lot, but for two newbies to the workforce who managed to escape undergrad with zero debt, wow!
I saw my coworkers buying brand new vehicles, buying or renting houses with large monthly payments, and maxing out credit cards to fill those houses with furniture and décor.
We were renting a modest duplex and drove vehicles almost as old as we were, so we knew we had decisions we had to make.
These decisions have been our financial foundation since we started our life together. We continue to live by them and adjust or improve them as necessary.
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- Live on one income; save one income.
This was much easier to do prior to having four children but still applies today. My husband’s salary pays our month expenses. Anything “extra” goes into savings or towards paying off our debt. “Extra” includes my salary when I was able to work, tax refunds, his bonuses, and any stimulus package received from the federal government.
2. Pay off debt early
As mentioned above, any extra money we earn either goes into our savings account or goes toward our debt. When we were building our house, my husband and I chose a 20 year fixed loan, with the agreement that we would pay this off within 10 years. By paying extra principal, we have saved thousands of dollars in interest, and will hopefully have this debt paid off within the next year, at the 7 year mark!
UPDATE: Paid it off at 7 years!
3. Use a credit card
This is the exact opposite of what most money-saving strategists will tell you, so allow me to elaborate. We use a credit card and pay this off EVERY month. Do not be tempted to make just the minimum payment. Do not charge what you cannot afford. I pay the bills and manage the money for our family. I am at fault if I have to take money out of savings to pay our credit card bill at the end of the month and I take this very seriously.
Also, a bonus of using a credit card: reward points. Amazon has a nice rewards system, so much better than our previous card, and we can use our points on diapers, toiletries, etc.
4. Automated payments for utilities
This one was difficult for me because I feared I wouldn’t be able to watch our expenses as closely but I’m so glad I made this change. I still keep a super close watch on all our payments. I still don’t do Paperless billing because the hardcopy reminds me to check our account.
Most of our automated payments are applied directly to our credit card (racking up those rewards) but some do come directly out of our bank account. We are always careful to have a certain amount in our account so there is no overdraft fee.
Another positive for automated payments is saving money on personal checks and stamps. I rarely have to buy either.
5. Used is good
Not great, but good, right? Wrong!
Lightly used is the best of both worlds! I admit I dreamed of buying a brand-new car in my younger days. Why is that so tempting? However, after shopping around I realized I was way too frugal to go this route. My husband was thrilled. We have only bought vehicles out of necessity and nothing extravagant and have never purchased a brand-new vehicle, just “new to us.”
This is also applied this to other aspects of our finances. We have literally saved thousands of dollars by accepting hand me down children’s’ clothing and toys and buying second hand. I get so excited when I find a Facebook yard sale. $2 pajamas? Yes, please!
Check out my post about saving money when buying children’s clothes for more money saving tips.
6. Meal plan and pack lunches
I make 90% of our meals throughout the week, using this meal planning sheet. Even before we had kids, our go-to rule was to limit takeout/eat in to once per week and all other meals we would enjoy at home as a family.
I say this but sometimes it doesn’t work out. Life happens. Sometimes, especially as parents, we are forced into survival mode, and we adjust as needed.
My husband always leaves the house with 1-2 meals packed and ready for his 12-hour shift. We save approximately $2,000 a year just by him not buying lunch and breakfast at work. He has a healthy appetite, so we LOVE this double decker lunch box! (#ad)
Want to save money when traveling or taking a trip to an amusem*nt park or the zoo? Pack a cooler rather than spending an arm and a leg on markup food items at these places. It’s so simple and saves so much money for this family of 6.
7. Every little bit helps.
A penny saved is a penny earned, right? Even the small things add up. One small impulse buy can ruin a budget. Here are a few things we do to save a little that adds up:
•Water saving shower head(#ad)- do your research to find the best one for you but this little addition to your bathroom can save anywhere from $25-$260 per year.
•Turn off the lights- I’m still a work in progress on this one. When my husband is home, I’m fairly certain he just follows me around the house to turn off the light switches behind me.
•Do your own taxes- This is something I have done the past three years and it saves us so much time and money. I collect the documents I need prior to starting and I can sit down and have our taxes filed online two hours later. We use the free version of Turbo Tax. I don’t see the need to purchase an upgraded version when our taxes are fairly straightforward.
•Coupons- I’m a sucker for coupons and coupon codes but don’t get tricked into buying something just because you have a coupon or coupon code.
•Shop with a list/Pickup order- Shopping with a list or placing a pickup order will save you so much money if you are an impulse buyer (guilty).
•Rebates- I LOVE Ibotta! Download the app to begin! Use my referral code (nalfdsx) to get $10 in your account after you submit your first receipt! For more information, check out my blog post 7 Apps That Will Save You Money.
8. Live below our means
Our goal every month is to make more than what we spend. It is simple math. We do not believe in taking out loans for frivolous wants; we don’t charge to a credit card what we can’t afford to pay that month. This has always been our most important “rule.”
Living frugal doesn’t mean you can’t enjoy life. It doesn’t mean we don’t splurge and have fun; we just have found ways to cut costs and have some financial stability and flexibility.
I know that I am blessed to have a husband who is on board with this lifestyle, because I really couldn’t do this without his support. If you are interested in making these changes and are married or in a relationship, I suggest you talk to you partner/significant other because it does take both to make this work.
I hope this small insight to our approach to our finances can help you. Our debt free journey has been far from perfect, but we are working on it. Every mistake (and yes, we have made a lot of them) has just been a learning experience for us. We don’t beat ourselves up, we don’t focus on the regret; we move on and learn from it.
Good luck to you, wherever you are in your debt free journey.
