While perusing the internet this week, I came across several advertisements for financing your wedding. Because there is nothing that says we are ready for the next chapter of our lives like starting it with a massive debt. Curious, I investigated more. Washington Times reported that the average price of an American wedding had reached a mind-boggling $35,329!
WHAT! On a party?
This amount could send that couple on good economic footing into the world. 35,000 dollars is a great downpayment on a home in most states or even a paid in full, flat-out cash price on some fixer uppers or condos.
It could allow that couple to house hack and cover all of their housing expenses!!! Why would anyone in their right mind finance a wedding?
Where are the friends and families not condoning excess and telling the perpetrators of such wastefulness what they are doing? TIME reports as of 2016 that 1 in 3 people have no retirement savings and that 72% of millennials have less than $10,000 in savings.
Where did we go wrong?
When did declaring our love for someone for our all our friends and families to nourish and protect become a pinnacle of American consumerism?
Does having the $3,000 dress instead of the $300 one say our love will last forever? Well it better, because that debt probably will stick around for a while.
But guess what, it does not, in fact quite the opposite.
On average, if you spend more money on your wedding ring and wedding, the marriage is less likely to last! The professors went on to hypothesize that it was possible that the economic stress of the debt from the wedding was what caused such outcome.
Do we need more reasons to be fiscally responsible, on this special day?
It goes on further to say:
“evidence suggests that the types of weddings associated with lower likelihood of divorce are those that are relatively inexpensive but are high in attendance.“
So if you want that marriage to last, go cheap, but don’t skimp on the people.
I didn’t know all this when I got married, but this is exactly what I had.
A big, cheap wedding.
This is what I did to get the wedding that I wanted without busting my budget, all said and done I think I ended up paying less than $2000 for 80 people:
Buy many of the things you would normally rent. And then sell them back on ebay.com, craigslist.com, or a Facebook group. Net after the sale will be a fraction of the cost to rent. It is usually pretty easy to do in bulk, but you can get more back separate. I got all sorts of things on Amazon.com: Wedding Fairy Lights, Table Runners, Table Cloth, Vases, and anything else you can think of!
Choose a cheap venue. We did a backyard wedding, and it was wonderful. Other places that are cheap are city parks, national parks, and some other public facilities.
Get a pre-owned wedding dress. Using an expensive dress for one day is wasteful. I bought something that I had tried on at a store for half-off the tag. And guess what you can sell it again afterward!! I used Pre-Owned Wedding Dresses, and I have nothing but good things to say about them. Many of the dresses offer returns.
Get a Birthday Cake! I went wedding cake shopping and was disgusted both with the level of quality and the price. Instead, I decided to go to my local bakery and ordered three all white birthday cakes. They were amazingly good and a fraction of the cost.
Rent the tables and chairs, make sure to shop around and don’t mention that it is a wedding.
Don’t skimp on the Wedding Photographer. This was the one thing I wish I hadn’t gone cheap on. Still, there are so many amazing photographers out there I would choose one that isn’t huge on the wedding circuit to get more value.
Food. This was my biggest expense. I had my favorite restaurant cater a buffet. The meal was my chosen splurge for my guests that made my wedding feel not low budget at all.
Get flowers in bulk. I ordered 450 roses in three beautiful colors from Sam’s Club.
Have family help out! Some family members will want to help share in your big day; this is an awesome way. Those flowers need to be arranged, the chairs set up and moved, maybe you have a cousin who would rather give some time than cash for a present!
How do you feel about the modern American wedding? What was your wedding like or what are you planning?
I often see these memes about adulting: the burden, the monotony, the reluctance. When did we decide it was normal to hate what we do day in and day out. Did we make a conscious choice to spend most of our time doing something we hate to get money? Or did it just happen? Why do people accept that the route to success is plodding away at a job for the majority of our lives, and the whole of our most productive ones at that?
So what happens when you say, F*** it! I don’t want to be a part of this system anymore! Well, that is what I did, I quit my job, put in my 30-day notice on my apartment, and sold all my stuff. Everything that I owned could fit within the confines of one backpack.
I had no home.
I had no fixed expenses.
What I owned:
Five lightweight pants.
Five pairs of underwear.
