WE'RE DEBT FREE!!! How We Paid Off $55,000 in 23 Months- Part 3
Behn and I started watching Dave Ramsey YouTube clips and listening to his daily radio show in January 2017. Dave lays out the 7 steps to Financial Peace and they made a lot of sense to us. We listed our debts from smallest to largest and discovered how much we truly owed- a little over $55,000. Most of these were educational loans. Behn and my undergrad, as well as Behn's Master's Degree. Years of paying minimum payments meant we had paid a ton in interest and the principle balances were stubbornly high. This is not hard to understand, but for years we'd only been able to pay the minimums. Now we were looking these financial statements in the eye. We were "sick and tired of being sick and tired," as Dave Ramsey likes to say. It was time to run from debt.
We went ahead and bought Dave's Financial Peace University and committed to watching the DVD's and doing the workbooks together every Tuesday night. At some point we planned on going to a community class, but it never worked out; however going through FPU together in our home got us on track.
Smallest balances were credit cards. We paid them off, cut them up, closed the accounts. Next was the van financing. We used Behn's yearly bonus to tackle that. Meanwhile, every single purchase was discussed. Was the purchase necessary? Did it fit in the budget? I know Dave recommends using the cash envelope system or his free app; what worked for us was to just constantly and faithfully communicate and be willing to say no or tell the other person no to a purchase. Our kids quickly caught on and began asking anyone and everyone if they 'believed' in Dave Ramsey. It was amusing to say the least! They listened to the radio show with us and we all cheered whenever some screamed, "WE'RE DEBT FREE!"
About 8 months in (August), I felt like we needed "a bigger shovel" to dig ourselves out of the debt hole. We decided that one of us needed a part time job. I ended up getting hired at a local seafood restaurant, waiting tables a few times a week. This did cause a strain- I was already working hard as a stay-at-home mom. Behn worked at his full-time job, obviously, and then came home and jumped into dinner, homework, and bedtime by himself. I became worn out from late nights at work. However, the cash from my job easily paid for groceries and helped us pay off my student loans that fall. By December, we decided that for the well-being of the family I should quit this job and instead found a wonderful job taking care of someone's horses 3 days a week. This little job, though not as much cash, was perfect. I was home right around bedtime and the 2-3 hours away in the quiet of the barn revived my spirit. The horses and I became friends and I listened to many books as I shoveled horse manure.
Sure, we made mistakes. We occasionally spent money when we should not have- there's a completely unused camping tent in the garage to prove that. I bought it one day at Aldi thinking that we'd camp soon- which we haven't so far. It could have waited. But in general, our spending was so focused and "gazelle-intense." Behn continued to drive his Hyundai- a true beater by now. It had no air conditional, manual windows, and the two back door handles broke. Oh, it was ugly and tiny, but faithful.
Last spring, we decided to make a change and sell our house. If we could make a decent profit on it, we would be debt free or close. We had put money into the property- planted trees, garden, fence up, new hot water heater, dishwasher, and that (pricey, financed) heat pump. Plus, the housing market had bounced back. We cash flowed new flooring and repainted several of the rooms and listed the house. I believe during this time we also managed to pay off the heat pump.
It took a few weeks, but we did get a solid offer during the summer. We packed up and moved a couple hours north, to a rental near Delaware. Behn continued his job, working from home twice a week and commuting in 3 times a week. The money from the sale of the house gave us a big boost! But we had to use a lot of the money for moving costs, an upgrade in Behn's car for his longer commute, home school materials, etc. We paid off Behn's grad school loan, but we still were not quite debt free.
We lost some traction after the move. I decided to homeschool the kids and so we were out and about more; we explored our area and all area Chick-Fil-A's...we planned a birthday party for Patrick...I was paying for a babysitter to help out some...kids were in tennis and art...and the holidays were coming up. We got back on track. We wanted to be done with this.
There wasn't much magic at the end. We crawled to the finish line, spending as least as possible in November and December. And, by God's grace, we did it; we scraped together the last few thousand dollars we needed to be debt free on December 11th. We're done; we did it...
WE'RE DEBT FREE!!!
So, how did we do it? Really, we just stayed focused and followed the plan. We communicated well and lived very simply. We sacrificed time together and worked extra jobs. About 1/4 of the debt was paid for from the sale of the house. During our journey, we also tithed 10% consistently to church, as well as contributed monthly to our favorite charity. God has been very good to us.
It's so exciting, and the plan doesn't end there. We now need to save a 3-6 month emergency fund and then begin saving for a solid down payment on our next home. We're ready to live a little, and yet we are focused on our next steps.
It took us 10 1/2 years to get here, but 23 months we were truly "gazelle intense" following Dave Ramsey's plan. Do you have debt that seems too big to tackle? Are you unfocused or messy with finances? Don't despair- make a change. If we can do it, really you can too. We're just a normal family living on 1 income, but this is really possible. I'm happy to answer any questions or encouragement.
