A step backwards

Just when I thought I was out … they pull me back in. — Michael Corleone, as played by Al Pacino in The Godfather: Part III

When I started writing this charting of our journey to debt freedom, I decided to be highly transparent through the process. I wanted my writing to be helpful to others who might be on the same journey, even if our circumstances are unique to us. I had hoped that giving a glimpse into our family’s journey, it might helpful to many more.

Sadly, we are no longer debt free. I am sorry. But if you will allow for my side of the story, please keep reading.

In July, I wrote about our decrepit van and the struggle we were having keeping it afloat. It was limping along until August, but then ran into yet another issue that I couldn’t troubleshoot on my own. It wasn’t for a lack of trying. I went to a local salvage yard and bought a part for next to nothing in a last-ditch effort hoping it would fix it, but the effort was in vain.

The van, which we called Rosie, had reached end of life. She wasn’t safe to drive anymore. The blinkers and the horn didn’t work, so getting around in the city without the necessary safety accoutrements didn’t seem to be the right choice since Rosie served as our main daily kid-hauler.

It seemed like we were destined to sink more money into it, but then the unexpected happened. We received a windfall in the form of a financial blessing. The amount was more than enough to cover the cost of a replacement van. We’ve been planning, researching, and saving to replace the van in December, but we weren’t fully funded toward that goal yet. And then this out-of-the-blue windfall happened, and we examined our options.

We could:

  1. Throw more money at the van and hope that the fixes would get us by until later when we could have the full amount to pay for a newer vehicle with cash;
  2. Purchase a somewhat newer, and somewhat similar mileage van that would be completely paid for with the money we received and what we had saved up so far, or;
  3. Purchase a newer, lower-mileage vehicle with everything we wanted but would require a small loan to get us all the way there, coupled with what we had in savings and our newly acquired funds.

My wife and I discussed it, and felt like putting more money into a vehicle that was destined for the scrapyard was a foolish decision. We could have went with the second option, but we believed that would be a temporary stopgap. So, we chose option three.

For most people, option three would be a terrible choice. However, we were in a unique situation where we had most, but not all, of the funds to purchase. The market for used vehicles is always hit or miss, but we knew exactly what we wanted and there happened to be the exact type of van to meet all of our needs and wants available elsewhere in the metro area.

After two test drives, lots of discussion, and some paperwork, the deal was done.

Believe me, it pains me to write this. And yes, all of this was a choice. Whenever someone says, “I had to buy a (insert whatever purchase here),” that statement should almost always be read, “I chose to buy a new (thing).” We chose to go back into debt for this purchase. No matter how small the amount is, it was a choice we made.

This weekend has really made me think hard about the baby steps. If you’re following the plan and you have things like working cars or a home that needs little maintenance, then things are going to work out great. But what happens when you get out of debt and things you’ve held together on a string start falling apart? It takes time to save up enough money for an emergency fund, and then start replacing things. If all goes well, then you’re golden. But if not?

Also, I’ve thought a lot about dogma. Those following the Baby Steps tend to be fairly cultish in adherence to the principles (raises hand). The principles are sound, and wise, but are they 100 percent applicable to all people? When do you step away from a dogmatic approach and ask, “What’s the best to do for us, in our situation, right now?” I’m not saying I have the answers to these questions. I am merely asking them.

This weekend’s van purchase was hopefully one we’ll utilize for another decade. We purchased Rosie in 2009, and it make it until last this year. That’s quite a run for a van that was made in 2000. The new van is a 2012 Toyota Sienna minivan with 107,000 miles on it. It runs and rides like a dream. The blinkers work, the horn works, and it has excellent tires. Even though our last van was a Sienna, they have made great changes in the last 19 years, and our new van has an incredible amount more space for our family of five.

I regret that we were not in a better position to make this an outright purchase, but we didn’t have enough saved yet to make that happen. Perhaps we shouldn’t have put $900 into the old van in July. Maybe my wife and I shouldn’t have taken a vacation to celebrate our 15-year anniversary that same month. It’s possible we could have been more intense in our savings since we paid off our initial debt in June. But that’s not what happened, and now we have to deal with the choices of our actions, past and present.

Most importantly, we had to tell our children of the decision, why we did it, and what this means going forward. It looks like The Year of No is still on. In a few months, we’ll be back to where we were in June; we just had to take a little detour to get there.

Dear reader, I’m sorry if I let you down. Please know I didn’t make this decision flippantly, and weighed heavily all the options we had before us. In the end, we did what we felt was best for us at this time. But I hope you can appreciate my effort to be transparent, even if that means admitting to backpedalling a little for a short time. I value integrity to a great degree, and felt I had to be forthcoming about our decision this Labor Day weekend.

