Congrats! If you're ever in Chicago, and you drink beer, I'll buy you one.

Wow! That's awesome. Congratulations!

Thanks for all the kind words.

I don't have much left to say regarding our debt paydown project.... but I wanted to close out with a bit of a recap.

Reading Dave Ramsey's Total Money Makeover got us going on our debt pay down project. I came across Ramsey's name as I was researching how to buy a new car without a car payment. Not surprisingly, I'm still driving my 1999 paid for car. We generally followed Ramsey's baby steps except we continued to contribute to our 401ks.

We had 8 unsecured debts. We had $23,580 in credit card debt (2 Bank of America cards, 2 Citibank cards, 1 Macy's card and 1 Home Depot card. Interest rates on our cards were as high as 21.60% (Macy's) to a low of 3.9% and we had 3 cards that were 0% to a certain date. We also had $4,588 in other debt and $27,370 in student loan debt (husband's MBA). We used the Dave Ramsey debt snow ball method and paid off our debts from the smallest amount (Macy's) to the largest amount (student loan). We had 7 of the 8 debts paid off by the middle of the year (June or July) and the second half of the year was all student loan.

We stopped using credit cards. I found that for me, not so much for my husband, switching from credit to debit really helped me decrease my spending. I don't think credit is evil, but I've discovered that when I was using my credit card for day to day purchases I was disengaged from my spending (I didn't really think about my spending at all).

We also started using Quicken to track our spending which helped us figure out where we should cut back. However, we still don't have a real budget but instead we use a spending plan. During our debt paydown project, we would pay all our fixed and semi-fixed bills, throw money at our debt snowball and give ourselves a set amount for spending (gas, groceries, eating out, fun, clothes) and when the money was gone we were done. I generally gave myself $500-$600 in spending money for 1/2 a month. I expect we will use a similar plan for our 2008 goals, but I would like to work on creating a 'real' budget. My husband also created a great Excel chart (which I wish I could post) that tracked our debt paydown. Updating that chart 3 or 4 times a month helped me stay motivated.

While I pay all the bills/manage our money and did the bulk of the work on the debt paydown project (my husband was in charge of paying off our 1 other debt) my husband was 100% on board with our debt project. I think my husband's support and agreement (he'd tell you that he was happy to agree to me paying off his debts) was the most important ingredient in our success. Its my opinion that, if you are married or in a committed relationship, it really takes commitment from both parties to pay off debt, reduce spending, invest for the future with any success.

Things I wish I would have done.... I never reached out to any of our credit cards to ask for a reduction in interest. I wish that I had done so and I'm not sure why I didn't.

Congratulations!

Truly inspirational. Congratulations on accomplishing such a fine goal and for being great role models for the rest of us.

Last year at this time we had paid off $31,276 in debt (between 1/1/07 - 6/30/07). This year, at this time, we have saved $20,296. Almost an $11,000 difference, ugh! We should be doing better.

Hi Sam,
I'm coming in a little late here, but wanted to post my congrats. I read your brief summary a few posts up...AMAZING JOB! I, also, got one of Dave Ramsey's books from the library and used the debt snowball idea. I've paid off CC loans (~$10k) and car loans (~$16k). We now have our mortgage down to ~$55k and a bit left on my student loan ($4k). I've been paying ~$900/mo extra toward the mortgage 'cause, when you do the math, it is just mind-boggling how much money you save in the long run!!! The plan is to have that paid off in ~3-4 years barring any major set backs. My student loan is only 3.125% interest, so an extra $40/mo to that is good enough for me at this point.
Dave's plan really struck a chord with me and I've made a lot of progress following his plan for the last two years. I usually check in with my spending plan at least monthly - sometimes more because it's so much fun (yeah, I'm a numbers geek!). It's great to see someone else who has benefited from his info as well.
Anywho, just wanted to say WAY TO GO!!!

vb

Five years ago, my husband and I had just gotten married (October 2006) and during this time period, five years ago we were taking steps to further merge our finances (we already owned our home together, plus an investment property). I had read Total Money Makeover during the Christmas holidays and we started our debt snowball as of 1/1/07. We went down to Key West for a New Year's eve long weekend (which we are again doing this year) and I can remember using cash for everything, keeping receipts and entering it all into Quicken. We quickly gave up using cash and went to debit and an allowance system and I was able to download our debit transactions rather than manually entering them.

I started this fiscal fitness journal in the spring of 2007. So I've been thinking about my five year update for my blog and have reread some of the posts from this journal. Amazing to relive the progress of 2007, the lessons we learned during this year changed the way we live our life today.