Hey guys! We’re excited to share one of our most interesting interviews to date (and our first guy!!). Today’s interview is with Debtless in Texas, a fellow personal finance blogger who has quite the story to tell. Once we started reading his interview, we couldn’t stop. And boy did we feel motivated when we were done. I think you’ll feel the same way, so we’ll let Debtless in Texas take it from here.
Tell us your story.
I was raised in an average middle-class family and was never really taught anything about handing finances. I worked through high school and made enough to cover the costs of being a typical teenager. My father passed away suddenly when I was in my early teens, and I knew that I was on my own when it came to paying for college. Thankfully, I also knew that going into tens or hundreds of thousands of dollars in student loan debt was NOT an option. I focused all of my energy and effort on schoolwork and being competitive for college admission.
My hard work paid off and I was fortunate enough to receive a full scholarship to an excellent private university through ROTC and graduated as a National Guard officer with ZERO student loan debt. I worked throughout college and spent everything I made to support myself while having a good time. Though I had no student loan debt, I did incur an 8-year obligation to the military, so my education wasn’t exactly free.
After graduating from college, I spent about a year and a half in training and was making what I consider to be pretty good money for a recent college grad. I never created a budget and didn’t really worry about saving for retirement. I got in the habit of using my credit card and paying it down every once in a while. I still cringe when I think about how much I must have paid in interest over the years. A poor financial foundation and a good steady paycheck set the tone for how I lived my financial life. I wasn’t saving anything and spent what I made… I was essentially breaking even.
After training, I volunteered to deploy to Iraq. Let’s just say that it was an eventful and life-altering year. One of the benefits of deployment is that you are not taxed on your income while overseas. I was making a lot of money and didn’t have many expenses. When I returned, I had a difficult time readjusting to normal life, could not find a steady job, and fell into the post-deployment stereotype of buying a new car. I ended up spending a year or so doing military funerals (I should write a book about that) and living off of what I had made overseas.
Long story short, I met the lovely lady that would eventually become my wife. She motivated me to get myself in order, and I eventually found my way into the tech sector. I was fortunate as she came into our relationship with no debt. My bad financial habits were still holding us back, and we were both essentially breaking even.
There are a few of those pivotal moments in life when you are able to pinpoint the exact time for a radical and fundamental philosophical shift — and mine came the second I found out that the wife was pregnant.
I created an extremely strict budget, paid off all credit card debt, started investing heavily in low-cost index funds, and followed a system of reasonable frugality. I optimize and minimize all expenditures and have some side hustles that enable us to automatically invest ~22% of our income before any money hits our bank account. We were able to build an emergency fund of 6 months of expenses and now save between 50–55% of our take-home pay.
You don’t double for the dude in the Dos Equis “Most Interesting Man in the World” commercials, do you?
Professionally, I have driven an ambulance, a golf cart, and a tank. I studied Krav Maga, brewed my own beer, and have seen where the Tigris and Euphrates meet. I have jumped out of airplanes, rappelled off of buildings, fell halfway into a grave while carrying a coffin, and was once slapped in the face while presenting a folded flag. I have experienced mind-numbing boredom, visceral fear, extreme adrenaline, and devastating loss and grief.
In my opinion, I have had enough excitement for three lifetimes and am now happily, very boring.
You mentioned you turned everything around when you found out your wife was pregnant. Why then?
I think that parenthood is one of the most fundamentally life-altering experiences in the human condition. I also think that focusing on finances was my way of nesting.
As soon as I found out that I was going to be a father, the reality of being responsible for another life hit me pretty hard. Not only did we create the little one, but we are also responsible for raising him to be an intelligent and responsible person. Kids are also extremely expensive.
I want my children to have more opportunities and a better life than I had. I made the decision to educate them about finances from the very beginning, but how can I expect them to keep their finances in order if mine aren’t?
So how are you able to save 50%+ of your gross salary? What major expenses did you cut back on to make it happen?
The first thing that we did to get to this point was to create an extremely detailed and strict budget. Unless you know exactly how much is coming in and going out, there is no way to find areas to optimize. We also combined all of our accounts, and we both have complete and transparent access to our finances. I believe that this was one of the most important things that we did. We are one team with one financial goal.
To make it happen, we did the following:
- Traded my post-deployment car in for a more practical and efficient car
- Cut our cable service and only stream via the Internet
- Shop around yearly for less expensive insurance providers and saved a bunch by switching
- Gave ourselves $100 to spend on whatever we want
- Set a strict budget for groceries
- Switched to high-efficiency LED light bulbs and low-flow shower heads
- Fixed appliances and did household/vehicle maintenance ourselves
My wife and I both work in the tech sector and are paid well. We make conscious decisions to live below our means and minimize the costs associated with every single expense. While this isn’t necessarily extreme, being more mindful of everything you spend and how you can use/spend less changes your perspective dramatically.
In my budget spreadsheet, each expense is shown as a percentage of the total budget. This has been the most powerful motivator for me and is how I find areas to reduce costs. If a certain percentage looks higher than it should, I can focus on reducing those specific costs.
What budgeting tools (apps, spreadsheets, strategies, etc.) are you using?
I primarily use my detailed Excel spreadsheet, Personal Capital, and Mint.
Each of these has their strengths and weaknesses, but I rely most heavily on my Excel spreadsheet. I track all income, expenses, investment account balance, monthly savings rate, and my allocated spending plan in one easy-to-use spreadsheet.
I have found that it is easier to stick to a budget that is realistic and still allows a small but firm amount of money to spend on entertainment, alcohol, or the occasional movie. The budget is a dynamic and fluid document — nothing is set in stone. If either one of us thinks that we should include an item, we bring it up and discuss it.
Any final words?
We didn’t start out saving 50% of our take-home pay; we had to slowly work our way up by starting small and keeping track of every single cent. Taking control of your budget and spending is an extremely liberating experience and anyone can do it. You don’t have to stop driving, using dryers, or remodel your own home to make a difference. Focus on taking small steps and reducing one expense at a time. You will be surprised at how fast progress snowballs into meaningful and dramatic change.
Thanks, Debtless in Texas! So much good advice rolled into one interview… Those final words are some of the truest you’ll ever read. If you have any questions or thoughts for Debtless in Texas, feel free to leave them in the comments below!