DEBT FREE!!!

As of about 5min ago I paid off my Tundra and a few other lingering bills and became debt free. Man what a feeling! I wish this on each and every one of you. Get out of the rat race as soon as possible and start making your money work for you.

A couple years ago I read Robert Kyosaki's book "Rich Dad, Poor Dad" and started listening to Dave Ramsey and heeding his advice and they changed my life. Wish I had done that 20yrs ago. If you don't know where to start, try those options.

Anyone out there with good financial advice, let's hear it. I'm a sponge and always looking for knowledge.

 

All I know is to live below my means. It’s amazing how less stressful life is doing that vs others I know that definitely don’t do that

 

Congratulations.

 

Dear Abby: It is human nature to want the best for one’s family, but a lot of the couples suffering this kind of stress have brought it on themselves.

There won’t be enough money for food and monthly bills if they are paying for new cars, a house they can’t afford, ordering takeout instead of cooking.
Couples’ financial problems could be greatly improved if they would only make better choices.

- Living Within My Means Down South

 

I screwed myself long ago when I was young and single. I had the cash to pay for everything but I was stupid enough to put all the fun things on credit cards. Doing zero balance percentage transfers etc. I knew what I was doing but thought I could pay it off sooner rather than later. Now it’s just a revolving door. I make decent money but my credit cards kill me every month. I hardly use them anymore. I’m basically paycheck to paycheck. The bank doesn’t want to loan me money to pay them off because they are afraid I would clear the credit cards and then fill them back up again. And I don’t have enough collateral for them. I don’t own my own home and probably never will. Stupid.

I hate myself every day for it. I tried debt consolidation and the monthly payments were going to be higher than my current credit card payments and I couldn’t afford the extra amount without it hurting my family. All my bills are on time and paid my daughter and wife are very well taken care of, and I pinch pennies to do modifications. Never been late on a payment on anything. At the moment I’m about $900 a month in credit card payments with no more room to spare. I’m sure there are things I can do and I’ve tried various avenues. But it gets tiresome and I’m just used to not having the money LOL. I still end up saving enough every year to make sure I do something with the family and create memories. This was one reason for the truck so that I could take them on inexpensive adventures.

At the end of the day, we all eat very well and have all the luxuries in life that I want do you provide for my family. I’m inching my way out of this hole. Credit card companies suck I’m sure in interest I’ve paid off my debt four fold.

I want spoke with a company that wanted me to go negligent and set my monthly payment aside so that they could then renegotiate my pay off for me. F that! They wanted me to ruin my credit. I have very good credit believe it or not.

 

Firstly....Congrats and join the club!So as a guy that has been told his whole life I'm not like others my age, and how my financial advisor/investor says that he uses my wife and I as examples to lots of people...I feel like I'm doing well enough. We always budget our life with spreadsheets. We started doing it like that young to ensure we didn't have to struggle as our parents did. I bought my first house at 20 years old and paid for 7 years, sold for profit, then built our own how. We saved up and got our payments to fall within $.08 of what we budgeted(under lol). We put money aside and ensure that we have emergency funds to cover everything in a worst case scenario. We once before had 2 car payments with a house and that was terrible haha. I paid my 2017 tundra off 1 year and 25 days after owning and we bought her a minivan for our growing family (have 2 with plans for more). Living within your means is probably the biggest piece of advice I can give. It's tough sometimes. Especially when you have to watch your friends/family get things given to them without working for it. We have people that have more than us with similar pay, yet we know for fact they don't have the cushion in emergencies and they're also paying expensive debts off. We just financed our newly built house 3 years ago at the age of 30, and are hoping to have it paid off by the time we're 55 at latest. What we plan and what happens can always change though....HE has proven that many times. Congrats again and good luck in life and life's choices!

 

Congrats!

I had the goal of becoming debt-free for a long time. We finally became truly debt free just a couple of months ago when we paid off our house. I have absolutely no loan payments whatsoever now. It is an awesome feeling.

As far as financial advise - the above poster mentioning living within your means is important. If you do happen to come into some money - don't let it go to your head too much. Keep a leash on it a bit. Enjoy it, but keep the end goal in mind. My ultimate goal is to retire when I am 53, and this was just part of that goal.

 

Congrats!!! Working on that goal now. Soon enough I can join in on the fun.

 

Well done. Our only debt is our home. I know a lot of people that make more money than my wife and I but are in debt up to their assholes. My wife and I are actually considering downsizing to a smaller home so we can have a paid for house by the time I'm 40. I feel for all the people that are consumed with keeping up with the Jones.

 

Congrats!!!

 

I've been debt free before. Several times actually

 

Whoa, I'm stressed just reading this. Keep up the good fight!

 

Pretty much this and on one income. Both my truck and my wife’s Mazda are both paid off and they have a combined total of 50,000 miles. Only debt is the mortgage and for a short time, interest free loan for new HVaC system. Our home should be paid off by 45 and retired by 52-55

 

Nice!! Congrats! We should have a PAID OFF THREAD lol. Cause I’m getting close too!!

