Thanks to the power of putting small yet continuous sums of money against our two loans, we just crossed beneath the $110,000 owed threshold. In just under 6 months, we've paid off over $14,000 in debt. Now, to be fair, that's a little behind where we need to be if we want to be paid off in that 40 month time period. But bear in mind two things:
1. In that time we've gone in to "crisis mode" and socked extra money away in a rainy day account, as well as refinanced our mortgage. Unless something truly insane happens, we won't have to do either of those again in the near future.
2. The later it gets and the more principal we pay down, the less of our regular monthly payment will go toward interest. A regular monthly payment toward a $90,000 mortgage won't lower the principal balance as much as it will if the loan's balance is $20,000. The closer to 40 months we get, the faster the principal reduction starts happening, like snow in an avalanche.
Things will be slowing up in the next few months -- summer means no income from school for me and less piano lesson income -- but we still hope to make great strides in our program. Our next big hurdle (hopefully in the next week or two) is to get the mortgage down below $90,000. Small goals, to be sure, but they help us stay on track and stay focused when we'd rather go out and splurge needlessly.
Monday, May 24, 2010
Thursday, May 20, 2010
Tough Choices
The scene went something like this ...
End of the day, both our heads throbbing, I ask my wife, "Why don't we just grab something to eat on the way home."
She agrees, if only because we're both still shell-shocked from teaching a bunch of 10- and 11-year-olds just a week from summer vacation.
We head to the parking lot, pull out, and head for home. Along the way begins the inevitable discussion.
"We pass right by Subway. You want that?"
She frowns. "We had a coupon for it, but it's at home."
"It's fine," I say. "We've only got $99 charged on the credit card so far this cycle."
"Yeah, but it's so expensive."
We fall into silence for a couple of minutes before she says, "We could do Little Caesars. It's not too far out of the way."
Well, she's right, but it's also right near the interstate, and by the time we get there it'll be the start of rush hour. Heavy traffic and beginnings of a migraine don't go well together, so I hem and haw and finally say, "What about Arby's? That's always good when we've got a headache."
She's quiet for another moment, then drops the bomb.
"We could just eat something at home."
When it comes right down to it, she's the one who more often than not has to reign in our spending. I'm not a spendthrift by any stretch of the imagination, but I don't mind spending five or ten bucks here or there, especially if it's for something for both of us. Part of me enjoys eating out as long as it's simple, so suggesting something at home causes a wrench in my gut, but in the interests of marital harmony (not to mention I just want to get home to take some Excedrin), I agree.
And you know what? The meal we ate at home (frozen pizza, about $2 from Meijer with some green pepper thrown on top) was every bit as easy as eating out would have been. It may not have been terribly healthy, and not as tasty as eating out (if only because there wasn't as much dripping fat and lard), but between the pizza and a few pain pills, the headache is gone, and I feel like I can get back to my life.
In the heat of the moment (especially when we're tired and don't feel our best) making decisions that are better for our finances can be hard, but like most things, I've found we have less "buyers remorse" if we go the frugal route, and we usually don't suffer on the fun side of things. Anybody have a similar situation they want to share? Comment section's below -- comment away!
End of the day, both our heads throbbing, I ask my wife, "Why don't we just grab something to eat on the way home."
She agrees, if only because we're both still shell-shocked from teaching a bunch of 10- and 11-year-olds just a week from summer vacation.
We head to the parking lot, pull out, and head for home. Along the way begins the inevitable discussion.
"We pass right by Subway. You want that?"
She frowns. "We had a coupon for it, but it's at home."
"It's fine," I say. "We've only got $99 charged on the credit card so far this cycle."
"Yeah, but it's so expensive."
We fall into silence for a couple of minutes before she says, "We could do Little Caesars. It's not too far out of the way."
Well, she's right, but it's also right near the interstate, and by the time we get there it'll be the start of rush hour. Heavy traffic and beginnings of a migraine don't go well together, so I hem and haw and finally say, "What about Arby's? That's always good when we've got a headache."
She's quiet for another moment, then drops the bomb.
"We could just eat something at home."
When it comes right down to it, she's the one who more often than not has to reign in our spending. I'm not a spendthrift by any stretch of the imagination, but I don't mind spending five or ten bucks here or there, especially if it's for something for both of us. Part of me enjoys eating out as long as it's simple, so suggesting something at home causes a wrench in my gut, but in the interests of marital harmony (not to mention I just want to get home to take some Excedrin), I agree.
And you know what? The meal we ate at home (frozen pizza, about $2 from Meijer with some green pepper thrown on top) was every bit as easy as eating out would have been. It may not have been terribly healthy, and not as tasty as eating out (if only because there wasn't as much dripping fat and lard), but between the pizza and a few pain pills, the headache is gone, and I feel like I can get back to my life.
In the heat of the moment (especially when we're tired and don't feel our best) making decisions that are better for our finances can be hard, but like most things, I've found we have less "buyers remorse" if we go the frugal route, and we usually don't suffer on the fun side of things. Anybody have a similar situation they want to share? Comment section's below -- comment away!
Sunday, May 16, 2010
A Stroke of Good Fortune
How does this relate to becoming debt free in 40? I recently received excellent news. In helping my mother explore the veterans benefits available to her since my father passed away, I discovered something amazing called "Remission of Fees." While in the service, my father had cancer. Because of this, he received disability benefits for the rest of his life. What I didn't realize? I was entitled to 124 college credit hours of tuition because of my father's disability.
This means I will only pay a small fee of my graduate fees per credit hour rather than the full-tuition. This saves us close to $10,000 for my masters degree, and I will still have 88 credit hours available to me.
Needless to say, we're overjoyed at our good luck. Are there benefits in your financial life that you are not taking advantage of? What wonderful surprises have you experienced? Tell us about it in the comment section below.
Sunday, May 9, 2010
$10,000!
Just crossed the $10,000 paid off threshold! Less than 6 months ago, we started this quest to get our debt gone, and in that time, we've paid off over $10,000 in principal on the loans. There's still a long way to go, and we're still a bit behind the pace we'd like to set, but with a goal this big -- whether it be paying off debt, learning a new skill, or losing weight -- you have to celebrate the milestones along the way. Each little victory, even one as small as getting rid of just over 8% of our total debt in five and a half months, is that added psychological boost which will help us get to the next milestone.
Are any of the rest of you out there trying to eradicate your debt? If so, drop us a note in the comments section and let us know how it's going.
Also, I realize we have been bad (okay, really bad) about posting on a regular basis. I'm hopeful we'll be able to post more routinely here in the near future, including a couple of posts about how we're tackling our debt now and how we're allocating our money. For those of you who have stayed with us and kept tabs on our progress, I thank you for being here, and we'll try to once more provide you (horrid split infinitive ... sorry!) with good financial advice and suggestions to help you get to where we're going. Thanks for being along for the ride.
Are any of the rest of you out there trying to eradicate your debt? If so, drop us a note in the comments section and let us know how it's going.
Also, I realize we have been bad (okay, really bad) about posting on a regular basis. I'm hopeful we'll be able to post more routinely here in the near future, including a couple of posts about how we're tackling our debt now and how we're allocating our money. For those of you who have stayed with us and kept tabs on our progress, I thank you for being here, and we'll try to once more provide you (horrid split infinitive ... sorry!) with good financial advice and suggestions to help you get to where we're going. Thanks for being along for the ride.
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