Debt Repayment Plan

Today I’m going to jump right in and talk about how we’re allocating our money and repaying our debt.  A little background:

  • We have 4 student loans- 1 has been repaid.
  • We have 2 car payments
  • We’re in the process of buying a house

I’m a teacher and my husband works in a warehouse in the packing and shipping department, so we obviously don’t make a large amount of money.  We get by with lots of planning.

We have 5 debt payments each month.  I try to follow Dave Ramsey’s babysteps to financial freedom.  We have our $1000 emergency fund, built back up from having to use it for a new car after our old one broke down.  Now we’re paying back our debt using the Debt Snowball method.  What happens is that we make minimum payments on everything except for the smallest loan.  We pay as much extra on that small loan as possible.  When that one is repaid, we take everything we were putting toward that loan and pay it to the next smallest.  Doing this has been so motivational for us!  We paid back that first, smallest loan and were so excited to see it diminish!

A lot of people using the Dave Ramsey system know exactly when they can repay their loans.  I’ll be totally honest, I have no idea.  Right now the loans are so large and overwhelming that I’m happy to just have a plan on how to repay them.  I’m working on figuring out the exact date.

I’ll go into how we cut costs so that we can put more toward debt soon.  I’ll give you a hint- it starts with not using our AC/heat and cutting food costs as much as possible 🙂

Budgeting This Life

Who am I?

By day I’m an elementary music teacher.  I teach music to over 500 kids in kindergarten through fifth grade.  I’m very lucky to love what I do so much.  In my job, you have to be flexible and outgoing.

By night I’m a numbers gal.  I love a good budget.  I’m weird, I know.  I enjoy telling our hard earned money where to go and what to do.  This is where the type A in me comes out.

Budgets are about balance.  If you spend put too much money toward fun nights out, you won’t have enough money to eat or pay bills.  If you put too much toward your debt without any fun money, you’ll crack- eventually, having no spending money will get old and you’ll splurge.  To me, it’s kind of like when you tell yourself you can’t have any chocolate ever again…and then you make a pan of brownies and eat half of them with chocolate ice cream on top.  Wait…nobody else does that?

Life is about balance, too.  Work, family, friends…it’s tough!  It’s so important to find that balance, though, and that’s what this blog is about.  It’s about finding a balance in my budget (we’ve got lots of debt- I’ll talk more about that later!) so that we can live debt-free someday.  It’s also about finding a budgeting out my time and energy in life.