I have a lot of goals for myself, probably too many goals. In fact, I should probably just focus on a few particular goals so that way I can actually accomplish something, instead of just having a never ending list of things I’d like to do. One of my goals is to lose weight (I am on a weight loss journey along with being on the debt free journey). I am always on Instagram, and I had been following some weight loss and transformation pages for inspiration for that goal of losing 60 to 80 pounds, when I came across some pages dedicated to becoming debt free.
Of course it’s always been a goal of mine to get completely out of debt (who doesn’t have this goal?), but I had no idea that the “debt free community” even existed or that it was actually as big as it is! There are tons of pages on Instagram dedicated to “becoming debt free.” Some are Dave Ramsey enthusiasts, some are making up their own rules, some like other financial gurus like Dave Ramsey’s daughter, Rachel Cruze, or Suze Orman, or that Barefoot Investor author guy. My point is that I stumbled onto this community and fell in love with it!
Dave Ramsey has some great advice with his “7 Baby Steps.” The first “baby step” being that we should stop and save $1,000 in an emergency fund before we do anything else. The second baby step is to sell everything and pay off all our debt, all of it. Then he advises of going to Baby Step 3, which involves saving a six month emergency fund ($10,000 to $15,000 for most people). He says that if we follow his baby steps to a T, we will all build wealth and “live like no one else.” I think he has some great points and advice, but I just don’t agree with everything he says. This is why I’m taking bits and pieces of his advise, mixing them with my own knowledge and other financial guru’s advice that I like, to create my own plan for getting out of debt once and for all!
I have many reasons for wanting to get out of debt once and for all, and I’m sure my reasons are the same as everyone else’s.. I want financial peace (not having to stress about bills and money, and not having to worry when an emergency pops up). I want to start my own business and quit my job that I absolutely despise (but have to keep going to day after day because the bills have to be paid somehow!) I want to have the freedom to travel if I wanted to (I’m not an avid traveller, but I would like to take a vacation to Hawaii one of these days, or hit up the Vegas strip!) I also don’t want to keep paying my credit card companies, student loans and car loan companies hundreds of dollars of interest every year anymore. I don’t want to continue giving my money away to these companies for no reason! (Well, they did loan me money at one point, but it’s like am I really still paying Target $15 a month in interest on crap I bought a year ago that I don’t even have anymore?)
One of the mistakes I made when I had my own business in 2009 is that I went into it with debt. This made it harder to keep the business going. After a year of struggling to keep the business going and keep all of my other bills paid, and putting 10-12 hours a day into running the business, I decided that it was better to shut it down because it just wasn’t profiting enough to sustain itself and my debt burdened life. I closed down my business in mid 2010, worked for a family member for until she retired in mid 2013, and then I joined the corporate world, which I absolutely despise. It wasn’t so bad working for my family member, but this corporate world life is really not for me, not even a little bit. So one of my main goals of my debt free journey is to get out of debt so that I can once again open my own business and do something I love while having flexibility and freedom.
I want to actually enjoy my life, and I absolutely do not enjoy life working in the corporate world. In fact, here I sit writing this blog post on a beautiful Sunday afternoon, dreading the fact that I have to wake up at 6 am tomorrow to go to a job that I hate, to get money to pay for crap that I bought months ago on credit cards. We only have this one life, and I have wasted the last 3.5 years of it working at a corporate job that I can’t stand. The corporate job keeps me captured for 9 hours or more a day (8 hour shift plus mandatory 1 hour lunch), usually there is over time, and although they say it’s optional, it’s really not because if you don’t stay caught up, you are at risk to lose your job. Then there is the commute. I spend 1.5 to 2 hours or more a day in the car going to and from work. By the way, did I mention that this job doesn’t even pay that well? I am grossing a little over $3,000 per month and netting about $2,200 per month. That is hardly enough to live in sunny Southern California! (Thank God my boyfriend also works and brings in another $2,200, or I don’t know how I’d survive).
So, to recap, my reasons for wanting to be debt free:
- Get out of the corporate world/job I hate.
- Open my own business, do something I love with a flexible schedule.
- Have the freedom and funds to travel at my leisure.
- Have more time to enjoy life.
- Do a job I actually enjoy and am passionate about.
- Stop paying interest (aka giving my money away) to credit cards, student loans and auto finance companies.
- Have financial peace, meaning I don’t obsessively worry about money, bills and emergencies when they pop up.
I am about $111,600 in consumer debt, not including the mortgage on my house, which is roughly $168,000. I was even more in debt than that when I started this journey, but my boyfriend and I sold two cars (quickly paid off $30,000 in loans by selling those two cars), a third car was totaled (which wiped out an $11,000 loan) and I have paid off about $1,200 of my credit card debt since starting my journey in November 2016. I guess I should mention that these numbers include my debt AND my boyfriend’s debt also (we have been together 8+ years and do all of our finances together).
My main focus since starting this journey in late November 2016 (right before Christmas, am I crazy?!) has been to pay off my credit cards first. I have paid off $1,200 in credit cards from end of November until now (end of March 2017). I have about $10,135 in credit card debt left to pay off and will then be working on my student loans or autos or maybe that pesky high interest personal loan I have. Most likely the personal loan will be the next focus after the credit cards. I am working on using the “debt snowball” method for paying off my credit cards (I think I should make another post, because you see, here I am already jumping from topic to topic, making this blog post way longer than it should be!) Okay, okay.. Another post coming up soon!
Happy Sunday everyone!
-debt free in 2017