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The equation to having a positive net worth.

October 17, 2012

It’s easy:
*Live BENEATH your means+
*Increase your income (ie, get a second job)
+
*Pay off debt
=
Positive Net Worth!

Paradise: Bora Bora

This is where I want to be when we have a ridiculous positive net worth someday 😉

So I lied….it’s actually not easy at all.  It’s one of the hardest things we’ve ever done! It’s interesting that our goal wasn’t to have a positive net worth, our goal was to pay off the house……having a positive net worth just happened to be a side effect of decreasing our mortgage debt.  It was SO EXCITING to not see a bold, red and italicized negative net worth in our budget, but instead to see the friendlier bold and black numbers that reflected our recent positive net worth.

It’s exciting knowing that our + net worth is only going to grow as our mortgage debt decreases.  In about a year, we will be able to keep every dollar we make because we will have no debt and I can’t even imagine what that will feel like.  This is me giving myself a pep talk because it has been everything but easy.  I have recently had to pass on several different outings because I want to stay on budget.  I know if I go to these different events it will result in excessive spending that I don’t need, and it is difficult to say NO to yourself and to say NO to others.  I’ve never practiced saying “NO” to spending before we got on our budget…..but I have to say that everytime I did it, I lived.  The world kept turning, I didn’t spontaneously combust, and most importantly, I got a chance to practice my “frugal” muscles.  I’m starting to realize that Dave Ramsey is 100% correct when he says: “Live like no one else so that later, you can live like no one else.” Sacrificing and learning to have self-control are essential to building wealth and keeping it.

Questions for you: To all you frugalites: Is it hard to say “no” to yourself?  Is it hard to say “No” to others? Are others understanding?  Any specific examples?

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13 Comments leave one →
  1. October 17, 2012 12:44 pm

    Although our mortgage isn’t paid we have the cash in the bank to pay it off. It feels good knowing it is there and that we can be mortgage free. The stress is well gone and now all we need to do is focus on the future. You will love it and you are right we had to give up a lot to get where we are but it’s so worth it. Keep at it. Mr.CBB

  2. Sweta permalink
    October 17, 2012 12:46 pm

    I find it easy to say no to myself because I was raised by frugal parents so I’m used to hearing no. Sometimes I get tempted by Groupon, but deleting myself from their email list has helped tremendously. Saying no to others can be kind of annoying because there’s always that worry that they might label me as “cheap” but at the end of the day I remind
    myself that they aren’t the ones paying my bills. I usually tell people I already have plans or have to work or something if I can’t make it.

    P.S. I found your blog at MMM’s blog.

    • November 16, 2012 9:41 pm

      Good for you!!! It’s so much easier if you have been raised to say no when you can’t afford it…..or think it’s unnecessary. I feel like I am getting much better about saying “no” and is life-changing!!!!

  3. October 17, 2012 1:03 pm

    Great pep talk post! I can’t say the we follow Dave Ramsey’s teachings 100%, but that just means that we have plenty of room to grow. I guess that’s my little pep talk to myself hehe! It’s awesome to read your blog and be inspired to get our debt in control! I can’t wait to be in the black also! It’s gonna take a lot longer than a year for us, but it’s all good!

    Cheers!

  4. October 17, 2012 3:57 pm

    Great pep talk! Congrats on the accomplishment! I don’t know what it is like to live dept free, by I am sure it feels good.

  5. October 17, 2012 5:08 pm

    Congrats on finally achieving a positive net worth! That must feel amazing.

    It is hard to say no to myself and to others. My coworkers seem to have a higher target lunch amount than I do (my target is $7, theirs seems to be closer to $20), which drives me crazy. Other than that though, I don’t spend too much money for my income, so I think I’m doing mostly okay.

    • November 16, 2012 9:47 pm

      That must be difficult when dining out with your coworkers. Do you order a separate check? How do you prevent from getting caught up in the “let’s just split the bill” scenario?

      • November 17, 2012 11:03 am

        I’ve mostly given up because they make fun of me for caring about the “pennies” which are in reality, dollars, because if I had my choice, I would go somewhere cheaper to get lunch. Oh well! I’m starting a new position soon, so there’s no sense worrying about it in the meantime.

  6. October 18, 2012 5:27 am

    I understand completely. But one thing I’ve realized, the first couple of times of saying “no” are the hardest, after that it’s easier because you have a goal in mind. I used to get paid and spend money instantly [very non frugal] plus I was living paycheck to paycheck [currently working on a hefty savings account] and now it’s easier for me to recognize a “need” from a “want”. To me [a recovering shopaholic] that’s my biggest lesson and a huge step towards having a positive net-worth. 🙂

    • November 16, 2012 9:51 pm

      It’s a hard lesson to learn, but you are right. It’s all about figuring out the needs from the wants. What will set you apart from everyone else is if you can delay the gratification of your “wants” because you know it’s not the right time, not in the budget, or just not neccessary.

  7. John S @ Frugal Rules permalink
    October 18, 2012 8:09 am

    Nice post. It’s extremely difficult to say no to yourself, at least that’s what I’ve found. That’s why it’s so important to exercise self-discipline and have a plan. Having a plan can really help keep you on track if you’re committed to it.

  8. MyMoneyDesign.com permalink
    October 18, 2012 4:15 pm

    Congrats on finally reaching this pivotal point! I remember the first time my spread sheet went from negative to positive. On paper, I was actually worth something. I felt like such a man! 🙂

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