Wow, I have become obsessive. Several people have recommended "The Total Money Makeover" by Dave Ramsey, and we're reading it for book club this month. I am 144 pages in, and ready to cut up credit cards (even though we have never been late on a payment, and therefore never had to pay interest on a card), and attack (and kill) our frustrating student loan debt.
Some thoughts on our debt: We weren't trying to be idiots when we got student loans. (Come on: who is ever TRYING to be an idiot?) We had been counseled by the church that it is fine to incur debt for education. So we did. And we'd also been counseled not to put off having kids until we could "afford it." So we prayed about that, and we had kids. And we've been encouraged to have me--the mom--stay at home with the kids. Again, this felt right, and we did it. At the end of the day, I'm trying to reconcile what we did because it felt right, and the reality that we have a lot of debt and it is growing, thanks to interest.
I know I shouldn't dwell on our choices of the past. I know I shouldn't second-guess choices we made according to spiritual promptings. But Dave Ramsey talks about debt in such a way that I feel like a careless, carefree spender because I have not dedicated the last 18 months of my life to debt-repayment. He says, "be willing to live like no one else now, so you can live like no one else later." And what does that mean for my family?
As I stare at our budget, and think about tackling our debt, I wonder whether or not I should put Isaac in preschool next year. I wonder if I should give up Gold's Gym. (This is painful for me to even think about. It means waking up at 6 am to work out like my sister, or finding some amazing swapping system with friends. Or work out videos (blah!). Or working at a childcare facility at a work-out place. Or not working out, which makes me want to cry.) I wonder whether Doug and I should really do a get-away next month, and what kind of budget we should create for that get-away, if we do it. I am still largely ignorant about finances, so I don't understand how to kill debt.
I don't want to work so much that it takes away from my raising-my-kids time. When they're up, I want to be with them, and play with them. I want to have down time with my husband. If I sacrifice kid and spouse time to make extra money, it will help us kill debt faster, but is it worth it?
I want to be wise. What are your thoughts? For those of you who eliminated debt, what would you advise? For those of you who think I did the right thing by having kids even though Doug was in law school, will you please let me know that? I am being fed messages from the world, and truth, and complex truths, and I'm losing my peace.
13 comments:
I'm really bad at staying on top of blogs - so I'm sorry for being so sporadic in commenting!
I think you absolutely did the right thing when you had kids while in law school. Buuuut....look at us. ha! 3 kids later and still in med school! I believe kids are worth it. They are worth the extra time it will take to get out of education debt. They make repaying loans a longer process because they require more finances and time.
All your other questions - I have no idea!! I'm paddling up the same river in the same boat. I'm looking forward to what more experienced folk have to say about that.
Hey Tara I made Oven-baked sweet and sour chicken tonight and I thought of you always calling about what recipes are good and I remembered this one is not in the family cook book so here it is. If you like sweet and sour chicken this is SO delicious! :-).
-Cut 2-3 chicken breasts (I typically do more because we ALWAYS have a lot of extra sauce) into bite-size pieces (easier to cut partially frozen chicken)
-Lightly roll chicken in flour (I put about 3/4 cup flour in bowl and toss chicken around).
-Set chicken pieces in sprayed 9x13 pan.
-Boil: 3 cups brown sugar, 1/4 cup mustard, 1 1/2 cups water, 2 Tbsp. Soy sauce, 1 cup Ketchup, 3 Tbsp. Dried onions, 1 tsp. Salt, 1/2 cup vinegar
-Pour Mixture over chicken. Bake @ 325 uncovered for 1 to 1 1/2 hours. Serve over rice.
Anyways now for my response to your blog: Marsh and I haven’t gotten to the dreaded debt part in our lives of medical school in our future, but my favorite example of this is my grandparents. My Grammie talks about the years before word perfect and they were tough. They gave their kids a half dollar coin each for Christmas one year. She talks about sewing patches on top of patches in her children’s clothes. But one meaningful memory of those times was when she would have debates about how much money to pay for fast offerings. She told me that one time she was trying to count up how much $ the food her family really did eat was going to be she said she decided that for breakfast they would probably eat half a box of cereal and so that would be maybe a dollar. And they probably would use a fourth a jar of jam and peanut butter so that was this much etc. with her just trying to make the fast offerings as little as possible. She said one time she had the impression “Karen you can do better than that.” She said that after her impression and a long thought about the purpose of fast offerings she started to pay more with her fast offerings and they never suffered for it financially. She told me that she knows that every spiritual impression she had and followed up on during those times was meant to happen. That includes having 11 children. I love having my grandma’s perspective on things like that because their story really is the rags to riches story. So if you need someone to look to during the hard times you can adopt my grandma :-). I’m not excited for when Marshall and I get to that step, and I’ll need you as my mentor so learn all you can so you can teach me when I go through it :-). Keep up the good work of learning and focusing on getting rid of debt and as my mom always says “you eat an elephant one bite at a time”.