My hope is that in a few months, this won’t feel like such a sting. And in a year, my hope is this won’t even be a blip on the greater story of an American family trying to navigate this country’s financial waters.

Time will reveal if my suspicions are true.

‘The Year Of No’ monthly report: July

Although we became debt free in June, The Year of No is still in effect. However, July became The Month of Yes.

In July, my wife and I celebrated our 15th wedding anniversary. Instead of putting money into savings, we allocated money to taking a mini vacation to someplace we have never been before, the Lake of the Ozarks. We did a staycation for the first few days with the kids, then my parents took our three children while my wife and I got away for a few days all to ourselves.

It was great to be able to take a vacation and not be burdened by “How are we going to pay for this later?” However, the month was not without some share of financial setbacks. We had some van trouble that needed repairs, but fortunately only had to dip into a little bit of savings to pay for it. Plus, we know how to take a cheap vacation. We used Airbnb for our lodging, rented a vehicle at a discount with our Costco membership, and didn’t eat out much. Instead we cooked meals in the kitchenette where we stayed. An anniversary gift that paid for a meal at a nice restaurant also helped (thanks mom and dad).

We’re no further ahead from when we paid off debt in June, but we’re not really behind, either. Now we have a new goal. It’s clear to us that the van is reaching the end of the line for our needs. Although I would love to save up a big, fat emergency fund we will have to instead save to replace the van within the next six months or so. I suppose that while we save, we will still be saving money, so that still sort of counts as a temporary emergency fund. It sucks that we need to replace a vehicle, but that’s the way it goes.

It could be worse; we could have debt left to go. But, we don’t!

Sadly, this means that we’ll have to put off our trip to Disney World. We had hoped we could go sometime in February, but now I have no idea when that will come. That’s not an easy trip to take because of the expense, but this will give me some additional time to research how to take the least expensive trip there to celebrate our debt freedom with the kids. I keep finding resources on how to make that trip less expensive, and I’ll be sure to share my findings when I figure out more in the months to come.

So now, we return to our frugal ways. It’s becoming more clear to be that being out of debt is not the end of the journey, but rather, the beginning.

When cars go bad

This week has been a challenging one for me with regard to our kid hauler.

There’s been a recall notice that I’ve sat on for forever, and since I’m on vacation this week I decided to take advantage of some free time to get it taken care of. Unfortunately, the Toyota dealership didn’t have the part to repair our 2000 Toyota Sienna, but one has been ordered and I’ll have to take the minivan back out for the final repair when the part comes in.

Toyota inspected the vehicle, and found that the alignment was off. They offered to fix it for $119, but I decided to pass. I called around and found a tire place not far from our home who would do it for $89, and decided to go that route. The alignment was successful, but they also found another issue with the CV joints. They are broken and leaking grease underneath. I was able to see the damage myself and confirm that this is something that should be taken care of.

However, I was quoted $500 ($250 per side) to have it fixed, and I decided to hold off. The van is only worth between $1,500 to $2,000, and I couldn’t see spending up to one-third of the vehicle’s worth on repairs when we already planned on replacing the minivan in the first quarter of next year.

I was distraught by the news. Although we have no debt, we don’t have enough saved up for an all-out replacement, or even a minor step up in vehicle. So my options were, as I saw it:

  • Switch vehicles with my wife until we can save up money for a replacement and risk a catastrophic failure, or;
  • Go buy a new (well, used) car using credit

As difficult as it is to think about, I was tempted to go buy a car on credit. I rationalized in my head how we could get an inexpensive enough replacement minivan and have it paid off by the end of the year. We could use the same vigor we applied to getting out of debt by June and then be debt free, again, by December.

But the more I thought about that option, the less comfortable I became. Did we really just bust our butts to get out of debt only to go back in again? How would we feel going back in debt after we’ve done all this grandstanding to get out of it?

So I did what I’ve learned to do in my mature years: I gave it five (proverbial) minutes.

After having student loan debt for so long, I have excellent credit. I could have gone out and bought anything I wanted and had it sitting in the driveway when my wife returned home from taking the kids to a dentist appointment. Instead, I opted to contact three people I consider wise, present the problem to them, also talk to my wife, and then make a decision.

The consensus was, generally:

  • You should consider repairing it
  • You’ll hate going back into debt
  • See what else you can think of

In an moment of clarity, I came up with a third option, and ran it by my wife, Amy. “If we could pay $100 per month for five months for you to drive the kid hauler safely and buy us enough time to save up cash for another minivan by December, would you do it?”

We were already on the same page. “We should fix the van,” she said.

I called the repair place, and asked if they could come down on the price. They knocked $60 off, and I agreed to the deal. We dropped off the van to get fixed, then packed up the family of five into my little Toyota Corolla and went to a local water park to enjoy the afternoon.

I don’t believe in no-win scenarios.

It appears we get to keep our dignity in tact. Granted, I would much rather put that money into a new vehicle. But talking it over with Amy, she jolted me back to my senses. The line where we say “enough” to borrowing money has been drawn, and we’re not backing down from it.

Rosie‘s days with us are numbered, but at least they won’t come with the stain of a car payment. Let’s just hope this plan works out.

Update – July 31, 2018: There ended up being some additional repairs that needed to be done to fully fix the van. With the alignment and CV joint repair, the total repair cost came to almost $800. Although that tweaks the above numbers a little, it didn’t change the outcome. We still believe it was better to spend $800 now, than to go in debt even for a vehicle we don’t plan on keeping much longer.

It still hurt to pay it, though.

Minding the blind spot

Recently I posted an article on social media by a minimalist author I read, Joshua Becker. The article, “All The Things I Want to Say About Money But Never Do,” spoke some tough words about the difference between those who say they want to have a different life but live very differently than the story they tell.

Probably one of the hardest hitting lines of the piece reads like this: “You would have more money for the things you want if you stopped foolishly wasting it on other things.

Woo, boy. Let’s just lay it all out there.

To be clear, Becker wasn’t talking about things like “if you’re poor, stop being poor” or how the ever vilified millennials could afford a house if only they could give up their love for avocado toast. Becker was quite clear — there are people he knows who have said they wanted to do things differently with their lives and finances, yet the lifestyle they choose daily reflect a different pattern.

I have people in my life who are like that also. Over time, I have learned to keep my mouth shut. Well, mostly. I’ve gotten better about it over the years. I have found that no one wants to hear how they’re doing something wrong, especially when they’re not ready to make a real change.

An acquaintance of mine called this viewpoint “disgustingly condescending and unrealistic,” in addition to “extremely elitist and smug.” He then went on to talk about my family’s progress in getting out of debt, and then spent the rest of his time talking about how our progress would be impossible in his current situation. As such, he derided our progress in claiming that the success we had couldn’t be applied to everyone.

I tried to point out that we sacrificed a lot, cutting down expenses to the bone. I tried to explain that I had worked two jobs, and as such put all extra money on our debt. I tried to point out that our income hasn’t always been good, and that there were plenty of times where there was no more money at the end of paying bills for the month.

He didn’t hear what I was saying. No, he didn’t want to hear what I was saying. The hard and simple truth was this: he was brimming with envy, because he wasn’t living our life.

That is a dangerous road to go down, and one that will never lead to happiness or success.

There was something he said that gave me enough pause that I’ve spent weeks thinking about it. He said, “But the amount of money you were able to put toward paying off debt each month is more than some people even bring home in a month. That’s your blind spot.”

He is partially correct. My family’s ability to pay on debt was more than some people bring home every month. But the blind spot isn’t mine, it’s his and everyone like him.

I don’t consider my family rich in the western mindset view of that word (but I would say we are in the global sense). We’ve worked really hard to get to zero, but our total net worth, especially for the age of my wife and I, not very far in the positive column. We may have cut off all the red chain links, but the black chains aren’t linking together, at least, not yet.

But this discussion really isn’t about money. The actual conversation revolves around the idea that you are responsible for your destiny. Money problems are only a symptom of a greater problem that you haven’t yet taken ownership of your life. Even worse, when your thoughts are consumed comparing your life to someone else’s, you end up stuck in a cycle of defeat.

Envy is the seed that plants a tree of spiritual death.

For every 10 people who have asked me about how to make a change in their career or how to pay off their debt, there’s only one or two who actually make an effort to create change. Yes, of course, there are people out there who are burdened with terrible wages, no skills, and difficult life circumstances. Of course! But that in no way means there isn’t a way out for those who have grit.

Change won’t happen overnight. Sometimes, it takes years. Take the story of the woman whose picture of her name badges went viral last year. The picture shows the progression of her work from a fast food worker at KFC, to eventually becoming a registered nurse.

There are people I know who found free programs to teach coding, sacrificed their time to learn some new skills, then found an apprentice job. Taking a pay cut from their previous employment, they are working toward an unknown future but betting on the one thing they feel they have the best investment in: themselves.

Or how about a friend of mine who has spent a long time working in the service industry, and decided that life wasn’t good enough for him? He learned new skills, dove into the work, and just accepted a position where he’ll be doing tech support for a company in Kansas City. He used to be just a guy that served drinks at a local watering hole, but now he’s on a different path. “I’m excited to get out of the bars,” he told me.

If you go to your favorite search engine and type “what the rich don’t understand about the poor,” you’ll find no shortage of articles talking about successful people and their blind spots. But what if you flip that on its head? If you search for “what the poor don’t understand about the rich” you get very different and sparse results. The best answers I could find on that question came from Quora: “What do rich people understand that poor people don’t?”

It seems there’s plenty of blind spots to go around.

Outside of the books necessary for my job growth and my decade plus interest in nutrition and health, the only other topic I’ve read and researched immensely would be personal finance. The one thing all of these texts have in common are a common question that is asked of the reader, either blatantly or with subtlety — what are you doing to improve?

I most like how the philosopher/writer Mark Manson put it: “How do you choose to suffer?” If you want to make change and make progress, it is imperative you learn how much you’re willing to suffer to get what you want. There is no way around it — struggle is necessary for growth and success.

I am positive I could look at just about anyone’s budget and find ways to make cuts. I am certain I could look at someone’s work and lead them on a path toward greater prosperity. Will someone else have the same outcome that we are now enjoying? I certainly hope not. I hope he is more successful. I hope she makes fewer mistakes. I want everyone to be successful, and enjoy a rich, full, happy life. And that, most certainly, will mean different things to different people.

There’s an old saying that says, “You can show someone the door, but you can’t make them go through it.” To those who want to poo poo their life and compare their circumstances to others, there will be no happiness. Those who blame the government, their families, their jobs, or whatever for their current situation will have no peace. Can they truly look themselves in the mirror after yet another year and say, “Nothing has changed because the world hasn’t let me progress?”

On the flipside, there are those who refuse to be complacent. They may be battered, but they are not done fighting. They may have the odds stacked against them, but they are working to find their way to the next level, and the next, and the next.

I don’t have enough time to outline all my failures, nor would I choose to do so. Instead, I’m working to keep getting better at all the things I do. I’m going to persist in looking forward, and I keep stepping away from my past. I don’t find much value in looking backwards.

You have before you two paths, one that leads to self pity, and another that leads to struggle. The obstacle is the way.

Change!

How did you do that?

In a previous post, I talked about one of two common questions I’ve been asked since becoming debt free: “What’s next?” This post is about the other common question I’ve heard quite a bit as well: “How did you do that?”

You’ve probably heard or said this question before. It happens a lot when someone loses a lot of weight. We all want to know the magic secret. “How did you lose 20 pounds? I have to know how you did that!”

We’re all looking for the secret to a higher level of success. While I don’t know if what we did is exactly secret (this is a public blog after all), if these words can encourage others to examine how they are doing things then I find it important to share.

  1. Have a plan. I stumbled for years before I found Dave Ramsey’s book “The Total Money Makeover” and decided the plan he outlined made sense. Maybe you don’t think Ramsey’s plan is right for you, and that’s OK. But don’t sit around without getting more knowledge about how you should move forward. Do some reading, investigate, watch some videos, whatever. Knowledge is power, and there’s no reason in a modern society to claim ignorance. Between your local library, videos, blogs, podcasts, and much more, cost shouldn’t be a factor either. There are lots of ways to increase your knowledge for free or cheap, if you’re willing to give up complacency and start searching.
  2. Go all in. We made huge strides when we decided to stop doing things at half effort. We looked for ways to cut expenses. We looked for deals. We increased income. And probably most importantly since I’m married, my wife and I got on the same page. We said no a lot. It was painful to turn down going out to eat, buying that extra self indulgence, or rewarding ourselves because we “deserve it.” Going all in requires a lot of intensity, but focused intensity is how you win.
  3. Have a monthly budget. I’m not sure if people are good or bad about this, but there’s no way I could live my life without a budget anymore. At one point in my life that wasn’t the case. I was so horrible. I spent money and kept checking my bank account to make sure I didn’t go over. That worked pretty well until it didn’t. I certainly didn’t have a plan to save or pay off any debt. I spent and spent and hoped everything would turn out OK. Now, we have a monthly budget (made in a spreadsheet) that allows us to tell our money how we’re going to spend it. We adjust as needed, but no more do we spend without a plan. There are many resources available to help you get started making a budget, so don’t make any excuses not to do it. Speaking of that …
  4. Stop making excuses. I was the king of making excuses. There was always some reason we weren’t making better progress. Only after I took a hard look at myself and my family’s situation, and was honest about why things were as they were that I came to realize we could do more. As a species, we are incredibly efficient at feeling sorry for ourselves. When you’ve finally reached you’re “I’ve had enough!” moment, you can reach into the pit of your stomach, purge the excuses, and get to doing the work of making a real change.
  5. Put off buying all that stuff you probably don’t need anyway. Do you really need a new car, or would a repair and contentment or a used car do fine for now? Are those name brand shoes a necessity, or can you get by with some “el cheapos” until later? Why are you still going out to eat for $10 to $15 a pop when you could easily bring a lunch for $2 a meal? If you delay your desires for a little while, then you can reap the rewards in the near future. The time goes by quicker than you might think. Resist the urge to indiscriminately spend now, and then go get yourself some nicer things later when you can use money instead of credit.
  6. Work hard, but also work smart. I was totally willing to work any kind of extra job to accelerate our debt payoff process, and had the support from my spouse to do it. I looked around and came across some side income that utilized the same skills from my profession, which happened to pay a lot better than being a janitor or a casino security guard (two jobs I seriously considered). The side job also allowed me to work from home, so I didn’t have to be away from my family for hours on end. Cutting costs will only take you so far, but bringing in additional income will catapult your efforts to the next level. It was hard work and stressful to keep things in balance at times, but it was so worth it.
  7. Ignore everybody. You might come have people in your life who won’t understand what you’re doing or why you’re doing it. From my experience, there are plenty of people who are willing to tell you how you’re doing it wrong and why your efforts aren’t that special. Ignore them; ignore everybody. The number of people I have found who are actively working to pay off debt and improve their financial future is very low. Fortunately, we were also surrounded by people who were encouraging us. But really, you have to ignore them, too. If you get too comfortable with your progress you may be tempted to back off your intensity. Don’t back off. Ignore the haters, say thank you to your supporters, and push really hard to the end.
  8. Have a big “why.” My family was a big motivator, for sure. I want to bring my children up with sound financial principles so they grow up and hopefully avoid some of the mistakes their mother and I have made. In addition, I was angry. Our student loan was our last debt, and I hate how the student loan system is set up. When students enter higher education, they are allowed to borrow huge sums of money. Regardless if you fall on financial hardship, like say the global economy almost collapsing, you’re indebted for life. Government-backed student loans are not bankrupt-able. I made that an excuse for a long time until I decided to funnel anger into energy for getting out of debt. We’re no longer a slave to that system of control, and I hope I can teach my children to stay free as well.

There is probably more to it, but that’s a lot of the main points. What’s keeping you from paying off your debt? If I can do this, then you can do this. It certainly won’t be easy, but I doubt you’ll regret it.

And as Ramsey says, “If you pay off your debt and hate it, you can always go get you some more.”

Next steps

Since becoming debt free, I’ve had two questions come up regularly by people I know and readers of this site. One of the questions I’ll address in another post, but this post is about the other question I’ve heard a lot: “Now that you’ve paid off your debt, what will you do next?”

My family is following Dave Ramsey‘s baby steps plan for our finances. In Baby Step 1, cultists followers save $1,000 — and only $1,000 — as a type of baby emergency fund to take care of problems that could arise while working the way out of debt. I have found that this step is often the most misunderstood of all the steps.

Yes, $1,000 isn’t enough to cover a major emergency. If something goes wrong that means you have to get pretty creative in figuring out how you can overcome the obstacle without going deeper in debt if possible. This is a difficult feat, and I’ll be the first to admit that for some major emergencies, you might end up with an expense that cost more than $1,000. But our experience has proven that most of life’s emergencies can be covered with $1,000 or less. In those cases, you use your baby emergency fund, press pause on paying more on the debt, and then rebuild the $1,000 as quickly as possible.

This baby emergency fund is not supposed to make you feel comfortable. In fact, it’s quite the opposite. It serves as a kind of cushion between you and minor emergencies, while also making you feel the pressure to quickly get out of debt so you can move on to a more robust emergency fund. I’ll cover that in a minute.

In Baby Step 2, you are supposed to go kind of insane. You buckle down, get really serious about paying off the debt, and then list all your debts from smallest to largest regardless of the interest rate on each debt. So, if you had $5,000 in credit cards, a $400 line of credit at the furniture store, student loans of $40,000, and a car loan of $10,000 the debt payoff would look like this:

  1. Line of credit: $400
  2. Credit cards: $5,000
  3. Car loan: $10,000
  4. Student loans: $40,000

This method is called the debt snowball, because once you pay the smallest loan with everything you have and then make the minimum payments on the rest. Once a debt is gone, you take what you were paying on that debt, and then apply it and any other money to the next debt. You keep going up the list until everything is paid.

I know what you’re thinking: it doesn’t make mathematical sense to disregard the interest rates and do it that way. However, the psychological wins you get from the debt snowball gaining momentum helps to keep you moving forward. And as Ramsey likes to say, “If we were doing math we wouldn’t be in this mess to begin with.”

So now that we’re here, what do we do now? Now we’re on to Baby Step 3.

In this step, we save three to six months of expenses — a real, actual, grown up emergency fund.

Whether you decide on three months or six months is more of a personal choice. Do you have a steady job that you feel has a reasonable expectation of being there for awhile? Do you have a household where both spouses work? In those cases, you might be fine with three months of expenses. Is your job volatile? Are you working on a contract basis or self employed? Then you might want to shoot for six months of expenses. It’s really up to you.

The great thing is that once all your debt is paid off, your monthly expenses will go down quite a bit. You end up needing less to sustain you in a Big Hairy Emergency. That’s where we are. We’re now in Baby Step 3, moving forward with socking money away for a potential emergency, which I promise you will come eventually.

I can’t think of a time in my adult life when we have had an actual emergency fund. Sadly, I can think of plenty of times where we have needed one, which ended up being handled with adding more debt rather than taking on extra jobs or working with service providers to get a payment plan figured out.

After we made our final debt payment, I was thrilled. However, since then I’ve felt a little lost. The process was such a huge part of our lives for awhile and now it’s … over. It sounds strange, but it’s almost like losing an old friend (even if it was one that I didn’t really like).

So now the challenge is this: we need to keep our intensity up. Now is not the time to start spending like crazy people. We’re still in The Year of No, but instead of our money going to some other bank, it’s now coming back to us. The danger is the possibility of lost intensity, but we will keep pressing on to our next goal.

Getting out of debt isn’t the end. In fact, it’s only the beginning.

We’re debt free

Free at last, free at last. Thank God almighty we are free at last. – Martin Luther King, Jr.

On Friday, June 15, 2018, my family officially became debt free.

We have no credit card debt.

We have no student loan debt.

We have no car debt.

We have no debt on appliances, electronics, or any other item.

And even though it’s not debt, we don’t even have any outstanding medical bills.

We’re currently renting, so we don’t even have a mortgage.

After almost 15 years of marriage, my wife, Amy, and I have finally returned to zero.

It’s been an amazing day. It started off with a nice morning walk, just me and my headphones. By the time I returned, the kids were already getting ready for the day. I grabbed Amy and said, “I need you to do something.” I logged in to the student loan providers website, set everything up, and said, “I want you to make the last payment.”

Amy pays the final debt
Amy makes the last payment on the remaining debt — the student loans.

She pressed the submit button, and closed the window. I am man enough to admit, I cried. Then, she cried. We hugged each other. She said, “You did it, babe.” I corrected her, “No, we did it.”

The wait began.

I had my favorite drink — Sugar Free Rockstar (which I like to call “cold coffee”) — and had the kids work on a sign that read “We’re Debt Free.” They colored in the letters with enthusiasm. They have been part of this process, and my family tree has been changed. They will grow up being taught to stay away from consumer debt, how to build savings, and learn how to give.

Amy had an activity planned with our kids, but my son was sick today so he stayed home with me while she took our two daughters to have some fun. The Boy and I hung out at the house. I chose to the take the day off today, because I wanted to be off for this special occasion. I cleaned and did a little house organization. I ordered my youngest daughter’s birthday gifts with the money we had budgeted. There’s no more credit card purchases here; everything is paid in full. I did anything to keep me busy while we waited for the official word from the student loan provider that the money had been processed.

My plan for today included meeting a dear friend of mine, David, to have a celebratory lunch. Since my son was sick, he agreed to bring lunch with him to my house and we enjoyed our meal at our kid-abused, paid for kitchen table. I had Chinese food, and savored every bite.

Food tastes better when you aren’t making payments on it.

My son wanted to play outside before going to the doctor, so we did. I relished my time with him. We went to the doctor; he’s fine and just needs to work a little virus out. He’s not contagious, so we are a “go” for celebrating more later tonight.

And then, more waiting. As has been the custom for this process this year, I knew the student loan provider wouldn’t have anything definitive until after 6 p.m. I checked anyway. “Processing,” it read. The wheels were in motion. I admit, I was nervous. “What if it doesn’t go through today? What if there’s some problem?” The borrower is truly slave to the lender.

We cut so much out of our budget this year. I took on a second job, utilizing the skills from my main job to aggressively accelerate our debt payoff. Amy helped run defense with the children, and kept the household functioning at somewhat normal levels. She was excellent with the budget when grocery shopping, finding things for the kids to do on the cheap, finding clothing, and so much more. For several months, I was doing 50+ hour weeks. It was so hard when we were going through it, but today it feels like a distant memory.

More waiting. And then, at 6 p.m., I checked again. The moment had finally arrived. The balance was shown as $0.00.

Our progress has been measured visually with a debt chain that has hung in our front room since January, the start of The Year of No. Each link represented $1,000 of debt, and we started the year with around $20,000 left to go.

I cut the next to last link in the chain, then had Amy cut the final one. It read, “Debt Free.”

Amy cuts last debt chain link
Amy cuts the last link in the debt chain.

Today was all about Amy. The last of the debt was hers, and today we fulfilled a goal I had made when we became engaged. I wanted us to be totally free, and now we have broken the chains of debt. When we started The Year of No, my deep-in-my-heart goal was to be out of debt by our anniversary. We beat that goal by one month. Our anniversary is July 26.

We have celebrated little milestones along this journey with something cheap and fun, and today was no different. We packed up the kids in our 18-year-old, paid-for, hanging-on-by-a-thread minivan and headed to a local frozen yogurt shop for a calorie-laden “dinner.” There no place for healthy food choices today; we celebrated our freedom with decadence, paid for with a debit card.

Debt free froyo
Celebrating being debt free with a family outing for froyo.

Froyo tastes better when it’s not attached to an annual percentage rate.

Today is day zero. Tomorrow is the first day of our debt-free life. I am beyond grateful to the many people who have helped on this journey, and have provided encouragement. I have even loved the haters, because nothing drives me more than “You can’t do that.”

We have followed Dave Ramsey’s plan as outlined in his book, “The Total Money Makeover.” I am here to say that we are proof: it’s a simple plan that works. I love it when a plan comes together. You can either wallow in your misery, or get angry and take action. I pray you chose the latter.

Our official debt payoff since starting the plan in full is $34,076 of debt paid off in 21 months.

Someone recently told me, “I wish I could be like you.”

You can.

The spiritual side of getting out of debt

Note: This post is religious in nature. If you’re not interested in that, I totally understand.

It’s not in my typical purview to discuss religious things in an open forum. While I have no problem discussing it in a one-on-one setting where reason, debate and healthy questioning can flourish, it seems that modern discussion of such things online often deteriorate into misunderstanding and hostility, of which I have no interest in participating.

However, I would be remiss if I didn’t discuss the part that my faith has played in our journey in becoming debt free, so I wanted to share my story. Everyone believes in something, but this is my journey. If you choose to follow down a debt-free path, I hope you share your experience as well.

There are many Judeo-Christian texts that highlight the importance of knowing how to handle money. I’m not referring to the gross prosperity gospel — a belief that God will reward you financially if you are obedient — but rather practical, ancient advice on how to handle financial matters.

For example, here are a few things that Judeo-Christian text warn about with regard to finances:

  • “One who lacks sense gives a pledge and puts up security in the presence of his neighbor.” – Proverbs 17:8. This is a clear warning not to co-sign for others. It’s literally saying you’re stupid for doing so.
  • “The rich rules over the poor, and the borrower is the slave of the lender.” – Proverbs 22:7. Fairly clear cut advice, that borrowing money makes you a slave to the one who loaned it to you.
  • “During the seven plentiful years the earth produced abundantly, and he gathered up all the food of these seven years, which occurred in the land of Egypt, and put the food in the cities. He put in every city the food from the fields around it. And Joseph stored up grain in great abundance, like the sand of the sea, until he ceased to measure it, for it could not be measured.” – Genesis 41:47-49. Here we see a warning to take advantage of prosperous times save for the inevitable bad times that will come.
  • “For which of you, desiring to build a tower, does not first sit down and count the cost, whether he has enough to complete it? Otherwise, when he has laid a foundation and is not able to finish, all who see it begin to mock him, saying, ‘This man began to build and was not able to finish.’” – Luke 14:28-30. Put another way, “Failing to plan, is planning to fail.”

And so on, and so on, and so on.

Two years ago in 2016, I felt a spiritual calling to move to a different city. I wasn’t sure how much this would positively impact my life, other than I was tired of commuting 50 minutes each way. I certainly knew plenty of people who did the commute from the city I lived in to the city I worked, and considered it “just the way it is.” But I could not escape this tug. I told my wife about the urge to move, and she reluctantly agreed. Like myself, she didn’t really want to move from the city we lived in (we loved it dearly), but she agreed we should follow this “call.”

Our house sold in six days. We moved two months later, and things haven’t been the same since. Within a week after moving, I was officially converted from a contract employee to a full-time employee, giving me benefits, more take home pay, and a solid foundation to make progress on our debt. We attended Financial Peace University, which is rooted in religious principles but is certainly not exclusive; if you have no religious affiliation you’re more than welcome to attend. We made a commitment to go all-in on our debt payoff, and on Sept. 11, 2016, began to work diligently on becoming debt-free.

From the upbringing of my youth, I remembered there was a passage in Proverbs that read, “Dedicate your plans to the Lord and you will succeed.” Well, I thought that was a bunch of hogwash. See, I had been committing a fair amount of plans and nothing was coming of it. It was only until I re-read that passage in late 2017 that I realized my mistake: I had completely misremembered it. The real passage reads like so: “Commit your work to the Lord and your plans will be established” – Proverbs 16:3.

You see, there is an important distinction between plans and work. It’s pretty easy to think your planning is the same as action, but it’s not. It’s the beginning of action, but not the follow through. It’s interesting how these passages can have both a spiritual and a practical value to them. The revelation of my mistake hit me hard. So, I decided to give it another shot. I wrote that verse out on a piece of paper with a challenge written underneath: “Are you there, God?”

Things changed.

My wife and I changed course at the beginning of the year. We doubled down on our efforts. “If we did this, this, this, and this, we could be debt free by the end of October 2018,” I told her. She was in.

But October wasn’t my real goal. My actual plan — the one I wanted to see established (you can read that word as “to be made true”) was that I wanted to be out of debt by July 26, 2018. That date is our 15-year anniversary, and I couldn’t think of a better present. While we were dating, my wife revealed to me the extent of her debt. I brought some to the marriage, but hers was twice the amount. Getting a master’s degree all on student loans can do that. Realistically, I had a choice to make: do I walk away from this, or do I saddle up and see what happens? I obviously chose the latter.

I had my actual plans, but how could that work? I looked at the possibility of taking on another job. I was content to do whatever I could get my hands on. Amy agreed to take on extra kid-rearing duties while I worked extra, so now I just had to find something. I inquired into possibly being a pizza delivery driver, a janitor, or even security at one of the nearby casinos. But another opportunity came that fit me perfectly. It was almost too good to be true.

Using the freelance website Upwork, I secured a gig that had me doing something I know pretty well:

  • I did web development work (what I do full-time),
  • for members of the United States House of Representatives (I previously worked in government for nine years),
  • in a web software called Drupal (which I also work in full-time and have for many years),
  • using a tool called Coda to complete the job (which I happened to write about five years ago, but haven’t used it much since then until this year).

To top it all off, my duties changed at work about a month before my side job, began, allowing me more freedom to work two jobs without getting completely burned out.

Everything just fell into place, just like that. I have never had so many positive things line up so wonderfully than it has this year. And it all worked: we are going to be out of debt by, early even, my desired goal of July 26, 2018.

So what’s the point of this discourse? As I said, we all believe in something. I’ll leave that to you to figure out what. But when it comes to achieving Big Hairy Goals, especially paying off debt, I don’t believe it’s all numbers. There’s psychological, spiritual, philosophical, and other factors that come into play. I would encourage everyone to look deep at what can help motivate them, to guide them, to drive them.

I am a deeply flawed, very imperfect human being. But my faith has played an important role since started this journey in earnest 21 months ago. And fortunately for me, it’s grown stronger for me this year for the better.

I hope you find your strength as well.

 

‘The Year Of No’ monthly report: May

Even though I felt like this month has felt a little slow, we are now a step away from the end.

For the month of May, we paid off $1,979.39. We have $1,676.75 left.

Through some creative budgeting (it’s fine, really – nothing crazy), it appears the final debt payment will be June 15, 2018. God willing, we are two weeks away from being debt free.

I make that prediction with a strong degree of caution. Things could happen in two weeks. Emergencies could come up, or some tragedy could befall us that would mean it gets postponed.

In addition, we’ll have a child’s birthday party to pay for out of the next pay period. That alone will require a little creative party planning to pull off.

Alas, here we are. Many mistakes have been made along the way, but now we have wisdom. We have tried to wander out of debt, but now we are running. We used to be losers. But now, we are winning.

This will be one of the longest stretches of time in my adult life.

Bring it on.

From a waterfall to a trickle

Things were going so well.

I suppose it’s not fair to say that things aren’t going well, but the momentum has certainly slowed down quite a bit. The extra income has halted, and now we are stuck with simply being patient. That is certainly not one of my better qualities.

Geez. Some people are never satisfied.

As it stands now, we should be finished paying off our debt sometime in June. I have a date in mind, but I’m hesitant to pronounce it publicly. I don’t like to count my chickens before they hatch. I have learned that lesson. So many times I’ve purchased something on credit thinking, “Well, we can afford the payments” or “We’ll have this paid off early” only to have something happen that prevents that from coming true.

That is not a good mindset to have, and it’s one that isn’t part of my thinking anymore. We’ll just be patient, and if it pays off by the date I plan, then great. If not, then we’ll keep plugging away.

There were a couple of expenses that have come up so far this month I forgot to plan for. In our state, older vehicles (definitely ours) need inspected either annually or semi-annually depending on what year they are (odd or even). And of course there’s the annual renewal of license plate tags that I totally forgot about. Granted, these weren’t huge expenses to take care of, but it slowed our momentum down a little bit this month.

That’s all to say that we haven’t cut any more links off the debt chain since April 30. Given the rate we have been paying things off, that feels like an eternity. That’s not to say we haven’t paid on the debt, it just wasn’t enough to warrant cutting off another link. However, the next paycheck is at the end of the month and the progress will continue.

So, we wait. With waiting comes more restraint. It’s so tempting to let off the gas now that it feels like we’re close to the finish line. But now is not the time for celebration. Now is the time to keep going as we have since the beginning of this year: head down, nose to the grindstone, determined and focused.

As others have learned, never celebrate too soon: