Debt Paydown, Tracking Expenses, & Financial Independence | Rebecca from My Fat Purse

Today's episode features Rebecca from My Fat Purse.

She breaks down how she and her husband paid down his $180k student loan debt in just 2 years.

Rebecca and her husband gave up pensions from the military and are poised to hit FI in 5 years.

She talks about how powerful tracking their spending and avoiding lifestyle inflation was to this journey.

Listen, learn, and let us know what you think.
Episode Summary
Rebecca's background

She started taking her finances seriously after marriage
* Rebecca's husband came into the marriage with $180k of debt
* They paid that debt off in 2 years
* Rebecca graduated without any student loan debt thanks to the military
* She studied mathematics for her bachelors
* Then she got paid by the Air Force to get her masters

Paying Down $180k Debt

* Rebecca attributes tracking expenses as the most powerful force to paying off debt
* They put all of one salary completely towards debt
* She also calls out how important it was to avoid lifestyle inflation
* That refers to slowly spending more money over time
* Rebecca's husband was also in the Air Force
* He was supposed to be on scholarship but ended up losing on it
* She covers that tough decision on giving up a pension and chasing FI

Life After the Military

* Her husband took a slight hit in income and she saw a raise
* Rebecca stuck with working for the military as a contractor
* Her husband decided to completely change up his job
* They now have control over where they live but decided to stay in Colorado
* This was mostly due to her husband's job and ease for her to find a good job

Path to FI

* They have purchased two homes
* One is their primary residence
* The other was for renting out on Air BnB
* That experiment didn't turn out well so they sold it
* Outside of their primary residence, they keep it simple with a three-fund portfolio
* Rebecca feels they are five years away from financial independence
* Next Rebecca walks through why and how they combined finances
* They do keep separate accounts for some flexible spending

Budget Tracking

* Rebecca really emphasized tracking spending and how she does it
* She started with Mint
* Recently she transitioned to an app called EveryDollar
* She also has built a very robust tracker you can download

 
Key Takeaways

* True Partnerships: Rebecca didn't put all the debt payoff on her husband, she knew that their goals were tied together and decided to help
* Tracking not budgeting: People often think you have to set limits on yourself when in reality, simply knowing where your money goes is the first step
* Not all real estate is gold: Just a nice reminder that while real estate is extremely powerful, it's not foolproof as Rebecca found out

Call to Action

Take some time and completely track your expenses for 1-3 months even if you've done so in the past. This can help make sure you fully understand where all your money is headed.

Join the Community
We’d love to hear your comments and questions about this week’s episode. Here are some of the best ways to stay in touch and get involved in The FI Show community!

* Sign up for our exclusive newsletter
*