This is a guest post from Jeff Rose. Jeff’s a Certified Financial Planner and the CEO and founder of Alliance Wealth Management, LLC; he blogs at Good Financial Cents and is working on his first book, Soldier of Finance.

Most people that know me think of me as being physically fit. Part of that is probably due to my military background, and I think the other reason people think of me as being physically fit is because they know I do a crazy workout program called CrossFit.

I’ve dead-lifted 515 pounds and I can back squat 335 pounds. I once did a workout nicknamed “Murph” that consisted of running a mile, completing 100 pull-ups, 200 push-ups, and 300 body-weight squats. In case that wasn’t enough, I followed up that workout with running another mile after that!

One of my friends often jokes and refers to me as “super fit.” A few years ago, we competed in the nine mile Urbanathlon race of Chicago, although prior to that I had never ran more than five miles in my life and only one time – the week prior to the race.

So while most people think of me as being physically fit, in the CrossFit community, I’m just about average. Actually, I just found out recently, that my fitness level compared to others within the CrossFit community is considered below average.

13,423 out of 25,000 male athletes

Each year, CrossFit has what they call their Open Sectionals, which allow CrossFitters from all over the country to compete in a five-week training program.

In this program, everyone does the same workout and we compete to see who can do it either the fastest or with the most weight.

You can go through the results online and see how you place, and if you try to find me in the top few places, you won’t see my name.

Actually, if you get to page 250 of 2500 pages, you still won’t see my name. Even though I’ve been an avid CrossFitter since 2005, there are so many other guys that literally kick my butt!

One of the toughest pills to swallow is when you complete a workout and you’ve given it everything that you’ve got. You give that workout a 110%, yet your score is only 50% of what the top guy did, sometimes less! Sometimes I get frustrated, but then I have to remind myself not to compare myself with others.

Comparing yourself to others can have some pretty horrible consequences, but not just in the CrossFit or fitness community.

Accept yourself, but make changes where it makes sense

As I said in the video above, a lot of people get caught up in comparing themselves to others when it comes to personal finance, too.

Have you heard of “keeping up with the Joneses”? This is a phrase that describes people who attempt to make their house as nice as the neighbors, or who try to buy all the same things that their friends and neighbors are buying. Don’t get caught up comparing yourself to others when it comes to your home, clothes, cars, the latest gadgets, and the latest iPad 3 that they just bought.

You have to make financial decisions based on your own situation, and not as a result of comparing yourself to others.

Just like in the CrossFit open workout, I’m silly to think that I should be close to the top spot. The athletes that are consistently placing in the top spots are training for that – day in and day out. They spend hours upon hours each and every day perfecting their skill, perfecting their craft, and that has put them at the top.

If you have a friend who has job or career that pays them well and allows them to have some of the finer things in life, you cannot get discouraged if your income doesn’t really allow for it.

You have to find a way to be fully content with what you have, at least for the time being.

If you have dreams and aspirations of owning a bigger house or driving something nicer, then invest in the time and invest in yourself first, so that you have the income to support those dreams.

Go back to school and get a different degree or a higher degree. Invest in some type of education program that gives you more knowledge and increases your likelihood to get a raise, or to find a job that will pay you more.

Or, find a side hustle that allows you to work on the side doing something that you love so that you can afford some of the things that you want. Don’t compromise your immediate situation by buying stuff on credit cards now, in an effort to keep up with the Joneses.

I think it’s always important to have a mentor in your life that can give you guidance, but the one thing that has always been helpful for me, especially for the mentors that are much more successful than me, is to realize that it took time, sweat, tears, and blood for these people to get where they are.

They didn’t win the mega-millions and become rich overnight. It took time and effort.

Instead of comparing yourself to others – start by looking at what you want to accomplish, and then find a mentor who can help you reach your own goals – regardless of what everyone else is doing.

*****

Baker’s Note:  Jeff’s an amazing guy to know.  If you loved his post, be sure to check out his personal finance blog at Good Financial Cents. 

*****

So is there an area of your life where you’re busy comparing yourself to someone else, either financially or otherwise?

Are you using that comparison to motivate you, or is it weighing you down?

Let us know!

Note: This is a post from Joan Otto, Man Vs. Debt community manager. Read more about Joan here.

Meet our automotive pride and joy – our fully-paid-for, 111,000-plus-miles, has-even-gone-offroading 2003 Ford Taurus SES.

This car is a beast. And, for the past six years (as of this past Sunday), it’s been put to the test – because it’s been our only vehicle.

In early 2004, I’d bought the Taurus for something like $13,000. When I got it, it was “almost new,” never having been titled and driven only as part of a fleet of cars leased to the dealership’s employees.

That car, by the way, marks THE biggest spur-of-the-moment purchase I’ve ever made; my mom was in the market for a new car, and I’d gone to the dealership with her to help her weigh the options.

She found a sage green 2003 Taurus that she loved… and when I test-drove it too, I realized how awesome it was when compared with the not-yet-paid-for-but-always-broken-down 1996 Dodge Stratus I’d been driving.

So I bought a matching one in red, rolling over my old car note and trading in the Stratus, which was in the running to need a LOT of work. Probably not the world’s sharpest financial decision, but at the time, as a single parent, I really needed and wanted a reliable vehicle.

Fast-forward a little; when we got married in May 2005, Chris had a two-door 1999 Ford Escort. He’d bought it several years earlier, and by the fall of 2005, we’d paid off that car loan and it was ours free and clear. The payments continued on the Taurus, to the tune of $250 a month.

With Sarah still in a booster seat, it was a LOT easier to take “my car” almost everywhere we went as a family. The Escort was used here and there… but not much.

Making the decision

In early 2006, the newspaper where Chris and I both worked full-time relocated its offices… to a half-mile from our home, through two blocks of residential neighborhood.

Suddenly, the infrequently-used Escort became the really infrequently-used Escort. At the same time, we started to get pretty serious about paying off our debt.

And we started asking ourselves: Could we be a one-car family?

We thought about all sorts of factors – positives and negatives. We were “side hustling” even back then, so there were places I, especially, needed to go besides the super-close newspaper office.

On the good side, we hadn’t merged our insurance policies quite yet, so this would help us simplify by dropping Chris’s auto insurance. And, of course, there was the bonus of a one-time influx of cash.

I do have to add one caveat here. My mother lives with us, and she has her car, the green 2003 Taurus I mentioned above. But Mom works and goes out with friends and to church and many other places, so her car is pretty much “busy.”

Very occasionally, I’ll take Mom’s car somewhere, or she’ll take ours, but in reality, we only have crossover when one car is in the shop, and then the three of us draw from the other car.

That said, knowing we had that backup became kind of a security blanket to help make the decision.

We also realized pretty quickly that even if we rented a spare car for the occasional times when we really needed it, that would cost FAR less than the maintenance, insurance and other costs that would come from us keeping Chris’s Escort.

So we sold the Escort for $2,300 on May 6, 2006, after placing an ad on Craigslist as well as in the newspaper classifieds. We asked well below Kelley Blue Book value in order to move quickly, and it paid off: We received dozens of calls, and the first “looker” became our in-cash buyer.

That money quickly went toward debt repayment, and within another year and a half (in the fall of 2007), we were enough ahead of the game to pay off the Taurus almost a year and a half early.

That baby is all ours.

