Counting pennies till they become Gold


Studies show that money is the one issue that can cause the most issues for a couple. There are also articles galore on big money mistakes singles, college students, young adults, young parents, middle aged folks, and your grandparents make with their money. (SO MANY ARTICLES!) However they (who precisely this “they” is I have no idea, but I am starting to suspect it’s something akin to the Matrix) say that if you communicate and have agreeable goals and plans that this issue can be resolved long before it becomes an issue.

In that sense Alex and I have been very lucky and understanding about our short term goals and our long term goals. When we first met it was to get our financial feet together. As we got closer to marriage it was to merge our finances and then start saving for a house. Now that we have a house we decided to purchase furniture. So our next step is to pay off the purchases we’ve already made while maintaining a certain dollar limit in both our savings and checking accounts as a “rainy day fund.” To that extent, Alex leaves me in charge. It’s a wonderful thing and I realize how much he is entrusting me with in the sense that he believes that I have our best interests at heart and won’t actually take all the money and run off to some faraway tropical island with a rum drink in my hand. (Why no I haven’t thought of that plan at all, why do you ask??)

So the other day I sat down and looked at what we were doing with our money. In the past we’ve followed the “avalanche” method of paying off debt by socking EVERY SINGLE DIME towards one debt while paying minimum on everything else, then snowballing that money to the next debt and so on. Much like an avalanche. (clever with the names, aren’t these financial whiz people?) This time I decided to follow our prescribed method of treatment and then see how long it would take. After running the figures, cross checking my numbers, and holing myself up in a dark little room (just call me Mr. Cratchett) I discovered that by simply taking our monthly funds that we normally push towards savings and applying it to Debt 1 plus the extra we always pay above and beyond the minimum towards Debt 2 and 3. Then snowball, avalanche, throwing like a grenade the money at the next debt once Debt 1 is paid off, etc we would be able to pay off almost $6k in additional debt WHILE maintaining our current savings account in less than a year. Of all of the money we owe less than $1k has any interest rate applied to it. So I think we are doing pretty dang good. The only funny thing is as soon as I realized all of this I called Alex and told him we could afford a really nice vacation next year.

Ultimately however, our goal is to have a child. The money aspect has been the one thing that TERRIFIES me/us (mostly me…because I handle the money) about having any children. We know there is no such thing as being “ready,” but we’d like to be as financially healthy and prepared as one can get. To that end we decided to pay off our debt. Its exciting to realize that we can achieve this and if heaven forbid a flying car falls on our roof or our cats decide to live up to their demon-spawn names by eating every piece of trim in our house WE’LL BE OK.

Trust and financial well being really do make a marriage. (Of course so does a few minor things like friendship, compatibility, and love but let’s not focus on the small details.) So all of this makes me curious. What do YOU do to have a healthy financial life? OR perhaps money isn’t an issue you face (which if that is the case, please call me perhaps we could date?) what issues do you face as a couple that you both work on to preserve the healthfulness of your relationship?

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4 responses to “Counting pennies till they become Gold

  1. Finances are the are where we really, truly suck. No lie.

    Still, we have managed to produce, feed and clothe three children and I got to stay home with them for 11 years to do it.

    I don’t know that we’ll be able to put much towards their college though due to our financial mis-steps.

    If you want true terror, I wrote this last year:
    http://ourfrontdoor.squarespace.com/notepad/2009/7/16/30s-thursday-the-cost-of-the-well-rounded-child.html

    • Mindee – I actually read that awhile back and started doing the math for ourselves and about died. Monthly expenses equal our mortgage. Yet financially we must both work, I am sure when we get there it will all happen, but on this side of the fence I stand with my mouth agape at parents who manage to have a stay-at-home parent and wonder what lottery they are playing to do it all.

  2. Grandma Judy

    One whole year I bought nothing….absolutely nothing except gas and groceries. I paid utilities, rent, and car payment(paid a 5 yr loan off in 2 1/2 yrs).
    I really got ahead fast… enough to buy this condo which I’ve paid off in 10 yrs instead of 15.
    Now no debt except whatever I charge to go on a trip which I pay off monthly.
    Yes, there is just one of me, but I had some HEAVY debt for awhile. By not spending, I paid it off as quickly as possible. It’s so “free-ing” to not be in debt!
    Then you can buy what you want and pay it off each month.

    • We did the nothing thing to save for the house and pay for the honeymoon. We’re headed back into that direction again to pay for the stuff we did buy recently. I also love the feeling of “no debt”