Oh hey there!
Today I wanted to pen you a more personal post. One that outlines (and celebrates!) a recent milestone in our family….hitting the $100k investment mark!
Now for some of you this may be a ways off, and for some of you this may seem like nothing compared to what you have invested. Either way, it’s an accomplishment for us and one that I want to talk about. Personal finance is all about making it personal. Personally I don’t care where our neighbors, family members, friends, bosses, coworkers or other individuals are at. I care about where we are at and how far we’ve come (plus where we are going!) I hope you can adopt this mindset too.
Over the course of the past 10 years (mainly the past 5 however!) my hubby and I have invested a total of $100k into our different investment accounts. While that is an impressive accomplishment for us, I can tell you that it has not been all smooth sailing up until now.
When I decided to leave teaching to become a financial planner, our wallets took a hit. Not only were we missing out on stable income, I also left some stellar state benefits (including free healthcare!) My husband and I adjusted but also encountered higher than normal medical fees due to surgery and eventually, the birth of our first daughter. At this time we really cooled it on our investing. Heck - we were just trying to stay afloat from paycheck to paycheck! We also racked up a bit of medical and credit card debt and in my younger more foolish years, I sold out of some investments to pay that off.
Now while I definitely DO NOT typically recommend selling out of investments due to paying a fee and missing out on what that invested money would grow to, it felt like the right choice at the time to get us out of debt. Do I regret that choice? Not necessarily, but it definitely wasn’t one of my smartest financial moves.
That being said, we are now consumer debt free, and have very little car and student loan debt left (as well as a mortgage). If we wanted we could wipe out all debt with our savings, but I like balancing both savings and paying off the rest of our debt as the interest rates are quite low on what is left.
So how did we save $100k? Here is the backstory:
1) When I was 23 I opened a Roth IRA through Fidelity and started maxing it out ($5500/year at the time). I used part of what was saved when I turned 27 to purchase our first home. Although I no longer max it out due to needing more cash flow with me not working/working part time on my biz, we still invest in it each month automatically and plan to use some of the money penalty free to pay for our daughter’s education in the future.
2) My hubby opened his 401k through work as soon as possible, and starting saving into it up to the match to begin with. Since then we’ve increased the percentage that is taken out of his paycheck. I tell people to always put enough to qualify for the match - free money is free money! Although I don’t love that higher fees associated with 401ks/403bs they can work quite well as it’s money that never touches your hands and thus, has to be invested. ;)
3) When I started teaching, I put 10% into my 403b through my employer. When I left, I rolled it into an Individual Retirement Account (IRA) at Fidelity.
4) While working at Thrivent, my hubby opened a Roth IRA and started contributing to it.
5) When I started working as a Financial Planner, I opened up and contributed to the retirement plans offered (both 403b and then 401k). These were what I cashed out when I we paid off debt.
6) My husband’s company has a great Employee Stock Option Plan (ESOP) that we take advantage of. We can buy the company’s stock at a discount which is a great deal! In September, we plan to increase this percentage.
So that’s basically it! It’s been a combo of employer sponsored plans (such as 401k and 403b) and individual plans (IRAs and Roth IRAs)
As I mentioned we’ve definitely had some hiccups along the way, but I’m proud of us for bouncing back and recommitting to our investing goals. Even if we aren’t investing as much as we’d like to, it’s still something!
The reason I wrote this post was to encourage you to start investing or to continue investing (if you’ve already started!) We tend to get bogged down in the details of where or how to start. If you’re unsure what to do first, check to see if your employer offers a plan and if they offer a match. Then take advantage of that!
I’ll be posting more investment related blog articles in the future, so if there’s a particular topic you want to see or question you have you want me to answer, leave me a comment and let me know!
And as always, thanks for reading! I appreciate you letting me guide you on your financial freedom journey.
Until next time…
Cheers to your abundance!
-Katie