Moving forward, we’ve committed to one big goal: We’ll never have a car payment again. We will drive this sucker into the ground, and whatever we can afford at that time – that’s what we’ll get as a replacement.

If that’s a $500 rustbucket, well, it’s lucky we pay for AAA. If that’s a $10,000 late-model used car, great. But either way, we will not take on a monthly payment for a vehicle.

The good parts

In six years of sharing a car with my husband, we’ve found an awful lot of pluses.

1. No car payments.

We have one car, fully paid off. If we’d kept the Escort, I’m not sure it’d still be drivable, and if we were committed to replacing it, we’d probably still have a payment on its successor.

2. Reduced insurance costs.

Since the Taurus is only titled in my name, Chris doesn’t even much “count” toward the insurance cost. We pay my mom’s car insurance as well, and for the three of us on both Tauruses, we pay $71.14 a month. Before, Chris paid that much alone, and Mom and I paid even more (through our former company!)

3. More consciousness about our driving habits.

You don’t tend to drive like a maniac in your vehicle when it’s the only one you have. (Or, at least, Chris and I don’t.) And since we know that errands aren’t just a “go whenever” proposition, we work harder to plan out our trips and avoid things like running to the store for just a few items.

4. More family time.

This wasn’t something that factored into our decision-making, but it’s turned out to be a great added benefit.

Chris and I spend a good amount of time driving each other places. “I’ll take you to tae kwon do, then go to the library, then pick you back up.” That sort of thing.

That gives us time to talk, and just to be in each other’s space. With two cars, we’d spend a lot of time doing the “you go your way, I’ll go mine” thing.

This goes for Sarah, too; she gets Mom and Dad time instead of being shuttled by just one of us.

5. We walk more often.

When I asked Chris what his thoughts were on why this setup works, his answer was simple: “It helps when you live within walking distance of a lot of places.”

Yes, we could walk with two cars. But we didn’t – and we probably wouldn’t. And the great thing is, we DO NOT live in a “city” by any means. We’re 100% suburbia.

Even so, there are grocery stores, convenience stores, parks, a tennis court, churches, our mechanic, a movie theater, restaurants, banks and more – all within an easy walk of less than a mile.

We’re considering changing banks – because ours is a mile away across a large highway, and we’d rather avoid it.

The less-good parts

Honestly, there aren’t too many things I don’t like about our one-car situation. That said, there are a few down-sides that are worth mentioning. Here’s Exhibit A:

1. I hate my driver’s side door panel.

It hasn’t stayed attached – despite repeated gluing attempts with every adhesive known to humankind – for about the past four years.

If you elbow it hard when you sit down, you’re usually good for about 30 miles, or until you open the door, but then it falls in again.

In the grand scheme of things, this ABSOLUTELY doesn’t matter, but along with the dents/dings/scratches/peeling paint etc., it does make me long for a nice, newish vehicle. (Even if I had to share it – newish would be nice.)

2. Maintenance issues.

This particular car has not been without needs in its first 111,000-some miles.

It’s not good on alternators (yes, plural). It’s soon going to need some transmission work, as you can tell when you try (and sometimes fail) to accelerate from a stop.

The water pump has been replaced. The suspension has been overhauled.

It’s not a money pit yet, but our biggest fear is that we’ll cross the “we shouldn’t put more work into this” bridge before we have the money saved up to buy a decent replacement.

3. Lack of hauling space.

If we had NO cars, and had decided to purchase only one for our family, we’d likely have chosen something with a little more room. The Taurus has pretty good trunk space, but it’s not good for moving even small pieces of furniture and what have you.

We’ve made it work pretty well, but it isn’t always the easiest.

4. Racking up the miles.

When we travel (and we do that a lot), all the miles go on one vehicle.

Now, that’s balanced out by our lack of commute – we average about 11,000 miles a year, which is REALLY low.

That said, we don’t have the option to, say, take the “better” car when we decide to road-trip to Vermont. It’s all Taurus, all the time.

Remember how I said we’ve gone off-roading in it? Yup, really. Dirt and not-even-dirt roads in upstate Pennsylvania are no match for this baby. (And it makes for a fun trip to the mechanic, because he starts off your inspection with the line “I have a really strange question to ask you… has this car recently been on a, well, an unimproved road?”)

So is it for you?

Look, I can definitely say that being a one-car family works for us – and barring any HUGE changes in our circumstances and goals in life, we plan to stay this way and probably even to drive LESS.

In a dream world, we’d keep beating this car up until Sarah, who’s 12 now, turns 17 and gets her permit. By that time, we’d be more than two years out from our final credit-card payment, and if we take even half the money we’re putting on the debt and save it for a vehicle in the interim, we’d be able to afford basically any later-model used vehicle we’d like. (That is, of course, dependent on this car making it five more years.) Then, Sarah could finish driving the Taurus into the ground, hopefully not literally.

We realize it’s not for everyone, though. We have friends who each commute an hour – in opposite directions – five days a week. It would be ridiculous to suggest they could become a one-vehicle family, at least not without a LOT of rearranging.

We’re lucky to live so close to all the places we need to go, especially because our town doesn’t really have a huge public-transit infrastructure. And we’re lucky – though I prefer to say blessed – that I can primarily work from home, which changes our situation drastically.

Finally, the biggest factor in making this work is that we want it to. We go out of our way to make it a success. I’ll ask friends for rides – in exchange for gas money, or in exchange for returning the favor at other times. We’ll rent a car when it makes sense, or rearrange our plans if that isn’t in the cards.

It would be pretty easy to say it “makes sense” for us to have another vehicle, but we don’t want one, and so we’ve built our lives accordingly.

I’m not asking you to sell your vehicle today. Far from it. But for many of us, transportation expenses are some of the highest we have, behind maybe only housing and food.

So I do challenge you to ask yourself this question: Is there anything you can do in the next month to save on transportation expenses? (Or anything you’ve already done?)

We’d love to hear your thoughts in the comments… and if you’re led to becoming a one-car or NO-car family, well, I can tell you from first-hand experience that it’s pretty cool!

Note: This is a guest post from Jen Gresham. A Ph.D. scientist turned writer and entrepreneur, Jen inspires people to find the clarity and courage they need to design a fulfilling career at her blog Everyday Bright. She is also the founder of the No Regrets Career Academy and The Bright Entrepreneur’s Club. Read more about Jen here.

I told myself I couldn’t afford to quit.

On the outside, everything looked normal. I was engaged in my work, did it dutifully, and casually chatted with co-workers in the hallways.

But on the inside, things weren’t right at all. My muscles tensed as soon as I walked in the office. I felt drained before I’d even sat down at my desk.

When my request for a transfer to another division was denied, I became depressed. I’d cry into my husband’s chest at night, saying “I can’t keep doing this.”

It took two miscarriages in the space of 12 months before I got serious about calculating the cost of change.

What’s your unhappiness costing you?

My normal coping strategy for stress is to eat.

But when my job stress became a daily shadow, food wasn’t just an escape, it was my lifeline. It not only got me out of the office, but the pleasure that came with a cup of tea or a toasted bagel smeared with cream cheese was a boost I felt I needed and deserved.

But it’s amazing how quickly these “pick-me-ups” can add up. Take a look at my eating expenses:

• Bagel and tea at local cafe: $4
• Mid-morning snack: $1
• Lunch (out): $10
• Mid-afternoon snack: $1

That doesn’t seem like a lot of money, does it?

