Why We’re Kicking Debt to the Curb

HEY! Does anyone still visit my blog anymore? It’s been awhile. A lot has happened since I last wrote 6 months ago. In learning and doing and experiencing new things – particularly in the realms of mental health and finance – I have new inspiration to write on these two topics. 

On the one hand, in the last 6 months I was introduced to counseling and how life-changing and beneficial it can be. More on this later! In addition, we’ve taken huge steps to take control of our finances and I’ve learned a ton (and even developed a passion for) personal finance. 

I hope to write some decent content that’s insightful, perhaps inspirational or at the very least, thought-provoking, from a Catholic perspective on both. I feel a tug to write about these topics — especially because mental health and money seem to be two topics that a lot of people don’t want to talk about. People get a little shifty in their seats when those topics get brought up sometimes. But I’ve never shied away from writing about uncomfortable things, so here we go 🙂 

First up on the docket for this new slate of content is… 

Why We’re Kicking Debt to the Curb

I recall a time a year ago when I just vaguely knew what our student loan balance was, and that a small payment came out of our checking account every month to keep Navient happy. Thankfully I don’t have any student loans (thank you mom and dad, so much!) but Jesse had a decent amount from undergrad. It was something I just set aside to worry about later. 

Fast forward to spring of 2018 and we found out that our incomes had gone up so substantially (yay!) that we no longer qualified for Income Driven Repayment. The realization that we’d be going from paying $65/month to $300 A MONTH for student loans — with no less than half of that going to interest — was like splashing ice cold water in our faces. 

We could think of SO MANY BETTER WAYS to spend $300/month. And we sure as he** didn’t want to be dealing with this for the estimated life of the loan, until 2030. LOL NO. 

From Clueless to Obsessed 

So we had to do some serious soul searching and researching. How the heck were we going to tackle almost 30K in student loans as quickly as possible? We had a few plans to pay off a chunk here and there, then we (foolishly) thought we wanted to buy a house but quickly took that off the table. We even thought we’d just make some extra payments every month but that seemed like dragging this stupid thing along with us for far too long when we did the math. 

Then I came across Dave Ramsey’s YouTube channel

If you’ve never heard of Dave Ramsey, please check out his YouTube channel and website. I don’t want to spend too much time here delving into his methods (he says it better than I do anyway! Just go to YouTube!) but suffice it to say that his “baby steps” look like this: 

  • Save $1000 for an emergency fund. 
  • Go full on, “scorched-Earth, gazelle-like intensity” living on less than you make, throwing everything, including what you have saved, at your smallest debt until it’s gone and then moving on to the next one. 
  • … until you’re debt free. Then follow the other “baby steps” in his plan related to building a more substantial emergency fund, saving for a house, investing, saving for retirement, etc. 
  • Oh, and don’t buy things you can’t afford. And if you have to take a loan out for it (other than for a house), You. Can’t. Afford. It. 

After listening to a few of his videos, I was also totally SOLD on getting out from under this gross burden ASAP, and on resolving to never go into consumer debt again. I began reading as much as possible about personal finance and getting out of debt so I literally went from being completely clueless about it to *obsessed* with how life-changing it is to take charge of your finances and be smart with money. 

Our Why 

We’ve had people tell us that “debt is good” and we see so many people our age buying houses, having kids, buying cars, going out, etc. Meanwhile, we live in a modest (yet cozy!) 1 bedroom apartment, budget like crazy, find all the free activities we can, tell ourselves “no” more often than not when we want to buy something, and avoid restaurants like the plague. So sometimes I find myself wondering, are we missing out? 

But really, we’re not. Ultimately we feel our “why” is more important than the instant gratification we may experience if we pursued some of that stuff right now, and is worth the delayed gratification. (Not saying that it’s bad if you’re in a position to do all of the above, everyone is different!). Future financial security and stability is very important to us, not in a “we want tons of money” way but in that we feel it’s the prudent thing to do to get out of debt, never go back into debt aside from a house (and pay that off ASAP!) and to build a base of financial stability for our family. 

When we aren’t held back by debt and monthly payments, we will have SO MUCH MORE FREEDOM to save for a house, save for retirement, pay for our future children’s education, afford things like vacations, and perhaps most importantly BE GENEROUS to causes that are important to us. 

And a MAJOR part of that security and stability is getting out of debt AS FAST AS POSSIBLE, and not going back. We decided that allowing payments on debts to eat up our monthly income is not how we want to live. 

Our goal is to owe as little money to as few people as possible — one with NO payments on things we’ve bought that we truly can’t afford, like student loans, car payments, credit cards, etc. We do not use credit cards anymore, we paid off Jesse’s car a year ago, and plan to buy my car in cash once the lease is up. It’s revolutionary and countercultural and weird, but it’s totally possible. 

Our Progress & Where We’re Headed 

I’ll spare you the specific numbers, but we began this little project at the end of June with a balance of 30K. It’s now October and we’ve got less than 4 months until our student loans are GONE forever. After the early months of 2020, we will never have to make another payment to Navient EVER AGAIN.

Ya’ll, I am SO EXCITED about personal finance now. I’m the kid who used to sit crying — yes, CRYING — at the kitchen table over how hard math homework was. And now I listen to finance podcasts and read finance blogs religiously.

And I’m writing this and future blog posts on this topic because I want everyone to experience the thrill of taking financial control of your life and experiencing the freedom that we’re already feeling now that the end of having this burden of debt on our shoulders is well within sight. 

It’s not a numbers thing, and it’s not a love of money thing. It’s about being a good steward of the resources we have so we can use our incomes the way God wants us to use them — prudently, responsibly, and generously, for our family and for the Church. 

More to come on all of this in the next few weeks. Stay tuned 🙂 

 

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3 thoughts on “Why We’re Kicking Debt to the Curb

  1. Doug Light says:

    Sarah! Great post! I teach Personal Finance at Washington High School. Constantly pound my students with these lessons! Thanks for sharing!

    Like

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