I told myself that I couldn’t get engaged, married or have kids until I was debt free.
When Joshua & I met in April of 2015 I was struggling financially. I had just met an amazing man who literally had all of his sh*t together and I couldn’t comprehend how he had accomplished so much since he was only 3 years older than I was.
I remember having a conversation with Josh about how he was going to trade in his car, to purchase a truck. We somehow got on the topic of how he made his ‘monthly’ payments and I learned that he did the ‘half- payment’ method. Essentially he paid a portion of his car payment with each check that he got. Since Joshua is in the military he got paid twice a month, so with each check he paid half of his car payment that was going to be due. Seems pretty simple, right? Well my brain couldn’t comprehend how he was doing this.
I was living paycheck to paycheck and never had an ‘extra’ money to throw at my bills to actually get AHEAD of my payments. Once I realized that there could be a method of prioritizing your money and winning at the game of finances, I started educating myself about how I could pay off my debt to get ahead.
How to get started:
I started following the Dave Ramsey Method 5 years ago. I told myself that I did not want to get engaged, get married or have children until AFTER I paid off all of my debt because I wanted to give the ‘best version’ of myself to the person I committing my life to. However, I ended up doing all three of those things before I paid off all of my debt. I’ve realized that there’s a beautiful story within that ‘failed ideal’ – I learned that I was valuable & desirable even though I wasn’t perfect and literally came with a lot of debt.
Once Joshua & I got married we combined our finances and started working on our debt free journey together. I want to stress that this method can work regardless if you are single, engaged or married. The key to accomplishing your goal of being debt free is being consistent & having a budget.
Step One: Save $1000 as your ’emergency fund.’
This step is crucial for your continued success on the plan. This money is to be set aside in a savings account that you have the ability to access immediately if you have an Emergency. You will add more to this once step two has been completed (aka don’t worry, you won’t only have one thousand dollars to your name for the rest of your life. **Note before completing this step if you are behind on any payments you should focus on getting current with those debts.
Step Two: ORGANIZE & PAY OFF YOUR DEBT.
List your debts from smallest to largest. Start figuring out what your debt free journey is going to look like! This moment may be scary & overwhelming but I promise this list will help you be successful & keep you on track. The key to the Debt Snowball method is to focus on one item at a time so you don’t get overwhelmed. . .
When Joshua & I were dating we had both started working individually on our debt snowballs. When we got married in 2016 & combined our debts we had 30 different items on our Debt Snowball Sheet. We had credit cards, personal loans, medical bills, student loans, vehicle loans, family loans. . . You name it, we had it. Combining our financing really taught us how to communicate & it was great to work together on accomplishing our goals and achieving our ‘dream life.’
I’m really proud to say that we have made great progress over the last 5 years. As of June 2020 we have officially paid off 25 of the 30 debts we have. That’s over $180,000 in debt in five years! You may be asking HOW THE HECK ARE YOU DOING THIS? Because honestly, most people think we are crazy – but the key is focusing on how you are spending your money.
Step Three: Make & Live on a budget.
Now that you have taken the time to identify your Debt Snowball challenge, go ahead and make a monthly budget so you can start paying off your debts quickly! After you calculate your monthly expenses, any ‘extra’ money you have left over should be paid towards 1.) saving for your emergency fund which leads to 2.) paying off your debt.
Items in your budget may include:
- Car Insurance
- Vehicle Loan (s)
- Student Loans (s)
- Utilities (water, electric, sewer)
- Auto Expenses
- Life Insurance
- Vet / Child Expenses
- Cable / Internet
- Amazon/ Hulu / Netflix Subscriptions
When you pay off one debt, you simply allocate what you were paying towards that item, to the next item (along with any ‘extra’ you may have that month). The term ‘Debt Snowball’ comes from the progression of you rolling your debt payments into each other. Think of how you roll a snowball: you continue to pack snow together until you’ve accomplished making the perfect snowball.
Paying off your debt is not any easy task, but it will help you regain control of your life. I’ve really had to take a step back & realize that life is about more than how financially successful you may (or may not) have. Gratitude & hope are essential for being happy. I don’t dread looking at our finances now because I know that we are in control of what happens.
I have a Budget Accountability Facebook Group that is a safe space to talk about finances & get encouragement from others who may be on a similar journey as you. Feel free to join if you’d like to take a deeper look into how I handle my finances & what debts we are currently working.
Dave Ramsey’s Plan has 7 steps total but I purposefully chose to only focus on the first few because that is where we are in our journey right now. As our debt free journey continues I will be sure to update you on how we are progressing! We have a few more items in our Debt Snowball before we can move on to paying off our mortgage! My ‘Big Goal’ is to have EVERYTHING paid off by the time I am 40!
Where are you on your debt free journey? Here are some tools to help you get along the way. Are you just starting or are you years into it like us? I would love the opportunity to cheer you on!
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