Hello friends!! If you’re anything like I used to be, money is an uncomfortable, horrible topic that you absolutely do not want to talk about. I hear you. I used to feel like my paycheck was gone before it even hit my bank account. Between school, rent, groceries, and gas I just always felt there was nothing left over! I have always desired to master my finances but never known how. Enter tall, sexy, husband and accountant.
Facing Your Money Head On
I realized my husband had the power to transform how I felt about money when we were engaged. We were looking for an apartment and had gone to a place we really liked. It was exactly what we needed!! However, it was going to go fast if we didn’t put down the deposit and first months rent. I was ashamed to admit that at that point (a few months before we were going to be married) I didn’t have the money to put down on that place. I was positive we were about to have our first super uncomfortable and real life conversation about money. I didn’t know where to begin. When we got back to the car, Alex said, “Well, that was a great place! But it sounds like we have to act fast. I could probably cover some of the cost. What do you have to contribute?” I felt my heart sink and started beating around the bush before finally saying, “I’m so sorry, but I don’t think I can put anything down on it right now.” I felt embarrassed! And then my now husband said something I will never forget, “There’s nothing to be sorry about! I don’t care how much or how little money you bring to the table. All we have to do is just face what we have head on and then go from there!” I have never forgotten that, and we have kept that motto in mind over the course of our financial journey through our engagement and marriage thus far.
How We Face Our Money
I have learned that facing your money head on and making it work for you is the key to financial freedom. I’ve also learned that financial freedom looks different for every person. For us, financial freedom means being able to spend and invest our money the way we want to, because we don’t sink when bills need to be paid. We are not wealthy by any means, but we’ve implemented certain practices that are helping us reach financial goals and be free:
1. A Strict Budget and Allocation of Funds
My husband is a whiz with spreadsheets. I mean, the man practically breathes formulas (and yet he’s equal parts nerd and jock, a rare find indeed). At the beginning of our marriage we started working together on a budgeting system. It started out kind of complex until we were able to simplify it to meet our needs. Our budget is this: we pay every bill, every paycheck. Basically instead of having a single paycheck that our rent and our utilities come out of, and then another one that takes out our internet, phones, cars, etc we simply split every single bill in half and “pay” it every paycheck. Now stay with me here. Interest bearing bills literally get paid twice monthly, which means we end up paying less interest over the life of the loan. Other bills that have due dates once monthly still get “paid” twice per month because we set aside half the amount each pay check, but then we actually pay the full amount whenever the due date comes around.
We apply this method to everything, including groceries, gas, clothing, date nights, holidays, savings, etc. Every penny is accounted for, and once our money is budgeted the leftover gets spent, saved, or invested!
***In case you’re not following, don’t worry. I want to collaborate on a full post or video or e-book or something with my husband. He knows all the technical lingo and I can dummy it down for people like me.***
2. Money in Many Places
Another trick that has SERIOUSLY helped us and even saved our bacon a few times is keeping our money in many places. Every account we have is shared (that is one of my number one tips for married couples to keep accountability and unity in spending). We have a couple checking accounts (one main one that we use most), a couple savings accounts (one that is flexible and one that is strict), and an investment account through a very easy to use app! If any of you are like me, you know how easy it is to spend every penny in your checking account. By keeping money in other places that are not as accessible, you don’t spend money that you shouldn’t!! This also helps cover rainy day expenses, builds a healthy emergency fund, and saves for fun activities or trips!
***I have a great list of financial apps that we love that I will attach another time. Sorry guys, there is just way too much to cover in one post.***
3. Diligence in Building Credit
One of the problems facing many people in my stage of life is not having much of a credit history! Credit is super important when it comes to major life milestones like buying a house. Even buying a car can be very difficult if you don’t have a good credit history or credit score. Your credit score is determined by the following factors: credit card utilization, payment history, derogatory marks (basically being reported to collections), age of credit history (do not close credit accounts, even when you have paid them off), total accounts, and hard inquiries.
My husband and I have taken small steps over the course of our marriage to build our credit in a healthy and disciplined way. Early in our marriage we bought a car! We co-signed the loan so it would affect both of our credit scores. We pay our car payment twice monthly so as to decrease average daily balance, which lessens how much interest we pay long term.
Another thing that can drastically improve your credit is responsible use of a credit card! After sticking to a strict budget over the last six months, we decided to get a credit card. We only make purchases that we have money to pay for. Once the statement generates (meaning it reported to our credit) then we pay it off with the money we had already set aside! This increases our credit score because our credit card usage is consistent and responsible. I’ll admit, this is a tough one, because it can be very tempting to spend money you don’t have. However, the reward for using your credit card correctly is worth the discipline!
Honesty and Accountability
One of the biggest causes of discord in marriage and relationships is money. If you don’t put the effort into being honest, open, and accountable to one another your money will get in the way of your relationship too. My husband and I always work on our communication with money. We discuss big purchases and we don’t get ornery with each other over little ones. We regularly look at our budget and talk about ways to improve. We talk about our goals and where we want our money to go. Communication is key! Openness is critical! One way we keep track of everything and stay on the same page is through a google sheet that we share between the two of us! We can view it on our phones and update it after any purchase!
I used to think that financial freedom meant being wealthy. Here’s the thing, one of the many downfalls we all face is always wanting more money than we actually have. But financial freedom is not the same thing as wealth, and wealth is not the same thing as financial freedom! Being financially free to me means knowing your bills are covered, having extra to invest, and constantly improving your situation (through credit score improvement and progress). Financial freedom is also facing your money head on. Not being afraid of what your bank account says is a huge leap in being financially free!
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