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Re-Evaluating Your Financial Priorities

in Joan's Posts, Money Basics, Our Financial Journey

priority

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

Since I shared my report from the three-year mark of my battle against debt, I’ve been amazed at the kind words from so many members of the Man Vs. Debt community. From comments to Twitter messages to emails, it’s really reaffirmed my commitment to pushing forward and – even if it’s more eventually than I’d like – ending up debt-free and staying that way for life.

That said, opening up about my slower-than-expected progress has also forced me to re-evaluate where I am, and whether what I’m doing is really in keeping with my truest desires financially and personally.

As I was preparing to write today’s Man Vs. Debt post, I kept finding myself drawn to a post of Baker’s from several years ago, Discovering Your Financial Priorities. I hope you’ll make time to read that, because it’s really the basis for what I’d like to do – and challenge you to do – today.

I need to refocus on what matters most to me. I’m making progress, but sometimes it’s not in the areas that really hit home with me. I’m hustling for extra money, but that cash is just going toward the bills and odds and ends of needs here and there, not really packing the punch I’d like.

I’m doing the right things, but not quite with the right mindset. And from the comments I’ve received since admitting how much I’m struggling, I know that I’m not alone in feeling a little adrift.

So let’s take the first step toward changing that. Let’s set some financial priorities, Man Vs. Debt-style. I’ll list mine, and I hope you’ll be thinking about your own so you can jump in and share in the comments!

1. Keep the bills caught up.

This has not been a problem in years for me, and I’m more happy about that than I can say. HOWEVER. I’ve been there, the juggling-late-bills dance, and I need to be sure not to forget how awful that felt. I need to make sure that this stays an articulated priority, so that I don’t get back to the really behind point. For us, this means not only having enough money to cover our regular expenses, but also having a decent buffer in the checking account for when “paydays” – sometimes irregular in freelancing – don’t line up with due dates.

2. Provide for needs and moderate wants for my family.

For us, most of this comes by way of food. I will tell you flat-out that we spend more on groceries than we “need” to. My husband, Chris, is a vegetarian; I have several food allergies; and we have other dietary considerations for other family members. Some of these are needs, while others are just preferences, but they’re preferences that are my personal priority to meet. This also stretches to include things like our Netflix subscription, occasional restaurant meals and movies, trips to the arcade, and so on. They’re wants – not large-scale ones like a 90-inch TV, but moderate ones that we value enough to include in our budget. Our house is another related area. It’s not the tiniest, but it works for our not-the-tiniest collection of humans and pets, and it’s a priority in our budget to keep it.

3. Have all the healthcare.

I don’t have much to say about this, except that I took a full-time job that pays LESS than I was making freelancing full-time so that I could have health insurance. It’s a priority for me. This also extends out from the needs/moderate wants category; for instance, I choose to spend a relatively small but not insignificant amount of money on fitness, because it’s important to my overall health and well-being.

4. Maintain an emergency fund.

In the past six months, this fund has meant the difference between “yes, we can afford to live in our house” and “no, we really can’t.” It’s vital. And we’ve managed to replenish it every time we’ve knocked it down in the past few years, which is amazing. But it needs to remain a priority that I remind myself of, because it sometimes feels like it’d be so easy to use that cash for something else.

5. Pay down debt and avoid new debt.

Interestingly, when I think about my real feelings about debt, I realize that fifth place is just the right spot on my priority list. It is a priority – but it isn’t THE TOP priority. I sincerely want to become debt-free, and I intend to stay that way for life. At the same time, there are tradeoffs I know I would make. I would go into debt to get medical care for myself or my family (and, actually, that’s the cause of about 90% of the debt I brought into our marriage anyway!) I  would just pay the minimums on my credit cards for a while to keep the bills current. I would take on a car payment temporarily to ensure that I have a working vehicle. At the same time, any money I have once the goals above are met WILL go toward debt repayment, and the end result, no matter how long it takes, is going to be the flexibility that comes from being truly debt-free.

What these priorities have made me realize

Here’s the thing. When I stopped and wrote down what REALLY matters most to me, I’m actually making more progress than I realized!

It turns out that while debt repayment is still a priority for me, it’s not my top priority – and so, while I’ll continue to push at it, I’m going to take a step back and celebrate the fact that, despite a drop in income in our family of more than 50% for the past five months or so, I AM meeting my financial goals!

Because I was hung up on just one goal – the debt-payoff progress, and my frustration that it hasn’t been going faster – I had been feeling defeated. Because I was only “holding steady,” I wasn’t finding anything to celebrate.

Now, I realize how thrilled I am to look back at the past few months and realize, “HEY. I kept food on the table! I kept a roof over our heads. And I did it without increasing my consumer debt!”

I AM making progress.

I AM meeting my financial goals.

I AM living in keeping with what my true priorities are (once I bothered to make them clear to myself!)

