In today's "Budget With Me" exercise, we're going through "Wharf Rat's" budget info.
He has a $127k income and $273k in mortgage debt.
His main goal is to be able to get his monthly expenses under control AND amass an additional $1M in net worth (he is currently almost at $1M), putting him at the $2M mark.
"Future Pacing" is an exercise we walk through with our student where we run some numbers on how much debt they need to pay down annually in order to reach their stated goal.
Here's what it looks like with $273k in debt:
This exercise is all about "breaking things down to the ridiculous" to help the visualize how much real effort is going to be required to accomplish their goals. From here, it's much easier to start pacing yourself in a way that's both aggressive while simultaneously sustainable.
These numbers can also be broken down further into monthly targets as well.
From there we can also figure out what needs to be:
1. Addressed in the budget (i.e. reduce, cut, substituted for)
2. Sold (i.e. scour the garage, attic, basement storage unit for items that can be liquidated to help put toward debt).
3. Earned (i.e. extra work projects, overtime, side-hustles, starting an online business, etc.)
I use an amazing budgeting software called "You Need A Budget" or "YNAB" in this series. It's totally not necessary for you to use that particular platform, but I will tell you that 100% of our students that have adopted it get much quicker and more accurate results by using YNAB.
Again to submit your information for the "Budget With Me" series go to: https://www.zerodebtcoach.com/budgetwithme
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