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Living below her means:
Lori, 30-something, marketing, Columbus, Ohio
• Bankrate.com

My husband and I both had credit card debt when we were in our 20s, but by the time we were married we had no consumer debt.

We moved to a larger house three years ago, and it was a breeze to get a mortgage approved. At that point we had about $45,000 in equity in our former home and the bank was willing to lend us $380,000! I was astonished. Neither my husband nor I could conceive of spending so much of our income on housing.

We upgraded from a 72-year-old three-bedroom house to a 12-year-old four-bedroom with a large master suite, a family room and sun porch. The house cost $200,000 and we spent $35,000 cash the first year on new furniture.

Living below our means has given us psychological freedom. In 1999, both my husband and I decided to switch careers. I went from a marketing job, with constant travel, to a similar position one mile from home -- and a pay cut. My husband went from a 12-year teaching career to working in network administration. The training we had to pay out-of-pocket for him to do this was $7,000 -- and he was out of work four months to train.

In 1999 our gross income was $40,000 less than in 1998. We now have the same gross income as we did before the switch -- but we never could have done this if we weren't living below our means.

It kills us to pay interest on anything. Our vehicles were a 1992 Ford Ranger and a 1994 Ford Taurus. Last year we decided to replace the truck. We went shopping and planned to spend about $16,000. We came across a new Dodge Dakota Quad Cab for $23,400. We decided to buy it and took a 48-month loan to get the best interest rate -- and put $10,000 down. That was in November 1999.

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By paying double payments for a few months, using a bonus I got and our income tax refund, we paid it off in April 2000. We felt that the $400 we paid in interest was a decent value to get a vehicle we loved so much. Now, except for our mortgage, we are debt-free again.

I guess the bottom line is that living below your means gives one the psychological freedom to make the choices that one wants to make, without having to worry about the price tag. I think that we are less stressed than some of our friends who have multiple vehicles, live in giant houses, take expensive vacations and re-decorate every other year. We're happy.

-- Posted: Feb. 2, 2001


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See Also
In their own words -- Andrew White, 25, Web site developer, Toronto, Canada
Karen Stewart, 39, marketing specialist, Neptune Beach, Fla.
MAIN: Living below your means can de-stress your life
AND: Tips for living below your means


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