I had the pleasure of spending part of a Friday afternoon with Courtney and our mutual friend Lauren, and Lauren’s son. It was great to see them all! Courtney sent in another update. They are bulking up their emergency fund which I think is fantastic, now that all of their high-interest debts are paid. With just the student loan left, they are diversifying their goals a little bit — building savings and starting Roth IRAs before the student loan is gone. I think that is a great move.
So, I have also changed jobs–again! I was working for a limousine company, but they were purchased by another company. Again, I took a pay cut ($.50/hour) and am only working 24 hours a week. Hopefully things will pick up and I will be getting more hours, but we’ve been able to adjust our budget and painlessly cut a bit of fat so that we are still on target for our goals.
We have strayed a bit from the Dave Ramsey plan. We did really well with paying things down and my husband’s tree business was very fruitful this year, so we both went on rather extravagant vacations. He went on a 10-day motorcycle trip with his friends and I went to New Orleans with my friends. We both had a blast and, while we did use credit cards, we paid of the balances before the bills even came! Dave Ramsey wouldn’t approve, but we considered it our last hurrah before kids and a more frugal lifestyle.
So, currently our outstanding debt is just the mortgage and Sallie Mae loans. We have $22,709.57 left in Sallie Mae loans. We have paid off everything else. At this time we have $8,330 in our emergency fund. Our goal there is $12,000, which is about 6 months of our expenses. Once we reach that goal (hopefully by the end of next month) we will be opening a Roth IRA retirement account for my husband.
Looking back on the last year and a half, I’m so happy we started out on a strict Dave Ramsey plan–we had no clue where to start on this journey and Dave definitely helped us grab the reins!
But, now that I think we have a handle on our spending and future goals, we definitely do some non-Dave Ramsey things that we believe are healthy for us. We do use credit cards–they help our credit stay strong and we get discounts and cash back which help us in our frugal ways.
If there ever comes a time when we do not or cannot pay off the balance in a given month, we will stop using them. We have cancelled two credit cards–my Discover and our Visa. We may cancel more cards down the line, but at this point when we know we will want to get a mortgage within the next several months the damage to our credit is not worth it.
Also, we definitely wanted to get our emergency fund padded before attacking Sallie Mae. And, we plan to contribute to retirement before all of our debt is paid off–this is really something important for us since my husband is 30 this month and we really don’t have much at all in the way of retirement!
We eliminated NINE month payments and paid off $33,692.16 in 18 months! WOOHOO!