 

I was once debt-free, except my mortgage. For those of you not Dave Ramsey disciples, that's Step 3 on the road to Financial Peace. That was on a single income of about 40k a year, supporting a wife and two kids. We kind of lost sight of the debt-free vision, unfortunately, and now despite a combined annual income of about $100k, we now have about $37,000 in debt, including two car loans, credit cards, and a loan for our HVAC in our house. I hate myself every day for slipping back into debt, it's such a fight to claw out of it.

 

I am right behind you our car and truck are paid off, the house pays off this year and only about $4k on credit card. Our plan is too be paid off by early spring. Not bad at 53 years old. Just wish I would have done it sooner.

Congrats to you and your family

 

Once upon a time, a long time ago, the topic of discussion became cigarettes ~ more specifically, quitting smoking. My compadre was nicotine addicted ~ he had started smoking as a teen.

He said;

"I don't know what the big deal is about quitting smoking ~ I've done it 4 or 5 times already."

And he was as serious as a heart attack when he said this !

Go Figure . . .

osidepunker

 

After some stupid choices and alot of tough recovery we're currently debt free other than The Woman's car. That'll last less than a month as we're in the middle of buying a house. Mortgages and reasonable car loans are acceptable debt along with student loans in our opinion. The biggest reason I drive a 1st Gen Tundra is I don't want $600+ per month truck payments.

OP asked for our financial tips so here's what we've learned and begun to follow. Keep in mind, I'm no expert but this stuff has worked great for us.

The basic principles we follow are:

- Save a minimum of 10% of your gross (pre-tax) pay.
- Build an emergency fund covering 3 - 6 months of expenses. You can choose to make this equal to exactly your expenses with no leisure factored in, or set it to equal your current standard of living. I like the latter version, as it puts more into the account and if you're tapping into it being able to go to a movie or out for dinner will help with some stress levels.
- I like to keep 1 month expenses in cold hard cash hidden at home, because reasons.
- Use government offered savings options and max them out. In Canada for individuals that's the Tax Free Savings Account and Registered Retirement Savings Plan. There's also some child related benefits that one can qualify for as well.
- Use employer offered savings options and max them out. My employer offers RRSP matching up to 5% of my paycheck. I put 5% of my check into the account and they match it. Not factoring in investment gains, that's a 100% return. You'd be a fool to turn that down.
- Once those are maxed, invest the rest as you see fit.
- Pay extra onto your mortgage as often and as much as you can. This is a good use for tax returns.
- After your savings are put away and the bills are all paid, the remaining money can be used for whatever your want. This is "fun money". We divvy it up between a few accounts for things like home goods, vacations, toys, etc.
- We use a cashback Mastercard and put all our monthly expenses on it. The cashback is deposited monthly into our emergency savings account, so it's a free $25 per month or so added to our cushion. We pay the card off every month and never carry a balance. Credit card debt is terrible.

Debt Philosophy:
- Mortgage is good, as long as it's reasonable. Don't buy a $500K house when you can get by with a $300K house.
- Car loans are acceptable, as long as it's reasonable and for your primary vehicle. We have a 2013 car and my 2005 truck. The loan is on the car since it's newer, less likely to break down and is our daily driver.
- Stundent loans are acceptable, as long as they're for a useful education. Gender studies or underwater basket weaving are bunk. STEM programs are excellent.
- Toy spending (boats, ATV's, guns, mountain bikes etc) is generally unacceptable debt. At minimum, 50% or more should be paid in cash, the remainder financed and then paid off with your "fun money" in under a year. We consider this acceptable only once or twice for $10,000+ items, such as a boat. If you can't afford to pay it off with your fun money, you don't need it. If you have say $300 per month in fun money allocated, and your boat payment is $300, that means you can't afford to buy that $25 headlamp (or whatever).

 

I will say this, I find it difficult to not smoke for an entire day. Even if it’s just two or three cigarettes a day I find those three hard to stop. If I could quit for months at a time that would be a step in the right direction LOL

 

Been there, done that too. Keep fighting for that credit rating. We did the debt snowball that Dave Ramsey preaches where you use the extra money saved when paying off the smaller debts to plonk down on the next largest debt and so on until they are all paid off. At one point I was $27k in credit card debt with 2 car notes at $592 & $595 and barely making ends meet, sometimes putting groceries on the credit card. A big no-no. The rich buy assets, the poor buy liabilities. Let that sink in for a bit. Don't give up, start making better choices now and before you know it you will be out of financial prison.

 

Excellent advice, thanks!

 

Brother, that sounds exactly like the situation we were in for a long time. Pretty much 100%. We were stupid for the first many years of our marriage, and ran credit cards up like crazy. Like you, we never missed a payment, never went without necessities, were able to take vacations, etc. Our credit was excellent, though we lived check to check. We’d make those minimum payments, which never brought our balance down.
The worst part of it all was if we had an unforeseen problem, like car repairs, or our home AC going out, things like that, we had no choice but to use credit to fix it. It just compounded it all even more.

