First Year Finances
Carefully Planning and Growing
Continued (page 2 of 3)
Wait, there's more:
Then there were student loans. Negotiations also took place about these. "I wanted to use our house down payment fund to wipe out our student loans and start fresh, but that made him uncomfortable, so we haven't done it... yet," says Elisa. "Sometimes it's hard to realize someone gets to have a say in a final decision." What was their final decision? "At first, I wanted to pay off the car since student loan interest is tax-deductible," says Patrick. "Ultimately, we sold the car and put the money toward student loans."
The couple also found a balance in their financial lives. "We came up with a budget plan," says Elisa. "It's a little Dave Ramsey, a little random money blogs and a little of just what works for us." Monthly, they pay bills together. Elisa's in charge of the day-to-day tracking of their major accounts (they've had joint accounts since their engagement), and Patrick tracks weekly expenses and cash purchases. "I manage the budget sheets; he does our QuickBooks," Elisa says. "I would say I spend more everyday time on it than he does, but he deals with more of the annoying little stuff."
The yin and yang of their financial differences also seem to be working for them. "If it weren't for him, I'd be on ramen noodles until we paid off those student loans," says Elisa. Patrick says this isn't an exaggeration. "She's definitely willing to live poorer than I am. I hate having debt, but I won't eat off the dollar menu to get rid of it."
Retirement funds rank high among the couple's financial goals. That being said, Elisa admits this precedence is on a bit of a hiatus. "Before we started really trying to pay off all our debt, I was putting 5 to 10% of my income in a Roth 401(k) plus fully funding my Roth IRA. Since we're both big believers in funding our own retirement, it's our first priority after the debt is paid off and our emergency fund is fully funded."
Down the road, they plan on working with a financial adviser. For now, Patrick uses his accounting skills when it comes to tax issues. His job also gives him access to professionals when advice is needed.
Working together on their finances, the couple has grown. "In the past, I was just saving for myself and my goals, and if I didn't hit my targets,no one else suffered," says Elisa. "Now I feel more responsible for the future of someone else." Patrick says he feels more pressure to be sensible. "I want to contribute to our goals as much as possible, especially with my income being so erratic. It's made me realize that the latest gadget isn't so important."
Through this growth, the couple says their lives have become enriched. "When I look at how much progress we've made in the last year, I definitely feel richer," says Elisa. "Yet we're still keeping our expenses as low as possible, so sometimes poorer." Patrick echoes his wife's sentiments" "Financially, we've come so far and have more in savings than we do in debt, which makes me breathe a lot easier."