Five lightweight Camis.
One pair of sandals. (Which at one point were stolen and replaced with 2 dollar thongs)
Airplane sized toiletries.
A super pack of hair ties.
A small laptop.
A water camelback.
THAT. IS. IT.
In the whole world!
I got a one-way ticket to Europe on the proceeds of my stuff and embarked on some of the best times of my life. I did work trades for room and board, which usually required around 25-30 hours a week of work to take care of all my needs.
I worked on a peace farm, the vineyard of a pair of circus performers, I lived with a British couple renovating an old castle into a B&B… which was complete with a haunting story and a dungeon. I met interesting people, a villain from the old Bond movies who made a kick ass shepherds pie and referred to the local villagers as his “minions”. An old man who had traveled around the world by sailboat and had met Salvador Dali. Peace activists who protested on the corner every week, I joined in! A man who got called away to advise huge companies during the 2008 financial collapse. And I mentioned the circus performers, right? They juggled chainsaws!
I found other kindred souls, and we would travel together for a month or two. People from all over the world who would give me a glimpse into life in their home country.
I learned about life in other cultures and saw things I will never forget.
I hitchhiked. I showered at many public facilities. I got acquainted with everything free, libraries, festivals, public pools, and most importantly nature. I ate weird local delicacies and pub hopped with a few of my hosts.
My biggest takeaways:
Life is about experiences, not accumulation.
Love people, not things.
Material things only hold you down from true freedom.
You might be asking, well why are you not still doing this if it was so awesome! My now husband and I ended up getting pregnant and could not live by the seat of our pants anymore. The desire is still there, and now our family is close to going back out on the road again. This time with a different kind of freedom.
At the heart of this is breaking out of the norm. To create your system. Which is what I’m trying to do now. Or, you live outside of it, which is what I did when I chose to be homeless. You can live a life where you choose how to spend your time. You can do this the easy way by living outside and eschewing everything and live in the flow of the world. Or you can put in some serious work and break the system!
I would also like to give a shout out to the homeless who did not get there by choice. And while I would like to tell those who are capable, that there are options. Some just are not and in my opinion are a symptom of a sick society. Homeless and Housing Charities.
That means 50% of people are living paycheck to paycheck in America.
For those 50%, I would like to tell you that this is not how it has to be. In fact, I would like to tell everyone toiling away with no plans of retirement or even those who want to take the standard age 65 retirement. That not only can you survive but can thrive! You can even retire early if you want to!
There are 4 Parts to Freedom!
There are many ways to reach financial goals and everyone has different views of what they want their lives to look like. People who lead you to believe that the only option to success is their proven method, or by buying their product are lying! The main goal is to be better off tomorrow than you are today, try to at least do something on the list, and if you want to never worry about money again, do all of them.
Part 1. Lower your cost of living.
Take a hard look at your life. Are you working for your needs or your wants? The first step to never worrying about money again is to lower the baseline amount of how much you need. I spent a year owning only the contents of one backpack, nothing else in the world. It was freeing. It was just me. I went to a country where the dollar went further, and I was thriving on less than $500 a month. Now I am not suggesting to you to go to these extremes. I only use it as an example of what is possible.
Don’t look at this step as a negative impact on your life, getting rid of things that hold you down only allows you to rise. Also, if you need less to live, you need less to retire!
If you have never written out a budget to get an idea of how much is going and out and where of your bank account, Mint.com is a great place to get started, and it is free. It also has a net wealth calculator built in.
Sell any large asset that is not making you money if at all feasibly possible. That means the huge house you are filling up with useless stuff. That means the car worth over $10,000 is gone. Unless your net worth is over a million, these cannot be considered reasonable.
Cut down any monthly expenditures you can, find a cheaper cell phone, pare down to only one entertainment source, call all your current providers and see if there is a way to lower your bill, don’t eat out as much, cut out as much frivolous spending as you can.
Part 2. Increase the amount of money you are earning.
So let’s say you get through Part 1, you have reduced your cost of living substantially, and you are still struggling to keep your head above water to live let alone to invest or pay off debt. It is time to increase your baseline income, find a better paying job. If you get through Part 1 and you’re looking like you are going to be able to make a lot of motion with your ocean, it never hurts to get a little more and get that tide a little higher.
