Let me start off this post by saying thank you for saving our lives.
2019 was a huge year for my wife and I and we could not have done it without the guidance of r/personalfinance. As a Christmas present to ourselves we paid off the last of our high interest debt and are looking forward to continuing to build wealth in 2020 and beyond. Up until a year ago we never made much and spent the majority of what we earned (although I always tried to save something for retirement). Thankfully I received a promotion near the end of 2018 but that did not stop the bleeding as our debt soared. I never would have imagined we would be one of the horror stories you read about making 90k+/year and still living paycheck to paycheck with over $25,0000 in debt. Proof you can be broke at any income level. We finally got on a budget at the end of 2018 and stuck with it throughout the year. We both turned 30 this year and really turned our lives around. Sharing our budget in hopes that it can inspire others who are in a similar situation. We are not entirely debt free but there is light at the end of the tunnel. After spending pretty much all of our 20's with various amounts of revolving high interest debt and no savings here is a look at where we currently stand:
Checking (one month of expenses + retirement contributions)
$4,000
Savings (two months of expenses - retirement contributions)
$6,000
Retirement (401k/Roth IRAs combined)
$75,000
Pre-tax 401k contributions (7% + 3% match)
$500
Monthly net income
$5,000
Monthly expenses
$4,000
Auto insurance: $105
Auto payment: $210 ($8,000 left at 4%)
Gas: $60
Internet: $50
Mobile phone: $60
Utilities: $40
Entertainment: $350
Roth IRA: $1,000
Groceries: $400
Gym: $10
Rent insurance: $15
Rent: $1,300
Misc expenses: $350
Dog food: $50
Monthly savings
$1,000
No plans for kids and we are content with renting for now. Our lease just renewed through May 2021. Immediate goals are going to be doubling our savings from three to six months and then building out separate buckets for travel, heath care and car maintenance through next year (everything that put us into debt in the first place). After that long term (2021+) we are going to look at beefing up retirement or starting to save for a down payment. Moving up the ranks from r/poveryfinance to r/personalfinance onto r/financialindependence. It feels good to finally start moving up in life and we owe it all to the wonderful community here. Happy holidays and happy new year!
Submitted December 27, 2019 at 06:23PM by 2020pfbudget https://ift.tt/2t8i5nM
