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Our journey towards financial freedom has begun!

August 28, 2018

[Image Credit: Max Pixel]

 

This week we have a guess writer! Please join me in welcoming Lauren Marshall. A new stay at home mum that has overcome some amazing obstacles...

I think money is sometimes more tied into our emotional wellbeing than I would prefer it to be.

Just like exercise, it feels good when we do what we set out to do. Saying, 'I went for a run today’, feels significantly better than, ‘I sat on the couch and ate donuts all day’. Saying, ‘I saved $4 today’, feels so much better than saying, ‘I spent $4 today’.

What is holding you back from achieving your personal financial goals? Or any goals for that matter?

Money often ends up being a bit more emotional than it appears to be on the surface. It is often attached to deeply entrenched behaviours, belief systems and the reward system in our brain. I believe there are a few key things which need to be addressed to help you overcome behaviours which sabotage your financial wellbeing, but the key one is your mindset.

I’m quite happy to admit that I have made my share of emotionally driven and detrimental financial decisions throughout my adult life. Decisions like, ‘Oh, go on! I deserve it!’ and, ‘What the heck? Our wedding budget is already $20,000 over budget, just put it on the credit card!’ (not even joking).

Frivolous decisions like these have had long term effects on my ability to achieve some pretty basic savings goals. For example, when we bought our house, we absorbed $30,000 of credit card debt on top of a half-million-dollar mortgage (what was the bank thinking?!). Every cent we have earned since buying our house has gone to paying off credit cards, bills, food and the mortgage. No holidays, little in the way of spending for fun. It really got on top of me for a while and I found myself in a dark place, believing that I would be in debt forever. I was in a rut, with debt feeding more debt and credit cards feeding more credit cards and I just couldn’t see a way out. 



Then the switch changed...
One day, I was listening to my dentist friend who was chortling about how easy it was to pay off her mortgage. It was like a switch went off in my brain.

“Why isn’t paying off our mortgage easy?”

I decided then and there that I needed to look in the mirror and take accountability for the financial position I had found myself in. That was quite confronting. No one allowed me to acquire credit cards, personal loans and car loans except for me. It was that day that I decided to work towards a debt free future and that I had the mental fortitude to make it happen. No more, “I’m never going to be able to afford that”. I was all about forging my way towards a future-proof financial situation which allowed my husband and I to lead a lifestyle which would ultimately bring us joy and comfort.

When I decided that it was time to leave debt to the past I really went for it. I first consulted with my husband, because the debt was his too. We discussed ways to bring down the debt as fast as we could. This included creating a plan and using some of our savings to just start paying off some credit cards. But before any of this, we sat down together and hand wrote our goals.

Hand writing these goals somehow solidified the journey we were about to embark on. With a glass of red in one hand and a pen in the other, we brain dumped the realistic, the tangible, the lofty and the intangible goals. We just let it flow.

That list looked a little something like this:

  • Be debt free by 2021, except for the mortgage

  • Stick to our spending plan each week

  • Create automatic bank transfers weekly which are dedicated to the upcoming bills

  • Cut up and pay off ALL credit cards, except for the one attached to our home loan

  • Check with each other when making purchases over $400

  • Hold each other accountable at all times

  • Retire with at least $2 million dollars

  • Be mortgage free by the time we reach 40

  • Never acquire a car via a car loan again – only ever buy a car if we have the cash in the bank

  • Annually call all insurance companies to see if we are able to reduce our monthly and annual fees

  • Go on 1-2 overseas holidays per year

We then went through this list and picked the top five which were going to be our priority to immediately set the wheels in motion:

  • Be debt free by 2021, except for the mortgage

  • Stick to our spending plan each week

  • Create automatic bank transfers weekly which are dedicated to the upcoming bills

  • Cut up and pay off ALL credit cards, except for the one attached to our home loan

  • Hold each other accountable at all times


Our journey towards financial freedom has begun
Our mindset went from feeling sorry for ourselves about our financial position to really uplifting each other. Giving ourselves a light at the end of the tunnel. Knowing that we may not go on a holiday until 2022 but that when we do, it will be a holiday paid for with our hard-earned money and we won’t be paying for it years later on a credit card that is sitting around earning interest. We switched the mindset from ‘I can’t’ to ‘I can’ and it felt incredibly liberating.

 

 

Speak soon,

Erika Gilbert

My Income Organiser

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