Nick and I have been talking about paying off our debt for awhile now. But that's all we were doing...just talking about it. Nothing ever changed. We didn't make any forward progress. But we did a really good job of talking about it.
You know that quote, "Nothing changes if nothing changes?" Well, that was us. All talk, no action. And we were sick of it.
Finally, after living in our new house for months and painting our bedroom, we got our bookshelves hung up and our books unpacked. One of the books was Dave Ramsey's "The Total Money Makeover." So I decided it was time for me to read it.
And I think I was done with it in a matter of days. I soaked in all the knowledge. All the information. Everything he had to share. And I told Nick about it, and that I was all in. I wanted to do something different for our lives. To stop living paycheck to paycheck and trying to dig ourselves out of a hole every month. I was sick and tired of it.
So he read it next. And I mean, every spare second he had, he was reading. We were FINALLY getting on the same page with our finances and what we wanted to do for our family.
And it was scary. Deciding we were going to do this and then moving forward with it. The first step was removing all of our credit cards from our wallets (our safety net!) and changing all our subscription orders from being charged to the credit cards. Instead, we set them up to be debited directly from our checking account. Which means we had to budget and be prepared for it!
That was the second step. Actually sitting down and budgeting and accounting for EVERY. SINGLE. PENNY. we spent. There were several months we'd get to the end of the month and I'd wonder where all our money went. We knew we had enough, but good grief, where was it all going?!
It was surprising to see just how much we spent on little things. Amazon. Vitamin Shoppe. Kill Cliff. Advocare. Red Box. Starbucks. Eating out when we weren't planning to. More Amazon. More Vitamin Shoppe. More. More. More.
Turns out we had a lot of extra money...we were just recklessly spending it. So, that was the first major adjustment in our budget. We are now tracking literally every penny that we spend. We track it all. We plan for everything. We set it aside so we're never caught off guard when it's debited. We know exactly where our money is going.
The third step we took, and this one was hard for me, was taking the extra money we had in savings and dumping it on our first debt. For you see, Dave Ramsey's Baby Step 1 is to save $1,000 in an emergency fund. And anything extra should be used to start paying down your debt.
Oh, this one was painful for me. I hate depleting our savings account. But we took it and paid it to Nick's car, our first debt in Baby Step 2. Baby Step 2 is paying off all your debt, using the snowball method, where you pay off debt in order of smallest to largest, gaining momentum as you knock out each balance. We are then taking any extra money we have each month and putting it towards our debt too.
Y'all, we will have Nick's car paid off THIS MONTH! Nick has been killing it at work, I've picked up more clients, PLUS we got a nice tax return this year! We set things in motion and the universe has been answering!
It's crazy how the universe conspires for you when you set a plan in motion. We have gazelle-like intensity with this. We're sick of paying more money in interest (that could be going to investing or saving for a fantastic vacation!) every month. So once Nick's car is paid off, we'll be dumping all that money onto my car. And the last debt we'll have after that is our small mortgage.
I CAN NOT WAIT to have these debts paid off!
As of right now, we are set to have them paid off by January 2022. However, we are working our butts off to have them paid off well before then! Our initial plan was to put an extra $300 towards our debt, but we've literally taken every extra cent we've had and paid it towards our debt.
Nick and I are both so excited about our journey into "Operation Debt Free." We have the same goals. We want the same things. We are working to make our lives different. We're living how others won't, so we can live how others can't.
It's hard. It's an adjustment. But it's doable. And we WILL make it happen.
Let me know if you have any questions about Dave Ramsey and his money makeover. Or, of course, click the link above and read more about it. I'd love to chat with you about it :)
Hope y'all have an amazing week!
With love and wellness,