“Get Real” Moments that Changed Our Financial Lives
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This article is part of the 2015 Financial Literacy Awareness Carnival hosted by The Heavy Purse. For more posts in the carnival, follow the link!
For most of us, saving money hasn’t always come easy. Even those of us who are born savers have stumbled along the way. Usually, it takes some education and a few massive money mistakes before we truly find our calling as extreme savers. There’s almost always an “ah-ha” moment (or seven) that forces us to get real about our financial situation. Our story is no different.
I have to admit, I’ve always been stingy, but saving money is something I had to learn. It wasn’t that I wanted to spend it all on stuff. Heck, I’ve probably only spent $1,000 on clothing over the last 20 years (for realsies). However, for years, I never really kept track of my money. As long as I had some in my checking account, I though I was fine. Boy, was I wrong.
“Get Real” Moment #1
When Holly and I first started dating, I was just another broke actor living in Chicago. I spent what I had on rent, groceries, and beer. By the end of each month, I had usually drained my accounts dry. Of course, that led to me putting a few groceries (and drinks) on my credit card to get me by. I’d pay the minimum payment every month, thinking I was doing a decent job handling my limited funds.
Of course, it didn’t take long before I built up some credit card debt. Not a lot, mind you. Just a couple of thousand dollars. Still, my girlfriend/new fiance didn’t like what she saw. If we were going to get married, it was time for me to “Get real, son.”
Holly helped me transfer all of my credit card debt to a 0% balance card with no balance transfer fees. Since we believe in combining finances when married, she helped me pay them off over a period of a few months. By the time we got married, my credit card debt was gone for good…and I haven’t carried a balance since. See, ladies! You really can change a man if you try!
“Get Real” Moment #2
Somewhere between 2010 and 2011, Holly and I were looking at our bank accounts. We had built up a savings of around $10,000 during the first year of our marriage, which we were pretty proud of. Yet, we never managed to save any more than that. We were making plenty of money, but – outside of our retirement plans – we couldn’t seem to sock away any more Benjamins.
So, we decided to start tracking our spending. What we found was both shocking and disturbing. We were spending more than a $1,000 a month on food…for (basically) two people!
It was time for us to get real. We began eating out less. We cut coupons. We shopped sales and ate meatless meals. Most importantly, we started budgeting our money…and it changed our life. In fact, it was so much fun watching all our savings pile up that we looked for more ways to cut our expenses! Eliminating everything from cable TV to movie nights, we cut our expenses down to the bare bones. We hurled all the extra money at our debts, and we became debt free in about a year.
Frankly, that “get real” moment set us on the course to get us where we are today. Learning how to budget motivated us to save. It encouraged us to find new ways to make money. And, it was the catalyst for the creation of this blog – something that has led us down drastically different career paths than where we thought we’d be 5 years ago. That moment changed our life. Although it was painful at times, what we learned from our experience has been utterly invaluable…and I wouldn’t change a thing.
What are some of the moments in your life that have caused you to “get real” about your money? Let us know in the comments below!
Our get real moment was more severe – job loss when we had recently maxed out on a mortgage. Our turn-around has been slower than yours, but it follows a similar path: budget to find the leaks in spending (food was one for us too), get rid of debt, start saving. It’s great to recognize the power we have to change our situation : )
Doesn’t it feel so go to know that you can control your own destiny? Too many people are so quick to give that power away. If you take responsibility and ownership of your situation, anything is possible.
“…it was so much fun watching all our savings pile up that we looked for more ways to cut our expenses!” I love how one money decision (to eat less) snowballs into another decisions and another and another. That’s how radical change happens. The motivation we receive from seeing things change builds that momentum for us to keep pushing ourselves.
I absolutely agree. Success tends to build more confidence…which breeds more success!
My get real moment was gradual. After l met my husband, he made me realize that l was eating out 3 meals a day! I had never really thought about it before. So much money down the drain. Eating in saved a ton, and it started from there.
Eating out has always been a big issue of mine. When I lived in Chicago, I used to eat out twice a day…usually. Of course, I could never figure out where all of my money went. At the time I didn’t care. Something about being a starving artist, I suppose.
Yep… we all have them. My first one was losing my job while mortgage rates were 18% p.a. (Australia during the late 80’s), it was nasty. I’ve had a whole different attitude to life and money since that time. I still have a tendency to learn lessons the hard way, though – so I’m sure there will be more lessons to learn before I’m done.
