In 2011 we purchased a foreclosed home. It was huge, it was 111 years old and it hadn't been properly winterized, we quickly found out, when we turned on the water and found burst pipes.
We had not been financially prepared to buy a home. We had other debt (student loan, credit cards, vehicle loans) and my then fiancée took out a 401k loan to come up with the rest of the cash for the down payment. We did so many things wrong in buying our home, but I was in love with the home and everyone we talked to agreed we were getting an incredible deal on the home.
The house had been purchased by the prior owners for $260,000, but it was foreclosed on and with the mortgage crisis at the time, loans were hard to come by and we ended up buying the house for $168,000. Somehow, we were able to roll in our closing costs and down payment into the mortgage through some special first time buyers deal and ended up with a mortgage of $178,238. We got a 30 year mortgage and an interest rate of 4.75%.
As soon as we moved in, I started to realize we might be in over our heads. The house needed a ton of work. We dropped almost all our cash reserves on a pellet stove and fixing the burst pipes that first month. We were planning a wedding and I had no clue how we would pay for it.
A few months after moving into our home, I found myself googling "how to pay off debt sooner." The first results I found were for Dave Ramsey. I quickly went down the rabbit hole and was obsessed with paying off our debt to create space between us and living paycheck to paycheck.
If you stumbled across by blog by chance, you may be wondering what is "FIRE" that I keep referencing.
F.I.R.E stands for Financial Independence Retire Early and is a movement that focuses on a goal rather than a specific way to achieve the goal. I came upon this from the old Dave Ramsey/TMMO forums, where people occasionally mentioned enjoying Mr. Money Moustache. I checked out Mr. Money Moustache's blog and was blown away.
Prior to his blog, I was feeling like we were moving financially in the right direction, but it would be a long haul and we were decades away from slowing down. After reading his blog, I realized there were other options. I could change my financial picture and put us in a situation where we could drastically change what our lives look like in 10 years.
For us, we want to slow down. We may not actually retire fully, but most following this movement don't intend to save 25x their annual expenses and then sit on a beach until they die. The goal is to put yourself in the financial situation where you can pursue the things you enjoy and not be trapped by bills/lack of savings/upcoming unplanned expenses.
We have set a goal of FIRE by 2025. For us, we need to be 100% debt free (including our house) and have significant funds in both our 401ks, 529 and outside investments. It is a stretch goal, but
Welcome to PoniesandFIRE, which is going to be a blog looking at personal finances in general and my family's personal journey to reach Financial Independence.
I am a 34 year old with a super hardworking husband and one child. Together we are striving towards some very big financial goals. In the short term, we want to become 100% debt free and in the slightly longer term, we want to reach a point where we are financial secure enough to live off of passive income.
I currently have two streams of income. My first is a full time job for a large scale horse farm, where I primarily work in the office, but can be found doing anything from riding, to working with baby horses to shoveling lots of manure. I also run my own side business teaching riding lessons, training horses and selling horses.
My husband works in the railroad industry and has nothing to do with horses, being somewhat allergic.
Together, we started the financial education journey through Dave Ramsey, after purchasing a foreclosed house in 2011 and realizing we were drowning in bills and completely overwhelmed. Since then, we have followed quite a bit of the Dave Ramsey financial advice, but also branched out into learning from a multitude of sources.
I am looking forward to discussing our journey and what we learn along the way!