DEBT FREE IN 2020, HOW IT HAPPENED

Hey friends, been awhile I know, thanks for finding your way back here.

As you can see with the big headline, we finally became debt free at the beginning of 2020 and this post is the story of how we got there; spoiler alert, it wasn’t supposed to be how our journey unfolded, what happened, in fact is what i wouldn’t wish on anyone.

And yeah, it would explain why I was out for more than two years, coz the wind really took out my sails.

Let me unpack….

So we started 2019 with a net worth of -$60 ,438 composed of about $83K in school loans and the balance on our car.

We managed to work our way down to -$40,564 by April 2019, after receiving a bonus and tax refunds, so essentially we were on our way.

My Mom who had recently just retired less than a year in January 2019, from working a job for 16 years straight, suddenly was diagnosed with Pancreatic cancer May of 2019.

It was such a huge blow to our family, to me personally since I along with my wife and daughter lived with her in the same house since 2016.

I had talked her into purchasing a bigger lot and constructing an ADU (accessory dwelling unit) in the back, essentially a granny suite, except that we lived in it instead of her.

We did this to prepare her for retirement, so that I would help her pay most of the mortgage and also help her around the house; she lived with my youngest brother who was single at the time, living in the front house, while me and my family lived in the back.

What was supposed to be a preparation for my Mom’s retirement, turned into a chaotic turn of events which eventually led to her passing in June of 2019.

Her passing totally devastated us, me especially, being the oldest of 5 boys who now were middle-aged men.

Man I tell you, there are things you think you know in life,  that you won’t realize were wrong assumptions unless you go through a life crisis such as this.

You’d think you’d know your siblings, growing up with them and all, but yet seeing them react totally the opposite of what you thought they were as soon as something like this happens.

Man o man, needless to say, after all that happened, instead of growing closer, I ended up being estranged with them; but that’s for another post.

So back to our journey….

The sad and unfortunate turn of events of my Mom passing, caused me and my family to be debt free.  Yes you heard it right, I’m debt free because of my Mom.

She left us  an inheritance that was more than enough to payoff ALL our debts.

I would never ever have imagined that this would happen, nor would ever wish it to happen this way, but such is LIFE.  We are never promised a day, a month, a year, a minute.

All we can do is prepare for tomorrow but live in the moment.

Let me tell you something about my Mom, or better yet, let me brag about my Mom.

Her name is Nena, she was the most compassionate, loving, kind hearted woman you’d ever meet.

She would literally give away the clothes on her back to strangers who needed them.

She was so generous and loving, when she saw a need, she’d immediately give and meet that need, and make sure no one noticed.

She was so selfless, she would make sure someone else enjoyed a meal, an outfit, anything that was needed FIRST, before she ever thought of indulging herself.

She was a workaholic, she always worked. I remember being hard on her once, on her 70th birthday no less, because I literally begged her to stop working for money and enjoy the nest egg she so meticulously pinched and saved for all these years.

She just shrugged it off and said, what else was she going to do with her life if she stopped working.

And she was also a God fearing, loving woman.

She was prayerful, she loved to study her bible, and constantly met with her bible study group to talk about things of God. So much so that in her last days, being self-aware that her time on earth was drawing near, she confidently declared to all who would visit and see her, that she was excited to go home.

My Mom, who constantly worked all her life, and mind you, she never earned more than $70K a year, managed to scrimp and save and was worth a little over $1.1M by the time she passed.

My Mom, Nena, the most generous, loving woman I had ever known, has caused me and my family to be debt free and put us on our path to financial stability.

She was until the very end, not only generous to others, but primarily to us her direct family.

Mic drop…..

So, to channel all my Mom’s accomplishments into a few simple financial tips:

#1 – Save a lot and often

My Mom who I already mentioned never earned more than $70k all her working years, consistently saved.

She came up from humble beginnings in the Philippines and would tell us stories of how she used to walk barefoot well into her teens to get to school since their family couldn’t afford simple necessities like sandals and shoes.

She’d always encourage and often remind us, her children, to save for rainy days.

Even if it was a dollar a day, in the long run, it would turn into a snowball of a nest egg if done consistently over the long haul.

So there you have it, tip #1, save a little or a lot, and do it consistently.

#2 – Take advantage of work-related savings plans

My Mom worked at several big firms, she was a paralegal by trade, and as soon as she learned about work sponsored savings plans like 401Ks, 457s and 403b’s, she was all over them.

She was onboard with these plans early on and realized that although she was saving a fraction of her salary, because of the employer match literally doubling her money up front, she’d be enjoying the compounding effect of the investment gains all throughout her investing years.

In the end, the bulk of her savings in retirement were in large part from these employer sponsored plans.

So tip #2, make sure you save, even if in small amounts, as long as there’s the benefit of a match, take advantage of them.

#3 – GIVE like you don’t own anything

I already mentioned how generous my Mom was to us her children, but more so to others.

She would make sure if she could, she gave. She tithed to her church, she financially helped her siblings and their extended families, and she also enjoyed secretly giving to others without them even knowing. She counted it as a privilege to be able to do so.

She lived her life and handled her finances as if she never had it nor owned it. The essence of being able to give like she did was that she got the mentality that she was only a steward, and in the end, she wouldn’t take any of her possessions with her. That freed her up to do what she did, be generous with her money.  And I for one and countless others benefitted as a result.

So tip #3, Learn to Give. You’ll never know how rewarding or satisfying it is to Give, until you’ve done so, especially to those who could never repay you.

#4 – PLAN like it’s your last day on Earth

Yep, my Mom planned. She had an estate plan composed of a will, medical directives, power of attorneys and most of all a living trust.

This made it easy for us the children, me especially being the executor of her trust to bypass probate and be able to settle her estate and distribute proceeds accordingly and quickly.

My Mom knew that if she didn’t plan out her estate, that it may bring strife and turmoil to her children, which it still did, but by making sure she expressed her wishes on paper, she got to control the outcome of where her possessions went, without anyone complaining or challenging her wishes. That was a huge Blessing for all of us.

So if you want to make sure you still controlled your assets even after you’ve passed, please setup your estate. There are lots of resources out there too, a simple googling of ‘estate planning’ will yield an infinite amount of hits. Please make sure to use the more established ones for better results.

So there you have it. The short and sweet of how we got debt free.

Again, apologize for being out all this time, it’s just that after the events from my Mom, the pandemic, and all the turmoil in the world, I lost focus and frankly got into a bit of depression.

Lucky for me, I am Blessed with a strong wife and excellent daughter, and they make it worthwhile for me to continue what I’ve been doing, also as a tribute to my Mom. Since she always wanted the best for us her children, and the only thing I know how to honor her wishes, is to be the best version of myself she envisioned me to be.

Again, thank you all for sticking with me and my journey and safe to say, I’m back 🙂

Appreciate you all.

Until the next one, Peace and Blessings for 2022 and the days ahead!