Hey everyone, I’ve got another Monday treat for you. A few weeks back, I contacted Bre from the Weight of Debt blog after reading an awesome post. When I contacted her, I was wondering if she would be so kind as to share her story with my audience. She responded with a “Yes”!!! So, without further ado, here’s her post!
The realization of debt is a force to be reckoned with. It will knock you down if you are not prepared to receive it. You can easily be up to your neck in debt and not fully understand your financial situation. That is where we were in December 2013. I would log on and pay my student loans with my eyes closed. After over drafting twice that Christmas I was forced to analyze our finances. The numbers were frightening.
At first glance, I thought my other half and I were in almost $200,000 in debt. Thankfully, after actual number crunching we discovered we were in far less debt than we thought. We owed a stifling $71,240, primarily in student loans! You may be thinking wow that original math was way off! Yes, technically we owed $163,860. The reason for this is parent plus loans. It important to state that we are still fully responsible for our parent plus loans but for blogging purpose and our sanity we are primarily focusing on the loans in our names.
After my financial reality check to the gut, I quickly started my blog The Weight of Debt just as a place to contain all the advice, research, and progress. My blog has played a big role in the ability to start our uphill climb to become debt free. It keeps me at a certain level of accountability that I would not otherwise feel. At the beginning of April I sat down with my other half and we did some serious number crunching and budgeting. We decided on a fast track plan and I declared to the world that we would be debt free in 2017! This plan requires quite a few components.
Budgeting on one income
The biggest component to this fast paced repayment is my other half had recently started a new job, which meant a pretty substantial pay increase. It was enough of an increase that we could fully budget our life on his income. Leaving my income to be fully focused on debt, for the most part. We still leave a small wiggle room and allowance for both of us. We do not plan on sacrificing our small indulgences during this process.
$2,000 A Month
To stay on track we have to pay at least $2,000 a month towards our debt. So far we are right on track. Last month we paid a whopping $3,043! Completely paid off and cut up our credit cards! The plastic surgery was a huge success! Paying off our credit cards felt amazing! Having smaller milestones and meeting them is so key to the long-term success. I cried after making those last payments. After having talked about it for so long on my blog, it was so surreal to be done with our consumer debt!
Another main component to the ability to our debt repayment plan is we deferred only my parent plus loan. The reason for this is because it is such a large loan that I was only making interest payments on it as it was. Almost $500 a month just in interest! So the plan was to put that money to better use towards our other debt for the first year to make better progress. I know this may have some other personal finance guru’s throwing their hands up in aghast. But the key word is personal here. This was the best plan for us personally. We want to see fast and substantial progress. With this method we will have one of the loans completely paid off much sooner.
Extreme Dedication & Self Accountability
Even with the small indulgences it is proving to be rough to start out on this plan. Making those payments the same day I get paid is rather painful. I have to remind myself why we are doing this. You have to constantly keep your eye on the prize. It is kind of an emotional roller coaster. Making the payments is rough but the feeling I get when I input them into our repayment spreadsheet and to see the closing balance to drop so much is exhilarating.
Being Fully Supported
Emotionally the biggest contributor is the support our families have given us. They have fully trusted us with the deferment and the plan we have decided for ourselves. We are very blessed to have such supportive family members. I really encourage you to also find those people in your lives family or not. Tell them about your financial goals and ask them to hold you accountable and to encourage you on your journey.
So far this plan is working well for us and we are right on track. We are only two months in, but the time has flown by! We will continue to take on this debt a month at a time. Please consider following me at @TheWeightOfDebt as we continue to carry the weight of debt! Thank you Joshua for allowing me to share this post on your awesome blog!
Author Bio: Bre is a new personal finance blogger at The Weight Of Debt, sharing her journey to become debt free by the end of 2017. She shares the ways she is making extra income, saving money, and all that she learns as she continues to pursue her goals of becoming debt free.