Debt Update

We started this journey in September 2010. As of July 1st, 2011, we have paid off $13864.01!!!!!

As you may have heard, Tony and I are working super hard to pay off our debt. We have made a few mistakes in the past that we can blame on being young and naive... or most likely we were just being stupid and careless! However, after taking a long 13-week course about money management, we are on the same page. A page that says NO to debt! A page that is sick of giving over $1000/month of our hard earned income away to the collectors! A page that no longer wants to be slave to the lender!

Here is the ugly, nasty truth of how out of hand our debt became:

So almost a year ago, on September 13th, we walked into our first Financial Peace University class. We had heard about it through our marriage prep class and knew that the first class was a freebie. Everyone else in the class already had the kit and workbooks ready to go. Tony and I sat empty-handed. He was embarassed, but I didn't want to "blow" $100 on something we weren't going to stick to. I even forgot to print out the workbook freebie handout, which furthered Tony's embarassment. I had forgotten that sometimes he doesn't like to "go with the flow" and stick out from the others. Needless to say, after one class, we were hooked. We bought the kit from our instructor before walking out the door that night.

I quickly dove in and became the nerd of the Stein team. Tony fell into the roll of the free spirit, but started to grow more into a tight-wad free spirit ;) Fortunately we already had Baby Step 1: $1000 Baby Emergency Fund in place from our wedding. After three weeks of class, I finally calculated our Debt Snowball. Ouch. Our total debt was... get ready for this... take a seat.... $61,943.19. We were 25 years old. How the hell did this happen?! It was time to get angry and get rolling on our debt snowball.

If we can keep up the same pace of about $1500/month, we will be debt free by June 30th, 2014. Although this seems super far away at this point, I have to remember what we started with (see that sickening number above) and how much on interest we will be saving (over $11,000!). Plus, it's seven years earlier than if we just paid minimum payments!

We are finally under the $50,000 mark. Do you know how much debt you have? Most recent grads/mid-20s have never added it up. You can't attack a problem if you don't even know where you stand. I challenge you to the Debt Snowball!!!

Add-On to Yesterday's Post

I noticed this beauty when we pulled into the parking lot at Welch last week. I usually don't take special notice of awesome beater cars, but I did a double take at this orange glory! Notice the small message on the back bumper?

"100% Down" and "0 Payments"

My first thought: he must be on the Dave Ramsey plan!!! Cash is king! Debt is Dumb! I have been lucky enough to never have a car payment (a special thank you to my awesome parents) and lucky enough to have gotten declined from a car loan when I was 21 (due to no credit) to prevent myself from the trap of monthly car payments that seem to be a normal part of life for Americans. I want to be weird! I will "suffer" through Grand Ams with 250,000+ miles on them where the doors and windows don't quite work, let alone the A/C. I will keep my smelly Neon that sucks oil like no tomorrow and constantly has a leaking tires. I do not "deserve" a better, fancier car.

I deserve to be debt free.  

Our Financial Journey... It's Only Just Beginning!

According to Dictionary.com, a resolution can be defined as a formal expression of group opinion, determination, or a solution of a problem. Synonyms include: resolve, determination, perseverance, tenacity, strength, and fortitude.

The first of the year brings many hopeful promises. Every year, without fail, someone asks me if I have a New Year’s Resolution. In the past, I have chosen things like working out, getting organized, getting good grades, etc. Although these are great goals to have, they can get a little lofty when there is no purpose or specification. Someone once told me (or perhaps I actually retained something from college) that goals need to be SMART. This stands for Specific, Measurable, Attainable, Relevant, and Timely. I think this is the first time in my 25 years where I have actually applied this theory for a goal of mine! Let me explain…

Way back in March of 2010, Tony and I were about halfway through our Marriage Prep class. By this point, we were realizing the true value of this class (not just the discount on our marriage license). Some of the topics were easy for us, and others were big eye openers. Our class leaders were a little quirky and almost too “lovey” but in the end, they ended up being a great fit to lead this class. While they were teaching our class, they were also students themselves… in Financial Peace University (FPU). During the marriage prep class, we briefly covered the importance of joint finances and being on the same page with your spouse, but our instructors were raving about the even more valuable and in depth lessons they were learning each week in FPU. Tony and I knew that FPU would probably be a good idea for us. Although we had good intentions, neither of us were great at managing money and we had a lot to learn about debt, investing, and retirement.

Our marriage class ended in April and the rest of the summer was swamped with wedding planning, vacations, and the big weekend of fun! Needless to say, managing our finances was not really on the top of the list. But for some reason, one of my first days back at work, I wondered over the Dave Ramsey’s website. Next thing you know, we were signed up for an FPU course just blocks from our home starting the very next Monday night!

Color Changes

Tony and I have been hard at work chipping away at our debt snowball, per Dave Ramsey's FPU class. That being said, we have decided to go easy on the Christmas presents this year. I know it's not as fun, but this year our financial peace has been the best present of all. I know, sappy.

So... my present from Tony is to decorate our bedroom (affordably). To kick things off, Tony painted three of the five walls (yes, we have an odd-shaped room) in our bedroom on his day off last Thursday. I had narrowed it down to a bright granny apple green, a dark masculine purple, or a rich deep tiffany blue. Tony was appalled at the thought of purple. And he definitely wasn't thrilled about green. So here is the winner: