Today, we have a powerful story from Dawn of Stepping Stones to FI. I’m so honored that she decided to share her story on my blog. She’s going to show you how to use the power of strong financial goals to overcome financial disaster. If you’ve ever felt deep financial disaster, this post is for you!
HOW TO USE THE POWER OF STRONG FINANCIAL GOALS TO OVERCOME FINANCIAL DISASTER
Take it away, Dawn…
15 years ago
When I look back to 15 years ago, I was living a completely different life. It wasn’t 15 years ago, it was an entire lifetime ago.
So much can change in a short period of time.
I married at the ripe old age of 22.
By 24, we had a baby boy. We had a beautiful home on over 2 acres, a horse, dog, 2 cats and a cute little tractor.
I tried to go back to work after we had our son, but I found I couldn’t stand the thought of leaving my baby with strangers. I wanted to stay at home and experience every little milestone.
You would think that making the financial decision to leave my work and stay home full time would have involved multiple budget meetings with my husband. And you would think that I would have understood the implications of no longer earning my own income.
How did that financial discussion between me and my husband actually go? I asked him if it was possible and he said “sure”. So I quit my job.
That was really the extent of the conversation.
I trusted him completely to manage the finances. We had a joint account with enough monthly funding to cover the groceries and standard household expenses, but beyond that, my husband managed everything.
I had a 401(k) from the job I held for 2 years but didn’t have an additional penny to my name.
Life seemed pretty good. Until disaster struck.
The transition from SAHM to widowed, single mom
When our son was just 3 years old, my husband passed away.
There wasn’t much time to adjust to the shock of this, let alone grieve, because it was soon apparent that I had no idea how to manage the finances and I couldn’t afford the luxury of time.
I knew nothing.
I couldn’t even access my husband’s accounts because I didn’t know what accounts he had or how to access them.
We had at least discussed life insurance and how important it was that he had a policy to protect me and our son. But it turned out he hadn’t moved forward with setting it up.
I did the only thing I could. I found a good home for my horse that had been a significant part of my life since the age of 13, packed up what I could, sold the rest, and moved back in with my parents.
11 years ago
I needed to start making money and supporting myself and my son. So, I combed Craigslist for any possible job I could qualify for.
I had a BS in Physics and had spent two years working as a Quality Control Chemist. There were exactly zero jobs waiting for me.
I finally convinced an Ophthalmologist to take me on as an optician and medical assistant, even though I had no medical experience. The pay was an impressive $14/hour. In the extravagantly overpriced San Francisco Bay Area.
I happily accepted the position and was grateful for it.
But, I also knew that I needed to do better.
Based on the average cost of living for the Bay Area, I needed to earn around $100,000 annually. How was I going to switch from earning around $20k/year to a six-figure salary?
I researched every career possibility out there, with the requirement that it pay well right out of school, took less than two years of additional education, allowed me to live at home, rent free, and wouldn’t put me into debt.
I was terrified of debt.
It was bad enough that I had nothing in my bank account. I felt so financially insecure and incapable of supporting myself and my toddler that the thought of taking on debt was unacceptable.
I researched any and all graduate programs, training programs and career paths that aligned with my skills and abilities.
Medical imaging to the rescue
As luck would have it, there was this little niche within the medical imaging field that was underrepresented. The government provided funding for a VA Hospital to put together a one year, accelerated training program. For free.
Free was exactly how much I could afford.
It must have been meant to be, this program was local, accepting applications and classes started in just a couple months.
I pieced together every remotely qualifying prerequisite I could from my college years and wrote the essay of my life for that application.
I was willing to do anything to get into this program. I even had to convince an interview panel that although I was missing one prerequisite course, I was still their best applicant. Out of all the qualifying applications, they only picked 6 people. Thankfully, that included me.
I put my heart and soul into that program. I fought to be top of my small class and treated every single hospital rotation as an interview. I wanted to work for every clinic I trained at and needed to prove that they needed me. Jobs for graduating students were few and far between, and there weren’t enough positions for all of us.