But when you multiply it by the number of days worked (roughly 250 days a year), you get $4,000. Of course, you need to subtract the amount you’d pay for eating breakfast at home and packing lunches and snacks. Assuming you can do that for roughly $5/day, the cost of my stress was $2,750 a year.

That’s a fair chunk of change.

But it’s just the tip of the cupcake.

When I took a closer look at where my money was going, it became clear that a lot of my expenses were pick-me-ups in disguise. Most of them were small: clothes, a box of pretty notecards, a nice dinner out, some apps for my phone, new songs, another dinner out.

You see where I’m going with this? I spent about $2,000 a month on these kinds of expenses, hoping they could fill a hole inside me. (Spoiler alert: They can’t.)

What holds many back is the fear that doing what they love will involve a pay cut, and emotionally, they just can’t deal with it.

Notice I said “emotionally.” The inability to take a pay cut often isn’t logical or based on facts.

I’m not saying you should live in complete austerity. But when you add up all the “necessities” that come with an uncomfortable career, it’s easy to get a wacky sense of your salary requirements without even realizing it.

Simply by pursuing work that didn’t require all those pick-me-ups, I discovered I could easily save more than $20K a year. Your number may be more or less than that amount, but most of the clients I work with find they can save much more than they originally suspected.

Exercise 1: Study your bank and credit card statements over several months. Ask yourself, “Did I buy this because I needed it or because I felt I deserved it in exchange for the trials of my job?” Compute your annual unhappiness cost.

What’s your happiness worth?

It cracks me up.

The diamond industry has convinced people that unless you spend the equivalent of one month’s salary on your beloved’s engagement ring, you’re somehow selling the relationship short. And because the ring represents status as much as it does bliss, people go to great lengths to spend as much as possible on that small piece of jewelry.

Don’t even get me started on the cost of the wedding itself.

Assuming someone spends 45 hours a week working and commuting, that means 40% or more of their waking hours are spent at work. Apart from their education, most never invest another dime in creating a career they love.

It’s not that they’re not willing.

Imagine yourself in a unique auction, one that offered the winner work that energized you instead of draining you, that inspired you to fully express your potential. You’d be proud to tell others what you did. You’d feel like you were making a positive impact in a way that mattered to you.

And imagine this work came with a 100% happiness guarantee for one year.

How much would you be willing to pay?

This isn’t a theoretical exercise. See in your mind’s eye the bidding, the flurry of hands, the rising tension in the room. Are you going to let this opportunity slip away?

Exercise 2: Jot down a figure you’d be willing to pay if you knew, for certain, you could buy a job that was deeply fulfilling for at least one year.

Budgeting for (and believing in) a better life

Believe it or not, the easy part is the budgeting.

First, combine the estimated yearly cost of your despair (your answer from Exercise 1) with the amount you’d be willing to pay for one year’s worth of a fulfilling career (your answer from Exercise 2). Subtract that sum from your current income.

This number now represents your minimum annual salary.

A couple of things to keep in mind:

1. Until you know what career or job would actually provide that sense of fulfillment, this number is generally meaningless, other than to reassure you that you need to earn less than you think. Many of us can, in fact, afford a pay cut.
2. Remember, you don’t have to keep your minimum annual salary forever. Presumably you’ll progress faster and make more doing something you’re fully engaged in and passionate about.

You may not be able to afford this minimum salary today. You may have student loans, credit card debts, or an underwater mortgage that require your immediate financial attention.

But don’t use your finances as an excuse for staying in a soul-crushing career forever.

The biggest hurdle between you and your dream job isn’t your bank account.

It’s that you’ve stopped believing in yourself.

When you give the cynic inside you the microphone, everything’s impossible. You gloss over your successes and focus on your failures. You tell yourself they call it work for a reason, then convince yourself your dreams are out of reach.

The voice in your head convinces you that you deserve a donut or a new pair of shoes, but not meaningful work. That’s for someone else. Someone better.

The Dalai Lama said:

It is very wrong for people to feel deeply sad when they lose some money, yet when they waste the precious moments of their lives, they do not have the slightest feeling of repentance.

That’s not a call to be reckless. Absolutely take the time to make your budget. Design a plan to get you there.

But whatever you do, don’t tell yourself it’s OK to waste one more minute of your precious life.

*****

You deserve more than just a paycheck. You deserve a better life.

Now go get it.

Note: This is a post from Joan Otto, Man Vs. Debt community manager. Read more about Joan here.

I’m that lady. The one with the checkbook and the neat lines of transactions marching down each page of its register.

And let’s be honest, nobody still keeps actual checkbooks with matching check registers – do they?

Though my husband and I do try to spend cash as often as possible, every bank transaction – online bill payments, ATM withdrawals, checks and Visa debit purchases – does go right into the register as soon as possible.

That’s right – I still do keep the checkbook in my purse. We don’t write a lot of checks, but we still find keeping the register for ALL transactions well worth it.

Chris, my husband, will usually hold any receipts he has in his wallet, then give them to me about once a week to enter in the checkbook to ensure we are on the same page.

Then, a couple of times each month, usually before I pay a set of bills, I go online and reconcile the checkbook with the bank’s online transaction record, making sure I haven’t missed anything and, most importantly, making sure my number (with any outstanding transactions factored in) matches the bank’s number. To the penny.

Part of this is just my personality – I’m often frightfully organized, and it’d make me itchy not to know how much money we have available.

But also, there was a time in my life in which it mattered – to the cent – how much I had in the checkbook, because if I was off by a couple of dollars, checks would start bouncing.

I don’t like to be real serious most of time; I’m kind of a clown, which you’ll come to know about me, but the thought of bouncing checks was serious stuff.

I remember holding my infant daughter, shopping in Walmart, and putting back jars of baby food at 59 cents apiece because I could get 10 but not 12 of them.

And with a budget that tight, you can bet I kept pretty close tabs on the checkbook. There was even an ATM in the next town where you could withdraw cash in any amount, coins included, and I have a strangely funny but terrible memory of going there and taking out $4.58 (leaving exactly $1 in the account) for gas money.

I guess those habits stick with you, because I’m still just as neurotic disciplined about it.

The funny thing is, I’m really “digital” about most things – except this. I swear I’ve tried every web- or software-based system for accounting for transactions, but I can’t get into them.

A pen, a paper, and little Xs next to the amount when it’s cleared the bank; that’s the simplest way and the way I’ve gone back to time and again.

And even if you’re not as neurotic as I am – almost all of use can benefit from the increased awareness. It doesn’t take nearly as long as you think – and will change your relationship to your spending.

Here are 5 reasons why I think this works for us:

1. We only have ONE account that has any money going out of it, so it’s not super-complicated to keep track of. (Our savings account, with its infrequent transactions, does have its own matching register, but I don’t try to marry the two!)
2. It’s how I first learned to manage money. My mom ran a small business when I was growing up, and when I was homeschooled, one of my jobs was to keep her business ledger. That built up such a habit for me that I find it hard to pick up any other methods.
3. It requires me to be intentional. I love the idea of some of the online money-management systems that keep track of your finances and make sure everything balances out for you. But I don’t love the practice of that – I like to be forced to really LOOK at where the money is going.
4. Along with that, this forces you to see the truth about your finances. I truly credit my banking system with our debt turnaround; even at our worst, I was faithfully keeping track of the money going out … a LOT faster than it was coming in. Hard to ignore the kinds of bank balances that have only a single number before the decimal point, you know? That really motivated me to take action.
5. Finally, it puts Chris and me on the same page financially. I generally keep the checkbook and pay the bills, but the fact that he keeps track of his own receipts and sees the balance means he’s fully aware of what we do – or don’t – have available.

