April 3, 2034...the day we are expected to pay off our last student loan. Our sons will be 23 and 20 for goodness sake! By the grace of God we plan to have all of our loans paid off well before that dreadful date. (Shhh, don't tell the bank.)
The reality is that our family is in tens of thousands of dollars of debt. It's not something we are proud of, but it's true. It's time to face the reality and do something about it! At the beginning of 2015 we decided after 6 years of marriage that we would finally put a budget plan together. Why it took us so long to start is beyond me, but it is what it is. We began very committed to living within the budget. As the year went on I found myself adding a few dollars here and there, especially to the grocery budget. I committed myself to an exercise and eating program that just made the grocery budget grow bigger. (Side Note: that is NOT how you "budget". You have the money you have. Stick to your set budget. If you're seeing things that may need to be adjusted, talk about it with your spouse if you're married. Do not just make up random numbers.) Items that I didn't NEED kept making their way into my shopping cart, and we were quickly back to paying our minimum monthly payments on our debts. No extra payments were made each month as we had originally planned.
In September 2015, God drew our attention to our debt situation. We put a full price offer on a house that was a little bigger in the perfect town, but it would have put us at the top of our budget. Meanwhile, we would have been needing to put minimum payments toward all of our other debts. They rejected our offer, praise the Lord! In November we took my husband's car to the mechanic. While it was still running we were told that the entire engine needed to be replaced! With too many unknowns we chose to look for a new car. I'm sure some might question this decision, adding debt when all we really want to do is get out of debt. Sure, it'll keep us there longer, but my husband needs the reliability and in the end it was the best decision for our family. Besides that, the term of the loan is officially 6 years. But this is our first targeted loan, and our goal is to pay it off entirely in 2 years -but may happen sooner as things currently appear!
As of now, January 2016, these are our debts : a car loan, and two substantial sized student loans. We do also have a mortgage, but I am not counting that as debt for this blog. I am proud to say that we do NOT have any credit card debt. And against the advice of financial guru, Dave Ramsey, we do have and frequently use our credit card. We just don't ever let the interest accrue and earn a bunch of cash back rewards. We view it as always having a 1%-5% (sometimes 10%) cash back coupon on our purchases!
One of the things I like most about this blog is that unlike many other blogs that I have seen, my blog will allow you to follow our journey from the very beginning. Please join me by subscribing. We might even learn a thing or two together along the way.
0 comments:
Post a Comment