Commit. Plan. Take action.
Today I have another debt free story to share with you!
One of my favorite ways to research for the blog is to interview people who have paid off their debt or are on the path to become debt free.
It’s no wonder that these stories are some of my most popular posts. [Read more…]
Around the new year people tend to set financial resolutions and plans for the next 12 months. The beginning of the year is also a good time to get a decent price on a used car. As you know, our little family grew by one last year with the addition of our daughter, Dahlia. Before now, we’ve driven a 2015 Volkswagen Golf GTI. However, fitting the car seat in the backseat isn’t the easiest thing to get done. So, we have been going through the pros and cons to try to decide whether or not we want to trade in our vehicle.
My husband absolutely loves cars. It is something he’s always been passionate about. One of his lifelong goals was to become an automotive journalism, which he accomplished last year. That being said, there is a little nostalgia attached to the cars we’ve had together.
Before we transitioned into being a one-car family, my husband drove around in a tiny 1999 Mazda Miata. We took a lot of adventures in that car. Eventually, Drew wanted to take it to race at the track. Unfortunately, that never ended up happening. We sold the Miata during the pandemic and still miss it dearly. It was such a fun car with so many memories attached to it.
The Golf is no different. For one, it is the first thing Drew and I truly purchased together. We named the car Gerry and we’ve used it as our primary driver now for three years. There have been road trips, it was the car we brought our daughter home in, the car we packed up and moved states away in. So, even though it is a pain to get the car seat into, part of me wants to hold on to Gerry just a little longer.
While we were initially mulling around the idea of trading in our car for something that would lower our monthly payment, we probably won’t be making a trade in unless we find a crazy good deal. The car seat dilemma is a temporary one. When we go on road trips, we can purchase a roof rack instead of buying another car. Ideally, we will pay the Golf off over the next two years or so and then pay for the next car in cash, keeping the Golf as a beater until it dies.
The only way a trade in would make sense for our family right now is if we found something that would give us lower payments with more space. With cars and real estate, that perfect mix of cheap but spacious is hard to find. Will family road trips in our little Golf be difficult? Yes. Will I also probably bump my head every time I put the car seat in the back? Also yes. At the end of the day, we have to keep our eyes set on what will be best for our family financially.
The purpose of this blog is to take you through the exact process that my husband and I have used to pay off more than $65,000 of debt in 11 months on a single middle class income.
To get you started on your journey, we began the process with making a promise and getting your spouse on board. Since then, you have calculated your net worth, reviewed the checklist to a strong financial plan, and written your goals.
Now you must develop a specific core habit to ensure your success.
The concern that I hear the most from people who are trying to pay off debt is how to recover from a setback.
Maybe it’s happened to you.
You get all fired up about paying off debt, take the time to create your debt freedom plan, figure out which debt you’re going to pay off first, create a budget, and start to throw every available dollar toward your debt.
This works fine for a month or two, or maybe just a week or two, but then something comes up to throw your plan off course.
It’s that time of year again when people vow to be better than they were throughout the previous year. I, for one, am a fan of New Year’s resolutions for a number of reasons. The main reason I love the idea of resolving to do better is it gives everyone a fresh, positive outlook. As I’ve mentioned in the past, remaining positive has brought me a long way.
However, many people set goals and make resolutions that are simply not reasonable. For instance, if you have a lot of debt and little-to-no savings, it is unlikely that you will (or should) own a house by the end of the year. So, how do you go about creating reasonable resolutions?
As you can see above, most of my resolutions have nothing to do with our finances (and that’s okay). Cutting our debt in half this year would be a HUGE deal for us and it is totally obtainable.
The other resolutions I’ve listed here are small but extremely important for me to maintain balance. First, my goal of “hustling more” will help us achieve our debt payoff goals. The more money we bring in this year, the more debts we can pay off. Next, self-care and health goals are always on my list. If you don’t invest in yourself (time or money), you won’t have anything to offer anyone else. This includes writing and reading more (for fun). Lastly, my husband and I have been slowly but surely learning German. I’d like to be fluent by the end of the year.
Unfortunately, most people stop trying to obtain their goals by the end of February (if they last that long). That’s usually because they’ve established these huge goals that are overwhelming, instead of breaking it down into smaller, easier tasks.
So, how do you go about creating reasonable resolutions and goals for yourself? Well, first you should read up about SMART goal setting. This method of writing down and setting goals for yourself helps you create smaller tasks and organized your path to success. Here’s a quick breakdown of the process…
You should also realize that, sometimes, life gets in the way of things. Don’t be too hard on yourself! If you run into problems when you’re attempting to reach your goals, take a step back and assess whether or not you have been specific enough in naming what you want to achieve.
