The confession… our total debt

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I promised transparency and updates on how our War with Debt program is working. So, where do I even start? I suppose the best place is by confessing our debt.

We have a total of (choke)$103,787.00 in debt.

Here’s the breakdown:

$82,438.00 in student loans (with 2-3 more years to go before I complete my Doctorate).

$1350.00 I owe my dad for helping me move

$1610.00 credit card

$2194.00 furniture loan. 0% interest

$2896.00 laser eye surgery loan. 0% interest

$13,299.00 vehicle loan (it’s a 2012 so it will last us a long time) – 2.5% interest

Yikes, right? I have always thought we weren’t doing badly, besides my school loans which we aren’t paying on yet. We have been able to buy what we want, for the most part without thinking much about it. Instead of changing our spending habits and selling stuff we don’t need so we can pay these off, we have just made our monthly payments on all this debt plus some extra. With Wes getting out of the military, we want it all gone, and we want the money that has been going to debt month after month to go towards our dreams! We are going to get out of the cycle of “pay off debt, have extra money every month, get more debt because we have the extra money every month to make payments on the debt”.

I have always been great with budgeting. I have a very detailed Excel spreadsheet with our monthly payments, investments, debt, etc. I’ve looked it over time and time again to see where I could cut down to save money. Before this program I really didn’t think I could find “fat” in my budget… aka money we’ve been spending that we can stop spending and put towards bills. I was wrong, so incredibly wrong. With Wes moving we will be losing a lot of expenses from living in two separate households which is great. So, I’m going to discuss our expenses as if he was already here since we only have a month left.

The most obvious expense I cut was my monthly car wash package. I knew that needed to be cut but I LOVE having my car washed and vacuumed unlimited times per month, so I somehow was justifying this expense in my mind ( <<cough>> LAZY). I hate to even admit it, but that’s $54 of “fat” trimmed off the budget.

The second expense I cut was Netflix. We have been paying for Direct TV for years. When I moved to Washington I didn’t get cable or Direct TV and have just used Netflix. When Wes moves the $200 Direct TV monthly bill will no longer be an expense as he has agreed to let it go. I kept justifying this $9 per month charge because Wesley will occasionally watch Netflix and, come on, it’s only $10 a month. But, $10 is $10 that could be going to pay off debt. When you add all the small stuff up, it makes a big difference. Now, this makes $64.00 in “fat” per month.

The last expense we are cutting is my monthly gym membership. I love the gym I go to. It’s huge and the membership is only $23.00 per month. The problem is I’m not using it. One, because there is a gym in my apartment complex and two, because I like to exercise outdoors better. I have kept the membership because it’s so “cheap” and it’s such a nice gym. It’s not a necessity and I can reach all my fitness needs with my other options. This is a silly expense. New total = $87.00 in monthly “fat”.

Those are just the monthly expenses I have cut (remember how I didn’t think I could cut any?). It’s not even covering the extreme change I have made in shopping for groceries. I used to spend $250-300 every two weeks on groceries. When I started this program I spent $186.00 for two weeks. I got groceries today and I cut my bill down to $146.00 that will last us two weeks. It’s safe to say that is another $100 in “fat” bringing our new total to $187.00/month that could be going towards paying off debt and saving for our dreams.

The next change I made was all my small purchases that add up. Until we get out of debt, I refuse to go buy coffee from the coffee shop and eating out will be kept to as minimal as possible. Just recently I traveled for work. I get per diem and I would typically eat out and buy things while traveling. This time I prepared and I am going to have about $400 that will be going to pay off debt because I PREPARED, didn’t eat out, and didn’t spend needless money at the gas stations. Plus, I felt so much better! A small example…. When I used to travel I would buy water/drinks at the gas station. It cost $1.29 for one bottle of water (I may have 10-15 during this kind of trip). This time, I went to the grocery store and bought 24 bottles of water for $1.88 that lasted our entire trip. I saved at least $10 in just drink purchases. All these little things, that seem so little, add up and keep you right where you are at… paying off debt month after month.

I could go on and on, but every person’s journey is different. If you have any debt at all, and you are thinking “well, it’s not that much debt” I urge you to reconsider your thought process. No one should have debt, period. It’s so sad that we live in a time where debt is the norm. We should be investing our money into fruitful things and not just “stuff”. I am just amazed at how much differently I view money since we started this program. I was definitely that girl who said “If I want to buy coffee every day, I will. I work hard. I deserve it”. I have a totally different mindset now.

In making these changes, I see a strong correlation between physical health, financial health and anything else you want you want. It takes planning and work. You can’t wonder around aimlessly spending money on whatever and just figure it out later. To be as successful as possible you need to be conscious of what you are doing and prepare yourself for success, not just wait for it to magically happen.

I can’t wait to keep sharing with you as we knock out all of our debt and start saving for our dreams!

What tips and tricks do you use to save money?

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