Chapter 1: Where are we now?
It is now time to set the scene for our epic journey. It begins in the same place as many other “average American” households, and where it will end remains to be seen.
As of January 1, 2016 Alyssa and I (Ryan) had a grand total of $101,597.83 in debt between student loans, credit cards, and my car loan. We both had good jobs and were working to build retirement savings and pay down debt whenever possible, but we never really set up a budget. We made a few major life changes in 2016, namely deciding to move to Colorado by the end of the year (and doing it!) and me becoming a CPA. Our household gross income was around $95,000 for the year since we both left our jobs when we moved states on November 15th and didn’t begin our new jobs until January, 2017. Having a month with no work in a new state was great for getting acclimated to our new environment, but terrible for our finances. We woke up on Christmas morning with a serious financial hangover. It was at that moment Just Another Dollar was born; we decided that in order to really change our lives we needed some help, and an Internet full of accountability partners seemed like the perfect solution.
And now to our debt situation in 2016.. Alyssa was the rockstar of our family throughout the year and managed to reduce her Student Loan balance by almost $12,000 in addition to putting $7,000 into retirement! I was very “average” by comparison and only made minimum payments for the majority of the year. The process of me becoming a CPA cost us around $3,000 (review course, exam fees, & licensing costs) and a lot of time, effort, and stress on our relationship over the course of 8 months, but we emerged from it in September more committed to each other than ever before. In October, Alyssa sent her old, broken-down car down the road and borrowed $14,000 to purchase a reliable newer (used) SUV with the intention of keeping it and maintaining it for the long term. Moving states in November also commanded a ton of financial resources, and between piling up cash for our eight weeks of unemployment and paying rental deposits and first/last month’s rent we ended up with a $7,000 higher credit card balance. At the end of 2016, we had actually increased our Total Debt balance by $6,000 to our highest amount ever. $107,614.32 — OUCH!
We are starting fresh in 2017. We will be living on a budget, making responsible decisions, and focusing on our number one goal (to be Debt Free). Coming soon, you’ll see posts from us on our budgeting plan (including frequent accountability check-ins), specific goals for debt repayment (and how we’ll achieve them), and what we dream of doing with the rest of our lives. While our household income in Colorado will be considerably less to start ($85,000) than what we left in Minnesota ($105,000) we hope to be back over $100k by the end of 2017. It will be critical for us to work on our behavior changes while our income is reduced so that as our disposable income rises, our spending habits stay in check and our progress improves.
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