I know, though, that I’m almost certainly the minority in this (even though I think the benefits are universal).

So what works for you?

Do you keep track of your expenditures from your main account at all?

Do you still carry around a “checkbook”?

Leave me a comment below and let me know! I’m super-curious about this. If you can make me feel any less neurotic, bonus points.

Back in February, I caused a little bit of a stir with the following comment on the Facebook page:

If I had a dollar, for every email I got from someone whom DEEPLY REGRETTED buying a house, I would never have to work again. Just rent, people. It’ll be o.k.

I got called everything from pretentious to a genius. And you know what? That’s OK.

If you’ve made a decision about your housing situation, you’re happy with it, AND you have the life you want – then stop reading here. Go on, you.

But if you’re not sure whether to rent or buy… if you’re doing one or the other but are desperately unhappy with your choice… or if you’re in what you think is a good housing situation, but the rest of your financial life isn’t making you happy… then read on.

Here’s the not-so-secret secret: There is no one-size-fits-all answer.

I’ve heard from people – both on that Facebook post and in countless emails – who made home ownership work out well. I’ve heard from just as many who bought their homes but would give anything to be renting. And I’ve heard from plenty of lifelong renters who are thrilled with their choice.

What I can say, though, is that MOST people who decide to buy their homes rush in, lock themselves in, and don’t see alternatives.

Nine times out of ten, housing-related costs are the largest single expense in people’s budget. Yet often, people put more thought into their car or even cell-phone purchases than their housing costs!

I will also tell you this straight up: I’m personally a HUGE fan of renting.

I see far more advantages in the flexibility that comes from renting than I do with buying a single home. (This should be fairly obvious for people who’ve followed the journey a while).

Now, let me add that I’m not anti-home-ownership. I’ve spent a couple years of my life in the real estate industry. Courtney and I have owned an 8-unit apartment building in the past.

I even love the potential of owning a home someday. And most importantly, I understand buying a home is more important for some people than the prospect of flexibility.

But I’m sick and tired of it being the default choice for the “American Dream.” It’s silly that we culturally view this as a must – and that we almost always jump the gun as a result.

First, let’s talk costs here…

I’ll start you off with a (far-from-complete) list of expenses that come up when you’re a homeowner.

• Property Taxes
• Remodeling Projects
• Homeowner’s Insurance
• Regular Misc. Maintenance
• Air Conditioning / Furnace
• Furniture / Home Decor
• Kitchen Appliances
• Outdoor Tools
• Electricity
• Gas
• Lawn Care
• Water Heater
• Water Softener
• Sewage
• Water
• Trash
• Landscaping
• Installation Fees
• Pest Control
• PMI
• Association Fees

Anyone else who has owned property of some sort could probably think back and add a few dozen bullet points to this list (yikes!).

You may or may not incur these costs when you buy (or during the time that follows), but many, many people do. And, once again, as a culture we rarely plan and budget for these expenses.

Do not stop at PITI, which stands for Principal, Interest, Taxes, and Insurance. 

Many people do their calculations based on PITI (even in the real estate and investing industries), without considering much else. This will backfire… big time.

Slow down – and think about everything you are signing up for.

This is life changing. Likely the biggest expense you’ll ever have in your life.

Slow. Down.

What I don’t love – is the myth that owning a home is a *must* or a *smart move*.

I don’t love the MYTH that owning a home is a smart investment.

Real estate can be an investment in some cases – but viewing your personal residence (where your family eats and sleeps) as an investment is a mistake.

Your primary residence should not be viewed as an investment, plain and simple.

The view that owning a home is an investment has led us to a huge bubble that has put millions of Americans in cages made of underwater mortgages. I don’t have to tell many of you this – I’ve heard your stories loud and clear.

One of the most interesting things I learned on our RV tour was the cost of homes across the country. Courtney’s mom bought a four-bedroom, 3000-square-foot home for under $100,000 in Indiana.

In Asheville, you won’t find nearly as many structures under $100,000 (very few). In Burbank, CA, most two-bedroom bungalows (1000 square feet) sell for $500,000.

We are all blanketed with one idea that we should be homeowners, but aren’t given an equal opportunity to do it. Circumstances are incredibly varied (job, location, family situation, freedom, social pressure, etc…) – yet we’ve prescribed one solid path to success for decades now – OWN A HOME, BABY!

This social pressure leads us to incredibly bad mindset for making life-changing decisions like this.

And it leads a tremendous amount of people to a trapped lifestyle (physically and mentally).

So when does it make sense to buy? Here’s your new set of rules:

• If you plan to live in an area 5-10 years minimum.
• If you are debt-free (before the mortgage).
• And if your TOTAL housing costs are less than 25% of your take-home income.
• Big one coming: YOU actually want to buy!

ONLY THEN, consider buying a house among one of your MANY choices for providing shelter for yourself and your family.

If any of those conditions are not met – you shouldn’t be buying a house.

That’s the bare minimum.

These will be considered by many to be “conservative” rules of thumb – but you need to be conservative about locking yourself into a structure. Learn from our nation’s mess!

I’d also say consider the following:

Do you have the skill to do simple home repairs?

(Anything from replacing a piece of gutter to fixing a leaky faucet.) If you have to call a professional for this relatively routine stuff, your costs are going to add up quickly, but if you’re fairly handy, it might be more economical than renting a home with “repair service” built into its costs.

Do you have the TIME to do these repairs and regular maintenance?

(Lawnmowing, mulching, changing furnace filters, etc.) If so, and if you enjoy those tasks, great. If not, renting – or purchasing a home in which these things are handled by an association – might be a better fit.

Do you have unique needs?

For example, if you want to keep 12 pets… if you have 10 children… if you need to be able to create in-law quarters… renting MIGHT not offer you the options necessary. In this case, a property you own might allow you to better manipulate your space.

Again, slow down. It isn’t the end of the world to wait and rent!

*******

When does it makes sense to rent?

Well, like I said, I truly believe almost anyone can benefit from renting. When we talk about freedom – and what that looks like – it becomes really clear that a mortgage is a BIG tie-down.

But here are some situations when it’s especially good to rent.

• If you plan to move in the next five years (or sooner!)
• If you aren’t able to or prefer not to do external and internal home maintenance.
• If you are still paying off your consumer debt.
• If your career or family situation is LIKELY to change drastically in the next year. (Marriage, more kids, kids leaving home, salary change, starting a new business…)
• If you are buying a house because it’s what you are “supposed to do.”

Again, that’s the bare minimum.

But also consider these issues:

Do you dread researching plumbers or electricians and getting quotes?

Forget skimming the yellow pages trying to find a reliable serviceman with the best rates. You have one phone number to call when things go wrong. And they take care of it all. Welcome to renting!

Do you want to experience a neighborhood before you buy?