Life is no fun if you don’t take the hard way sometimes! I think mortgage rates were pretty nasty all over in the 80’s. I’m still not sure everybody has learned the lessons of 2008 though…
I love that a financially real moment for you was when you decided to get serious about Holly. I have a client who is the same way. He was definitely not financially real about his money but he wanted to propose to his girlfriend and I said that he needed to clean his act up fast because no woman wants to marry a guy who’s finances are a mess. And you both did it!
She deftly guided me to make the correct choices and decisions…pretty much like she does now. I’d be lost without her 🙂
My first moment was probably around 12-13 when I started to understand the concept that you could own parts of companies via the stock market. I had always seen my grandparents track the market, but around that age I started to ask questions. Shortly after that I made my first investment.
That is freakin’ sweet Brian! I wish I had been interested in money and business back in those days. Unfortunately, I didn’t start investing until much later. Fortunately, I was still pretty young and never got bogged down with some of the debt that a lot of my friends accumulated.
My get real moment is when I needed money to pay for my car loan and I did not have much money and had to borrow some from my parents. That was the most intense moment because I was ‘scolded’ by my mother.
A good scolding from mom always serves as a wake-up call! 🙂
We’ve had several get real moments as well, but one of the most recent was when my hubby had to turn down a job he really wanted in a place we really wanted to move to – all because of our debt. The job involves a decrease in pay, and we decided we just can’t do it while we still have student loan debt. That was a major letdown and a major wake up call! We are now in the most fierce debt pay down mode ever!!
Ugh! Debt sucks! Good for you guys to realize that it just wasn’t the right time for a job change. That takes a lot of discipline and maturity.
Good stories! Our’s came when our first child was born. Right away I could see that if we continued to spend the way we were we would never be able to do most of the things we dreamed about doing one day with our kids (like college, tropical vacations, etc). So we committed to stashing a small amount of money in our savings and raising that level year after year as our income grew.
It is amazing what a child can do for your perspective, isn’t it? Good for you on making the change!
haha “you really can change a man”. It’s true- I got my boyfriend to open a savings account and actually set his money aside instead of spending it all 🙂
Boom! Nice work Stefanie 🙂
I wish I could say tracking our spending made a big difference, but honestly it more so confirmed what we already knew. Our student loan payments (or I should say, the size of our student loan payments) are what really opened my eyes. It helped motivate me to work hard to offset those monthly payments – and I continue to do whatever I can to increase my income.
You’re a hustler DC! Keep at it my friend.
St. Thomas, was it? I thought long and hard about going there…and my wallet is glad I didn’t!
My get real moment was when I realized I was in debt because of low self-esteem and depression. I got the help I needed and took the time to organize my finances so that I could start moving forward financially. I knew that if I stayed in debt, I was never going to be able to retire early or be happy over the long term.
Good for you Jon! I’m sure it takes a lot of courage to be able to see that in yourself, admit it, and then do something about it. Well done!
Our “get real” moment was the moment we realized we were WAY over our heads in debt. We might be slow learners, but we get there eventually. 🙂
Sometimes learning the hard way is the best way to learn 😉
Good thing you got Holly to set you straight and told you to “get real son.” We don’t have a hardcore budget like you guys do but we did realize that we probably should have more savings than we did and that we couldn’t just chalk up the lack of savings to too much expenses. When we added up our expenses, we realized that there was more savings possible.
Tracking expenses is a great thing to do. (Try combining it with a budget and see how its power multiplies 😉 )
ha ha I’ve never even met Holly but could imagine that conversation! I think overall though you both have been very money smart from the get-go.
🙂 I think I’ve been juuuuusssst smart enough not to do anything too stupid!
We used to think that if we had X dollars in savings that we could spend whatever we wanted because only people who were good with money could have savings right? Savings does no good if you also owe thousands in credit card debt! Wish I’d had Holly to straighten me out years ago!
Ha! I’ll loan her out to you if you ever need her Kim 😉
Seriously though, we pretty much thought the same thing. We were paying all of our bills. We had some savings, more than a lot of people our age. We had rentals. We thought we were doing well. Luckily, we finally realized that we weren’t doing ourselves any good by not growing our savings and continuing to accrue debt.
Tracking your expenses for the first time is often shocking since you have literally no idea where your money is going. After the shock wore off for me I started to commit to a budget and never looked back.
Good for you! It can be a truly eye-opening experience. Once we saw where we were at, it really set us straight. While it was difficult to confront, doing so changed our lives for the better!
Love this post! We used to spend way too much money on food, even when we were barely making any money. It’s a habit that we are just not beginning to change and I’m loving it now.
Man, we were spending waaaaay too much on food. It’s amazing how much money you can find when you aren’t giving it all to the restaurants…and the cable guy…and Sallie Mae…
Great stories here! Personally, I had to get real about money when I graduated with $206k in student loan debt. It was horrible when I realized I needed to pay $2k / month just on student loan debt. But through learning about money and my blog, I’m down to $135k in just three short years. Certainly this would not be the case if I hadn’t taken ownership in my debt.
Good for you Natalie! Keep at it.
I don’t have any idea what I would have done if I had that much student debt. My chest is getting tight just thinking about it. Way to get after it girl!
I also got financially real when I started dating my now fiancee. It’s funny how we get serious real fast when we meet a good woman.
Cheers to good women!
My get real moment was with my future wife, early on in our relationship. I was spending all this money trying to impress her, and she finally told me it wasn’t impressing her: it made me look like an idiot. 🙂
Like you said, a good woman can help bring about change.
That, my friend, is the most brilliant thing I’ve read all day 🙂
I love that Holly helped you get real, Greg! I did not know that you were actor, although I can absolutely see you on stage! Helping people see how budget can actually mean freedom versus restriction is one of my favorite things to do. So many people feel out of control and don’t realize that it is a budget that will help them. Thanks to both you and Holly for participating in the carnival and your continued support. I truly appreciate it!
Thanks for asking us to participate Shannon!
I think you are right about budgeting. Far too many people see it as a restriction. However, until you are in control of your money, it is truly controlling you. Once you learn how to save and budget, you have the opportunity to do far more things than you ever realized were possible…and you can do them without being stressed about where your rent money is going to come from.
I had a similar a-ha moment with my investments recently. I’d been investing for a little while, but not really tracking progress. Similar to what you’re talking about with budgeting/saving. If we don’t track how things are growing, how can we see our progressive and improve upon our methods?
And props to using a BT! It irks me to no end when people are too terrified of them.
Right on! In addition to just knowing where you are at, tracking also helps to keep you motivated. When you never see any progress, it is so easy to give up.
One of my first get real moments happened when I read the total money makeover. IT was simple but effective advice from a book. IT changed my behaviors for the better. Good stories and this get real idea can become a series of ongoing posts.
Great book. I listened to the show for years before I read the book, and it has obviously had an impact on me too 🙂
I’ve had plenty of get-real moments. A few of the more profound ones: Getting a divorce and racking up major credit card debt (instead of “manageable” credit card debt) because I refused to live differently on one income versus two. Subsequently, I couldn’t keep caught up and everything started snowballing into collections. Later, with my credit was in the toilet, I had two consecutive horror-story landlords who motivated me to get my credit in order once and for all so I could buy a house.
Ouch. Sorry about your situation. Sounds like you’ve had learn a few things the hard way. Glad to hear that you got yourself back on your feet.
Our get real moment was when we decided to pursue financial independence. We’d always been frugal, but we realized we’d need to kick it into extreme frugality mode in order to accelerate our early retirement goal. Food was a big spending area for us too–we were able to slash that down to less than $330/month for the two of us, which made a huge difference in the monthly bottom line!
Most recently was our decision for Mrs. E to be a stay at home mom to care for junior. We\’re still adjusting to the baby and the change, but luckily our finances were already in good order so we have the breathing room to recalculate our budget in phases.
The most surprising thing to me is that we\’re still able to save and invest on one income.
When I first got a job I could do around my disability, I think I got a little lax with spending. It took a couple months to realize that, despite all that new income, we didn’t have any savings to speak of.
But I’ve always been frugal-minded (if not always able to follow through perfectly). So I think the “get real” moment was from Tim. He had grown up in an area where everyone was always just getting by. So the mindset becomes “We’ll never have enough, so we might as well enjoy what we have.” When we met, he was getting his paycheck and buying two boxes of Magic cards (roughly $240).
I put us on a plan to get rid of his student loan debt, and after a few months he saw that it really was possible to get out from under it. It gave him hope, which kept us going.
Hello,
it seems that you have a good impact on each others life! keep up the good work.
My first need to budget came when I quit my job to go back to school. I had a budget for the 12 months of studies, and I needed to pay attention.
My second real moment was after the buy of an appartment. There were some months where the salary did not cover all regular expenses.
Both were good lessons for my future life