Information Gathering Mode

We’ve had a great week after declaring we were debt free last Tuesday. It’s an exciting time for the family to put the focus of debt repayment behind us and begin to focus on wealth building. We have gone into information gathering mode again, but this time I’m not the only one involved. My wife is also playing a big part. We are double checking our options on investing and college saving before jumping back in. We have discussed adding some discretionary spending to the budget too. We are taking a cautious approach as we need a bit of time to re-evaluate our budget. We just want to breathe for a week or two before we make any major decision. I expect that it will evolve over the next few months before we settle in for a bit.

information gathering

Feels Different

Our family’s mood certainly had a different feel to it this weekend, there was something missing, oh yeah that huge pile of debt. All kidding aside I do feel different, in a great way, like some weight has been lifted. The family grabbed dinner out Friday night and we had a great time. We did manage to discuss credit cards and debit cards. My youngest son wasn’t totally clear on the difference. We cleared it up for him and I was surprise to hear his older brother and sister view on credit cards, stating when using CCs you’re using money you don’t have. On the ride home we all sang alone to the new U2 album, Songs of Innocence. It was a fun family night. I did some grocery shopping this weekend and it felt different. I still stuck to my list, used coupons, total bill was just over $76, but paying certainly had different feel to it in a good way. I really can’t explain it in words, but it’s a good thing.

Reality Check

There has been a lot of interest in our story since we have made our debt free announcement. I have several interviews and posts pending with our blogs. I’m proud of our accomplishments and I’m happy to share our story. My wife and I both posted statuses on our personal Facebook account and the response had been overwhelming positive. We have several friends asking how we did it. We are offering help where we can and supplying them with resources. I also had the opportunity to be interview by Libby Kane for Business Insider. We had a phone interview last week. After hanging up the phone with Libby I again felt good about what we have accomplished, exciting for the future for my family. The post was published yesterday on both BI and Yahoo Finance. What I wasn’t prepared for what all of the negative comments.

Ouch! The internet tough guys were out in full force. I guess I should have anticipated it, but I was just on such a high from the past week that it never crossed my mind. I guess I’ve been spoiled by the great community we have, because most of the comments on Debt Discipline have been from fellow personal finance bloggers. I’m trying to deal with it, as these internet trolls mean nothing in the grand scale of my everyday life and I need to reminder myself just that. I have offered the same advice to others, but when you start making comments about my wife and kids, it has gone a little too far. My wife was upset too and I apologized for putting us out their like this. I’ll chalk this up to a lesson learned.

Posted in Debt, Education | Tagged , | 18 Comments

Week End Round Up #50

Happy Friday! Welcome to our week end round up #50. Can’t believe I’ve reached 50 week-end round ups, but a fitting number for this week as that’s how many months it took us to become debt free! We averaged a $2180 debt repayment over that time. We are super excited about completing this and looking forward to the next phase of our journey. I’ve been featured on my first podcast interview over at Couple Money Podcast –Episode 001. Please give it a listen. On to building wealth for us! Happy Weekend!

What’s your weekend plans?

week end

Now on to some of my favorite reads from the week:

Credit Cards Are Officially NOT for Me @ Enemy Of Debt

The Danger Zone @ brokeGIRLrich

I was intimidated by investing, but here’s how I got started @ Get Rich Slowly

Here are some of my favorite blogs:

Moneyminiblog
Messy Money
Frankly Frugal Finance
The Frugal Farmer
brokeGirlrich
Debt Debs
Enemy Of Debt
Disease Call Debt
The Broke and Beautiful Life
Club Thrifty
Squirrelers

I continue to featuring Interviews of fellow Personal Finance Bloggers, please consider participating.

Please e-mail me for more details.

Have a great weekend!

Posted in Personal Finance, Week End | Tagged | 14 Comments

Suburban Economics

As I’ve posted about before I like to review and compare data from surveys or research to see how my family stacks up against the results. I came across a new survey called “The Eighth National Suburban Survey.” It focuses on suburban economics, life and politics. I will focus on the personal finance details of the report. Of those surveyed 34% say they are better off financially than they were in 2008. 23% say they are worst off and 41% see no change in their financial condition. 41% of the suburbanites surveyed say they often live paycheck to paycheck and 66% do so at least some of the time.( I know this equals 107%, but this is what the survey stated and there is always a margin of error.) This has increased from 2008 when 38% often lived and 60% some time lived paycheck to paycheck. The survey states that although things have slightly improved economically since the recent recession, confidence in the President and our government is still mixed, as well as public schools ability to providing a quality education. There is a lot of information to digest in this survey, but after reading it I can’t help but feel the people surveyed are just looking for someone else to fix their problems.

Suburban

Pre-Personal Finance Education

I could relate to this feeling of wanting someone else to fix my problem before I was educated about personal finance. I never considered myself dumb, just naive. It took a seriously wake-up call in the form of $109k worth of debt to force me to educate myself and family. We were always living paycheck to paycheck and anticipating the next pay increase at work. If the pay increase wasn’t what we expected and didn’t help cover our bad money habits there was backlash toward our employers for not recognizing our hard work. We never considered fixing our own problems. We often looked to someone else to do it for us. No one else was forcing us to use credit cards to over spend, but when it came time to cleaning up the mess we looked for help from someone else other than ourselves.