Look for a new job in your same field. Find someone who will pay you more, use that current job to leverage you into more money!
Get a second job. Or, if there is a spouse at home consider them taking on a small job while the main breadwinner is home. I don’t advise this just for life quality, but it is an option for speed, or if the situation is dire.
Low earnings in your field? Switch it! Look for paid apprenticeships in construction, like plumbing and electricians. Jobs which provide their training like Emergency Services (police officers, dispatchers, firefighters.), or drivers (Truck, School Bus, Boat.) which often train you to get your Commercial Drivers Licence (CDL) which can be a huge money maker. See: How to get a high paying job with no debt involved!
Go back to school. This can be a rough one. First, the earning potential of the job you will get from going back to school has to be very good. Make sure that one year of your projected salary can cover your whole debt incurred plus any lost income you could have been making during the time I took to complete it. Make sure to shadow your projected career, or find some volunteer job around it to see if it is a fit for you first. There is nothing worse than incurring a bunch of debt only to hate what you got out of it.
Part 3. Kick debt in the teeth.
I am not of the opinion that all debt is bad. Would it better to have no debt, YES! But, I believe in the power of leverage. Using student loans to leverage you into that job that makes you much more income. Using mortgages to get you into and possibly renovate an investment property that yields cash flow after all expenses. Getting a small business loan to grown your company and your earnings.
The key for those is the end goal must be worth it, and you must complete the task the loan allowed you to do. You have to be getting more out of the debt then the lenders are getting out of you.
Consumer debt is typically the anti-thesis of being financially healthy. This includes cars, credit card debt, any debts that are not currently making you more money than the interest they are charging you. You cannot do Part 4, investing in yourself while you have consumer debt, the interest they are charging simply cancels all gains you are getting elsewhere.
Cut up your credit cards or make them inaccessible to yourself. (I’ve heard of people freezing them in ice and keeping them in the freezer.) I do not advise canceling them because it generally does not help your credit score.
If you keep unfreezing those cards, it is time to have none at all.
Don’t sign up for credit cards for the free rewards or discounts, especially if you have a track record of racking up debt. There is a reason they do these incentive programs, they more often than not get more out of you then you will get out of them.
Attack your highest interest charged debts first for the most results, attack your smallest balance debts first for the most motivation to keep going.
Have a ton of debt, and you can’t even get a handle on the monthly payments? Even after Part 1 and Part 2? Consider moving the debt around. Some cards will do balance transfers and give you a flat low-interest charge up front by adding it your balance. Only do this to debts you are sure you won’t be able to touch for the period it is held for because you are working on others. Wait that didn’t work, not enough wiggle room to move it: have some other large asset? Look into selling that asset to pay your debt off or getting a loan against it at a lower interest rate. No assets? Maybe it is time to consider bankruptcy.
Part 4. Invest in yourself. Diversify your earnings.
This Part is the fun one! Make sure that you are good with Part 3 though before doing things on this list unless you can manage to do them for no money or debt! If your goal is truly not to worry about money make sure to build up a buffer in a liquid, interest accruing account like a money market fund of at least 3 to 6 months of your current expenses. Remember the more sources of income you have, the less impactful losing one is, so diversify!
Start your own side business, this can be anywhere from starting a blog, to a service like consulting or tutoring. Remember to start small and scale up with success try to grow from your earnings!
Make sure you are matching any employer contribution into your retirement account.
Invest in the stock market. If you like your field of employment and enjoy going to work, ramp up those retirement contributions and also invest in IRAs. If you would rather retire early, invest in index funds and dividend stocks.
Get an investment property. Investment properties can be a really strong contributor if you would like to retire early as it can quickly push you into gaining passive income.
Let me first start out saying this is not an affiliate link bank; I am not going to tell you that doing all your searches through Bing or Swagbucks, or all your shopping through iBotta is passive income. Because it is not! Those are just incentive programs, to do your shopping through them, or to actually do work for them by building their businesses. Passive Income is income that does not come from trading your time for money; it is something that is sustained even when you are taking no actions. However, that does not mean there is no work involved!!!! Let’s get this straight; there is no such thing as money without effort. The closest thing is government cheese, but you still have to jump through a ton of hoops, live a very modest life, and be reliant on someone else. Passive Income streams tend to have a lot of work up front that yield a slow stream that takes only a negligible amount of time and maintenance later.
