This year has been a year of debt-blasting for me. So far, to date, I have paid off over $30,000 in student loans for my husband and me, and I'm proud to say that we are now officially totally paid off for two Bachelor's and one Master's degree. I was also able to save up enough for the dream honeymoon to Hawaii that we never had (we were totally broke when we got married) and even started a fund for our girls' private school tuition for next year.
At 29 years old, that feels pretty darn good. And I have to admit that the feeling is kind of addicting. What once seemed impossible to me (having no debt) now is like a drug. I want more. We've never had credit card debt, but student loans and car payments are a large load to carry every month. My ultimate dream goal is to pay off all of our extraneous debt, continue to pay off our house, and then sell it and save enough to pay cash for our dream home.
It seems crazy, but seeing what I've been able to accomplish this year so far has got me dreaming big. To start, I set what seemed like a pipe dream to pay off our remaining debt: $16,000 dollars for the car we purchased three years ago by the end of the year. With Christmas coming up, it's not going to be easy, but in the words of my idol, Barnie:
Here are a few of the strategies I'm using to pay off our remaining debt and still have money to get through the holidays:
1. Set a budget.
This seems like a no brainer, but I realized that in my 29 years of life I've never actually really budgeted. I mean, sure I had some kind of idea, but mostly I just put stuff on my credit card and held my breath when my bill came, hoping it wasn't too much.
Turns out, this plan is not super helpful and we actually budgeted for the first time this month. It's been horrible, to be honest. I hate it so much, but if you think of it as a temporary solution to getting your finances on track, it helps a lot.
2. Make meal planning more simple.
There is no shame in more spaghetti and breakfast for dinner.
I've always meal planned because I enjoy knowing exactly what we need to shop for and I also can't cook with crap, so it takes some of my stress level down a notch to at least have somewhat of a plan for dinner.
But I realized I was mostly planning pretty elaborate meals in an attempt to cultivate their precious palates when half of the time, my kids wouldn't even eat them. So I decided to nix that. There is no shame in more spaghetti and breakfast for dinner. As a bonus, dinnertime is way less work to clean up, too. Honestly, I don't know why I didn't do this sooner.
3. Have a "no-spend" week or two.
I picked this tip up from Jordan Page at Fun, Cheap or Free and it's a good one. Set a week every month to literally spend no money and turn it into a game or a competition with your partner. It might sound lame but it kind of gets addicting to see how creative you can get without spending anything for the week.
When I ran out of dish soap for ours, my first instinct was to run to the store and then I thought, Why? We have tons of hand soap and surely we can last one week without it. You'd be amazed at how little things like that can add up.
4. Sell stuff.
It might sound silly, but you can seriously make a nice chunk of change for selling stuff around your house. Use eBay, use your personal social media or use a swap site, but take a good, hard look at what you have laying around your house collecting dust and ask yourself if you could part ways with it. I sold old books, dishes and even a few wedding presents I had yet to use and made almost $100. It might not sound like a lot, but when you're saving, everything helps—and that's almost one whole week of groceries.
5. Check out your student loans.
If you have student loans, check if you are eligible for any loan forgiveness or cancellation programs. One of the newer loan forgiveness programs is the Public Service Loan Forgiveness program, which allows people who work for certain employers to have their loans completely forgiven after 120 payments. Not too shabby. My husband is a public school teacher, so we qualified for one of the forgiveness programs and got more than half of his student loan debt forgiven, which was a huge, huge sigh of relief.
6. Cash in savings bonds.
My husband has a bunch of savings bonds that honestly, just make me kind of stressed. I just know we are going to hang on to a bunch of them and I'll forget about them when they're actually worth their full amount in 30 years. So this year, I decided to bite the bullet and lose a whopping 10 bucks on some of them and cash them in for Christmas cash so we didn't lose track of our goal to put all of our income toward our debt. You can check what your savings bonds are actually worth at the U.S. Treasury website, and it's worth doing because some series have completely stopped earning interest, which was news to me.
The nice thing about paying off debt is that it's not a forever financial goal. It has really helped me to realize that it's temporary, and although every single last penny is going to paying off debt right now and it kind of sucks (and I mean that, right down to me pulling pennies out of our spare change jar to pay for school lunches), the pay off will be so great.
8. Shop around for presents.
I have four kids and I hate shopping, not to mention I'm rarely ever without them, so online shopping is the only way I get Christmas shopping done, but this year, I started much earlier and made sure not to buy anything that's not on sale. I compared prices at each store and I checked every day (which admittedly is a pain in the butt) for the big-ticket items that I want, waiting for them to go on sale. It's taking extra time, but I've been able to save almost $100 so far this way.
9. Pay debt off a little at a time.
The nice thing about paying off student loans, for instance, is that even if you don't have the full amount to pay off right now, anything you pay off will reduce the total amount, which could reduce the interest you owe. So paying it off a little at a time makes a difference. Even if you don't have the full amount to pay off, make a goal to just pay off an extra $100 (transferred automatically so you don't think about it, of course) at a time if that's all you can do.
Maybe this isn't the most helpful tip you've ever received, but the biggest part of our budget every month goes to food, so cutting that expense down was Priority No. 1. And one of the cheapest, still heathy options out there is our trusty friend, oatmeal. Get acquainted, guys, `cuz it's gonna be a long winter.