Debt Paydown, Tracking Expenses,&Financial Independence|Rebecca from My Fat Purse - a podcast by Cody of Fly to FI and Justin aka Saving Sherpa
from 2020-02-18T08:00:32
Today's episode features Rebecca from My Fat Purse.
She breaks down how she and her husband paid down his $180k student loan debt in just 2 years.Rebecca and her husband gave up pensions from the military and are poised to hit FI in 5 years.
She talks about how powerful tracking their spending and avoiding lifestyle inflation was to this journey.Listen, learn, and let us know what you think.
Episode SummaryRebecca's background
She started taking her finances seriously after marriageRebecca's husband came into the marriage with $180k of debt
They paid that debt off in 2 yearsRebecca graduated without any student loan debt thanks to the military
She studied mathematics for her bachelorsThen she got paid by the Air Force to get her masters
Paying Down $180k DebtRebecca attributes tracking expenses as the most powerful force to paying off debt
They put all of one salary completely towards debtShe also calls out how important it was to avoid lifestyle inflation
That refers to slowly spending more money over timeRebecca's husband was also in the Air Force
He was supposed to be on scholarship but ended up losing on itShe covers that tough decision on giving up a pension and chasing FI
Life After the MilitaryHer husband took a slight hit in income and she saw a raise
Rebecca stuck with working for the military as a contractorHer husband decided to completely change up his job
They now have control over where they live but decided to stay in ColoradoThis was mostly due to her husband's job and ease for her to find a good job
Path to FIThey have purchased two homes
One is their primary residenceThe other was for renting out on Air BnB
That experiment didn't turn out well so they sold it
Outside of their primary residence, they keep it simple with a three-fund portfolioRebecca feels they are five years away from financial independence
Next Rebecca walks through why and how they combined financesThey do keep separate accounts for some flexible spending
Budget TrackingRebecca really emphasized tracking spending and how she does it
She started with MintRecently she transitioned to an app called EveryDollar
She also has built a very robust tracker you can download
Key TakeawaysTrue Partnerships: Rebecca didn't put all the debt payoff on her husband, she knew that their goals were tied together and decided to help
Tracking not budgeting: People often think you have to set limits on yourself when in reality, simply knowing where your money goes is the first stepNot all real estate is gold: Just a nice reminder that while real estate is extremely powerful, it's not foolproof as Rebecca found out
Call to ActionTake some time and completely track your expenses for 1-3 months even if you've done so in the past. This can help make sure you fully understand where all your money is headed.
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