Stock Market: Dividend Stocks, Index Funds. The key for passive income in the stock market is only to take the interest accrued out or dividends. Dividends Stocks are single company stocks that have a good track record of growth in the value of the stock as well as give little kickbacks called dividends. The key with the stock market as a passive income is that you do not remove the money that is generating the interest or dividends. The catch for this is that it takes a significant amount of cash (Work) to make any real life changing amounts here.
Real Estate: Rentals, Owner Financing, Lending. The best thing about this category is that it all works together to allow for a lower point of entry. The bad part is it takes a long time or a lot working with many balls in the air to switch over from the person paying mortgages payments to the person receiving the mortgage payments. There are also so many different options for investing within the Real Estate industry. The baseline rule is getting someone downstream of you in the world to pay you a consistent cash flow.
Businesses: Franchises, Self Startups. These take a lot of upfront work and time; businesses vary widely from restaurants to vending machines to small-scale blogs. Your imagination and motivation is the only limitation. Entry point can be very low like a blog or require significant capital such as a franchise. For passive income, the goal has to be generating enough income that you can hire people to do all the work and still yield an income.
Creative Royalties: Inventors, Authors, Musicians. Usually taking a great deal of upfront work and marketing before any returns are seen. These once they are created passively create income. How much income mostly varies on quality, quantity, and marketing. For this not to be a business you have to hand this off to someone else such as a record company or a publishing house.
“People always need a place to live.” This was a statement made by my real estate investment mentor. He had been a real estate investor from the age of 20; he tried all manner of operations, land to single family homes; commercial store fronts to multi-family housing. Slowly and steadily he weathered the economic climates, and he worked his way to an early retirement at 45.
Countless people are investors in real estate, some small like me who own only seven units, some big who own apartment complexes all over the place. Some passive who have all their properties managed by someone else, some active who play the role of the property manager. Real Estate should be in your portfolio. When held for long times it is steady. When leveraged the return percentages can be very high. When fully paid off they are an amazing constant source of income.
An investment property is one that is purchased with the intent of making money. Your home can build net wealth, but it is not an investment property unless it is multi-unit and you are renting the other units out.
1. Leveraging yourself into a fortune.
Loans are still available at historic lows in the United States, when you compare our rates to the 15% of times past our buying power is stronger than ever. The advantages of using a loan to purchase real estate are you can take a smaller amount of money to purchase a large asset that yields more money and which puts more money in your pocket every month. It allows the little guy to get into the game and get great returns.
There are three ways to get tax deductions on investment properties.
Operating Expenses, these include but are not limited to property management, water bills you pay for the property, and repair costs.
Interest on Loans, your loan company will send you a tax form at the end of the year, and it will be a tax deduction.
Depreciation (Cost Recovery), this is only for investment properties, not your personal residence, this is an incentive from the government. This tax incentive is to help counteract the natural wear and tear your investment receives. They deem the economic life of a property to be 27.5 years; the deduction is the properties purchase value divided evenly over that time per year.
Real Estate does not have a static value, it changes with the market and time, however, over time almost all real estate in the United States has gained a great deal of value. This is a wonderful thing because it means that for long-term property investment keeps up with inflation and has the potential to yield you a great deal upon sale.
Two things of note:
When you invest only for appreciation short term, you are moving into a different investment strategy of speculation.
There can be significant capital gains taxes on home sales; please seek advice from a tax specialist for more details on this.
4. Cash Flow.
This is my personal favorite of the four ways I am making money from real estate right now. Cash flow is the reason people call Real Estate investing a passive income, and I would personally call it a mostly passive income. Cash flow is the money that is generated from your asset in excess of the costs. I use a conservative estimate of half of your rent going to losses, repairs, vacancies, and costs. Many people use this to pay off additional on the mortgage, save for another investment, or just fund their life.
Are you ready to buy an investment property? Get PreQualified before you talk to a Realtor!