It’s fun to imagine living in a new place, but it’s also intimidating. How much will I really like it? Will I really be able to work at the cafe during the week? Do I really want to be ten minutes out of town? Do we click with the neighbors? By renting in an area, you can test the water without too much commitment. It’s far better than being two years into a mortgage and regretting where you’ve planted yourself.

Do you want to have a better idea of how much you’ll pay each month in housing?

Rent doesn’t change (well, nearly as much as housing costs). The far majority of expense swings related to housing are the landlord’s responsibility in most situations and areas. Consistency and simplicity allow you to focus your time and stress reserves on more important things in life you want to accomplish.

*******

“I’m wasting that money, when I could be investing it.”

Sigh.

First, do the math (honestly, with all the numbers – for all the expenses). In a lot of situations, this is an ASSUMPTION – and simply not true.

Second, consider opportunity costs of the additional flexibility that comes with renting.

Third, much of your “investment” is going to interest (and in some cases taxes and insurance in the primary payment). If you move in the first few years, you aren’t “investing” in almost anything – especially when you factor in costs of selling and buying.

Once again, I firmly believe your quality of life will increase dramatically when you STOP viewing your primary residence as an investment.

*****

Over the last few years, the perception of whether renting or buying is “smart” or “dumb” or a “waste” has dramatically changed. A huge collapse and a recession can do that for you.

What it comes down to, though, is mindfulness.

Be aware of YOUR situation.

Don’t get sold an “American dream” that turns into a nightmare. It’s happened to millions of people (and many emailers).

Don’t trade your freedom for something that is only that – a THING.

Your home isn’t “you.” It isn’t your family.

It’s a roof over your head, a place to sleep, something totally and utterly replaceable.

Your HOME and your HOUSE aren’t necessarily the same thing.

You can make a HOME out of many situations.

We value the opportunity costs of living a flexible life far too highly to burden ourselves with a huge mortgage and the cost of upkeeping a home.

What about you?

Have you had a fantastic or awful experience with buying or renting?

Have your beliefs about owning a home changed in the last 5 years?

Have at it!

Early this week, I received an email question from a passionate reader.

I’ve changed a tiny bit of the details to protect the guilty, but the question went like:

Hi Baker!

I forgot to ask you a question about money vs time. I hope you don’t mind that I ask you here: I have a bunch of crap- loads of it. But at this point I’m thinking it’s not the best use of my time trying to sell it all.

I’ve got 3 kids (7, 5, and 21 mos) and Im thinking it best to donate most of it except for a few items that are clearly worth over a hundred dollars. And spending the time instead creating and writing my blog.

Would you agree with this decision or would you still recommend the selling process?

Much appreciation,

-Really sweet lady that Baker hasn’t asked permission, so he won’t share her name here.

I love questions like these, because they are simple, straight-forward and easy for me to provide help!

Here was my response edited for the blog:

Hey (secret woman) thanks for emailing and all your kind words!

I tackle this problem a lot – but only from people who are really honest with themselves (like you).

I always give the following advice:

The single most important thing is ridding that crap from your life.

A.k.a. getting it out of your life will reclaim so much time, stress, and energy that throwing it into a bonfire would be beneficial to you.

Now, obviously we don’t want to do that! So donating the far majority of small stuff is usually worth it for busy people and entrepreneurs.

One other idea is to host a mega yard sale – it’s coming up on Spring – you likely wouldn’t need too much planning and could devote one weekend to dumping a ton of it a micro-prices. Essentially mark everything to move quickly. Then on Sunday bring a truck and donate anything that’s left.

We’ve found these weekend projects can be fun family bonding moments, can generate a least a little bit towards the blogging or travel fund and can save you a trip or two to Goodwill, etc…

If it were me, I’d donate it. My wife would likely coordinate a mega-yard sale and then donate.

Do go for listing the “low-hanging fruit” or the larger items you know will sell for a decent amount of money on Craigslist or eBay.

But if you try to individual list every single item you sound like you’ll be far less likely to actually succeed at the most important step – getting rid of it for good!

Hope this helps… please take pictures if you go the bonfire route!

-Baker

Haha!

Obviously, I’m being cheeky when talking about the bonfire. But I’m not being cheeky about the end result.

Nothing is more important than parting ways with the crap that bogs down your life.

In other words, it’s easy to get sidetracked.

It’s easy to get attached to the “value” that you put into something years ago (or even weeks ago) and thus let it keep you from ditching the physical clutter that plagues you.

Don’t let anything stop you!

In Sell Your Crap I have a full walkthrough with recommendations of where to sell what item (based on its value, size, shape, type, etc…). We also provide a full list of where to donate specific types of items (to avoid bonfires).

I don’t have the space to break that all down here, but we always start that process by setting a “floor” or minimum value that we will invest time in selling. For some people, the floor may be $5. Anything worth at least $5 they will sell.

For other people, the floor may be $100. Anything less than that and they are donating – above that they will work on selling.

You set this amount in your own life.

The lady who emailed me was in the middle of radically changing her life and her business – and thus her floor in this case was higher than it may have been even months before.

Bottom Line: Your excess crap steals your time and energy – and adds stress to your life. Sure, get money from it if you can. But let nothing stop you from your commitment to reclaim your freedom.

In case you were wondering… here’s her response:

You’re so awesome! I just may have a bonfire, but don’t worry — I will not link you to the cause

So glad you confirmed what I thought about this — for *me* it’s just not worth the hassle of a yard sale. Time would be much better spent towards creating our new life!

The crap is good as gone!

Perfect!

You can see the passion and the excitement in her emails. And I have no doubt that purging the crap from their life will only add to the momentum!

It’s springtime, folks.

Look around and identify the layer of crap in your life.

Time to have some bonfires!

(figuratively… or literally… your choice…)

Baker’s note: This is a post by Joan Otto, the “community manager” here at Man Vs. Debt. Expect to hear from her more and more in the coming weeks!

Hey, it’s Joan! Hi again. So in my introductory post here on Man Vs. Debt, I shared with you the cold, hard truth about our financial picture. (It wasn’t pretty.)

I got into the numbers behind our debt, to the tune of about $70,000 currently before the mortgage, and about $90,000 at its worst. But those aren’t the only, uh, not-pretty numbers I’ve been keeping track of in recent years.

While I was getting deeper and deeper into debt, I was also getting fatter and fatter.

After the birth of my daughter in 2000, my average weight was around 117 to 130. But at worst, in early 2005, I carried about 170 pounds on my 5-foot-4 frame. That’s not the end of the world, but it’s about 50 pounds heavier than I should be, especially in light of some health problems that weaken my joints.

50 extra pounds of weight on my knees meant I was, at one point, looking at having a knee replacement in my early 20s, to which I said NO FREAKING WAY.

That was my turning point.

I joined Weight Watchers, started exercising, and eventually reached a goal weight of 118 pounds around Christmas 2006, essentially dropping 50 pounds from my highest weight. I even became a Weight Watchers leader as one of my (many) side jobs.

Since 2006, my weight has fluctuated like crazy, mostly between 118 and 145, all still in the “healthy” range for my height according to the body-mass index. 145 is my top “healthy” weight, and anything above that is considered overweight.

Well, guess what?

As you can see by my not-at-all-nice graph above (which doesn’t even INCLUDE the heaviest points, because of course I wasn’t interested in keeping track of those) … well, for the past year or so, I’ve been on an up-hill climb, headed suspiciously close to – and sometimes veering scarily into – overweight.

