If you’ll indulge me today for just a second, I’m going to offer up a little debt-management counseling. Although I haven’t conducted a scientific study, I suspect that many people of modest means who are most successful in managing their personal finances understand the importance of being patient.
I’ve said it before and I’ll say it again: People who are debt-free didn’t get there because they’re impulsive shoppers or always looking for instant gratification. If the money for something isn’t in the budget, then they save their money and wait.
When I look back at my own personal situation, patience has played a ginormous role in allowing me to build a healthy nest egg while keeping my debt limited to nothing more than a very manageable $600 monthly mortgage payment.
An unexpected milestone
I was reminded of this again last week after my wife and I bought beautiful new end and coffee tables to cap off our recent remodeling project.
As we were loading the car with the old tables to give to a local charity, it suddenly dawned on me that we originally bought that furniture as low-priced hand-me-downs from some friends of ours more than a decade earlier. (Alas, ladies, unfortunately I’m not really as young as I look.)
What made this even more momentous was the fact that, after a long 13 years, we were getting rid of the last two pieces of hand-me-down furniture in our house. Finally!
When we first bought our new home, we bought one new furniture set to go into it — a kitchen table with six chairs. Everything else was “donated” by our folks or bought second-hand from friends at a significant discount.
We consciously ignored the urge to instantly fill every room with brand new furniture because: 1) We didn’t have the money and 2) we weren’t willing to go into debt for five or six years to pay for it.
Why waiting is worth it
I estimate the Honeybee (my wife) and I could have furnished our entire house when we first moved in 13 years ago (minus the kitchen set we bought) for about $12,000.
If we had been impatient and took out a five-year loan for the full amount at an interest rate of 8 percent, we would’ve paid out an additional $2,598.96 in interest over that time. Even today, that’s enough money to pay for a room or two of furniture all by itself.
The truth is, other than our cars and the house, we just don’t buy anything unless we have the money already set aside to pay for it in full. I can’t imagine how much that has saved us over the years in interest payments, but I suspect it’s significant. And those savings allowed us to afford some things much sooner than we otherwise would have – without being beholden to any lender.
The reality is saving money takes time
Anyway, this little furniture episode got me thinking about how long the Honeybee and I have had to wait to buy certain things we’ve wanted since moving into our new home 13 years ago.
So I put together a list of all the “big ticket” items we’ve bought – either for the first time, or to replace our second-hand stuff – since moving into our home. The numbers in parentheses note how long we had to wait before we could finally afford to buy each item.
- Matthew’s new bedroom set (1 year)
- Backyard patio slab (1 year)
- New minivan (2 years)
- Family room sofa set (3 years)
- Nina’s new bedroom set (4 years)
- Built-in family room entertainment center (5 years)
- Tile floors for family room, foyer, powder room, and kitchen (6 years)
- Replace blinds with shutters throughout house (7 years)
- Loft remodel, including furniture, wood flooring, and built-in loft office desk and cabinets (8 years)
- Wood flooring in guest bathroom (8 years)
- Upgraded carpet in living room and bedrooms (8 years)
- Dining room table, hutch, and buffet table (9 years)
- Living room sofa sleeper (9 years)
- Upgrade the wood privacy fence with a block wall (10 years)
- Upgraded glass front doors (11 years)
- Upgraded iron staircase balusters (11 years)
- Upgraded cabinets in kitchen, powder room, and baths (12 years)
- Kitchen, powder room, and bath remodel (13 years)
- Family room coffee table and end table (13 years)
- Master bedroom and bath remodel (still waiting; will do next year)
- Backyard patio cover (still waiting; two years away)
- New car (still waiting; unknown how far off)
- Computerized telescope (still waiting; unknown how far off)
People of modest means should understand two important facts: 1) We can’t have it all at once and 2) saving money takes time. Sometimes lots of it.
As you can see, after 13 years I’m still waiting for a few things, including my high-end computerized telescope. That’s OK, though. I may be old, ladies, but life is a marathon and, as best as I can tell, I’ve still got more than a few miles to go. Besides, the stars and planets aren’t going away any time soon.