What about you? What are your priorities – and once you’ve listed them, are you actually using them as the scale you measure yourself against, or are you trying to compete in a different race?

I’d really love to hear your thoughts in the comments.

{ 37 comments… read them below or add one }

Alan April 28, 2014 at 10:11 AM

Joan. I think you put down an excellent list. You are making progress, that is most important You have a plan. Taking care of your health and fitness is absolutely important. You want your health when out of debt so you can enjoy debt free. Excellent job.

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Laurie April 28, 2014 at 10:45 AM

Hi Joan

I also know how hard it is to keep everything going and priorities in line. I had debt on account of injury from a job. I am now over half done towards being debt free. I have to re assess also because it doesn’t always seem like we are progressing like I should. It is amazing to actually figure out your progress. It feels good. Like you my priorities are different as we have two large dogs, three kids not moved out yet and parents to look after also. Life is a challenge but it’s doable. Sometimes hard but making progress. Keep up the great work Joan

Laurie

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pt April 28, 2014 at 10:55 AM

Yes that about sums it all up for me. Needs (rent, food) come first. I don’t even need a phone nowadays so the phone bill is just whatever. I am thinking of getting rid of my smart phone (71 dollars a month) for a phone that takes calls n texts ONLY.

Thanks for sharing this!

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bjb April 28, 2014 at 11:52 AM

pt … I did this a few years back and haven’t regretted it once. I have an inexpensive (read: “not smart”) phone, and a pay as you go plan and spend about $100 **A YEAR**
on cell charges.

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bw April 28, 2014 at 11:48 AM

Joan … your list is exactly right in my book, as well as the items being in the right PRIORITY order, as your post talks about.

I really do have to emphasize how important #3 — health insurance — is. As an RN, I saw so many times where hard working folks who had no health insurance (usually since their employers did not provide it), got totally underwater in debt due to an unavoidable health issue.

I’m curious if you’ve thought any more about going 100% free lance now that the ACA law is in effect. As someone who had to buy insurance on the open market for the past 3 years (since I retired in my late 50′s), once ACA became law, my health insurance coverage became VASTLY better and for VASTLY less cost.

On the open market, I pretty much bought a level of insurance that covered only the catastrophic stuff. Now, under ACA, I have preventative coverage, MD office visit coverage, drug coverage, as well as the catastrophic stuff —- ER coverage, hospitalization, surgery, etc. And my monthly bill now (for this VASTLY BETTER coverage) is LESS than HALF of what it was when I was buy just the minimal insurance.

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Gin April 28, 2014 at 1:31 PM

Loving that this has worked out for you, but it may not be that way for most. I have no one, not even one single person, who has come out ahead on ACA so wondering what part of the country you hail from, thinking that might be a factor.

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bw April 29, 2014 at 8:42 AM

Gin … I live in NC. And you are so right, that one’s location affects everything with the ACA law (so crazy).

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Mary Ann April 28, 2014 at 12:19 PM

Joan, I agree whole heartedly with you and it made me realize that since I’ve been following Man vs Debt (along with a few others) I have had so much more control over my money and have been maintaining your items 1 through 5 consistently. Is my debt paid off, no, but it is going down, some months not very much, but others better. So it’s important to have your bills paid, your household taken care of, your own health a priority and then take care of the nasty debt business. I think we are all on the right track!

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Amy April 28, 2014 at 1:16 PM

Joan, I think you’ve done exactly the right thing here. Life is full of trade-offs and tough choices, and by identifying your priorities, you’ll be able to make informed choices. I really like your holistic approach. Good luck!!

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Kurkela April 29, 2014 at 2:26 AM

I recently read a book by Jerrold Mundis “How to Get Out of Debt, Stay Out of Debt and Live Prosperously”, and he has the same idea. We are not living for debt, we are people who for various reasons have got into debt, and we should not live for that debt. First, we must take care of ourselves,and only when we are healthy and strong enough, we are able to work harder and think better, and then we can more easily get rid of our debt.

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Gail May 1, 2014 at 2:29 PM

Hi Joan, I really enjoyed reading about your financial priorities, and I was really happy to see that, like you, I’m not as far off as I thought. It’s great to get that validation. For me it helps me to stay on track. Keep up the good work!

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Monique Grattan May 2, 2014 at 1:02 AM

I love, love, love this! I am also re-establishing some goals and priorities in my life. I can agree with yours 100%. The only thing I would add is a vacation fund. My hubby and I have spent years without a vacation. I am choosing to make this a priority in our lives. I am choosing to invest in this. This is priority. This even comes before debt repayment. Even if it is day trips…that’s fine. As long as it is time to invest in us.

Love your writing :-)

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John May 2, 2014 at 7:02 AM

Joan, great points you bring up. It’s too easy to get tunnel visioned on paying off our debt and completely ignore other equally important financial goals like having good health insurance. Like you said, there are somethings that are worth going into debt for and it is important to write out for yourself ahead of time what those are. Health should definitely be one of these.