It has become popular for people to choose words to describe their goals for the year. This year, my word is going to be “intentional.” I want to be more intentional about how I spend my time and what I focus on, shifting towards things that bring me joy and make me more available to my daughter.
According to Merriam-Webster, intentional is defined as “done by intention or design.” Some common synonyms for the word include conscious, deliberate, purposeful, and willful. So, instead of doing things on a whim or without planning, I’ll take my time and be intentional with how I move forward.
It’s more than that though. Since giving birth to my daughter I have avoided things that feel like a waste of time. My time is valuable. I could be spending it with my daughter, watching her continue to grow. So, when I’m not doing that, I want to be using my time to the fullest. This means being more intentional about how I spend my time. For instance, I need to make certain things higher priority during her resting hours instead of scrolling endlessly on social media. That way, when she wakes up from her nap or simply wants to spend time with me, I’m there to do it.
I’m also going to be intentional in other ways. We are working to be more intentional with our money and how we spend it. There are things we are doing (like cleaning out closets and minimizing expenses) that are helping us be more intentional about how we spend. For example, we definitely didn’t need a dozen streaming subscription services. Trimming some of those down can help us save for more important things.
Another way we hope to be more intentional in 2022 is with our health. Towards the end of my pregnancy and since my daughter’s birth we’ve spent so much money on eating out. Instead of spending money on fast food or eating out daily, we are going to put money towards our health and wellness. For me, this will take the form of private yoga sessions once a week. My husband is going to look into martial arts classes. Rather than throwing it away on junk food, we will be more intentional with our money and put it towards improving our body and mind.
When it is all said and done, financial resolutions and your “word of the year” only work if you have a plan to put behind them. To be more intentional this year, I am journaling daily, I’ve deleted many social media apps off my phone, and I’ve added more books to my TBR list. We are surrounding ourselves with people and things who are positive, intentionally working to create a happy, healthy life for our family.
Each month I bring you a recap of the previous month’s progress on paying off our debt. This serves two purposes — to keep my husband Mike and me accountable to our financial goals and to give you a look behind the scenes of our strategy for paying off our debt.
Do you feel like you’ll never get out from under your pile of debt?
If so, you need to read this inspiring story from the Miller family.
As their family grew from five mouths to feed to seven and with a wage of no more than $14.50 per hour, Ella and Lavern Miller paid off $137,000 of debt in four years!
Read on to hear from Ella Miller herself how they paid off so much debt in such a relatively short time.
Everyone has a way they like to organize their financial plan. For some, it is easier to log everything into a spreadsheet. Others have started using apps to manage their cash. In our family, we use a budget calendar to stay on top of our finances.
While writing everything down on a calendar may seem a bit old-fashioned, it can work really well, especially if you do better with writing things down. I personally still keep a physical calendar for everything, so adding our budget into it made complete sense. Here’s what ours looks like…
As you can see above, I have color-coded what money we have going in and what we have going out every week. Our paydays are written in red and all of the money going out is written in blue. This includes all of our bills, groceries, and my hubby’s vape fluid for the month. As you can see, there is also a note to have money budgeted for Valentine’s Day as well as $500 into savings.
If you’d like to create your own budget calendar, it is really easy. All you need is a monthly calendar layout (you can even do this on your computer if you prefer). Once you have your bills and earnings written out on the calendar, you can decide how much money you can budget towards entertainment and additional debt payments.
Of course, everyone’s budget calendar is going to be different. If you have a larger family, you’ll spend more on food. People who have more debt may also have more monthly payments to consider on their personal calendars. As you begin to pay things off, you can always change your budget because you’ll be jotting down your expenses and earnings every month as it changes.
Also, it is a good idea to set aside a day every month to review your budget and see what the month ahead will bring for you financially. Be sure to also note any large, one-time expenses that may occur, like paying taxes or renewing your car’s registration.
Readers, do you use a budget calendar? If not, what kind of budgeting method do you use?
Get ready to be inspired!
Every other week or so I bring you an interview about a journey out of debt for motivation that it is possible to live debt free.
Recently, I have shared Dontae and Laura’s debt free journey and Amy’s journey to financial freedom.
Today’s interview is one of my favorites!
Miriam Lilly is a 29-year-old young woman who paid off all of her debt so that she could stop saying “no” to opportunities and start saying “yes” to life.