So a few days ago I revealed just how much debt we have, but that’s only half of the story. For that number to mean anything to you as a reader, you need to know how much income we have as well.
If we have $119,000 in debt and make $2,000,000 per year, that’s not such a big deal. This blog would last about two days, and as soon as the check cleared, I’d have nothing else to write about. On the other hand, if we have $119,000 in debt and only make $20,000 per year, it doesn’t matter what we do to try to pay down debt; we’ll never win, and this blog will be extremely sad and repetitive.
So here goes…
Our annual household income (take-home pay, because that’s the number that matters) is $41,640.
So there’s some context. Our debt-to-income ratio is 2.86.
For household income, I’m in the twenty-third percent.
Hopefully, that number will increase over time, and when it does, I’ll post a little update here since new income means a different debt snowball. We should see a bump in take-home pay since we stopped all contributions to retirement and our HSA. I would elaborate on the reasoning behind why we did that, but instead I’ll just mine that for a good two or three posts in the future (blogger win-win!).