Has it been over a year since I last blogged!?! We’ve been in the trenches, grinding out baby step 3.
A summary of 2015:
Chasing a toddler around while trying to survive the Texas heat, while pregnant. That’s right! We added on! In August we met our second little boy.
And seriously – paying medical bills, being pregnant, keeping the toddler alive, meeting the new baby, dipping in and out of the emergency fund because of slow work & medical expenses sums up all of 2015.
SO…. I picked the blog back up as things start to settle down.
AND because we have a new update!!!
Quick summary from when we started this journey in January of 2012 until now (4 years):
*Paid off 46K in debt in 22 months (Read our “by the numbers” posts starting in January 2012 to see how we did that.)
*Paid for items without going into more debt: A minivan, foundation repair, new hot water heater, a couple of mattresses, a washer, as well as a garage renovation
*We welcomed 2 children into the family (which resulted in maxing out our deductibles 2 of the last 4 years. 6K and 12K!)
*Experienced 1 layoff – and from that point on have only had one income
*Experienced a couple of slow work cycles
This last year (2015), similar to when we were paying off debt in 2013 and our first son was born, we were really cautious. We also had to pre-pay my OB early in the year. After the deductibles were reached, and we got our pre-pay money back, we were able to put a little bit more toward the emergency fund. My husband had a couple of large projects come up in the fall, right as we were calculating medical expenses.
Overall, we ended 2015 being a little discouraged. In rough estimates, 2015 resulted in 25% drop in income.
One super positive note from this stat is our extreme gratitude that God continues to provide for our needs. We have the four walls (food, transportation, shelter/utilities, clothing) covered no problem. We are so thankful for starting this journey 4 years ago, it gave us the tools and skills to keep a close eye on every dollar in, every dollar out. A 25% drop in income is very likely to cause disaster. For us, it did not.
The year ended and we were relieved to see it and it’s expenses go away.
And then, something unexpected happened.
January 2016. A couple of big, outstanding checks arrived. We never know when checks will come in – and honestly, we almost have to live as if they won’t. Having a client owe money is very different, and less secure, than having your employer owe you a paycheck.
When the checks arrived, we were amazed. It was what we needed to FINISH OUR 6 MONTH EMERGENCY FUND.
That’s right— we are FINALLY DONE with baby step 3!
*Phew* big sigh of relief.
We can now move on. It’s possible we will have to dip into the fund again, and finish it, and use it, finish it, etc. – but we are choosing to mentally move on. We won’t abandon the fund and be without a safety net, but we also need to start focusing on some other items.
Our specific plan is a little in the air. It will be some type of step forward, perhaps baby step 3b, or baby step 4 (or a combination of the two).
Baby step 3B is a down payment. We would like a slightly different living situation. While we do “own” our home, the equity if sold today, will not be enough for a 20% down payment for the type of home we are looking for in our area.
Baby step 4 is investing 15% of income to retirement, making use of all tax-free options as best as possible. We have invested in the past, and have made small contributions in the last 4 years, but we would like to get that up and rolling to the full 15%.
And with that – while we are not done with the baby steps – I’m probably done blogging about our baby steps journey. The first three steps are the hardest, but they are also the most measurable. For more info on the baby steps – and to see how you can get started, visit Dave Ramsey’s website.