Until roughly 5 years ago finance wasn’t something I gave a second thought. I grew up in a home that was not poor but nowhere near wealthy, either. Money was for bills, food, an occasional vacation and little else, mostly because there was little of it. My father reminds me that when we were children we rarely asked for money. We didn’t really need it as there was plenty to do without it. It wasn’t until I was 14 that I got an actual job that produced a W2 and the only reason I got that job was because I wanted my own vehicle. The sad part of all this is not the $1800 I spent on a late 80’s Monte Carlo with checkerboard rims. The sad part is that while I started earning at a very young age I never actually learned the basic principles of personal finance. Truth be told, I still don’t know them all but I’m learning. Also, full disclosure, that Monte Carlo was great and of all the cars that came later, that’s the one I miss the most.
I’m at a point in my life now where I have dependents. My wife and I have two young children for whom she cares 80% of the time while I make a living as a software engineer. While she easily has the more difficult job I am the majority of our income. My wife does work part time at a salon and does considerably well for the hours she’s actually able to be there. However, as you can imagine, with two small children she’s not able to be there very much; it’s definitely a part-time gig that is great extra cash but I think it’s more important for her to get out of the house and interact with adults 12-15 hours a week; helps keep her sanity, you could say. When she and I were planning our future we knew we wanted children and we didn’t want them raised in daycare. Don’t get me wrong, daycare is fantastic. It’s great for single parents or partners who both earn high incomes that justify what you pay for the service. For my wife and I the extra money my wife could generate while we paid for daycare wasn’t enough to justify the expense. More importantly, my wife just wanted to be there everyday, every moment while they grew through those toddler years which I always loved and respected. Kids can be exhausting! The amount of energy they have is seemingly endless.
As I aforementioned, my income is really what our family survives on. Until recently, we had what I thought was the correct version of an “adult” financial framework; a checking account, a savings account and contributions to a 401k. Growing up the only real financial advice I can recall was, “put money in the bank”. To be fair, at that time, interest rates for a savings account were an astronomical ~5.00%, compared to today so putting money in a savings account actually meant something. Sadly, these days, you’re lucky if your savings rate keeps up with inflation; in most cases it does not which means putting money in savings costs you money because the dollar you put in there today has less buying power than the dollar you take out a year later but, we’ll get to all that. Right now it’s probably easiest to explain my motivation here by stating that I was tired of losing money while doing what I thought was the right thing. So, I decided to do something about it for the sake of my family and this is how I began.