It’s official! The Mister and I have paid off our last loan – at age 24!
This is what it feels like to be debt free
I never had any debt until I was married. I made it through school without needing any loans (due to the longtime gift and support from all of my family). My husband received a lot of scholarship help and only needed a couple of very small loans to make it through college.
When we both graduated and were waiting for him to be sent to more USMC training in Virginia, we utilized a USAA loan to refinance the student loans, to pay for our wedding and a new car. Our wedding only cost $10K, by the way, but I can share those details another time.
The life of that $25K loan was only about a year and a half. How did we make it happen? A watchful eye, teamwork and planning. Everyone has different circumstances in their lives, but here are tips from our life that made us and will continue to keep us debt free.
- Consider the cost of school carefully – For my long rant, you can see my previous blog post about how following your passion can be terrible advice. My less rant-y advice is to think hard about your ROI when it comes to your degree. Getting an expensive English degree from an private or out-of-state college isn’t likely to pay for itself right after you graduate. An engineering degree, however, can be different. Staying in your hometown or choosing a town where the cost of living is low can really reduce what you spend on housing, transportation, entertainment and food. It might seem like a less exciting adventure, but massive debt can also be cripplingly depressing.
- Limit “going out” – There are two tips in here. 1) Make a commitment to yourself and your budget that you’ll only spend $X on eating out/entertainment per week, then STICK TO IT. 2)If you’ve reached your limit for the week but still want to go out with your friends, eat ahead of time and freeload on complimentary chips & salsa (if available) and water. If it’s some other costly entertainment, suggest staying in (mention you don’t want to spend money, you’d be surprised how many in a group will chime-in in agreement) or meeting up with them afterwards.
- Meal plan for grocery shopping – When I was just taking care of myself, this was so much easier. One big batch of food could feed me dinner for a full week and a peanut butter sandwich was perfect for lunch. Now, cooking for two, I think strategically about what protein we’ll be having each night, when we will have leftovers and what kind of sides and snacking will fill all of our days. I can mix up the meals every week, and generally stick to replenishing the same types of meat and snack while buying extra ingredients here and there. Don’t just improvise while in the grocery store and don’t shop while hungry.
- Shop with consequences – I make it year after year with minimal shopping by asking myself 2 questions before I buy something and the answer has to be “yes” to both: Do I need it? Do I love it? For some people, that isn’t enough to kick the habit, so I offer you an extra remedy. For every new piece of clothing you buy, you have to get rid of something else taking up space in your closet/dresser. Nothing you’re willing to throw out? Then maybe you’re not ready for new clothes.
- Buy used – Buying brand new furniture for your home is tempting to make it look like a perfect page from Home & Garden. Instead you can get creative to give your home its own personality and save so much money by shopping in places like Craigslist or Ebay. It can take a lot of searching and patience (and sometimes the willingness to refurbish an old piece), but if you’re on top of these sites you can find people getting rid of furniture, appliances and vehicles in perfect condition because they need to free up their space ASAP or are moving on a tight schedule. Hell, this goes for pets too. Adopt from a shelter or find someone who is looking to re-home their animal instead of going for a new pup or expensive breed.
- Embrace Excel spreadsheets – I have to admit this is my husband’s territory. He’s the numbers guy. He has a spreadsheet that shows exactly what our money goes to each month – rent, phone, utility bills, gas, credit cards (paid down monthly…no debt here, remember?) plus a certain amount set aside for entertainment/incidental spending. All of these rows are put into a formula to determine what we net each month in our savings. If for whatever reason we’re not hitting our savings goals, we talk about it.
- Check your accounts constantly – Again, this is something my husband does. He looks at the accounts almost daily just to see how we’re fairing for the month. Say we make a big car repair, by reminding ourselves that our accounts are lower than normal, we can adjust our habits. Plus, we have the added advantage of stopping suspicious activity on our cards almost as soon as they happen.
Aside from perhaps financing a house many years down the road, we have no intention of getting ourselves into any kind of debt for any purchase for the rest of our lives. Amen to that!
What are some ways you’ve improved your money saving skills?
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