Baby Step Update — Financial Freedom

Hi friends! How are you doing!?

I’ve been meaning to do this post for a while, but for whatever reason it just kept getting pushed to the back burner. Financial peace is something I think about a lot and I thought it would be fun (and hopefully encouraging to you) to update you on where we are in the baby steps.

My husband and I have been following Dave Ramsey for a bit. I honestly don’t remember when we started learning more about his Financial Peace system and baby steps, but we’ve been taking it seriously and moving along the steps. Maybe about a year at this point? We read Dave’s book, The Total Money Makeover, in January and I listen to his podcast, The Dave Ramsey Show, regularly. By regularly, I mean every day.

I really appreciate his no-nonsense attitude about finances and how willing he is to provide free resources for people that want to learn and make the changes. Not everyone is open to changing, but the ones that are have a proven system to build wealth and leave a legacy. I was hesitant to get on board with his methods, but the more I listened, the more sense it made to me. It feels good to have a plan and it has helped Eric and I with our communication about money. We’re on the same team working toward the same goals. What a blessing!

If you’re not familiar with Dave Ramsey, he talks about 7 Baby Steps to get out of debt, save for your future and ultimately be able to build wealth and give.

Baby Step 1: Save $1,000 (starter emergency fund)
Baby Step 2: Pay off all debt (except for your home) using the snow ball method
Baby Step 3: Save a fully funded Emergency Fund (3-6 months worth of expenses)
Baby Step 4: Invest 15% of household income
Baby Step 5: Save for kid’s college
Baby Step 6: Pay off your home
Baby Step 7: Build wealth and give

Simple and to the point. Once you complete a baby step then you move to the next. It takes out the guesswork so you can focus on using your money best for your stage of life.

You may remember we officially paid off my student loans (you can visit the post here) back in September. Best feeling ever! Since then we have made a lot of progress. We did things a little off plan at the beginning as we were learning, but at the end of the day things got done.

Baby Step 1 completed November 1, 2017.
Baby Step 2 completed November 2017.
Baby Step 3 completed February 14, 2018 — sweet Valentine’s Day gift 😉
Baby Step 4 started on February 18, 2018
Baby Step 5 skipped for now (we will start this once we’re blessed with kids)

That leaves us to paying off our home and/or saving up for a future down payment on our next home! We’re not sure when that move will happen, but we want to be prepared. We’ve accomplished all the goals we have set to this point, so it’s time to set new and bigger ones!

Last month we decided to start working with a Financial Advisor to help with our retirement savings and be a guide through this financial journey. We found him through Dave Ramey’s endorsed local providers, SmartVestor Pro. Our advisor also happens to attend our church which sealed the deal for me! We are young, so retirement seems so far away, but it’s important to us to start this right so we can maximize our efforts.

Our journey up to this point hasn’t been perfect. There have been times that felt clumsy and hopeless. Especially at the beginning when we were trying to figure it all out and get systems into place. Debt snowball. Budget. Weekly budget meetings. Things I wanted, but knew I shouldn’t buy. It was tough, but it did get easier each day.

I have to be honest, we’re not 100%. We do our best to follow the plan exactly, but sometimes it won’t be 100%. But we’re as close as we can be for right now.

We still have a leased car. A “fleece” as Dave would say. Worse comes to worse and we’ll finish out the lease then pay cash for our next car.  We have been busy with work and opening up the new ice cream, Vida Dulce, that other things may go to the back of our minds for the time being. We are only investing 15% of my income instead of our household. Since Eric is a business owner, the investments aren’t as straight forward — I’m sure we’ll discuss that with our advisor. With the shop opening recently and getting paychecks figured out, we’ve put a pause on paying extra on the house to make sure we have enough money to pay our bills. We’ll get it all together, but for now I feel good about where we’re at and what we have accomplished!

If you’re already on your financial freedom journey or want to start one, I have some encouragement for you. 

It will be hard. Financial peace + freedom isn’t normal. Normal is debt, credit cards, loans. We want to be weird! It will take intention and hard work.

If you are married, communication is key. You have to be on the same page, otherwise you’ll be spinning your wheels and get frustrated. You are stronger together. Once you attack this, you’ll realize you can do anything as a team!

You may want to give up and throw in the towel. But don’t! It is worth it. Each positive step you take moves you that much closer to your goals.

You are doing this to live a life a freedom and leave a legacy. You are doing this so that you can be a blessing when the opportunity arises. You are doing this so that your life isn’t full of money stress, but full of peace and joy.

Don’t get me wrong, money isn’t everything. But it is a major tool that allows us opportunities and choices. You don’t have to be “rich” to do this plan. My husband and I do well, but we certainly don’t make a ton. We had to make sacrifices and decide what’s more important. I’ve heard success stories of single moms, of couples that make annually $750k+ and everything in between. It can be done if you decide.

Do you have a financial goal you’re working towards right now? I’d love to cheer you on! As always, I’m available to chat if you have any questions or just need some accountability ❤

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