I want to say thank you to my family and friends who encouraged and cheered for us. And thanks to kind family and especially our parents for helping out with things like buying kids shoes, coats, and making their birthdays and Christmas special. My parents also gifted me extra birthday money to go toward my student loan, which was appreciated. I'm especially grateful for Behn, the money guy, for all his detailed budgeting. We're a good team.
To God be the glory!
We went ahead and bought Dave's Financial Peace University and committed to watching the DVD's and doing the workbooks together every Tuesday night. At some point we planned on going to a community class, but it never worked out; however going through FPU together in our home got us on track.
Smallest balances were credit cards. We paid them off, cut them up, closed the accounts. Next was the van financing. We used Behn's yearly bonus to tackle that. Meanwhile, every single purchase was discussed. Was the purchase necessary? Did it fit in the budget? I know Dave recommends using the cash envelope system or his free app; what worked for us was to just constantly and faithfully communicate and be willing to say no or tell the other person no to a purchase. Our kids quickly caught on and began asking anyone and everyone if they 'believed' in Dave Ramsey. It was amusing to say the least! They listened to the radio show with us and we all cheered whenever some screamed, "WE'RE DEBT FREE!"
About 8 months in (August), I felt like we needed "a bigger shovel" to dig ourselves out of the debt hole. We decided that one of us needed a part time job. I ended up getting hired at a local seafood restaurant, waiting tables a few times a week. This did cause a strain- I was already working hard as a stay-at-home mom. Behn worked at his full-time job, obviously, and then came home and jumped into dinner, homework, and bedtime by himself. I became worn out from late nights at work. However, the cash from my job easily paid for groceries and helped us pay off my student loans that fall. By December, we decided that for the well-being of the family I should quit this job and instead found a wonderful job taking care of someone's horses 3 days a week. This little job, though not as much cash, was perfect. I was home right around bedtime and the 2-3 hours away in the quiet of the barn revived my spirit. The horses and I became friends and I listened to many books as I shoveled horse manure.
Sure, we made mistakes. We occasionally spent money when we should not have- there's a completely unused camping tent in the garage to prove that. I bought it one day at Aldi thinking that we'd camp soon- which we haven't so far. It could have waited. But in general, our spending was so focused and "gazelle-intense." Behn continued to drive his Hyundai- a true beater by now. It had no air conditional, manual windows, and the two back door handles broke. Oh, it was ugly and tiny, but faithful.
Last spring, we decided to make a change and sell our house. If we could make a decent profit on it, we would be debt free or close. We had put money into the property- planted trees, garden, fence up, new hot water heater, dishwasher, and that (pricey, financed) heat pump. Plus, the housing market had bounced back. We cash flowed new flooring and repainted several of the rooms and listed the house. I believe during this time we also managed to pay off the heat pump.
It took a few weeks, but we did get a solid offer during the summer. We packed up and moved a couple hours north, to a rental near Delaware. Behn continued his job, working from home twice a week and commuting in 3 times a week. The money from the sale of the house gave us a big boost! But we had to use a lot of the money for moving costs, an upgrade in Behn's car for his longer commute, home school materials, etc. We paid off Behn's grad school loan, but we still were not quite debt free.
We lost some traction after the move. I decided to homeschool the kids and so we were out and about more; we explored our area and all area Chick-Fil-A's...we planned a birthday party for Patrick...I was paying for a babysitter to help out some...kids were in tennis and art...and the holidays were coming up. We got back on track. We wanted to be done with this.
There wasn't much magic at the end. We crawled to the finish line, spending as least as possible in November and December. And, by God's grace, we did it; we scraped together the last few thousand dollars we needed to be debt free on December 11th. We're done; we did it...
WE'RE DEBT FREE!!!
So, how did we do it? Really, we just stayed focused and followed the plan. We communicated well and lived very simply. We sacrificed time together and worked extra jobs. About 1/4 of the debt was paid for from the sale of the house. During our journey, we also tithed 10% consistently to church, as well as contributed monthly to our favorite charity. God has been very good to us.
It's so exciting, and the plan doesn't end there. We now need to save a 3-6 month emergency fund and then begin saving for a solid down payment on our next home. We're ready to live a little, and yet we are focused on our next steps.
It took us 10 1/2 years to get here, but 23 months we were truly "gazelle intense" following Dave Ramsey's plan. Do you have debt that seems too big to tackle? Are you unfocused or messy with finances? Don't despair- make a change. If we can do it, really you can too. We're just a normal family living on 1 income, but this is really possible. I'm happy to answer any questions or encouragement.
I want to say thank you to my family and friends who encouraged and cheered for us. And thanks to kind family and especially our parents for helping out with things like buying kids shoes, coats, and making their birthdays and Christmas special. My parents also gifted me extra birthday money to go toward my student loan, which was appreciated. I'm especially grateful for Behn, the money guy, for all his detailed budgeting. We're a good team.
To God be the glory!
Great job guys! Very inspiring to me.
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