I’ve covered the basics and some of our story and psychology around money here before, so if you need a refresher take a minute to read this gigantic post from 2016.
Now, here’s my disclaimer. Please take this with a grain of salt. We started out very differently than so many of other business owners/professionals. Neither Aaron nor myself had any debt of any kind when we got engaged (We didn’t go to college, ergo no school loans). We bought our first house together before we were married …
Since 2016 we’ve sold those businesses Aaron owned, bought and sold a few homes, moved our primary residence, became landlords, and learned a lot along the way.
A year ago we were still having the “Buy vs Rent” conversation with anyone who asked us what we thought. “Definitely buy a house, it’s the better investment,” we would offer. “Here’s how you invest in yourself to start flipping houses.” “The first one is always the most risky, because it’s moving forward with this big idea you have and seeing what happens next.”
Since then, I’ve found a few more voices in the personal finance realm that have made really good points and caused me to go: Huh. I no longer think rushing to buy a house is the better investment. I actually know this from our experience of renting for 2 years (2010-2012) and how freeing it was to have one line item dedicated to housing in our budget: RENT. That was it, pay it and be done. Live here but also live every where else you are because you’re not focused on fixing, building, changing or keeping a house up.
We were big Dave Ramsey fans for a long time and he still has his place in personal finance. People who go through his courses know how well it works but there’s also so much shame in those conversations. I honestly didn’t know there were women who were talking about this. Investments and graphs, budgets and tax strategies. I found them this year and it’s been amazing to read, listen and watch how they talk about money.
Like, I don’t think credit cards are the devils semen just waiting to impregnate our life with bad decisions. We have, and use, credit cards. We pay them off entirely every month and if you aren’t up for that kind of responsibility, then yea, don’t have one. But there are so many upsides to them if you’re willing to keep track of your financial life.
Ok, now that we’ve got some of that out there … let’s dive in a little deeper. I’ll ramble about few areas of our personal finances; Owning Rentals, Future Goals and Strategies, my personal favorite – Currency, and I’ll wrap it up with my favorite Financial Tools.
We have 4 doors (3 properties, one is a duplex). We knew we wanted to own a few rental properties but didn’t know how to get started. It seemed like a lot of saving and waiting to be able to “get in” the rental market. You need a larger down payment for a mortgage on a rental property, the rates are higher, and there are hidden fees and taxes you have to pay right away. More inspections, complying with the City guidelines, Rental Certificates … etc. Not to mention when things go wrong, you get the call and you have to fix it or pay to have it fixed in a timely manner.
We started telling our neighbors that if they were interested in selling their homes, we’d love an opportunity to make the first offer. A couple of them reached out to us – multiple times we didn’t bite and they sold with a realtor or via an estate but we did end up buying the house next door to us, finally. This was our first rental. We used equity from our own home to get the house and fix it up: then we put a FOR RENT sign in the yard and the adventure began!
Renting out a home is a full time job and thankfully the first one was right next door so we could see everyone stopping by and looking in windows. It was easy to meet on a moments notice to show the home and we’ve been really happy with our renters (in all of our properties).
We broke the seal – the next deal didn’t seem as hard to understand. The mystery was gone and we had cash flow and an entire system set up for easy banking relationships and future borrowing opportunities.
Aaron really loves the rental business we have. He’s streamlined so much of the process (his sweet spot) and loves to share what we know and how we do things. We’ve toyed with the idea of making our process an easy to digest e-book and maybe we still will. I know he’d love to help other young investors get started.
We are always looking but with the housing market as hot as it is right now: we aren’t in a hurry to buy high. So we keep saving and waiting. Our goal is to have 10 properties. This is one arm of our future retirement planning.
Future Goals and Strategies
One of them, as I just mentioned, is owning more rental properties. But I’ve recently gotten very interested in investing. Not in Day Trading – that’s not for me. I have nothing to offer on that subject, but in long term investments. Compound interest. I’m devouring everything I can read on investing. I’m a real good saver. It’s just my natural bend to save but I’ve traditionally kept a large cash balance and I’m slowly working my way towards investing more. Still saving, still accessible, but doing more for us in the meantime.
The evergreen advice always stands here: It almost doesn’t matter how much you have to start with, it matters more that you start early. Young. Definitely do the 401K match if it’s offered to you and then when you can … however much you can: add more.
The hardest part of future planning is that it always matters when you start. So start now. I love using Betterment for our investment accounts, it’s easy and I’m going to keep referencing Katie’s blog because the amount of information she has available is amazing.
