We have made TONS of financial mistakes over the years; so many, in fact, that when we reflect upon our past, it is a miracle that we are free from consumer debt and continue to pay additional principal on our mortgage every month.
Over the next several months we will be sharing our biggest mistakes. We aren’t doing this because we want to beat ourselves up and relive the decisions we wish we could take back, but because we sincerely hope we can help someone else from making the same mistakes.
Neither of us was raised in a family where financial matters were discussed, let alone healthy financial attitudes and strategies encouraged. This is not to lay blame, but to set the stage that we have, for the most part, been figuring this out on our own. In most cases, we failed to seek — and when we did seek, we often did not find — wise counsel. We find ourselves reflecting on our past and say, what if? It is not helpful, but when we think about retirement, which is creeping up much faster than we would like to admit, it sometimes can’t be avoided.
If you’ve not already “been there and done that” allow us to present our own experiences as cautionary tales.
Autumn is my favorite time of year, and if you spend any time on social media, it seems many feel the same way. The sights, sounds, and smells of the season are a delight to the senses and the weather is perfection in my book.
This is the time of year when I feel at my best, and I appreciate being able to spend more time outside. I love having the windows open and being able to cook without worrying about running up the electric bill while the AC beats back the heat from the kitchen.
Without further ado, here are some of my favorite low cost fall activities:
We have finally reached the very last baby step. And if you personally have or will soon arrive at this step, congratulations! It takes an incredible amount of work and dedication to get here, and you deserve to sit back and enjoy this part of the ride.
Even if you’ve been investing 15% or more, have set aside enough to help your kids get through college debt free (we think they should pitch in; it’s good to have “skin in the game”), you still may not be in a position to give much more financially than you have been throughout the process, and that’s okay. While we think you should certainly give whatever you can, and hope that your ability to give financially continues to increase over time, there are so many other ways you can give that may have an even bigger impact on the lives of others.
In our last post, we discussed baby step #5 and mentioned how steps 4, 5 and 6 are to be worked on simultaneously. And, that it is our humble opinion, steps 4 (investing 15%) and 6 should take precedent over saving for your children’s college (step #5).
Now, on to the debate that every single personal finance blog has touched on at least once; do you pay off your home early or invest more money? Which one will be better, financially speaking, in the long run. There are a ridiculous number of variables to consider: Do you plan on staying in your home long term? What is the interest rate of your mortgage? How much is your home worth? How much principal do you have remaining to pay off? What return do you expect on your investments? How soon do you plan to retire? What do you anticipate the rate of inflation will be? It’s enough to make you dizzy.
Here we are at baby step #5, saving for your children’s college. As you likely know, Mr. Ramsey’s guidance is to work on steps 4, 5, and 6 at the same time. He does keep this step more vague then the others due to the differences in family circumstances, from those who do not have children to those who have a boat load, creating a much bigger challenge in saving for college for the entire brood.
Most of what we’ve read, heard, and watched from Dave himself about this part of the journey implies it’s a non-negotiable step if you have children. This is concerning, as everyone’s situation is different. To be fair, Chris Hogan, one of the “Ramsey Personalities”, has shared on more than one occasion that one size does not fit all and, furthermore, making sure you can afford to retire should take priority. Amen to that! Continue reading “Commentary on Step 5 – Saving for College”