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Cindy May 10, 2014 at 6:12 PM

Thank you so much for this. I have been figuring out how to pay off debt, not add to it, but also accommodate differing viewpoints in my house about how to do all this. I am realizing that I really shouldn’t say we’ll totally stop doing x or y if those are high priorities for others. We can budget for some money to buy small extra that make us happy and still pay on the debt. I will have to think about the priorities specifically, but THANK YOU for this perspective.

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Mark Ross May 14, 2014 at 8:24 AM

Great points Joan! I always list my priorities, and I think it really helped me in achieving my goals in life.

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Den May 15, 2014 at 9:39 AM

Joan – you ok? You’ve been really quiet for 2 weeks……

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Chris May 18, 2014 at 3:10 AM

Having an emergency fund/cash buffer provides a peace of mind like no other … takes most of the stress out of your life!

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Becky May 29, 2014 at 8:19 AM

Hi Joan, I’ve been checking every day for a new post and your mid month update…love reading your blog. Hope everything is ok!

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Kurkela June 6, 2014 at 3:15 AM

Joan, where are you?

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Bilgefisher June 9, 2014 at 4:21 PM

Joan,

I was glad to see the update on your financial page. Hope all is well out there.

Jason

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Laura June 11, 2014 at 5:34 PM

I so totally needed to read this post – thank you for sharing it! Your priority list echoes mine, and it’s a refreshing change from the more popular view that repaying debt should somehow take precedence over meeting genuine needs that can’t be compromised and moderate wants. One is not a bad person for paying the minimum or only a bit more than the minimum on a debt when it keeps the mortgage paid on time and food on the table.

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Steven June 13, 2014 at 9:41 AM

Hey Adam, since you put your face on this website and have other people write for you can you step up and let the readers know what’s going on? There are people who are concerned and care to know about Joan, seeing your smiling face is not helping.

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Jeff June 24, 2014 at 3:02 PM

My hardest struggle with my family is helping them to separate “Moderate wants” from more extreme wants.

Great post!

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Cori June 25, 2014 at 4:27 PM

Missing the updates! Hope all is well.

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Rachel June 27, 2014 at 1:40 PM

Prayers to you Joan. We are all sending you positive thoughts!

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Tina June 30, 2014 at 4:25 PM

Joan, need an update soon. don’t leave us hanging.
Hope all is well. Miss you!

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Diane C July 4, 2014 at 3:57 PM

“Now, I realize how thrilled I am to look back at the past few months and realize, “HEY. I kept food on the table! I kept a roof over our heads. And I did it without increasing my consumer debt!”
I AM making progress.
I AM meeting my financial goals.
I AM living in keeping with what my true priorities are (once I bothered to make them clear to myself!)”

Just curious, and I realize the internet doesn’t allow much for tone, so please know I’m asking this gently: Were is your husband/family in all this? Why so much use of first person singular? Are you trying to dig out of this hole all by yourself?

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Anna July 10, 2014 at 12:31 PM

Joan we miss you!!!

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Cori July 18, 2014 at 3:48 PM

I hope this blog wasn’t abandoned & that all is well with you. I enjoyed reading your updates!

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Jenny July 29, 2014 at 6:45 PM

Hi Joan
Where are you? Have missed the May and June updates!

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Mike July 31, 2014 at 10:58 AM

Joan, are you on extended vacation?

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Chris August 2, 2014 at 5:28 PM

Of all these, I feel the emergency cash fund is the most important one. A strong cash position allows you to avoid the mental poverty of living paycheque to paycheque, which is a big impediment to even getting started down the road to being debt free.

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Michelle August 10, 2014 at 6:11 PM

We have the hardest time maintaining our emergency fund. We have just started to “pay ourselves” as part of our budget.

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Michelle August 20, 2014 at 8:23 PM

Feel proud of all of your achievements. Imagine if you hadn’t started this journey! As for my priorities: debt free, growing my investments, and focusing on my savings account.

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Veli August 25, 2014 at 3:14 PM

So this blog has come to an end, i think. The strange part is that it’s been almost four months since the last post and two and a half since the last debt update and here i am, at least twice per week checking for possible new entries..

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KariVery August 29, 2014 at 1:48 PM

Me too :-(

It would have been nice for someone to say SOMETHING? Did they drop off the face of the earth, or what?

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Kellie August 27, 2014 at 2:38 PM

Joan,

This is exactly what has been missing in my plan! I only focused on my debt, and everything else took a backseat. Not only did this cause me stress it also threw off my budget. I now put saving for the inevitable above my debt. Christmas, oil changes, and license renewals aren’t surprises, but I would always use that money toward my debt. I would feel great until the check engine light came on. :)

Thanks a ton for this.

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