Like, “a heavy sweater on weigh-in day puts me over” kind of close. And my body-fat percentage is about 30%, which means about 43 pounds of ME is made up from fat. You need some fat – but not that much.

And I hate it.

Yes, I’m not back to my highest weight. I’m still in single-digit pant sizes (ladies, you know this is big!) But I’m not doing what I need to do to be my healthiest.

And, BMI aside, I feel fat.

145 is more weight than I’m comfortable carrying. I’m tired, and my knees hurt, and quite frankly I know that I’m not going to stay at 145.

If I don’t make a change, the fact is, I’m going to gain more weight back – weight I once worked really hard to lose.

So why I am writing about this on Man Vs. Debt?

Because Baker’s also trying to get back to a healthier weight? Well, yeah, that factors into it. But what really sparked my interest was a forum topic during our Kickoff 2012 You Vs. Debt class.

We were talking about “Patterns” – things we noticed that lots of class members had in common. And the biggest thing to come up was that being in debt seemed, for a lot of people, to be linked to both having a lot of clutter and being overweight or making unhealthy food and exercise choices.

It turned into an incredibly poowerful conversation, and I felt like one member, Laura, really summed up some of the problem I’ve noticed in myself. She says:

It seems like the urge to overindulge in food I don’t need comes from the same place as the desire to spend money I don’t have. Both overeating and overspending seem to be an attempt to fill a void in my life that can’t actually be filled with either food or possessions, but rather can be filled with relationships and rich experiences. Both overeating and overspending are a form of “giving up hope” and “giving up control” over my life. Tracking feels to me like I’m grabbing back the steering wheel, and making a choice about where I want to put my attention and steer my life.

That’s exactly it.

I firmly believe that when you make a CHOICE to change, you can alter the course of your life. I also believe that those choices and lessons are very transferable!

5 things I learned while losing weight that are helping me pay down debt

1. Write it down. In Weight Watchers – and MANY other weight-loss and exercise plans – a key tenet is keeping track of what you eat. If you don’t have an accurate record, it’s way too easy to delude yourself about what you’re really taking in and expending. In You Vs. Debt, a key tenet is writing down what you spend, and creating an accurate picture of what you owe, for the same reason.

2. Get support from others on the same journey. I was a big fan of the weekly meetings in Weight Watchers, even before I started leading them. (And now that I’m not leading regularly, I miss them!) It felt SO GOOD to know I wasn’t alone, and to get encouragement both when I had successes and when I had challenges. That’s also what brought me to Baker and You Vs. Debt as a participant – I needed a community around me. I’m not someone who can succeed on my own! Find your support system.

3. Splurge where it really matters. When I was losing weight, I would often make some pretty basic substitutions. (Baked chicken, veggies instead of fries, etc.) But if I was really craving a phenomenal cheeseburger, I did NOT follow the “diet” advice of having a low-fat English muffin with a veggie burger patty and low-fat cheese on it. I didn’t even “splurge” by getting a small McDonald’s cheeseburger. No, I would go to my favorite local restaurant and get the most wonderful concoction of feta cheese and ground beef layered on a thick bun, probably the equivalent of about 2,600 calories, and I’d dig in. It’s the same with money. I buy most of my clothing at Walmart or the local thrift store. But I spent $250 yesterday on a purse – because I’ll carry it every day and get years of use out of it, whereas my cheapo purses generally only last me a few months before getting holes in them. Pick what matters – and really enjoy your splurges. But don’t splurge where it doesn’t matter!

4. Don’t get frustrated when your progress plateaus. I’m pretty sure there’s not a human being alive who’s lost weight in a healthy way without hitting the occasional slowdown or plateau. I’m also pretty sure there’s no one in the world who’s tried to pay off $90,000 in credit-card debt who hasn’t had months where they were able to pay just the minimums. That’s OK. Don’t beat yourself up. Just keep doing what you need to do, and your progress will show again soon.

5. Check your progress regularly and assess what’s working. In Weight Watchers, members who are in the “losing process” are asked to weigh in each week. This, combined with the tracking system I mentioned earlier, gives you feedback on what’s working and what’s not. If the scale moves the direction you want, then the choices you made were probably pretty OK ones. If the scale doesn’t move the right way, then you can look back over your tracked food, drink and exercise, and see where you can make a change. The same goes for your finances and your budget. I don’t know how many people I know who’ve set up gorgeous works of art and called them a budget. But these same people – myself included – are often guilty of not revisiting them and seeing what works and what doesn’t. Check yourself. See what’s working, and CHANGE anything that’s not!

5 things I learned while paying down debt that will help me “re-lose” 20 lbs.

1. Don’t overcomplicate it. I am a famous overthinker. Until recently, I had spreadsheets for my spreadsheets when it came to debt reduction, and I was trying 10 different approaches at once. When I narrowed my focus, followed the You Vs. Debt course and didn’t try to throw in 50 other tips, I was successful. Same for weight loss and fitness. I’m struggling now because I want to do too many different things – Weight Watchers, juice fasts, 4-Hour Body… it all sounds great to me, but I’ve got to pick an approach. I’m also not going to be able to realistically schedule the gym AND regular tae kwon do workouts AND sessions with a trainer AND long hikes AND Nerd Fitness. So I’ll pick what seems most manageable and focus on those.

2. Set up specific, tangible “Very Next Steps.” This is a total You Vs. Debt thing. When you have more than your year’s income in debt staring you in the face, the old advice of “pay off your smallest debt first” doesn’t really get you psyched up. If you’ve got 100 or 50 or even 20 pounds to lose, it’s not really very motivating to say, “OK, that’ll be great when I reach that goal.” You need to pick what Baker calls your Very Next Step. Is it to track what you eat for a week? To exercise 3 times? To lose the first 5 pounds? When you reach that, set the next one. Then the next.

3. Don’t be overly restrictive. Ohh, I’m so bad at this. While paying off debt, we’ve gone through phases where we eat cheap hot dogs and don’t buy anything – ever. We use up the little toothpaste samples from the dentist rather than buying Colgate. That sort of thing. And you know what? These periods of “starvation” almost always result in a binge later on. The same goes for food. I’m not someone who’s going to succeed in long-term habit change by saying I’ll never eat a potato chip or a french fry again. I know that about myself. So, while I’m certainly going to limit those things, I’m not going to restrict myself in ways that aren’t sustainable.

4. Remember that it’s a marathon, not a sprint. Getting out of debt takes a while, and so does losing weight. If you take your time and do it RIGHT, you’ll make it to the finish line. If you try to rush – like, say, dumping a ton of money on paying off a credit card, but having no emergency savings – you’re only going to hit a setback later. The same goes with weight loss. I could lose 10 pounds this week, but that wouldn’t set me up with good habits for long-term change. So I need to commit to building good habits the right way.

5. It never ends. That sounds depressing, doesn’t it? But I realize that right now, I’m aiming for this really specific goal of having $90,000 in credit-card debt paid off. Great – but that’s where the real challenge begins; I need to live a life in which I won’t ever carry consumer debt again! I was slow to realize that about weight loss. I hit my weight goal, and I “sort of” maintained, but it wasn’t until recently that it really clicked – this is a forever thing. I’m ALWAYS going to have to work at this. Maybe not as hard at some points, but the fact is, there’s no rest for the pear-shaped!