A few words on this: I immediately feel shame when I say these things. It’s not lost on me that we are privileged, that a lot of the decisions we made have worked out for us. I’m not going to spend a lot of time here because I’ve covered this ad nauseam in other posts but I am getting to my next point which is more on the psychology of money and what we believe about it …
What do you think when I say Currency? Money? Cash? The green stuff, right? Sure, that’s obvious. But not everyone wants to be rich, some people just want to be free.
If what we do from here on out makes us rich, thats cool. But I already am and not in the way you want to subscribe to me. I’m more interested in the things in our life that make us a better community, a warmer home, a larger table, another opening for more of what I hold close.
As a very young girl I observed the adults around me act like Money, or Having Money, was the goal in life. It’s how they showed other adults what they felt was important. It’s how I was bargained with, for and ultimately discarded because my need for Money With Adults wasn’t following the right version of manipulation.
Not having money is a very tough place to live out of. There will never be enough when there never is. So money becomes this THING we just can’t quite reach for. I wish I knew the podcast I listened to that talked about the idea of finally having enough money to survive and what that did to their ability to be the boss of money, instead of money being the boss of them.
It’s a shift, for sure. And it’s powerful.
I have a few mantra’s I keep close: Let go, Let’s go! and I already have everything I need. There were a lot of years as young marrieds and being a young mom that money was the boss of me. The green stuff, and whether or not we had enough of it. We didn’t, most of the time. But I started paying attention to what I thought “having it” would fix. Would it cure my emptiness? Would it bring my loved ones back from the dead? Would it give me second chances? Would it buy me the life I really wanted? And what was so bad about the life I was currently in?
Money actually had nothing to do with any of that. So I started paying attention to what did. And this is where I’m going with Currency …
I learned that what mattered to me was not how many groceries I could afford to buy, but how many people I could fit at my table.
I learned that what mattered to me was not how clean my house was, but how it felt to sit on the floor with my kids while they learned to walk and hold them when they fell.
I learned that what mattered to me was not how finished my spaces were, but how alive I felt hosting friends and family inside any of the walls we had.
I learned that what mattered to me was not how current something was, but how at-home I could feel in the spaces I created.
Sometimes when we hear NO in our financial lives, we’re supposed to hear NOT YET. You eat an elephant one bite at a time. Looking at someone’s life on the outside who have been living, doing, etc for decades longer than you and comparing it to your current situation is real dumb. Your beginning isn’t supposed to look like someone’s middle or finish line. Adjust your focus and get clear on where you’re going, not where someone else is.
I’m now the boss of our money and my favorite currencies aren’t green at all. Unless it’s from my garden. My favorite currencies are love, patience, inclusion, food, hugs, warmth, walking in the woods, dancing and laughter! How I experience life, this one life I get, actually has nothing to do with money and everything to do with my attitude and gratitude.
But now that I know better, I can do better. And here’s how:
My Favorite Financial Tools
You Need a Budget (YNAB) … this is the budgeting app I use and have used for years now. Take advantage of their tools – I email them all the time, or do live chats within the app – and they are AMAZING at customer service and answering all of my questions. When our daughter got her first job, we bought a subscription for her also. Which we’ll cover until she’s on her own. Talk to your kids about money, show them your budget and what it costs to own things. Teach them how you keep it going. They’re not magically going to understand this because of algebra 1 in Mr. Tailbottoms 8th grade math class.
Betterment … this is the investment platform I’m learning (and loving). In our financial past, we’ve had accountants and specialists take care of this side of our finances but as things get simpler for us and I learn more, I’m comfortable taking the reigns back and being educated on my choices is just as powerful as having them.
Mint … I use Mint to have an overall snapshot of our financial picture. I get an over-all look at our accounts, investments, assets and net worth. And you can use Mint as a budgeting tool if you’re just getting started (I used mint before I moved over to YNAB and never looked back).
Wealth planners and other educational tools: I’ve purchased a few different tutorials and materials from Money with Katie and am looking forward to more as I need them. We have quite a library of books on real estate and finances as well, but you can reach out if you want more information.
Now it’s Your Turn:
Have a good podcast, article, suggestion, tip, blog post, or?? … you get the idea. What are you learning lately about money, currency, financial goals, travel credit card hacking and whatever else you geek out about? I WANT TO KNOW.
I’m not asking anymore, I’m telling you – drop it in the comments for the rest of us who made it through all 2,200 words about money today. It’s our consolation prize.
You already have everything you need (for right now, for this moment, for the next half hour). Sometimes in order to see the long view, we have to focus on the next few steps in front of us. Don’t freak out, and keep going.
You’re doing amazing.