Source: google.com via Johanna on Pinterest
(We’re working through Tsh’s new ebook One Bite at a Time together. You should join in too. The book is $5, small price to pay, no?)
Man, I really hate money.
I hate talking about it.
I hate thinking about it.
I hate having to dole it out.
But, it’s here and it’s real and it’s one of those necessary evils in our culture.
And, Week 2 is to Make a Debt-Free Plan.
So I suppose I gotta even blog about it now.
About a year or two ago, I about had a heart attack when I realized how much debt we had accumulated over the years.
Fresh faced in college, armed with those credit cards practically tossed around the student union (but it came with a free T-shirt!), not to mention a brand new start up business…well, let’s just say I was less than excited to see what that number was when I actually sat down one day and added them all up.
Ew.
Super gross.
And we had two car payments.
And student loan payments.
Gross, gross, gross.
So I decided right then and there to have a debt free plan.
I took control of the finances and said to Andy: “I’m getting rid of this debt. Don’t freak out at the bank balance. In fact, don’t even look at it. Because it’s gonna be low for a while. I’m gonna let it slim itself down because paying interest on debt just so that we have a cushion in our bank account doesn’t make sense.”
“But what if there is an emergency Jeannett?”
“We’ll charge it. IF we need to.”
I realize how backwards that sounds, but the truth is that in an emergency situation, the least of my concerns would be money. In non-emergency times, a huge concern was money. Ergo, I wanted the debt to be gone even if it meant we didn’t have much of a cushion for a while.
Scary? Yes.
Worth it? ABSOLUTELY.
After about 14 months of hunkering down…paying and paying and sending even the littlest bit away…and NOT just waiting to “send it off with next month’s payment”…nope, if some random rebate check came in for $30, that $30 was sent THAT DAY. I didn’t want to even be tempted to “accidentally” spend it…14 months later…we were mostly OUT OF DEBT.
No car payments. No credit cards.
We still have our student loans and our house payment (I mean, I’m pretty sure we’ll have that for a while)…but that’s it.
Our student loans are next on the list…but with an interest rate of about 2%, I’m more concerned now with building up that cushion I whittled down. Once we have a good little chunk saved up (which is proving difficult with the neverending medical bills that keep coming in the mail), I’ll go back to focusing our efforts on those school loans.
Even with the school stuff, I cannot even begin to tell you how amazing it feels to not have all those bills.
Just paying bills every month is so much easier!!! I pay the mortgage, the utilities and Sallie Mae. The end. Not a whole slew of credit cards. No juggling balances to take advantage of 0% balance transfer teaser rates. No making minimum payments.
It’s a really great feeling.
And it’s nice that I did this a while back so that this week’s project was already done. ;)
Have you made a debt-free plan? It’s scary right?! But totally worth it. Promise.
Disclaimer: links to Tsh’s book are affiliate links and if you buy the book after clicking I make a small percentage. So buy it please.. ;)
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Congrats!! My hubs and I are debt free. However we do not own a home. We can’t really afford anything so we are just saving our pennies until we can buy a house. We paid off the credit card and all the student loans and just use our debit card! Its so much simpler! Keep it up because it is awesome to get rid of all the debt! We went through Dave Ramsey’s Financial Peace University class and I highly recommend it!
Shortly after my husband and I got married, we put together a 5 year plan to pay off everything. We have a year left and we aren’t exactly where we hoped to be. We have paid off a lot of stuff, but we still have student loans and some old stuff of my husband’s that he occured before we got married. We were able to pay off my car, but then we had to get a van when our family got bigger (though we did buy used, so the our loan isn’t as big as a new car loan).
When I look back over the past few years, I think we’ve gotten a little away from our plan (some due to life’s unexpected surprises/changes). I think we should probably sit down and work out another plan.
I’ve heard lots of good things about Dave Ramsey’s financial class. I would really like to sit in on that one day.
I think im going to get this book. Im trying to come up with a debt plan to get my husbands credit straight first. then mine.
My husband and I when we first got married made a plan to always stay out of debt. Once we paid off all my college loans we have been pretty good at keeping to this plan. Except for our home we have no debt. If we don’t have the money we don’t buy.
Praise God!
I know exactly what you’re going through. My husband and I have been working hard to pay off our debt for the last 3 years (we’re in South Korea teaching English) and this is the year that it’s going to be finished! It feels SO good and God is SO SO faithful!
Congratulations! It is so hard, right?! But so, so, so worth it!
My husband and I always were debt free (besides student loans) until we bought a house…and then when we had 2 babies and I quit working…well it didn’t quite work out as well as we had anticipated. But, we are slowly working our way out of that hole. In retrospect, it would have been smarter to pare down our consumerism a bit once I gave up my very large salary to stay at home with my babes. Live and learn! Congrats to you for being mostly out of debt! We are working on a 5 year goal now, because I would rather not go back to work, even if it would mean getting out of debt a heck of a lot faster.
Congrats on your hard work!! My husband and I have tried to stay debt free aside from a mortgage for as long as possible. At this point in time, we only have the hospital bill from our son’s birth, which will hopefully be paid off by May, if our debt plan stays the way it is now!!
I didn’t do too much work on this chapter this week since we already have a debt free plan. Besides our mortgage we just have our car loan and one other small loan. That loan will be paid off next summer and then we will work on finishing our car payments.
Just ordered the book because I have been really wanting to tackle these types of projects especially our debt. We don’t have any credit cards but we do have quite a few school loans, car payment and some random bigger bills laying around…
so thankful that my husband and i are debt free. (except for the house we just bought!) we transfer money to an emergency savings account every paycheck so that when emergencies come we will have the money to pay for them! loving this book!
i’ve been going through school slowly to pay for school w/o loans and i am so happy. i have no debt and i want it that way forever
Awesome, Jeannett! You should be SO proud of that! I was excited to read Tsh’s next “bite” b/c we’ve been working to become debt free the last few months. Another vote for Dave Ramsey’s Financial Peace University! Or at the very least, buy the book! We started the class in August and it is GREAT! It is faith based, which is a big plus! Our plan to to pay off everything (other than mortgage) by March 2012! Then have 3-6 months worth of expenses in savings by end of 2012. I CANT WAIT!!!!
LOVE this one! (And yes I need to pony up that $5 and buy the book, will do that later today at some point.)
My mom gave me the DR book and I was an immediate convert! As in highlighting, dogeared pages, post it markers, etc. We have modified the gazelle program slightly which I realize he doesn’t approve of….but we have a 1 year old and I don’t frankly want to wait until she is 5 to be able to take her anyplace, do classes with her, etc. We are mindful and careful of what we justify and what we put off.
It’s scary not having that cushion I admit!!! But this past summer when dh and I were both working LOTS of hours, it was exhilarating!!! to make triple payments on our cc bill. It and our truck loan are now down to 1/3 of where we started. We still have a ways to go and challenges, but it’s great to see things changing to where we can USE our income. I want to homeschool so we have got to pay things off to make that even possible.
Our budget is still tough but a work in progress…we still end up spending WAY too much at times on groceries, gifts for relatives, or eating out. (My husband is the worst culprit at stopping for a snack here and there but again we’re working on this, trying to send more snacky stuff with him, and he’s already made a huge dent at least.)
At the very least, it’s great to actually have a plan. :)
Thanks for the inspiration ladies! I’ve been very bad this year with our budget. I had it all paid off and now the debt is back! I should’ve cancelled them all when I had a chance. I know technically you’re not supposed to cancel them because it lowers your credit score, but like Dave Ramsey says, why worry about a credit score when you shouldn’t be charging it anyways!
Hi Ladies,
I am nearly debt free. No credit cards, just mortgage and home equity line of credit. I followed David Bach for the most part. Paid off the smallest debts first. The hardest part was making the commitment to spend nothing on extras. I did so for almost two years. At some point you just need things though so I’ve started spending again and I already feel out of control. Tomorrow I’m going to work on a five year plan and refocus my efforts to finally get onthe plus side. My husband is hopeless. I finally had to take control of all the money and credit cards. It’s not ideal, but I wanted to share so that you know it is possible to do this by yourself. I nad to take away his ability to run up our debt. After he ran it up twice so sky high, he had to admit
That he couldn’t control it and let me handle the money. It’s been several years now and he seems relieved. I know he’s not learning anything about handling his own finances, but I’ve just accepted the fact that he can’t learn. He and his mother both seem to have this problem where they can’t grasp how things add up. Ex.–that’s great the concert ticket is $70 and you have $70. But there are two of us, we will need to eat out at or near the venue, and we will need concessions/beer money inside. Also gas money. It will cost around $300-$350 to attend the concert. His response would be, “No, it couldn’t be that much.” Yes, yes it can.
My husband has always talked to me abut our debt free plan (which he put into action when we got married) but hearing it from Tsh made so much more sense–same plan, go figure! This project has, however, gotten me to actually look up our bills and budget. Also, I’ve followed Tsh’s advice about using envelopes for cash, and when it’s gone, it’s gone! The first week of envelope system was dicey, to say the least. But, I’m going to stick with it in the spirit of “simplifying” my spending habits.
I feel like this is one we have under control. My husband and I got married at age 29. So we both had several years of working real jobs and saving money before we got married. My husband actually managed to pay off his first (tiny, two bedroom, no basement) house a year after we got married by selling a bunch of his stock he owned through his work. Now we have a larger house to fit kiddos in. We had hoped to sell the old house right away to help us pay off the current one. But, you know all about the economy right now. So, we are currently renting it out and still doing our best to pay off our current home ASAP. Congratulations on how far you’ve come! It is so freeing not to be weighed down by debt, isn’t it?