This Nurse is Living Her Best Life (Kinda)- Ep. 11
Most know of my story about how I paid off $1 million in debt. However, in episode 11, I share more about my personal experiences after I became debt-free.
So many people focus on getting debt-free, but not enough talk about what happens next. So let me dive in and tell you how my journey to financial independence and retiring early continued.
After paying off over $300k in debt from April 2015 to October 2017, I still had $20,000 left in student loans, $30,000 IRS debt, $10,000 owed from my divorce, not to mention what I owed on my house. To eliminate that last chunk of my debt, I sold my house bringing my debt pay off total close to $1,000,000.
Once I paid the last of my loans, I was debt-free!!!!
The feeling of being debt-free is hard to describe, but I'll try. Imagine the experience being something like--instantly everything in your life gets better. Your life improves exponentially, and the world is perfect.
You're set for life, right?
Well, not so much.
This article will focus on what I did, so you can understand what life is like after you become debt-free. Here are some of the essential investments I made, and now I am richer than ever!
Invest in Yourself and Self-Care
When I became debt-free, I invested in myself. First, I decided to hire a business coach, and I joined a wealth-building mastermind with Hilary Hendershott.
Sometimes when you are ready to move onto the next phase of your life, a coach and accountability partners, which came from my mastermind group, are what you need. My group helped me focus my steps and inspired me to take my business to the next level.
Secondly, I invested in self-care. I left one of my jobs to get out of a toxic environment. Being debt-free gave me the flexibility to do what was best for me.
For the majority of my life and most of my nursing career, I always had two jobs. For my part-time benefitted job, I transferred to another location after I sold the house. Unfortunately, that hospital was a horribly toxic work environment. In the eight years, I had been a nurse to this point, I had never seen as many adverse maternal outcomes as I saw in the first few months working there.
The patients weren't being treated fairly, especially African American women. Their care was so subpar. I was scared that I was going to lose my license being associated with these doctors and their unconscious biases.
I would cry en route to work, knowing my pleas for quality improvement had fallen on deaf ears. It was horrible. I even had physical manifestations. My skin was in the worst shape it had ever been and I walked around with dark circles under my eyes from chronic lack of sleep.
Worst of all, I had a miscarriage.
It was horrendous. So at that point, I had a choice to make. Leave for my sanity, my health, myself. The freedom of being debt-free made that all possible.
Treat Yourself
Days after being debt-free, I bought a Tesla Model X! Don't judge me. I know many people in the FIRE community would frown upon my investment, but here's why I did it.
My car may be extravagant, but she was something I wanted. I am a nerd, and I like gadgets and SUVs. I had three Lexus RXs beforehand, and that was the only car I liked--until the Tesla.
I had my eye on this Tesla forever. So one day, I promised myself when I had enough money to buy a Tesla with cash, I would get it.
After I sold my house and paid off everything off, I had enough money left over to buy the Tesla Model X with cash to spare. So with that plan in mind, I was ready to buy. But, after speaking to my financial advisor, they advised against it. Instead, I leveraged my credit. I negotiated a 1.4% car loan through my credit union and purchased my baby.
For most people, buying a Tesla would not have been the best financial decision. But it was an excellent decision for me. That's what makes personal finance personal. Each person handles their finances according to what's best for them.
My car sparks joy and speaks to me. However, I am very frugal in other ways. I got something I wanted, and if that means I have to work a couple more years before I reach FI, that's OK. I think it's worth it. I have no regrets about my car.
Next, I put the cash I was going to use to buy my car, towards investments, which so far have paid off.
Max Out Investments
With no debt to pay, I had more income to invest. I put money into my daughter's 529 college savings plan, opened an after-tax brokerage account to invest in the stock market, fully funded my Roth Individual Retirement Account (IRA), and maxed out my retirement account at work.
I funded all my tax-advantaged accounts through the end of the year. This swift action helped me when I filed taxes and boosted my retirement savings.
Move to Save Even More
In the midst of me quitting my toxic job, my partner got offered a job in Nevada in Reno. I decided to go with him to Reno but keep my other job--the one that didn't drive me crazy.
So off we went to Reno. Immediately, we had a substantial drop in our living expenses. I don't mind sharing numbers, so here you go.
In downtown Oakland, California, we lived in a small two-bedroom apartment after I sold my mini-mansion. We shared a 1,000 square foot apartment and paid $3600 a month. On the other hand, we were able to buy a house in Reno for about $350,000. So we decided to buy a home in Reno.
My partner is in education and was signing a three-year contract to work with the administrators of the Reno School District. So I did the math and thought, we could buy this house, and after three years it would be a great investment property. For this reason, we purchased, even though we could have rented for less money. The house was in a great community on a golf course with pools. I felt this house would be a resale or rental opportunity.
Another bonus about the house was that it was in the best school district. I'm telling you it was a bomb place to live. Plus, it was right on the border to California. So I was close to California and near downtown Reno. What a prime location.
Be Prepared for When Life Happens
Best news of all came next. I found out I was pregnant with my second daughter. So there I was in going through a high-risk pregnancy because (I might look young but) I'm old. Fortunately, I wasn't dealing with a crazy job too.
One day, I was in a car accident while I was pregnant, and I ended up in the emergency room. That's when I found out that I had a huge cyst, probably larger than the baby, on one of my ovaries.
The good news is I had an excellent delivery. My daughter was born on New Year's Eve. After she arrived, I experienced terrible postpartum depression.
Also, my partner's work status changed. The Reno Superintendent dropped the contract they had with this consulting company and he took another job within the company. Goodbye to that three-year contract.
Hello to a new job in Las Vegas, which is an hour's flight away from Reno or an eight-hour drive. At the same time, I worked in Fremont, California, which is an hour away from Reno by air or a four to five-hour-long drive.
Our crazy commutes, postpartum depression, me being a new mom (again), whoo we had a lot going on. Then, I had to undergo surgery, where I ultimately lost my ovary. I was so hormonal and feeling bad.
Since we didn't have any family in Reno, it was a tough time. So just as quickly as we moved to Reno, we decided to move back to Oakland.
Y'all may not know this, but I love my grandfather. He is 91 years old and helped raise me. So we moved closer to my grandfather and decided to rent. We lucked out and found a house right around the corner from my grandfather.
The home had a lower level. The landlord allowed us to sublet. So that leads me to what I did next.
House Hack to Stack Money
We saved half our rent by subletting.
House hacking is when you rent out a portion of your home for extra income. When I was paying down $1 million in debt, I used house hacking to get debt-free faster.
In the suburbs of the San Francisco Bay area, I lived in a house with five bedrooms and five and a half bathrooms. And once I started getting serious about paying off my debt, I started subletting out the rooms.
My old house was perfect for subletting because each room had a bathroom. During my debt-free journey, I had as many as three people renting in the house at one time. That made my housing costs extremely low.
That's mastering house hacking, you guys. The two most important things you can do to improve your finances is to decrease your two significant expenses, which are your housing costs and your transportation costs.
I was able to reduce my housing costs by house hacking.
You can house hack too. Heck, I did it as a single mom with just me and my baby. And I was completely safe in my house. My renters were trustworthy. I went through a thorough screening process, and one person ended up helping me a lot with my daughter. That was a significant bonus.
Now, I still house hack with two little kids, and they're just fine. So stop making excuses, find your way to make more income, and improve your finances.
Anyway, back to my story.
So we found this house, and our expenses were super low. But what I forgot to mention is that our home in Reno was still on the market. As soon as we decided to sell the housing market slowed down.
So my house was on the market for one month, two months, three months.
I was paying the Reno mortgage and California rent. My situation became extremely taxing.
Side Hustle
So whenever in a bind, old habits will arise. I know how to hustle. To bring in enough money to cover our bills, I decided to go back to working two jobs. Before when I lived in Reno, I could work six days a month to cover all of my expenses. But in California, I needed to work more to make ends meet.
I had also decided to invest more money into my business. However, when I made that decision, I also went back into debt for my business. The debt I went into for my business made me so uncomfortable. Plus I was paying a mortgage and rent.
The only thing I knew for sure, was it's easy to find jobs in nursing, especially being in a labor and delivery nurse, which is always in high demand.
Do Reality Checks
In my search, I found the perfect job. I told myself I could work this new job temporarily, for two months or so. And then when I figure out if I like this job, I would drop my hours at my other job where I had health insurance and other great benefits.
Do you know, I went through the process to get on-boarded, but then a couple of days before I was going to start my orientation, I had a total meltdown.
You see, orientation coincided with my daughter's first day of school. And when I tell you, my baby cried so hard, when I told her I wasn't going to be there for her on her first day of school--it made me cry too. As a matter of fact, by taking this job, because they wanted me to work pay shift, I would hardly ever see my kids. I would have to leave for work at five-thirty in the morning, and I probably wouldn't get back until about eight-thirty at night.
My kids are young, but I realized I would never see them. At first, my work schedule had reached a point where I had to realize that it's all
OK to take time to go back to full-time work.
I had to accept it would also take time to pay off my debt. I was not willing to sacrifice the time that I have now with my daughters.
I now work an amazing schedule. Just three days a week, I go to work. I'm able to pick my kids up from school and daycare, see them every day, spend time with him, help them with homework, and work on my business. Things are good.
Embrace the New You
Today, I am happy and whole. One difference is that I am no longer the nurse that makes $230,000 a year. For a long time, that was been my identity, but now other things mean more to me.
I've learned, I don't have to earn a lot to impact my finances. I have to make the most out of what I make. So, I cut my expenses down and work with what I got.
Finally, the house in Reno sold. With those proceeds, I was able to pay off my remaining debt (minus my car). A majority of my paycheck is going towards funding my work retirement accounts, my daughters' college funds, and my Roth IRA.
Things are really on the up and up, and I still invest heavily in this business.
For me, paying off debt was just the beginning. From that point forward, I was starting over from zero. However, as you can see, so much can happen along your financial journey after you become debt-free. Use the days after debt to focus on you and be flexible when life happens.
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TRANSCRIPT:
Naseema McElroy: 04:10 Hey, so on this week's episode, you guys, I got a special treat. It's just gonna be you and me. And, I'm going to take some time to give you a little insight in my life and what's going on right now. And to update you from where I left off, which is, you just know that I paid off $1 million in debt. If you follow me on Instagram, you might know I have two kids. Other than that, I haven't really talked about myself and what's been going on for these last few years after I paid off this debt. Alright, so I'm going to start back at October of 2017. That's when I sold my house and paid off the last of my debt. At that point I had about $50,000, $30,000 from my divorce and $20,000 left on my student loans. And, I was debt-free.
Naseema McElroy: 05:03 Okay. Now, everything gets better. Your life is exponentially improved. The world is perfect. You're set for life, right? Not so much you guys. When I paid off that debt, that was the beginning of me just starting from zero. I was just at zero at that point. So, I want to talk to you about some of the things that I did when I paid off all that debt. So, I did a lot of investing in myself. I invested in growing Financially Intentional. I hired a life coach. I joined Wealth Building Mastermind with Hilary Hendershott. And, something that I did, which people in the community may frown upon is I bought a brand new Tesla Model X. And oh my God, sigh. Oh my God, she is so extravagant. You know you guys, thi
Naseema McElroy: 06:13 I had three Lexus RX's beforehand and it was like the only car that I liked. So, there's only like one car that I like and I had my eye on this Tesla forever. And I was just like one day, I made this promise to myself when I was going on this debt payoff journey. I was like, one day, when I have enough money to buy this Tesla in cash, I am going to get it no doubt. So, when I sold my house, after paying everything off, I actually had enough in the bank, left over to buy the Tesla Model X in cash. And that's initially what I planned to do. But actually after speaking to my financial advisor, they advised against it and I ended up negotiating a 1.4% loan through my credit union to pay for, to finance my Tesla. And, they thought that my money could spent in investments, which, you know, have paid off so far.
Naseema McElroy: 07:15 So the things that I invested in, like I said, I, I did coaching for my own finances. I did coaching for my business. I invested in my daughter's 401k. I opened the after tax brokerage account for myself. I made sure that my Roth was fully funded. Everything was maxed out at work. So, I made sure that all my tax advantage accounts were completely funded through the end of the year. And you might say, you know, buying this car was ultimately not the best financial decision and it's not. But personal finance is personal and it's not gonna look the same for everyone. And, I really like to practice an abundance mindset versus a scarcity mindset that you'll see in these communities. And that car, it really sparks joy in me. It speaks to me. I am very frugal in other ways, but I feel like that's something that I wanted and something that if it means that I have to work a couple more years for, I think it's totally worth it.
Naseema McElroy: 08:22 So to each his own, but I have no regrets about my car. It's a bomb, y'all. So, the summer, the following year, there were a couple of things that was going on. I always had two jobs. So, I worked at one hospital and then I had transferred to another hospital within the same organization that I had worked for when I moved back to Oakland to be closer to family. That hospital, you guys, was such a toxic work environment. Not only was I just overall stressed. I used to cry before I went into work. The patients were being treated barely, especially African American women patients. That care there was just so subpar. I was scared that I was going to lose my license or be associated with the doctors there in any kind of malpractice suit. So, I would shake any time I had to go to work. It was horrible.
Naseema McElroy: 09:18 Not only that, I had physical manifestations, like I had acne on my face and if you guys know me, I have not one pimple. The only time I've ever had acne on my face was when I turned 30 and I was like really stressed out about life. Don't ask me what was going on. But that's the only ever time I've ever had acne. Never had it as a teenager, anything, but it was just manifesting in my face. And I'm not saying that trivially or like acne is like some minor thing, like this is how bad these things were manifesting. I also had a miscarriage during that time. It was horrendous. So, at that point I had a choice to make. My partner got offered a job in Nevada in Reno, and we could, I could stay at this job that was super duper crazy or I can go with him to Reno and continue to work at my other job.
Naseema McElroy: 10:13 So, we decided to move to Reno and moving to Reno was a substantial drop in costs of living. I don't ever mind sharing numbers. So in that apartment, the little small two bedroom apartment and a thousand square foot apartment we were renting in downtown Oakland, we were paying about $3,600 a month and we were able to buy a house in Reno for about $350,000. So we decided to buy in Reno because my partner was getting a contract. He's in education. So, he was getting this three year contract to work with the administrators of the Reno School District. So, I was like, okay, I could buy this house. It can, after the three years, will be great investment property. Even though I could have rented for a whole lot cheaper, this house was in a great community, has on a golf course, have pools. I'm talking about four hours of daycare during the week included in your HOAs.
Naseema McElroy: 11:12 It was in the best school district. It was a bomb place to live, plus it was right on the border to California. So, I was as close to the California border as I was to downtown Reno. And so it was prime location, just it was a really nice place. And so we decided to buy. And so we moved there last summer and things were great. What I felt was that right before we moved and while I was working at this job, another reason why I decided to leave the toxic place I was working was I found out I was pregnant with my second daughter. So, I went through my pregnancy there. It was high risk because y'all I'm old. I might look really young, but I am at advanced maternal age. It was high risk. A car had backed into my car during my pregnancy and I ended up in the emergency room and then found out that I had a huge cyst. Almost that was probably bigger than the baby on one of my ovaries.
Naseema McElroy: 12:13 So, it was even more complicated with that. Anyway, I had great delivery experience. I delivered my daughter on New Year's eve last year. It was a phenomenal experience, but then had to deal with getting the cyst removed. And so, in that process and after having the baby, I experienced like really, really bad postpartum depression. A thing that I forgot to mention was a couple months before I was delivering my daughter, my partner's work status changed. So basically Reno Superintendent dropped the contract that they had with his consulting company that he works for. So this three year contract that we moved to Reno for was no longer, so he ended up staying with the company, but he had to work in Las Vegas, which is an hour flight away from Reno or an eight hour drive. And I worked in Fremont, California, which is an hour away from Reno or how long is that drive?
Naseema McElroy: 13:14 It's like a four or five hour drive or it's a 45 minute flight, but a four or five hour drive. But anyway, that, though like our crazy commutes, my postpartum depression, me being a new mom, then I ultimately had to undergo surgery where I ultimately lost my ovary, sent me on a hormonal, like basically I was really feeling bad and we didn't have any family. It was a really hard time. And so with that and the fact that neither one of us lived in Reno, we decided to move back to Oakland so we can be closer to family. So we moved back in this summer, the summer of 2019, so we could be close to my grandfather. And my grandfather's 91. And you guys know, he's like my best friend. He took a major part in raising me, so we decided to move back close to him.
Naseema McElroy: 14:15 But this time, I decided that we were going to rent and it was super duper important to me that our rent be very affordable, lower than what we can afford. And that we'd be able to have space that we could sublet out our extra space. So, we looked up on a house around the corner from my grandfather with a whole bottom level that the owner allowed us to sublet. The rent was already way less than what we're used to paying in this area. Plus, we're able to save almost half of our rent by subletting it. So, that was a major win. Oh, one thing that I, I don't know why I always forget to talk about this when I share my journey of paying off that million dollars. A big part of it is, you guys know I had this big old house in the suburbs of the San Francisco Bay area.
Naseema McElroy: 15:08 It was a five bedroom, five and a half bath house. And once I really started getting serious, I started subletting out the rooms. One of the rooms I sublet to my coworker. And so she had her own room, her own bathroom. Every room had their own bathroom. So it was actually perfect for subletting it. And then during my journey, I had at least three people subletting the house at the time. So that drove down my housing costs extremely low. And that's called house hacking you guys. So I know people talk about latte factor and all this kind of stuff and yes, those things are super duper important. But the two most important things you can do to drive your finances to improve your finances is to decrease your two major expenses, which are your housing costs and your transportation costs. And so, I was able to drastically reduce my housing costs by house hacking them, and I'm doing it now.
Naseema McElroy: 15:58 I also want to just put something out there for you guys who think that you can't possibly house hack. I did it, number one, as a single mom with just me and my baby, and I was completely safe, people in my house were completely trustworthy. I went through a thorough screening process and plus one of them was my coworker and I completely trust her. She even helped me with my daughter. So, that was a major bonus. And then, now I do live with two little kids and they're just fine. It works out. So stop making excuses you guys. Anyway, back to my story. So yeah, we found this house, so our expenses were super low, but you guys during this time, since we moved, my house in Reno was still on the market. I don't know what's going on with the Reno market, but it seemed like as soon as we decided to sell, the market slowed down.
Naseema McElroy: 16:50 So, my house was on the market one month, two months, three months. And so not only am I paying this mortgage, I'm paying my rent here. And so it became extremely taxing. And you know, I went back into this mode like, I know how to get out of this. I know how to hustle. So, I need to pick back up or work two jobs. I've always worked two jobs my whole life. This is the first time I only had one job. So, when I came back to Oakland, I went back to working my job. I was working six days a month. I went back to working full time and full time for a nurse is three twelves a week. Well with this shop it is three twelves a week. So, I was working three twelves a week, but I had this negative self-thought that I was super lazy.
Naseema McElroy: 17:37 Also, when I was working six days a month in Reno, which I don't know if I mentioned that. I had a line item to mention that. So when I moved to Reno, the cost of living was so cheap. I only worked six days a month, I think I did say that. But anyway, so I went back to working three days a month and, but I was just like, I'm used to grinding. I'm used to working like five days a month. And so, I started looking for a second job so I can cover all these expenses because once I was in Reno, I also actually went back into more debt, growing my business. The working six days a week covered all my expenses, but it wasn't enough for me to grow my business like I wanted to at that time. So I did take on some debt to grow my business and that debt you guys was making me so uncomfortable on top of the debt that I was paying a mortgage and rent.
Naseema McElroy: 18:35 So I was like, I gotta hustle you guys. I got to grind. I mean, I know how to do it. I can just find another job. It's easy to find jobs in nursing, especially being in a labor and delivery nurse, I am in high demand. And the place that I really, really, really wanted to work, I got a full time job there. But, I wasn't ready to give up my full time job where I was working because all the benefits are under me. I don't ever want to be in a position where my kids don't have insurance. So, basically, what I did was commit to working six days a week. And so I was like, okay, I can do this temporarily for two months or so. And then when I figured out if I really, really liked this job and everything is working out, you know, then I'll drop down at my previous job just to be in per diem, which means that only have to work five shifts a month.
Naseema McElroy: 19:28 And so I was committed, I was hustling and you know, I went through the process, got onboarded, fully hired, went through, you know, all of my physical, drug testing, all that stuff that I had to do. And then a couple days before I was gonna start my orientation, I had a total meltdown. You see, orientation coincided with my daughter's first day of school. And when I tell you, my baby cried so hard when I told her I wasn't gonna be there for her on her first day of school. As a matter of fact, about taking this job, because they wanted me to work day shift, I would hardly ever see my kids. I would have to be at work, like leave the house at 5:30 in the morning. I probably wouldn't get back until about 8:30 at night. My kids are young, they go to, they sleep a lot.
Naseema McElroy: 20:18 I would never see my kids. I mean, and for me at first it was okay because I was like, it's just going to be two months but I couldn't do it you guys. I couldn't do it. I came to the point where I had to realize that it's okay to just step back and take my time, pay this stuff off and not sacrifice the time that I have now with my daughters because you guys. Actually, the way that I'm working right now feels amazing. Working three days a week, I'm able to pick my kids up from school and daycare. See them every day. Spend time with them. Help them with homework. I'm able to do stuff with my business. Like things are good. The only thing that's missing is now I'm not that nurse that makes $230,000 a year and for a long time, that had been my identity and though I'm not comfortable being on the margins of how much I make, like I couldn't be that nurse that made $14 an hour. It makes me super uncomfortable. But I really had to come to grips that I don't have to earn a lot in order to really, really affect my finances. And so, I said, well, I'm just going to grind, make sure I cut my expenses down, work with what I got. And actually, just last week, when I was at FinCon, and this is gonna be a couple of weeks from when this episode is airing, but my house finally sold. And with those proceeds, I was able to pay off my remaining debt minus my car and so, I am now back debt free minus my car. So, I'm not completely debt free, I'm never gonna say that, but it feels so freeing. And now the majority of my paycheck is going to fully funding my 403B and I do have access to a 457 so I'm funding that. I'm back funding my daughter's college funds. I have maxed out my Roth IRA and things are starting to be on the up and up.
Hey there I’m Naseema
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