Stretchin' Our Dollars

We opened another envelope on June 15th! We have now paid off $5,108.58 since January 1, 2012. This is a big milestone in our debt-free journey. The note inside was encouraging. It reminded us that this process is slow, but worth every step. There are 5,280 feet in a mile, so if every dollar we paid off was equal to 1 foot, we are just about 1 mile out of debt. Our debt balance at the beginning of the year puts us at a little over "6.5 miles" in the hole! We're climbing out, and every dollar counts!

Here are some ways we save a few dollars here and there to make our income go farther:

1. We make our own breakfast, lunch, and dinner instead of eating out. We budget a few meals to eat out and they become even more exciting now that we rarely eat out. (I'm talking 2-3 times a month)

We also meal plan so we are only buying food we need for the meals we are going to cook. I like "roll-over" meals, because left-overs aren't always very exciting. For example: If I cook a roast in the crock-pot, the next night I can do beef and noodles or bbq beef sandwiches and make a totally different meal. My best friend Lauren rolls over spaghetti and meatballs to meatball subs another night. Genius! (less cooking too, by the way!!)

2. We grocery shop at Aldi for about 60% of our food- our staples (milk, eggs, pasta, baking mix, cake mix, seasonings, dressing, condiments, etc), some fruits and veggies, and low-cal popcorn and fudge bars come from here.

3. We price match at Walmart- we only price match things we normally buy, we don't buy things just because they are on sale!! These usually include boneless skinless chicken breast, chips, toilet paper, laundry detergent, and fruit. So for these items I bring in another store's ad for the week and show the cashier that the same item is cheaper and Walmart matches the competitors prices. Then I don't have to go to 4 different stores to get the best deals.

4. We buy store brand items on almost everything- diapers and wipes included. Even our son is in on this adventure!! :) Bonus: since my husband works at Target we get an extra 15% off!

5. We pay cash for groceries, dinners out, and special occasions. This helps us have a firm stopping point when we spend in these areas. We realistically look at each month and budget accordingly. Every month is different and we learned early on that we had to build in life to fit each month. Some months we are out of town several days and our grocery bill is smaller. Other months we add to it because we are having people over for dinner or need to make a side or dessert for a party and we need to make sure we have enough.

YTD pay-off: $5,108.58
Total Debt Pay-off: $29,108.58

What a week...

We moved to our new apartment one week ago. One week ago, we left our nice, comfy, air conditioned apartment. We left that nice, comfy, air conditioned apartment to live in an apartment that didn't have working A/C. This apartment didn't have working A/C until today...one week later! It's been a long, 85 degree week. I'm glad I waited until today to post about the move. Otherwise this post would look alot different!!

Through all of this, Chris and I had to daily remind ourselves why on earth we moved. Seeing the goal, dialed in the purpose of living in a older, cheaper apartment for us.

Here's the list:
(I need this handy when people look at us like we are crazy and say "why???" when we tell them we moved here)

1. Increase Margin- our income is maxed out at this time so we need to reduce expenses...$300 to be exact!

2. Decrease Risk - if one of us loses our job or something happens medically, we are more likely able to pay bills, food, utilities, and rent here than the other place

3. Increase Intensity- we were comfortable at our other apt. Living here will give us motivation to pay off debt quicker and save for a house sooner.

4. Further from Normal- 70% of people live paycheck to paycheck, so broke is normal! We haven't lived that way for over 3 years and don't plan on going back now!

5. Learn Contentment- we are learning already that we can make do with little. I want this same attitude when we look for a house someday, we want to make do with little then too.

 6. Our Desire to Give- we are filthy rich compared to most of the world, even at this apartment. Why do I deserve this extravagance when others have nothing? I'm ready to give like no one else!!


Debt Pay-off Update: paid off another $1,000 and opened another envelope on May 4th!

YTD Pay-Off: $4,228.60
Total Debt Pay-off: $28,228.60

One Down...Two to Go!

Chris and I celebrated a milestone this past week, we paid off one of our student loans. We have slowly knocked off debt after debt to get us to this point. We have followed the snowball principle and only paid minumum payments to all of our debts except the smallest one on the list. We attack the smallest loan and then roll on to the next one. Because we have lined-up our debts in order of amount, naturally these last two are going to take awhile to finish off, they are our largest amounts. We will be even more happy to pay them off since they have been along for the ride these last few years.

With all of the talk about student loan forgiveness going on right now, it makes me want to take care of my own mess even more, I don't want tax payers to pay for my loans. Chris and I signed paperwork declaring that we understood that the money we use for college we will pay back. It's hard to hear all of the college grads who think because college was expensive they shouldn't have to pay for it. I agree, college is expensive, but I chose to go and now I pay for that choice. I also learned along the way that I hate debt and because I learned that lesson the hard way, I don't plan on getting any more student loans to finish my masters degree. 

