Actions taken so far

Although I just started blogging about my family’s journey to financial freedom, I have been taking actions toward this goal for the past few years.  Below are some of the steps my wife and I have taken to get to where we are at this point on our journey.  While we’re happy with the progress we’ve made so far, we have a long ways to go to reach the tipping point, but the progress we’ve made so far gives us confidence we can get there in time.

  • Paid off my student loans – I graduated from business school with my MBA in 2006, and at one point, had over $110,000 in student loans to my name.  I paid the last of these off in 2014.  It was a happy day to know I know I no longer owed that money, and it freed up my cash flow by a little over $300 per month.  I was greatly inspired by No More Harvard Debt, and while it took me a bit longer than it took Joe (the site’s founder) to pay off the debt, I did accomplish the goal.  My wife graduated with her MBA 1 year after me, and has already paid off her student loans, as well.
  • Paid off two cars – my wife and I now have to cars that are completely paid off.  We each moved out of New York City a few years back, and when we did, we bought new cars and settled into new lives in different parts of the country.  Now that we have a growing family, we may be buying a larger car or an SUV in the future, but we plan to pay cash for any new vehicle, and not to have a car payment again in the future.  For me, with a 4-year car loan, paying off my car increased my cash flow by over $600 per month.
  • Cut the cord on our cable – I held onto cable for longer than I probably should have, in large part because I love sports, and watching football on Saturdays and Sundays in the fall is one of the more enjoyable activities for me.  However, since we have a growing family, I have less time to watch sports, and it’s more enjoyable and rewarding spend time with my family anyways.  I just made this change recently, as I am currently living apart from my wife, but this change has increased my cash flow by approx. $100 per month (Internet is $55/month, Netflix is $10/month, and my previous bundle package was $165/month).
  • Got a roommate – this is the biggest recent change, and has proven very rewarding financially.  My wife and child are currently living in a different city from me, and I travel pretty much every weekend to see them, so it just seemed wasteful to be paying for two bedroom apartment in the Bay Area, while using only about 1/2 the space approximately 2/3 of the time (5 out of 7 days), so I put an ad in Craigslist and found a gentleman with a similar family situation to mine.  He works for Apple.  He works long hours, and his family is currently residing in Southern California, so he is gone most weekends, as well.  This has worked out very well, as I have made a new friend and the money I receive each month to help with the rent has subsidized my plane tickets to visit my family.  My roommate moved into the apartment only a few few weeks after my wife and daughter moved out, so the overall impact to cash flow has been small.  I receive slightly less than $1,400 per month to help with the rent, but spend approximately the same amount on flights and parking during the same time frame.  While I don’t necessarily enjoy being a male in my forties living with another man, this situation has worked out better than I anticipated, and I don’t feel as wasteful as I otherwise may have felt if I had not taken this step.  It’s obviously nice to have some help to pay rent to boost the savings rate, as well.
  • Small steps toward frugality – I have also taken a bunch of smaller steps to help save money.  These are minor steps, but I think the end result of many steps together will move the family toward financial independence sooner. I bring part of my lunch to work each day (grabbing lunch in the office cafeteria with my co-workers has proven to be a good break, and has enabled me to socialize and unwind during a given day, so I’m reluctant to bring my whole lunch), cutting down on my Starbucks trips (I still have coffee, but generally buy a larger container of Starbucks iced coffee for about $5, and just bring a cup to work each day, the larger container lasts about 1 week for me), cooking more at home, checking out more books and books on CD from the local library.

So, there you have a it; a summary of the main actions we’ve taken up to this point to help push us toward the tipping point.  I will be posting passive income received and savings rates each month starting in June, but thought it was important to document some of the steps we’ve taken to date on our journey to financial freedom.

How about you?  Have any readers made some similar, or different steps on the journey to freedom?

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