10 years ago
One of the clinics I rotated through liked me so much, they provided additional training while I was still in the program, then lined up a job for me upon graduation.
It wasn’t the perfect job because it was even further away and they couldn’t offer me full-time with benefits.
But they compensated by offering a higher hourly rate. I was going to start making $47/hr! That’s almost 3.5 times what I was making before! I was thrilled.
This allowed me to take some time to de-stress and gain control of my life. I rented a little apartment and my son and I began yet another chapter of our life.
Over the next five years, I focused my attention on building my career.
I didn’t actually know of any other medical imaging technologists in my field that treated their job like a career. Why would they? We all work in clinics and get paid hourly. There isn’t much of a career ladder to climb.
But my goal was to be earning enough to feel financially comfortable. And these jobs weren’t covering it.
So I treated it like a career. I found ways to stand out and get noticed.
I joined my local technologist chapter, as well as the national society. Then I wrote abstract articles so that I could give presentations at the national meetings.
Even though I am extremely introverted and shy, I put myself out there and networked. I won awards and started volunteering for the society.
The goal was that when the perfect job became available, I would be the technologist they thought of.
5 years ago
I started my current job 5 ½ years ago. Was I making my goal of $100k/year? Nope.
But that was by choice.
Finally, I actually had a choice.
I had the freedom and control of my life to choose more time with my son.
I started working less than 30 hours a week, earning $82k/year.
It was the best thing I could have done for myself and my son.
While I was so hyper focused on my goal of financial security, I didn’t realize the price I was paying for it.
I was so exhausted and under so much stress that I was constantly sick. My doctor finally ordered me to take 2 months of medical leave.
My son also had a lot of healing to do and needed help to do this. But finally, we had the time and the means to take care of ourselves and each other, and settle into this next chapter of our lives.
The last 2 years
After taking a few years to heal and settle into a regular routine, I started working 34 hours a week.
I’m proud to say that last year, I made it to my goal of earning $100k/year.
I could be making more, but I’ve come to realize that quality of life, and time with the people I love, is so much more important.
I’ve spent the last 10 years desperately fighting to regain financial control. This is 10 years of my life dedicated to recovering from a financial disaster.
I look back now and cringe at how ignorant and naive I was about personal finance and how trusting I had been to let my husband manage everything.
My path would have been so much different if we had sat down together and discussed the future and planned for an emergency.
While I could be working and earning more, I achieve the same thing by avoiding lifestyle inflation.
I used to spend money without thought.
Now, instead of spending money as it comes in, I avoid any expense that isn’t really necessary.
Earning money to spend on a new car will not add a huge amount of joy to my life.
Saving money for the future I dream of and continuing to realize my goals actually will.
My goal now is to build passive income by investing in real estate and begin to generate income while working from home.
Instead of my daily 3 hour commute, I dream of building a successful business.
I want to teach and empower other women who struggle with finances like I did.
And I want more time at home to do all the things I’ve missed out on. Gardening and being present with my family and loved ones.
I’ve spent too much time away from family and friends while building my income and savings. Now that I have financial security, it’s time to focus on the big picture.
How I learned the power of goal setting
When I look back now, I’m amazed that I have made it so far and achieved so much. Was it luck? Was I special? How did I actually make it from point A to B?
Being frugal didn’t help me turn a $20k salary into $100k. I could have read every personal finance book or blog out there and still not achieved it.
I believe it all comes down to the power of goal setting.
Ultimately, I learned so much about the power of goals during my training and the years following.
I entered into my one year of school feeling defeated and uncertain about my future.
I didn’t believe in myself because I felt so financially insecure.
But over the following years I learned how strong I was. I finally came to believe in myself and trust that I could accomplish the big goals I set for myself.
Here’s what I learned.
For a really big goal to be achievable, you need to ask yourself the following questions:
- Why is this goal so important?