So what’s next?

Much like with my debt, I’m going to put it all out there for you guys. You get to hold my feet to the fire! My “big goal” is to be down to 125 pounds and less than 20% body fat by the time I take my black-belt test in tae kwon do, in about another year.

My first step regarding my diet is to track what I eat this week and for the following three weeks using Weight Watchers’ system, and to stay within what they recommend for me as a daily target.

My first step regarding my activity level is to go to tae kwon do class at least 3 hours a week for the next month (if not more!) and to get to the gym at least once a week for an hour, preferably twice.

Can I do it? I think so – and the habits that are helping propel me out of debt will help me get there (and vice versa)!

Do you feel like there are parallels between your “money life” and other areas of your life?

What habits or skills have helped you tackle both issues?

Would love to know what you think!

Today I turn 28 years old.

Many times on my birthday, I reflect about my life, my meaning, and my goals for the next few years.

I’ve done a little of that today, but not as much as I have in the past. (For example, you can read these 26 life lessons I wrote exactly 2 years ago.)

I have thought about a few simple things – a few goals, if you will – by the time I hit 30:

• I want to only work on projects I deeply love and care about – that combine to positively impact millions of people’s lives.
• I want to have a million in positive monetary worth (and no debt). That’s right, nothing wrong with saying that. It’s the *why* you want it that matters. I want it for flexibility and the opportunity to work on amazing projects when I see them enter my family’s life.
• I want to spend the majority of my post-afternoon-ish day with Courtney, Milli, Charlie, and any future additions to the family.
• I want to remain healthy and active (for me: under 15% body fat, 95% whole foods diet, under 200 pounds).

You know, the same things we all think about on our birthdays.

And speaking of working on projects I deeply love… I’ve loved Man Vs. Debt for 4 years now. Sure, sometimes it’s been a love-hate relationship, but I’ve deeply enjoyed building this community. It’s changed and continues to change my life.

In fact, sometimes I feel I’m too in love with it. 

I’ve wrapped so much of my identity up into this site, that every single word I write – and every single post that gets published – reflects intensely on me.

That’s a double-edged sword.

On the positive side, it means I only publish content that I think is the best of the best of what’s on my mind. This makes me feel good. It’s a bit more impressive. I know the far majority of posts will help at least some people.

But on the downside, it means that my ability to help people is based purely on my motivation to write. And the pressure to write – and write every post so it’s amazingly complete and epic – is intense.

So in turn, I don’t write very much. And when I do, I only write what’s on my mind in that particular moment in time (instead of what I believe will truly help people).

And thus, I severely limit the impact this community can have on the world.

I limit the potential of how I can help people through this medium I’ve devoted nearly half a decade to.

And I limit the potential of how I can help people through new mediums, projects, and arenas.

At my very core, I want this site to help a whole crap-ton of people overcome debt, ditch the clutter, and do more work they love. It’s really not that complex of a vision.

But the current system I use to write, publish, and help people is a bit broken. It’s completely reliant on my in-the-moment motivation, my current place in life, and my immediately-in-front-of-my-face experiences.

*****

Jonathan Fields once told me his journey was to build a “body of work” he could be proud of.

That phrase really sank home.

Life is a journey to build a “body of work” you are proud of.

So what if you’ve been an accountant for the last 30 years. That’s just part of your body of work. What’s next?

So what if you’ve been a stay-at-home mom for the last 10 years. That’s just part of your body of work (an important part… but a part nonetheless).

So what if you’ve been a ______________ for the last _____ years…

Man Vs. Debt has been – and continues to be – a life-changing part of my body of work.

However, I’ve realized that if I continue to let every word that posts to the blog define me as a person, I’m going to continue to limit the potential impact this community can really have.

That’s why, for my birthday, I’m giving myself a present.

I’m going to allow myself to let go – as an experiment.

For the next two weeks, we’re going to switch things up. We’re going to post much more frequently on a wide variety of smaller topics.

Anywhere from 3 times a week to 5 times a week. Myself, Joan, and maybe even Courtney will be chipping in.

We’ve brainstormed dozens and dozens of topics – and the whole team is excited to try out the experiment.

I’ll write a couple times, Joan will write a couple (she’s great), and we’ll share more stories, links, and news from the community itself. (Want to share your story on the blog – or post about something specific? Now’s a good time to reach out!)

I’m going to allow myself to let go of my perfectionism, my intense control, and letting the blog define me as a person – for at least the next two weeks.

Don’t worry, while the posts may not be 4,000 words – they will continue to have the same vision, values, spunk, and attitude that you enjoy.

I’m excited to hear your feedback after the next couple of weeks. Don’t hesitate to voice your opinion! You matter to us.

*****

My question for you is… what does your “body of work” look like?

Are you letting any one aspect of your work – no matter how amazing it is – define you as a person?

I’m truly interested to hear your thoughts on this one.

Xoxoxo,

-Baker

Most of us are taught to view risk through the lens of losing something.

What could I lose if I make this decision?

If we could lose much, it’s risky.

If we could lose very little, it’s not that risky.

Sounds pretty simple. But here’s a secret:

By nature, whenever humans estimate potential loss – we grossly exaggerate it.

Not only that, but we want to hold on to what we have now far more than we want more of something new.

These two tendencies keep us trapped.

Trapped in fear of an exaggerated loss. Trapped in fear of an inflated risk.

Instead, I’ve carved out a new definition of risk for my major decisions in life.

Will I deeply regret not having the courage to make this decision?

One of my friends wants to travel to every country in the world. That’s amazing! But personally I don’t feel like I’d look back and regret not accomplishing that in my life, so passing on that decision or goal isn’t very risky for me.

On the other hand, I had a moment where I decided that if I didn’t take the leap to create a documentary from scratch… I would have regretted letting the opportunity pass.

There’s a million reasons NOT to do the documentary. There’s a hundred different reasons people would say it’s “risky.”

But if I would’ve skipped taking the shot, I would have looked back later and said, “Damn, I wish I would have had the courage to take that shot when I had it.”

To me, that’s risky.

Risk is not the chance you’ll act and lose something important.

Risk is the chance you’ll look back and regret not having the courage to act on something meaningful.

*****

*****

Baker’s note: This post is by Joan Otto. Joan’s been a full-time member of the MvD team for over three months now. This is her story in her own words.

*****

Joan and Chris were doing all right.

And they were TIRED of it. Tired of living paycheck-to-paycheck. Tired of having a six-figure household income and never having quite “enough” to do more than pay the minimums.

Tired of going to jobs that demanded too much of their time, working part-time jobs that sapped their energy and took time away from their amazing 11-year-old daughter, and tired of being broke and tired.

They knew they could do better, but it seemed that every time they tried to make a change, “something” came up. The house needed a new roof. Then a new heat pump. There were car repairs. Braces. It seemed endless, and the treadmill was exhausting.

Oddly, it was almost as if they weren’t doing “bad enough” to make a change.

They didn’t qualify for lowered interest rates or special programs. They could feed their family and put gas in their (shared) car. But there was no wiggle room. They were just comfortable enough to stay stagnant.

When their daughter, Sarah, was diagnosed with Asperger’s syndrome in early 2011, everything changed. Chris and Joan had always wanted to “be there” more in her life, but now, that became an absolute necessity.

