Nurses and Financial Freedom

Soliloquy, MSN, APRN, NP · Apr 22, 2015

How do you define "financial freedom"?

Financial freedom to me is having no debt or financial obligations.

Soliloquy, MSN, APRN, NP · Apr 22, 2015

Don't eat out, buy a car that's 10 years old, don't buy the newest and latest iPhone when it comes out. Don't go to Starbuck's. Work OT. Figure out how much money you need on a monthly basis to pay all your bills, buy groceries conservatively, and pay for gas. Then pour every extra dollar you make beyond your monthly expenses into your debt. Do that every month and you will have your student loans paid off in less than a year.

Should I put my savings on hold? Right now I put 50% of my weekly income into savings and then 50% into my loans (after the weekly payments are taken out and after taking $100 for myself). I'm like really trying to work this out because I want to be done by the end of this year. lol

Soliloquy, MSN, APRN, NP · Apr 22, 2015

I owed 48,000 in student loans which were paid in 2.5 years and I had 18,000 in the bank at that point as well.
I moved to a rural area and worked permanent nights. I did nothing but work and sleep during that time. I didn't spend money except for groceries and my rent was cheap.
Two years after that, I put down 25 percent on a mortgage and moved to the city. I live well below my means and invest. It can be done with some sacrifice and a concrete written plan.

That's good because you had a goal in mind. I think my biggest barrier has been mental in that I think that at my age I'm suppose to be more social (even though I'm an introvert) but I want to get this out the way and soon!

Jules A, MSN · Apr 22, 2015

Financial freedom to me is having no debt or financial obligations.

That is kind of tricky because although I pay my credit cards in full each month, my mortgages and cars are paid off but that doesn't mean I don't have financial obligations. Electric, water, heat-cooling, food, gas, home and car maintenance, veterinary care, property taxes, health care, gym membership etc. all continue to add up to substantial obligations.

Soliloquy, MSN, APRN, NP · Apr 22, 2015

I will also add that Dave Ramsey's Total Money Makeover changed our family's lives (this is NOT a religious book, it is the secular version of Financial Peace).
After reading it, my husband and I realized we didn't want to be slaves to our debt and mortgage. We paid off $80,000 in consumer debt in 18 months, moved out of our house that was larger than we needed (2500 sq ft for family of 4) with a mortgage that was MUCH larger than we needed, rented for 3 years, then bought a house half the size and half the mortgage, and easily 1/3 of what we COULD afford if we wanted a $2800/month mortgage. We've lived here for almost 2 years, and we will have our mortgage paid off in another 8 years.
Reading that book totally changed our lives. We now plan to retire in our early 50s with no debt and a paid off house.

I'm going to read this book as you've given your testimony that it's really worked for you.

joanna73, BSN, RN · Apr 22, 2015

You can be social but when your goal is debt repayment, there needs to be a limit for entertainment. Invite friends over for dinner. Go for a walk and grab a coffee. Join a gym.

The company you keep is most important, not the activity.

Soliloquy, MSN, APRN, NP · Apr 22, 2015

That is kind of tricky because although I pay my credit cards in full each month, my mortgages and cars are paid off but that doesn't mean I don't have financial obligations. Electric, water, heat-cooling, food, gas, home and car maintenance, veterinary care, property taxes, health care, gym membership etc. all continue to add up to substantial obligations.

At this point, if I buy a home, it will be a townhouse (i hear they're easier to sell than condos) and then I'd rent it out so that I'm not paying for all of that out of pocket. I kind of would like to get into real estate on the side? And use travel nursing as a way to see the rest of this country while still contributing to my future and having flexibility. I just haven't figured out a specialty that doesn't have me running around like a chicken with my head cut off and that I enjoy enough to want to keep doing. Career-wise, that's where I'm at.

mhy12784 · Apr 22, 2015

Financial freedom is about spending more than anything

Thats the single biggest key

Jules A, MSN · Apr 22, 2015

That sounds like a great idea and just be very picky about who you rent to. In my area townhouses are easier to sell than condos also. Having rental properties has been very good to me even though I rarely make more than the mortgage payment in rental income. They pay for themselves and usually increase in value. In the end I'm left with far more than I ever would have had if I had just put money in a savings account or CD both of which don't pay squat now.

mhy12784 · Apr 22, 2015

Renting is risky

One bad tenant especially early on can be a financial nightmare

Especially depending on the state you live in

Be exceptionally careful how you rent

Jules A, MSN · Apr 22, 2015

Renting is risky
One bad tenant especially early on can be a financial nightmare
Especially depending on the state you live in
Be exceptionally careful how you rent

While I agree 100% that it is important to be very careful who you rent to I would disagree that it is across the board "risky". It can be a long, ugly process if you have to evict someone but someone thinking about renting needs to have the stomach for that as well as some money put aside for repairs, vacancy or the chance that they get stiffed by a tenant.

I have rented out 3 houses over the past 20 years and have not ever, knock on wood, had a negative experience with a tenant. I have had a few who called me for silly things and one who paid late every month but kept the house in perfect condition and I always eventually got my money. My properties have never been damaged and I so far I have always refunded the entire security deposit.

It might be some good luck but I think there is more to it. A big factor as with all things real estate is location, location, location. Mine are all in young professional sought after neighborhoods where rental properties are at a premium and so is the amount of rent money you can charge. I don't ever consider anyone with less than stellar credit, no matter how nice they are and that has worked well for me so far.

klone, MSN, RN · Apr 22, 2015

Renting is risky
One bad tenant especially early on can be a financial nightmare
Especially depending on the state you live in
Be exceptionally careful how you rent

That's why it's beneficial to use a property management company. They take 5-10% of the gross rent, they do all the background checks, maintenance, dealing with unlawful detainers, etc. That's what we plan to do when we retire - we want to move abroad and rent out our house.