In 2003, my girlfriend (now wife) and I graduated from university with nearly $50,000 in debt. This debt was a combination of my wife’s $30,000 in student loans and her $20,000 new car loan. Since I learned fundamental saving habits at a very young age, I managed to graduate university debt-free with $10,000 in savings. Combined, however, we were $40,000 in the red (not including a new mortgage).
Over the past five years, our financial picture has changed drastically. Not only have we dug ourselves out of the hole, but we’ve grown our combined net worth to over $285,000.
How did we do it? We didn’t strike it rich in real estate, we didn’t luck into some crazy stock tip, and we don’t even have extremely high paying jobs (we started at $85,000 gross combined). Instead, we systematically controlled our spending so that our expenses were well below our income. We then took the savings and aggressively paid down our debts while at the same time investing for our retirement.
Here’s how we did it …
(via getrichslowly/guest post by ‘million dollar journey’)
I like this article because it reminds me of how a family of 4 or 5 can live on the the $2k income of one working father, while a single person earning $4k might have trouble making ends meet.
Often, it’s not about how much you make, but about how you handle your money.
I started freelancing in May 2007, and on the average, I’m making more than I used to at my full-time job. Thus I have been trying to save more by not increasing my expenditures. On top of that, I’ve cut down on the nasty habit of taking taxis everywhere!
It’s not an easy journey, but like the authors of the article did, I too am working towards saving for a property which I can rent out, and make it work for me! Having a goal always helps!