They know that if the whole family is going to make it through Sarah’s high-school years, at least one if not both of them will need a work-at-home, flexible-schedule career. And more immediately, they were committed to being able to homeschool their daughter, which brought with it some great possibilities but some unexpected expenses.

When the “why” got big enough, their motivation grew. They started by knocking down $10,000 of their $89K credit-card debt. But they knew they couldn’t stop there…

*****

See how I’m not QUITE smiling in the photo above? That was taken on one of our lowest days, late in 2010. We went to an expensive amusement park with our best friends – even though I knew we had a negative checking-account balance – and only had enough room on our credit card to buy a few snacks. My best friend’s husband took pity on us and bought Sarah and me sweatshirts when the evening got too cold for our T-shirts. Not too long after that was when things finally hit rock bottom.

I’m Joan, and at its worst, my family’s consumer debt was almost $90,000 – and that was BEFORE our $209,000 mortgage.

Now that we have that out of the way… Hi. Nice to officially “meet” you.

I’m part of the team here at Man Vs. Debt, serving as project manager/community leader/Joan of all trades. And in some ways, I’m kind of the “anti-Baker.”

World travel? Not so much.

I’ve lived in the same county in southcentral Pennsylvania my entire life. In a huge move, after getting married in 2005, my husband and I moved one town over from the one in which I grew up.

Flexible living arrangements? Well, note the previously-mentioned $209,000 mortgage.

Also, by way of introduction, besides my husband and daughter that I talked about earlier, our household includes my mom, Joan, who lives with us, a hundred-pound dog and five cats.

That's me at left, with Chris, Sarah and my mom. Oh, and Huggles, the three-legged cat.

Entrepreneurship and career flexibility? Not so much.

I started working at my hometown newspaper when I was 16, and worked there full-time until December 2011. That’s 13 years – I’m now 29. Oh, and I still work there on a part-time basis. My husband has worked for the same newspaper for about 12 years.

The thing is, I’m NOT that different from Baker. Or at least the Baker who wrote this declaration of war on debt in 2009. Chris and I are at war with our own debt, and what you read above is the start of our “success story.”

In AMAZING news, we’ve paid down $20,000 in the past 15 months, dropping our consumer-debt total (not including the mortgage) by 20%.

Here’s the scary part though: We’ve gotten almost this far before – and then racked it all back up. We’ll come back to that in a few minutes – because I want to talk about where this debt came from, and why I think this time will be different!

Before that, though…

Here’s where we stand.

(Note for radical clarity: Chris and I have talked together about disclosing this info and we’re both in agreement with Baker’s policy of radical financial transparency. But, you know, don’t judge. Please.)

PNC Mortgage:  $204,717.84  (5.5% effective APR)
Bank of America credit card:  $27,071.45  (25.24% APR) WE HATE THIS DEBT!
Citi credit card #1:  $19,007.78  (11.15% APR)
Household Finance credit card:  $8,732.82  (9.99% APR)
Citi credit card #2:  $6,414.73  (12.74% APR)
Personal loan:  $3,221.98  (don’t even ask about the APR – the interest is already calculated in, and it’s ridiculous)
Discover credit card:  $4,044.50  (0% APR for 9 months, then 15.24% APR)
Tires Plus (our mechanic) credit card:  $1,564.70  (14.04% APR)

Total debt without the mortgage:  $70,858.26

And don’t forget, that’s the “we’ve made a ton of progress” view.

As I mentioned before, that’s the scary part. We’ve come almost this far before, early in our marriage – and then racked it all back up when our 30-year-old house needed a roof, our basement flooded and our heat pump died.

Legitimate expenses? Well, sure. Or at least that’s what we told ourselves. I mean, everybody owns a house, right? Everybody pays for stuff like that on credit.

And that’s when I found Baker.

That’s when I – when we – started to think differently. Following along with his family’s journey helped to shape our own. It was a wake-up call; it was our “free your mind” phase.

For about two years, from 2009 to early 2011, we started working at our finances. We tried all sorts of things – from the radical “don’t spend a stray dime” mindset, to spending only in cash, to making two extra credit-card payments every single month (even if it was $5), to selling crap on Craigslist, to expanding our online bookstore, a fairly lucrative side business for our family.

It was kind of a shotgun approach. We were making progress, for sure, but then we’d just have those months where we might as well have owned stock in our local convenience store for the money we spent there.

Well, like I said, I’d been following along with Baker’s journey (read that as:  I was a rabid Baker fan) through all this. (I was the crazy lady who made his family drive an hour north of Baltimore to meet my husband and me in person during his RV tour.)

I participated in the Pioneer You Vs. Debt class last spring… and then the Fall 2011 class… And I have to tell you, that’s when I figured it out.

This time is different because we’re different.

Before, we were making things too complicated. And with individual credit cards with debt totals like $40,000 on them at worst, the old mantras of “pay a little more than the minimums” and “snowball by paying off your small card” just weren’t cutting it.

We didn’t feel like we were making progress, and quite frankly, it was just too easy to slide back into old habits when it didn’t seem like we were making a dent. I won’t even say those were bad habits – just careless ones.

But careless doesn’t kick $89,687.23 in consumer debt to the curb.

That’s where I’ve got to hand it to Baker. His radically simple ideas have really made the difference for us:

• Track your spending, every day, with a pencil and paper in your purse or pocket.
• Don’t be afraid to negotiate.
• Sell crap that doesn’t enrich your life, and use the money to put yourself in a better position.

And it worked.

Not because Baker is brilliant or because those ideas will magically double your money. But this system worked because we worked.

The start of this post is my Day 1 You Vs Debt challenge, in which our assignment was to create the beginning of our success story.

And I did. I don’t mean I created it in writing. I mean I started creating the life I want for my family.

I quit a steady full-time job with a major national news corporation to work from home with Baker full-time. I used the negotiating skills I learned in You Vs Debt to essentially create a part-time job for myself at my former company, which still provides a lot of value for them and allows me to continue doing some things that I love, like running my own blog about life in our town.

I got real about committing time to my daughter’s education, and now we’re a homeschooling family. I devoted more time to my tae kwon do practice and started working out regularly outside of martial arts, trying to build a habit of fitness.

Your life can change. YOU can change.

I remember a close friend of mine who was in the Narcotics Anonymous recovery program telling me that it all boils down to one thing – “you gotta wanna.” And, much like in my friend’s program, success for me means surrounding myself with people who will encourage me when I’m doing well, support me when I’m struggling, and hold me accountable to my own personal goals when I’m wavering.

And the cool thing is, my job here with Baker is, in large part, to create exactly that.

My biggest goal as part of the Man Vs. Debt team is to help grow and pull together this awesome community of people who want to sell their crap, pay off their debt and do what they love.

Now that we’ve met, I would be honored to have you walk beside me to create the life YOU want while my family and I keep working on ours. You’ll be seeing me pop up a little more around here, helping Baker out with odds and ends, and I hope you’ll say hi and help me out along the way!

Leave me a comment and say hi! It’ll take me a while, but I’d love to start getting to know everyone!

Baker’s Note: Joan has been a life-saver for me. Her passion for this community rivals my own – and her dedication to making it even better will mean big things in the near future. Welcome, Joan!