I’m embarrassed to say it, but we spent the first fifteen years or so in that situation. We’d learned well before that not to use credit for unnecessary stuff, but things like I mentioned would force us to do it. Need a new lawn mower, refrigerator, etc? We had to charge it.

We lived ok, but not a dime to spare. I even delivered pizzas as a second job for a while trying to keep us afloat. I’m not proud of the situation we were in, but I’ll gladly share it in hopes it keeps someone else from making the same mistakes.

I wish I could tell you some big secret that got us out of it, but there isn’t one. It just took a hell of a lot of time and focus.
First step was to avoid adding to it if at all possible. We couldn’t always manage that, like I said, but we didn’t do it if we didn’t have to.
After that, we just started chipping away at it. We’d work on the small ones first, and get them paid off. Then we’d add whatever we’d been paying on that one to the next one. I think they call it the snowball method. It does work, as over time you have more and more available cash to apply to balances.

Another thing we did: If we got raises at work, via her salary, or me making more commission, was to apply that additional income to debt pay off. My wife would look at it month to month. Say for example I made $2,000.00 in July of 2009, and I made $2,500.00 in July of 2010, she’d throw $500.00 at a credit card. (Just made those numbers up) We knew we’d covered our bills the year before, so anything over that got applied. We did this for years.

It took a lot of work and focus, but man was it worth it.

 

That’s awesome...

 

I’m proud to say I never took out a single student loan.

 

I had the GI Bill and still had to take out loans for school. Paid them all off along with the wife's Masters loans. Student loans along with an affordable home mortgage are acceptable debt in my opinion now but when I was young I had to keep up with the Joneses and it killed me.

 

Good stuff. I didn't either. One of the benefits of going into the trades. The Woman is going back to school in Sept here so we're taking advantage of a gov't student loan for her. However, her program will help increase her earning power by at least 50%. It's also zero interest, no payments required while she's in school and up to 6 months after graduation. Basically enough time for her to go to school and find a job before having to pay it back. We could pay it in cashnow, but why bother? I'd rather earn 6 - 7% with that money and then pay it back later.

That said, I have a couple friends who took out roughly $50 - $80K in students loans for 4 year degrees. They had them paid in full in less than 2 years after graduating and their income potential is more than double that of mine. So it does depend on what you study.

 

That does sound exactly like my situation. I’m 10 years into it and really plan to be out of it in the next five. Although I started this debt about 20 years ago and it just slowly gained. It’s pretty much stabilized right now and I’m chipping away at it. Although if we need a new refrigerator or lawnmower etc. I have to do the credit thing. One reason why I like 18 months zero interest at Best Buy LOL that has saved me before. Also I have a hard time with my tax return. I want to throw it at the credit card, but instead I hold onto it in case there’s an emergency repair that needs to happen. And it has paid for itself. Right now I’m chipping away at my smallest credit card. Once that one is paid off I will put that same amount to the next card. I am not giving up! When everything is paid off I plan To put 3/4 of my now clean credit card monthly payments into my retirement and a savings. Since I don’t miss it much now, other than not being able to do all the trips I’d like, I think I will be able to have a nice cushion by the time I retire.

I’ve definitely learned my lesson, although I kind of knew what I was doing but I didn’t care when I was single. Almost 11 years ago when I met my wife I cleaned up my act real quick. Now I’ve got the job I want and I just need to get out of this hole. Once that happens I think I’ll be OK.

It’s difficult at times because I don’t want my family to suffer because of my stupid decisions before I took on that responsibility. So I feel bad when I have to say no do certain things that I would love to do for them. Occasionally I give in and overextend myself. My stepdaughter is nearly 18 and we’ve made a lot of memories that she can look back on as a good childhood. Now is the time for my wife and I to put our heads down and clear out this debt before we’re too old to enjoy the debt-free life.

I’m definitely envious of all of you who were smart enough to be financially responsible and become basically debt-free. I’ll get there someday!

 

Congrats Chris! It’s a great feeling to be debt free. We were in that situation until we got the Tundra and the Avalon in the past 8 months. So we have a couple of loans to pay off. I plan to retire in 3.5 years and I’m sure my accountant wife will have them fully paid off or nearly paid off by then.

 

Once upon a time I was visiting my local surf shop when a young-ish mom and her 8 year old daughter came into the store.
The daughter wanted a pink skateboard and the shopkeeper said it was a hundred bucks.
Without batting an eyelash, mom said to her daughter;

"I have fifty bucks ~ if you have fifty bucks we can get your skateboard today."

I almost fell out ! This is a strategy my mom used on us kids sixty years ago when we wanted something special.

I think money management starts just like this ~ and at a very early age . . .