- What exactly is the goal and what will it take to accomplish it?
- How will you accomplish it?
Understand your why
I had the goal of landing a job that was reliable, provided benefits and paid well enough to live comfortably in the Bay Area. But what would happen if I didn’t succeed?
It didn’t matter. Failure wasn’t an option.
I had to support myself and my son. I wanted control of my life and I wanted a happy family home free of financial worry.
This was my why.
Clearly define your goal, then break it down
The next step was to understand precisely what my goal was. I needed it clearly defined, with a beginning, end point where I knew I had achieved success, and a time period in which to accomplish it.
I needed to go from earning $14/hr to over $100k/year. And I needed to achieve this as soon as possible.
So now I understand my goal and why it’s important to me.
Next, I needed to break it down into what it would actually take to achieve it.
Given that most jobs available in my area were part-time and didn’t provide benefits, this was a difficult goal to attain. I also didn’t have any experience, which made me a less desirable hire.
So, I needed to stand out. That’s it.
I needed to stand out in my class, not just for my group, but over the previous classes as well. I needed to stand out in my clinical rotations so that the clinic would feel the loss when my time with them was over. Then I needed to network and stand out to anyone in the field that would know of available jobs.
That’s what I needed to do.
But how would I do it?
How to achieve a really big goal
I felt like I was living in survival mode for much of this time period. So I needed to know exactly what to focus on in the moment.
I couldn’t look too far ahead, it was too overwhelming. I needed to remain focused on whatever small task was going to get me closer to my goal.
Simply setting the goal won’t get you there. It takes a plan. It takes breaking that goal down into achievable steps that, one-by-one, will get you there. Then you focus on the action steps and nothing else.
How would I keep going when I felt too exhausted and overwhelmed to continue?
The same way you eat an elephant. One bite at a time.
I was going to focus on one small goal at a time. A tiny little piece of the overall goal. Every Sunday I would map out my one small goal for the week. Then I created a simple scorecard to keep track of my progress.
That scorecard kept me going. It even kept my son going.
He had a really hard time during this period because I was away so much. My commute was 45 minutes to the daycare, then at least 40 minutes to either my classes or whichever clinic I was rotating through.
But if I could take a one week time block and map out when I would be home, and when I would be free to spend a whole day with him, he could follow our progress and get excited about each step.
It helped us both feel that we were making progress. I was getting closer to my big goal and he was getting closer to more time with me.
Money and life lessons learned along the way
I know what it feels like to be financially insecure and completely uncertain of my future. I never want to feel this way again. And I never want anyone else to go through what I did.
Any single income family should have a plan in place for the unthinkable loss of that income. It could be a layoff, an injury or health problem, divorce, or in my case, the death of a partner.
Life is precious. The family and friends and communities we welcome into our life are precious. Focus on building a career and providing for the present, but also the future.
Beware of lifestyle inflation, it will cause you to become a slave to your career indefinitely.
Overcome Financial Disaster
Finally, the most important money lesson I have learned along my journey is the importance of financial planning.
Understand your own money. Understand exactly how much you earn, spend and save.
Think about the future and the life you want to live. Then, give your money a purpose. That new flashy car that provides social validation but puts you in debt will not add lasting joy to your life. But buying yourself the freedom and independence to contribute to your community and time with your loved ones is priceless.
Dawn is a personal finance blogger at Stepping Stones to FI.
Her blog provides the foundational steps that anyone can follow to achieve Financial Independence, or FI. Topics include personal finance and wealth building basics, as well as successful goal setting techniques to achieve the life you dream of. As a full-time single mom that started from the very bottom, she has learned just what it takes to gain control of her money and pave the path to a secure financial future. You can read more about Dawn HERE.
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- 7 Frugal Habits that will save you Thousands
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- 5 Tiny Frugal Actions you can take to save big
Have you ever overcome financial disaster? Let us know in the comments below!