During my online discussions, people share with me how they are following good money management principles. As we celebrate July Fourth, I wanted to offer some of their stories about financial independence.
“We are debt-free and loving it. We just paid off our mortgage and now, to quote a certain someone (you), we got that monkey off our back. We are grateful that we never had any student loan debt and, thanks to my thrifty stay-at-home husband, we have been able to live within our means. Since we pay cash for our new (to us) cars and do not carry a balance on our credit card, our only debt has been our mortgage. We are free at last. Now we are able to maximize our retirement savings and we still have eight years to continue saving for our daughter’s college education. Signs are good that our daughter will continue our family tradition of thriftiness. On vacation she complained that we didn’t have the same cable options at home as we had at the cabin we rented. I told her that the entire cost of our vacation was about the same price as a year of extended cable and which would she rather have: more TV or a family vacation? She thought long and hard and finally said, a vacation. Hopefully she will continue to understand that less debt will always equal more choices in life.”
“Wow, it really adds up. Recently I decided I needed to get more proactive on my outstanding bills. Instead of getting an extra job, I decided to get extra money by forgoing my cable and home Internet for three months and not getting that coffee every day. I knocked $600 off the bill and read a lot of books and watched some shows at the library. Yes, I am relieved to have cable back, but it was totally doable for three months.”
“Life does happen. Just wanted to give you a shout-out for encouraging a robust ‘life happens’ fund in addition to emergency savings. I’ve had flood damage, some other home expenses, and my car died. But we were able to cover these expenses with money from the life happens fund. I then built the account back up by taking an entire bonus and putting it in my life happens fund, even though I really want to take a vacation. I’ll sit in my newly safe house and count my blessings instead.”
Michelle Singletary: For those who aren’t familiar with a “life happens” fund, it’s an idea that I created years ago when I saw so many people raiding their emergency fund such that when a true emergency came along, they were broke. The life happens fund is separate. You build it up with at least $1,000 to take care of the things that happen — storm damage, car or home repairs. It’s another great safety net.