Total debt pay-off: $27,847.52
YTD debt pay-off: $3,847.52

There's an App for that!

We opened another envelope this week! Yay for another thousand bucks paid off!! The card inside this envelope told us to go on a well deserved date night! So we decided to head to the plaza and enjoy some KC BBQ and eat dinner at Jack Stack. The weather was so amazing that we ate on the patio...in MARCH!! After dinner we had cheesecake at THE Cheesecake Factory. It was fun to spend some time just the two of us and celebrate our hard work. We are only a few hundred dollars away from paying off our smallest student loan!! Can't wait to only make 2 debt payments a month!

A teacher at school told me about the perfect iphone app for tracking our progress. It's called Debt Payoff (right next to my NCAA app!!). When I got the app it was free, but it's $0.99 now! Sorry! On this app I can see the interest we are saving by paying hundreds off each month rather than just paying minimum payments. Here's some scary info- if we only make minimum payments from this day forward we will be debt-free in 20 years and 6 months and pay $23,000 in interest! Yikes!

Other features: I can make a pay-off plan (lowest balance first is the same thing as our snowball idea), calculate what our payments will be someday when we get a house, and there are pie charts!!! It's nice to see the interest we pay each month go down because we are knocking the principal down so much.

Envelope #4: $935.92 left to pay-off

Batter Up!!!

We knocked another envelope out of the park this week. Our tax refund helped and we are happy to say that we've paid off $2,000 in debt this year we have $33,000 left to pay off. The card on the inside gave us a little spending money to go buy some spring clothes. It was nice to pick up a few things that we've been wanting/needing.

Our apartment lease is up in May and we had to make a decision to stay here or move somewhere cheaper to keep this debt-free game from going into extra innings. So we recently decided to turn in our 60 days notice and we're preparing to move out. We started looking for apartments but every place we called about is ready now...we're not. So we are learning to step out in faith. Yikes! I was using craigslist to soothe my fear of homelessness, but it was only making me more insecure. Chris and I decided that we aren't actually practicing faith...just fear and self-reliance. So craigslist is going to wait until we get closer to the move-out date and we are going to treat our fear of homelessness with a huge dose of prayer.

Envelope #3: $747.09 left to pay off

The Envelope Please!

It's been a long time coming, but we managed to finish off our first of 35 envelopes this week. We decided to sell our dust-collecting Wii on craigslist and got $150 out of it.

On the inside of the envelope the card read,

"$1,000 paid off $34,000 to go! We have a long road ahead of us but I know we'll make it!! ROADTRIP- QuikTrip drinks to celebrate the first of many steps!"

We always get a quiktrip drink on our way out of town to visit family or go on a long trip, so it is fitting for us to start this long journey with a QT drink! The neat part about paying off this past $1,000 is that it marks $25,000 of debt gone since we started this 3 years ago. I have a feeling if we wouldn't have put it toward debt, we would have nothing to show for it now. So glad we chose the road less taken, it feels so good!

Envelope #2 has $891.49 left to pay off. Good news though...our tax refund is pending in our checking account right as we speak. After a friendly car repair, we have a big chunk going to debt. I have a feeling envelope #2 isn't going to get settled in on our fridge!! YES!

In 1 Month...

It's been a month since we had to buy Chris a new car. Since then we have been putting all our extra money to build our $1,000 emergency savings back up. In the last month we only made the minimum payment to each of our 3 student loans. As of yesterday, we now have a fully funded emergency fund (yay!!) and we are ready to start paying off debt again. We call this snowballing.

Dave Ramsey's strategy for efficient debt pay-off is to put your debts in order from the smallest amount owed to the largest amount owed. Start working on the smallest one first, making only minimum payments to the rest. As soon as the smallest debt is paid off take all of that money and put it toward debt number 2. It's a snowball effect. When we started paying off debt we didn't have much of a snowball because all of our money was spread out over several debts. Now that we are only down to 3 debts our snowball is huge compared to what we used to snowball!!

The encouragement in the beginning was to be able to pay off small debts quickly and be done with them. Now since we are at our largest debts, they don't go away as quickly, but we see this huge chunk of money that someday will be ours to choose where it goes! We could literally send someone from our church to the Philippines every 2 months with our snowball right now. We can chose to do that someday when our money is ours again!

Oh and that $1,000 envelope hanging on our fridge- it only needs $50.79 to open it. Read about our envelope motivation system to finish our last $35,000 of debt in one of my older posts.