Post Personal Finance Education

After our a-ha money moment in June of 2010 our perspective shifted. The whole victim mentality went out the window. We began to rely on ourselves to fix our financial problems. We did this in a few simple steps that we overlooked for years.

  • Developed a plan for our money
  • Spend less than we made – (cut lifestyle)
  • Prioritize needs over wants
  • Increased income
  • Continued to education our family about money

Now having these steps as a foundation for our finances, I’m not chasing a pay raise at work. Don’t get me wrong I certainly take pride in my career and would like to be promoted and increase my salary, but it doesn’t make or break me. I have created options for myself and my family by taking control and not leaving it in someone else hands. We have reduced stress in our lives, build security, and improved relationships all by taking control of our finances. So if I was asked the same questions before June 2010 as the people taking the survey today I know I’d be upset with the President, Government and school system too because they weren’t doing enough to help me. But in fact I was the one who wasn’t doing enough for myself.

Do you know anyone who relies on others to fix their problems? How do you deal with friends or family who think this way?

Posted in Education, Personal Finance | Tagged , , | 3 Comments

We’re Debt Free!

Today we made are final snowball payment of nearly $2700 to Bank of America and after 50 months we’re debt free! This journey started back in June of 2010 with close to $109K in debt shackled our family, a lot of uncertainty, and the need to make a change. We have had our share of bumps in the road along the way, temporary job loss for my wife, Murphy visited us more the once, and the task of cutting lifestyle for over four years. We stayed motivated each and everyday by focusing on the end goal of being debt free and thinking of what our family’s life would be like when we have a surplus of income each month. That one goal carried us to this very day.

We involved our children in the discussion from day one, letting them know that there would be changes. That the “no’s” we were often saying along the way were being said for the promises of future yes’s. The no’s were because of mom and dad’s past mistakes with money, and we want our children to learn from them so that they will not repeat these mistakes when they start their financial lives. Looking back over the 50 months, we survived. No matter what was thrown at us we were able to deal with it. We learn to adjust as we went. If you are just starting out on your debt repayment journey I’m here to tell you it can be done. If there is anything I’d like to change about the last 4 years is I wish I would have started this 10 years ago.

We have shifted gears quickly, our discussion have changed from debt payments to building wealth. We have many decision ahead of us, now having over $2k extra income per month. We have already have a fully funded our emergency fund, and now are increasing our retirement savings and starting college funds for our three children. It’s an exciting time for us because for the first time in a long time we are on the positive side of our income and can truly make a difference in our lives going forward.

debt free
How we got Started

Luckily for us we ran out of credit in the summer of 2010 or we may have continued on a destructive spending path digging further into debt. We were trying to plan a family vacation and I realized we were out of money or should I say available credit. We were living paycheck to paycheck at that time and have very little available cash. I looking to our credit cards and loans to fund our vacation that year and quickly realized we had maxed our 5 accounts. I tried to increase our credit lines, but was turned down as our debt to income ratio was too high. In that moment we had hit our rock bottom. We had nowhere to go, we could not borrow our way out of this problem any longer and continue to manage our monthly minimum payments.

I began to seek information about debt, I figured there had to be some get out of debt quickly trick I had been overlooking for years. Well I came across two resources. A blog call Punch Debt in the Face and a guy named Dave Ramsey. These two resources led to a new way of thinking for me, and onto a number of other resources. Ramsey’s “A Total Money Makeover” book was the first financial book I read. I brought all this new-found knowledge to my wife, the debt snowball, cutting lifestyle etc and after seeing we didn’t really have many options we jumped in. I worked with my local credit union and join a debt management program (DMP) they were able to negotiate with our creditor to reduce our interest rates. This ensured more of our debt snowball money was going toward principle rather than interest. I wanted to gain the quickest momentum so that’s why we went with a DMP, I know some have had success negotiating reduced interest rates directly with their creditors. Our initial payment was $1800 a month and we increased to a maximum of $2300. Our average was $2100 over the 50 months. From that day on we stayed the course.

Would we do it again?

I encourage anyone with any amount of debt to take a look at it and ask yourself why are you carrying it? We would take the leap again to become debt free in a second, so much so we wish we had done it years early. Being debt free even for a short period of time has given us peace of mind. We have a lot less stress in our lives, we don’t fear changes or unexpected events because we have a plan. Our family of five in on track, we openly discuss money and it has led to better overall communication as a family. It feels so good to be headed in the right direction. What are you waiting for?

We will be celebrating this accomplishment as a family. We will be heading out to a nice dinner at an upscale restaurant. Yes it will be paid for in cash!

*Part of Financially Savvy Saturdays on brokeGIRLrich and Shoeaholic No More*

Posted in Debt, Personal Finance | Tagged , , | 41 Comments