We did it. We finally did it. We’re debt free.
Thank you Dave Ramsey and your baby steps!
Dave and I were blessed to enter our undergraduate experiences with supportive families who didn’t force us into the family businesses/careers but encouraged us to chase our dreams and major in whatever we wanted. Fortunately both of our choices led to degrees that eventually got us hired in great jobs together, hence the reason we met in the first place!
Most of Dave’s undergrad was financed through private and federal loans. I made it through the majority of my degree without taking out loans (thanks mom and dad) until the economy did a wonderful belly flop in 2008. Between the two of us, we racked up $85,000 in school loan debt and a couple of car loans. Holy guacamole, Batman.
Here’s the part where the path winds a little: I eventually left my “job that a million people would kill for” so we could actually live together when we were married. I took a job at minimum wage for a little while just to have SOMETHING to do-while I was stuck at home I was doing laundry for the fun of it…seriously. That measly paycheck took some adjusting but I quickly found a job at the church that paid almost double and required me to work less so I could start grad school. We didn’t accrue any additional debt since grad school was free and actually paid me a monthly housing allowance, thank you GI Bill, I knew I sold my soul for a reason! Here’s the fun part, we only lived off of Dave’s salary. Everything I earned went to savings to beef up our emergency fund, 3-6 months of living expenses, and investing 15% of our retirement (hi baby steps 1, 3, and 4).
Okay the path straightens: I later found my current job, which is fantastic. I am blessed to have such a fulfilling career that still makes me bounce out of bed in the morning almost 9 months later. I am also blessed that Dave’s pay allows me to earn less to have a job a truly enjoy with a team that is more like family than coworkers. The point of this digression is that now that we’re debt free, we have even more freedom to pursue our passions and chase our dreams. We can DO WHAT WE WANT.
Here’s how we did it:
I am not a person who is comfortable with debt. AT ALL. That said, I paid off the debt in my name 3 months after I was assigned to my ship, which was approximately 11 months after undergraduate graduation. Dave had a bit more than I did so he tackled each monthly bill as best as he could, paying the minimums and focusing on his shiny new career as a pilot.
The game changed when we got married (4 years ago next month-wowza). Suddenly that debt was in my court, too. Hit the road, Debt, ain’t nobody got time for you in this household! We made a game plan to pay off all of his minimums but to put a little more into the smallest loan, following Dave Ramsey’s debt snowball process. In just a few months, we conquered the first debt. We took a beat, realized how amazing that felt and kept rolling the snowball. We took the money we were used to paying for that first small loan and put it on the next, slightly larger loan. We didn’t get to see that money anyway, so we didn’t miss it. We also didn’t miss the interest rates we were used to getting smacked in the face with!
We continued on for 3 years and 11 months. Although I’m sad that we had to move and sell our house, we did all the renovations ourselves, which helped us walk away with enough money to pay ourselves back and to pay the school loans off completely. I just hit “submit payment” on Dave’s final school loan. It wasn’t easy to see that much money go away so quickly after we earned it through the house sale (approximately 18 hours in the checking account-I didn’t want to get too attached to it) but oh my gosh, we feel amazing right now.
Next steps: keep living below our means (saving feels good and who actually NEEDS a giant house and the latest designer fashions!!), figure out where our careers are taking us next, and prepare to buy another house we can renovate and make more money off of 🙂 Baby steps 5-7 engage!