This is something I'm pretty proud of and wanted to share. It's also incredibly personal, and I'm more than a little nervous sharing, but maybe it will encourage or inspire someone having their own financial struggles. This started out as a ridiculously long post, so I ended up splitting it into a series. Be sure to check out Part 1 and Part 3!
Back to the debt snowball. Last time, I told you we had paid off our credit card debt. Our car loan then became our smallest debt, so that's what we went after next. We were able to DOUBLE our monthly payment, and soon we decided to sell it and pay the whole thing off. And that's what we did. So now we were left with just our student loans and our mortgage.
Along the way, we hit a few bumps. Our remaining vehicle (which is paid off AND gets incredible gas mileage) needed more than a few repairs. We were able to pay cash and move on with our lives. Not that it didn't hurt handing over that much money for something not fun and not planned for, but it did feel good that we could pay for it outright and without creating more debt for ourselves.
And now, most recently, after getting starting on preparing our taxes, we realized we'd set aside a little more than we would need. My husband (as you may or may not remember or even know) has his own business, and so he has an account set up especially for saving money to pay taxes at the end of the fiscal year. We made the decision to take that extra money and wipe-out his student loan debt this month. Now, I'm excited I get to start watching my own student loan debt start dropping dramatically since that's the next in line for us to work on.
Our spending is prioritized now. We don't get to do all the fun things that we'd like to do and that some of our friends and family choose to do, but eventually we will. It is frustrating watching others take expensive vacations, buy new cars, and treat themselves to so many things I would love to indulge in but don't.
Honestly, though, the most frustrating part of this whole budgeting system has been this: thinking of all the money we wasted for so many years by not focusing on getting out of debt sooner. We're lucky that we have great renters in our house right now - they pay on time every month, take great care of the house, and the money they pay covers our mortgage. We're lucky that we have a generous family that allows us to live in this house with them while paying for nothing but groceries and our own expenses. And we're lucky that we've learned to manage our finances in a more responsible way early enough to set an example for our kids. We even plan to get Dave Ramsey's books for kids to really hit the lesson home with them.
Do you find yourself comparing your spending habits to those around you? It's a horrible habit. And how do you teach your kids the value of money? Chores? Allowance? I'd love some tips!
Honestly, though, the most frustrating part of this whole budgeting system has been this: thinking of all the money we wasted for so many years by not focusing on getting out of debt sooner. We're lucky that we have great renters in our house right now - they pay on time every month, take great care of the house, and the money they pay covers our mortgage. We're lucky that we have a generous family that allows us to live in this house with them while paying for nothing but groceries and our own expenses. And we're lucky that we've learned to manage our finances in a more responsible way early enough to set an example for our kids. We even plan to get Dave Ramsey's books for kids to really hit the lesson home with them.
Do you find yourself comparing your spending habits to those around you? It's a horrible habit. And how do you teach your kids the value of money? Chores? Allowance? I'd love some tips!
