We've never relied heavily on debt, but we still never thought we could actually be financially fit, let alone debt-free. It always seemed like something other people were able to do, but not us.
You know what else? Becoming debt-free has created other unexpected side effects. Here are a few:
1. My husband and I both work on our finances together.
I’m still the budget maker and bill payer in the family, but since we make the decisions on how the money is allotted, we have to take the time to communicate, come to an agreement, and project our monthly financial plans. We’re more unified in our marriage than we’ve ever been.
2. We eat healthier.
This has never been a major issue since I prefer cooking from scratch, but because fresh ingredients are cheaper (in the long run) than boxed food, we eat well. And we eat frugally!
3. We have less stuff.
Because every dollar is accounted for in our zero-based budget, we know whether we have the funds to buy that random coffee cup or candle. More often than not, we don’t even want that kind of cluttered stuff because of our financial goals, which are more important than those cute dessert plates at Target. Every cent counts.
4. Because we have less stuff, our home is easier to clean.
The small amount of storage space (in our one closet) is mostly well-organized, we know where things are, and surfaces are basically empty. This makes cleaning much quicker.
And because we have less stuff, our home feels calmer. It’s a simple place without much clutter, so it’s usually peaceful.
5. We talk about money with our daughter.
Sure, she’s only three, but she can understand basic concepts. She’ll be aware of our family’s financial goals because we’re okay with talking out loud about money with her. It’s not a taboo topic, because money’s not scary or off-limits.
6. We’re actually aware of where we are financially.
We know our net worth. We know exactly how much we’ll have set aside for Christmas this year. That’s a great feeling.
7. We have goals – actual financial goals – and they’re reachable.
It might take a while, but I don’t doubt we’ll have 6 months of expenses in savings, at least a 20% down payment for a house, and plenty for retirement when the time comes. Knowing that they are possible breeds excitement about the future and contentment in the present.
8. We have some money to spend on whatever we want, guilt-free.
In our monthly budget we’ve allotted a small amount for each of us to spend on anything at any time. Passing by a Starbucks and craving a latte? If I have personal money left still in the month’s budget, I can buy one without feeling like I’m blowing cash on stuff I should be using for the electric bill. It’s in the budget.
9. I know more financial stuff.
Before all this, Roth IRAs, escrow, index funds, ESAs and 529s, and even sinking funds were really confusing. But I get it now because I've taken the time to learn. Even better, I actually enjoy strengthening my financial smarts. I feel in control because I get it.