2FD 087: Debt and Mortgage Free in Four Years, Negative Net Worth to 750K and Estate Planning

On this episode of Two Frugal Dudes, we’re putting debt in the rearview mirror, increasing our net worth, and looking ahead at estate planning. We’re joined by Andy Hill of Marriage, Kids and Money.

Andy’s Journey

Andy and his wife Nicole started their life together with little knowledge about how their finances worked. With plans of having a family, Andy started reading the works of financial gurus like Dave Ramsey and Suze Orman with the intention of learning ways to mitigate their consumer debt.

At the time, Andy and Nicole had around $50,000 in debt. While Andy’s initial approaches to debt-reducing ideas didn’t go over as planned, they eventually came together with a strategy and paid off their debt in a year by smart spending and living on 50% of their income to get by while applying the rest to debts.

From there, they kept building momentum. Following the same principle, they were able to pay off an additional $195,000 over four years, becoming mortgage-free while their children were still young.

Negative Networth to 750k

Andy and Nicole decided to find out their net worth after watching an episode on Suze Orman’s show pertaining to the same. They were shocked to discover that they had a net worth of negative $50,000. They made it their mission to eliminate their debt, putting them back at even, before they started investing.

By paying off their consumer debt and mortgage, as well as investing smartly, they were able to create a combined net worth of $750,000 over eight years.

Andy’s advice to those looking to do the same is to eliminate the excesses in your life. With careful planning, you can live on less than you think. Visit Andy at Marriagekidsandmoney.com for debt fighting tips and tricks, and a free copy of the Young Family Wealth Playbook.

Frugal Tip of the Week

Estate planning is one of those things that no one wants to consider but is of the utmost importance for protecting your assets. There are a lot of great templates online with which you can take a DIY approach, but they don’t incorporate all the local regulations and legal jargon you need to make it legitimate.

While working on his will, Sean stumbled upon Legal Zoom, which offers legal advice and forms for your convenience. Sean was able to get all the proper documentation required for his family with a legal consultation for an affordable amount.

Setting up a proper will can ensure your children are taken care of. You can also add a lot of customization, with percentages, alternate beneficiaries in the event the main beneficiary is no longer around, and more. Living wills and advanced directives can tell your family what your life support and funeral preferences are and assign power of attorney in case you become incapacitated.

Be sure to update your documentation regularly to incorporate new assets and new family members.

Fun fact: UPS stores often have a notary to sign off on your documents and talking nicely to other customers can get you a couple witnesses!

Where Our Money Went

Sean is expanding his hobbies and revisiting his love of video games. It’s been almost a decade since he last immersed himself in the world of gaming, shelving the controllers to focus on other things. Sean dreams of making video games a part of his retirement plans and decided to ease back in now.

Sean is diving back into World of Warcraft, which as once a source of extra income. Many Frugal Cashmates make a side income building up video game accounts and selling them to other users.

Kevin received some unexpected income as a result of an overpay to the government. While unexpected money in the mail is usually a positive, it’s frustrating to pay for services that are supposed to identify tax breaks in the first place.

Show Links & Related Episodes

Music: https://www.bensound.com/royalty-free-music