While we’re not living WAY below our means,
we’ve been slowly but surely chipping away at our debt, lowering our debt payment obligations, and thus learning to live below our means.
If you remember a year ago, when I was doing budget updates, we were stretched so thin. We were both working, but we had so much debt we could barely make the minimum payments each month. This month, we’re paying off our personal loan – freeing up $500 a month!
While that’s awesome, and it seems like we should be able to put $500 towards our debt snowball,
that’s not the case.
Part of being and adult and making smart choices is taking $100 of that payment we no longer have to make and putting it in savings each month, since our savings were put on hold. It also means taking $130 of that and putting it in savings each month to pay our car insurance when it comes due, leaving us with only $270 to put towards our debt avalanche.
But as sad as that is that we can’t put the whole $500 towards debt, paying off that personal loan and living below our means for the first time in years has tons of advantages!
While I have no desire to bend or break our budget, it is gives me a lot of peace of mind to know that we have wiggle room if something were to go wrong, or some emergency come up.
No longer do I have to plan out a month’s worth of paychecks, bills, and the associated cash flow. Sure, I keep an eye on our bills so I make sure we’re covered, but the process isn’t nearly as detailed, time-consuming, or STRESSFUL as it was before.
I Feel the Pride of Ownership
I read an anology once about money. Basically, it said that each and every dollar that you save or invest is like an employee, going to work every day, making more money for me! I can’t take credit for the analogy, and for the last year I haven’t totally known how that felt, but I do now.
We’re starting to put money in savings again, and I love the feeling! I have hundreds of employees providing me with passive income! Literally, I smile when I log into Mint.com :-)
Along the same lines of pride of ownership, wealth accumulation is an amazing thing. I know that $100 a month seems small, but when you look at it on a larger scale, $100 a month has a huge impact. Such a huge impact, in fact, that $100 a month for 40 years will grow into a bit more than $270,000. My $100 a month doesn’t seem so shabby now, does it?
Brighter Financial Outlook
Now that I have moved past my disappointment of only being able to put an extra $270 extra towards debt, and I know that I have lowered our expenses as low as we can without going crazy, I can focus on increasing our income.
Personally, I love blogging, but there are always things like surveys, writing freelance articles, and secret shopping! And yes, while it does sound like more work to earn more money (and you’d be right) it brightens my financial outlook because I have the power to change it! I’ve already helped our situation so much, and I can do more!
Giving, both to charity and to our church has been a priority we just could not afford. Now that we’re living below our means we can afford to give (a little) again!
As I said before, I recently took a promotion that was in title only. In fact, I’m making a little less money, but working less hours, on things I’m more interested in, as well as having the option to work from home occasionally. Were we not paying off our personal loan in Novebmer, I would not have been able to take that promotion that helped my happiness. Also as a result of the promotion, I will be eligible for another (this time with more money) promotion!
I used to dread budget updates. I dreaded even the most constructive criticism when I published them because I was impatient to make drastic changes to our debt and our cost of living. Now, even though we have a long way to go, I am starting to feel good about our budget!
You (and only you) decide your future:
When you live below your means, you have the ability to pursue your passions. I am discovering this – in fact, I just took a title promotion that allowed me to work less, work from home if I wish, and gave me a salary (as opposed to hourly). However, the salary just slightly less than what I was making before.
As a result, I am much happier! I have more time to devote to family, my health, and my passion: blogging!
Ability to Increase Your Income:
Part of my passion for blogging is creating a revenue-earning business from nothing. Each time I sign a new deal, or receive a check for advertising I feel a sense of pride. Not only is it amazing to me that people come back over and again to read what I’m writing – I can make money from it!
Of course, there are many more reasons to live below your means then I could physically cover here – and everyone’s reasons are different.
So tell me: What are your reasons for living below your means?
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