I am an Excel junkie and I do multiple “What if” budgets that explore more of less revenue and possible outcomes of expense management changes like accelerating car payments or various debt payments.

But then I am rather obsessed like that!

Best, RB

We also went from two very good incomes to one very good income. Fortunately for us, though, my wife always knew she wanted to stay home when we had kids, at least while they’re young, she was a better financial planner than I was (at the time), and so she never let us spend one dime of her income while she was working. Not only did we not spend any of hers, but we saved a healthy chunk of mine as well.

For five years we put all that money into plain vanilla CD’s so that when we finally had kids, settled down, and bought a house we could make a 75% down payment.

I realize that not everyone is fortunate to be in a situation to live like this, but I also know that there are A TON of educated young people who are, and choose not to.

The benefits to this plan are three-fold, in my opinion. The first is that you never get unnecessarily accustomed to a lifestyle that you will eventually have to cut back on. The second is that it takes serious advantage of the time value of money. The third (an extension of the second) is that by “buying down” your mortgage so significantly, it frees up alot of cash right away for savings, yes, but also plenty of fun stuff.

We have more free spending money now than we did when we had two incomes and were earning more.

This is a hard path to follow initially, and if it had been my choice I wouldn’t have been forward thinking enough to do it. So I have only my wife to thank for this one, and her very sensible and frugal parents for their example.

The only thing that stood out in your posts, Laurie, was you mentioned spending alot of money on your kids’ education. I’m assuming this is in addition to college savings, and you’re referring to private school tuition. I can’t pretend to know anything about your situation, but I know those bills would be somewhat of a game changer for us. When we were house hunting, the first criteria we searched by was the public school district we were comfortable with.

I really didn’t do a good job of pointing out that it isn’t the case that we never eat out or that things are super tight – they aren’t. We budget for entertainment and eating out on a monthly basis. I spend a lot of money on mhy kids education. What I’m really surprised at is that we DON’T have the money to pay down the mortgage if we’re saving like we should. We’re currently shoveling Roth $833, cars $500, college $350 sinking funds ~$800 into savings every month. There is certainly money there – it just seems like we have to save it all!

Interestingly, I know in my heart that if we had a sudden windfall, I’d plump up the kids college funds, add another 3 months emergency fund and possibly fill the car funds … and we might go out for a nice dinner. Perhaps the problem is really me!

I do have to add that before kids we were a two income family (I also was making just at 6 figures) so I think I’ve also been very spoiled by the days where spending on a lavish vacations and eating out at will were common place. Doesn’t it always feel like a punishment when you have to cut back?!? Even though I’m really perfectly happy with the way that things are, it still seems like (my choice to stop working and stay home) is also in some ways a little bit of a punishment!

Sometimes I think that just knowing so much about the budget (I’m the nerd in our family) keeps me from *enjoying* the fruits of spending any money. Guess that is a good thing most of the time!

We have never carried much “debt”, and have had only a 15-year mortgage for the past 7 years. We buy cars with cash, pay off our credit in full each month, and save more than 40% of our after tax income. We also pay an extra $600 per month on top of our $888 mortgage. Still, we budget every penny, and do without many things that we would like to have (vacations that aren’t visiting relatives, for example).

We have maxed out work-based retirement plan contributions (what is now 401k, but had several names before that) for 16 years. 16 years – and folks, it is still not very much money. We have also maxed Roths for 10 years – and they are worth less than our contributions.

If we budget carefully and do without for the next 20 years, we have a slight chance of having just enough in retirement accounts to meet our basic living and medical needs. “Rich” is not a possibility. And “dreams” have been put aside as childish.