What’s your goal when you retire? For many- it’s to be a millionaire by the time you leave the work force but how realistic is that?
From millennials to those who want to retire in the next few years, it seems we all know we need to do more now to prepare for our future.
In part one of our series, we meet a couple in their 30s who were able to turn their finances around and get on track for their future.
“It’s crazy to think that we’re on track to be millionaires,” said Tracy Gifford, saving for retirement.
It wasn’t always that way.
Just a few years ago, 32-year-old Tracy Gifford and her husband, 33-year-old Chris were struggling with no plan at all for their money.
“For seven years as a pharmacist, making good money we lived paycheck to paycheck,” said Chris Gifford, saving for retirement.
Chris was making $150,000 a year and Tracy was staying at home with their three young boys but like so many other millennials they were drowning in his student loan debt owing $115,000.
“To be honest we never had any plan of paying off that debt,” Tracy Gifford said. “We just figured we’d have two mortgage payments essentially the rest of our lives.”
But a $10,000 settlement changed all that. Chris and Tracy didn’t know what to do with the extra cash and went to class, taking a financial peace course that taught them to have laser like focus to attack their debt and start saving for their future.
“We paid off $105,000 in 10 months,” she said.
So, how’d they do it?
“We went through every expense we had and we went OK what are the essentials? What are things that we kind of want? And put strict limits on what we could spend,” Tracy Gifford said.
They ditched cable TV, started cutting their boys’ hair themselves and Tracy even started a blog — StayFitMom — that brings in extra cash.
“Some months were so hard. Felt like I was so confined and I couldn’t have anything I wanted. Then a couple of months went by and I kept seeing that number go down on that student loan payment and it was so exciting,” she said. “Every month we would cross out that number and the number would become less and it would become more and more empowering that we could do it as we saw that number decrease.”
“I’ve seen clients turn things around in a matter of a month,” Lisa Chastain, Millennial Consulting, LLC.
Chastain is the owner of Millennial Consulting LLC and wrote a book helping Millennial women get control over their finances.
She says one of the biggest problems for those who aren’t saving is simply not knowing how to do it.
“At a much younger age, they want to save. They’re doing their best to do that. They just don’t exactly know how. They just haven’t been taught how,” she said.
In fact, experts believe roughly two-thirds of millennials have nothing saved for the future at all.
Tracy and Chris say they know what that feels like and now how easy it is to turn it all around. With no student loan debt and no credit card debt, they’ve turned their focus to tackling their mortage payment with the same intensity. Soon, they will be completely debt free and able to save the rest of their money for retirement, college and their future.
“It’s nice to know that in a few years when our house is paid off that we’re not going to have to worry about finances, at that point we can live off of $25 to $30,000 a year,” Chris Gifford said.
The Gifford’s say they’re also open with their three sons about money teaching them at a young age to save and budget.
If you need help with your budget or how to start saving for your future, experts suggest you make an appointment with a certified financial planner.