Just like you...I am a victim of our cruel society in which we WANT everything! And we want it right NOW!
HOWEVER, Paul & I are on our way, with millions of other Americans, to start breaking that trend! Having a car payment, student loans, credit cards and even a house payment doesn't have to be 'the way' we live! We can all break out of that awful cycle by having a plan. The best plan I (or rather he) has come up with is Dave Ramsey's plan. http://www.daveramsey.com/home/
So basically... 'The Plan' is...
Pay the minimums on all of your debt for everything BUT your lowest outstanding debt, paying the absolute MOST you can towards THAT debt each month.
...then once that debt is gone (pause for a YAY!), then roll all of your extra income into payments paying off your next lowest debt! (YES, it's really that simple!)
Now this plan involves a 'mental shift' to put it lightly! You have to go from living outside your means to living well beneath! You might hear some people call it the 'rice & beans' method. This is where you should NEVER seeing the inside of a restaurant (which is the only rule Paul & I break...for shame!), cutting out all of the unnecessary crap (Starbucks for me) being mindful of your budget, etc. Now I'm not going to lie this has been incredibly hard! When you want to buy that one thing that for you wasn't a big deal before you started this crazy plan...come on it's only $50 but now it is because it means halting your plans, shifting things around so that you can have that now. Is it worth it? Do you truly need it that bad? It's been tough to say no to Paul or myself when I want something....but hey that's what makes this a goal, why it's so important to look ahead at what we are gaining and it's also why not everyone can do it!
But for us...it means giving ourselves the best start our family can have! Savings for our future & our future family, no matter how big ;)
We have done soooo well after our wedding starting this Dave Ramsey plan...we have paid off my credit card (some left over stuff from our wedding), a small loan & we've almost paid off Paul's truck...all the while paying lots of medical bills (for me and my gallbladder issues), the random trip for family events, CPA tests & study materials, etc. We've done sooo well over the last few month and only have about a year to go before we can scream "we're debt FREE!!!!" on Dave's shows (everything but the house anyway). Every Friday people get to call in to share their story and scream "we're debt free". I can't wait for that day!
...it doesn't stop there though...we're only on Baby Step 2 (paying off debt). Here is some more information on the baby steps from Dave Ramsey - http://www.daveramsey.com/mobile/baby-steps/, but the basic idea is 1) save $1K 2) pay off everything but the house (huge accomplishment for most) 3) save 3-6 months worth of expenses 4) increase 401K contribution to 15% 5) save for kids colleges 6) pay off your house early & 7) build wealth and give!
It's basically a life-time committment to ensuring your future! Therefore it's the perfect plan for me...keeping your focus on both the details as well as your long-term goals! I love it! Love feeling like we are in control of our financial future :)
My sister & her husband are on it too...we're helping keep each other on track! Helps when the rest of the world thinks you're crazy I guess. So if this kind of plan would help you as well, I say 'go for it'! Life is too short to constantly be paying our hard earned money out in interest to every type of credit company out there. You DON'T HAVE TO always have a car note, credit cards, etc. to live! On another small note of accomplishment: we were able to knock down some of our normal monthly bills like cable, car insurance, etc. by asking our providers to work with us. Paul got $50/month knocked off of our cable/internet service. Now we are thinking of cutting the gym and just walking in the neighborhood & changing car insurance companies (potentially cutting hundreds of dollars off each 6 months). We're doing sooo well! I'm sooo proud of us!
A little more Dave Ramsey advice - "Live like no one else now, so you can live like no one else later!" ...that's what we're doing anyway. :)
You can download the calculator here to see how quickly you can be debt-free too!
http://www.vertex42.com/Calculators/debt-reduction-calculator.html
