What the meltdown means to me, a 35-year-old married West Coast homeowner

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Despite my Ivy League MBA and my role as a founder of a personal finance web site, I haven't done much in the way of planning my financial situation. All of my financial milestones in the past decade or so have been accidental, serendipitous, or just a gut response to a disaster.

I was pregnant pretty much the moment after I was engaged, at 28. Through the birth of three boys (all of which came along a little sooner than I expected), I worked in a unusual career that I made up out of whole cloth, starting out in dotcom operations management, finance and product development and ending as a professional blog producer. While it paid fairly well, it did not pay nearly as well as the jobs of my business school peers; and it became very difficult to make extra room in my budget to pay my huge student loan payments. Instead of paying down my student loans, I've only compounded them.

One thing I did brilliantly was to buy a house in an up-and-coming neighborhood immediately upon getting pregnant with my first child, and never refinancing it. Buying it was a gut reaction to the nesting hormones, but it turned out wonderfully. Four years later a Starbucks went in two blocks away, and my home's value doubled. Early on, I took out a home equity loan to (hiding my head in shame) pay for our wedding; I'm thankful I never refinanced the house, keeping my ARM that was garnered at the peak of my credit score. While I was seriously guilty of living outside of my means as a young bride and mama, after I became pregnant with my second son I buttoned down the hatches, canceling all my credit cards and vowing to live on what I made.

That one really good decision -- never to refinance my mortgage -- has paid off with a low-ish monthly payment and a fast-reducing principal balance. And with my new philosophy of "no debt no way never," I know at least I won't be facing a tough credit review at my local bank.

Another great financial decision I made was to stop driving the family car and travel by bike. I spent my Economic Stimulus Package on a fancy cargo bike that can transport my kids and lots of groceries -- and whose maintenance costs consist of an inner tube every six or 12 months (ok, I'll admit it, I buy a new helmet or some other kind of bike accessory every six months too. $120 a year!). Other than the cost of the bikes for me and my six-year-old son, we spend about $250 a year on transportation.

In response to the financial crisis, I've decided to put more of my rather small 401(k) balance into the S&P 500 (seems like a buying opportunity) and finally start college saving accounts for my boys, also invested in index funds. Hopefully we can tell them how prescient their mama was to start when the market was at the Great Low of 2008. Due to rising grocery prices and philosophical and environmental concerns, I've begun to eschew packaged breads, cereals and snacks in favor of baking from scratch, grow more of my own food and get as much of the rest from local farmers and ranchers, also volunteering to pick neighbors' neglected fruit trees and preserving the produce. Those 8 pints of fig pear lavender jam in my pantry were almost free (I just paid for honey to sweeten them) and will taste great on homemade bread this winter. And, if all goes as planned, I'll be saving enough money to start whittling away at that student and home equity loan debt this month.

Lots of my friends about my age are making similar choices, foregoing cars, preserving food, cutting back on needless spending. Others who have just completed significant refinancings to pay for remodels or home expansion are working long hours to keep the wheels turning. Their homes are lovely, but I'm happy I didn't make a similar choice. In my opinion, now is not the time to increase debt for a bigger car or a bigger/lusher home. Now is the time for debt reduction, scaling back activities, and simplification.

And now is definitely not the time to refinance my mortgage.
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