We are starting to face the reality of our student loans, though we still have a couple of years before we can really start digging in to paying them down, and that is kind of scary.
Here are my thoughts. First of all, spiritual promptings surpass all wisdom of the world. So, you did exactly the right thing by following them.
Second, though I really do like a lot of what Dave Ramsey says, I think there has to be some sort of balance between being financially responsible and enjoying life (not that the two are mutually exclusive in all cases). This is something that I have thought about a lot in my life, and I have just decided that I don't want to constantly be living for tomorrow. Not that I would throw caution to the wind and rack up a bunch of consumer debt, but there is definitely something to be said for living your life now and enjoying it. Even if it means you are not putting every extra penny you have toward paying back your loans.
Last thought. Anything that maintains your sanity, such as a gym membership or a getaway with your husband, is worth the money. Period.
I'm loving the comments, guys. And I will love that chicken dish, Shauna.
Okay I just wrote a really long comment, but I don't want to offend anyone here, so can I have your email address so I can just send it to you privately (ha that is if you still want it lol)? Such a sensitive topic and I don't want to incite any riots. :) my email is jthesavage@gmail.com (yes it is a totally embarassing email address.
Been there, done that, beat it, and now teach it. Call me.
I'm sorry you're dealing with this. Hey, read "The Wealthy Barber." It's a fun read all about saving money when you don't have any. Best of all, you put it down feeling inspired. Great principles that have helped us stay above water.
As for school debt, my favorite answer comes from my recently sworn in lawyer brother with a house worth of student loans: "Well, when you think about it, President Obama just finished paying off his debt a few years ago, and he's done okay for himself."
Adam and I have killed all but one school loan over the past 3 years, and granted, our financial situation is different, but this is how we did this sanely. And by sane- I mean we still lived how we wanted and still saved to pay off debt.
First, find a percentage of your monthly budget that seems reasonable to remove. It doesn't have to be much at first- it just has to be. So $20 a month? Perfect- start with that.
Now go open an account that doesn't have a card associated with it. This can be a savings account associated with your normal accounts at your bank. The important thing is you can't overdraft into it. Once the money goes in to this account, it doesn't come out unless it is going toward debt. Period. If an emergency happens you have a rainy day fund for that. This account is not your pirates chest.
Now, start moving money over once a week. Once you are in that habit, drop it to once every two weeks, and then once a month. In the meantime, make a comprehensive list of all your debt and interest rates.
We paid off our car first. It had the highest interest rate. After that we wanted to really feel like we were paying off debt, so we paid off our smallest loans- our second school loans that were under 5k. The goals were so much more attainable than looking at 18k or 25k.
As you pay things off, you will both be earning more money (because time passed and pay raises happened) and you will find additional ways to save AND most importantly, you will not be paying a monthly payment on the loan you paid off. Once a loan was paid off, that monthly expense was added to the monthly savings account. So the car cost us $250 a month, once it was paid off, that $250 went into the savings account to be applied to another loan.
Then things get exponential :)
And finally, pick a time frame to dump your savings account into a loan payment. So say every quarter you throw an additional $80-$100 at a loan. This isn't to replace a payment, but in addition to your monthly payments.
I also would pick a loan that what you are paying toward is over the amount of accrued interest. So if Doug has like $150k in law school loans, don't start with that one. Start with the smaller ones where the monthly interest rate adds up to be lower than your payment- you'll get to the big loans.
Also, we dump all of our tax refunds into loans every year. We never depend on this money for pleasure. With this money we have knocked out three different loans over the last three years (usually the tax refund was the last payment on the loan we were already focusing on). So it was like $5k to finsh up the car payments after a tax refund. It was a school loan last year, etc.
This year we have only my big school loan left and our tax refund will be going toward that.
As we pay things off I add the monthly savings to a total that is posted to the fridge. Each time something gets paid off, I add that monthly payment to my "Monthly Savings" tally. It gives me something to work toward- and keeps the goal fresh.
Okay- that is it- sorry that was so long.
Thanks again, everyone! I've gotten individual email responses, phone calls, and your comments, and I've loved hearing your thoughts:).
O, the student loan debt...... I hear you! I bet if you saw ours, you would feel GREAT about yours! It is definitely overwhelming and causes major anxiety at our house. We try to keep our priorities straight and live within our means, but beyond that, I don't know....... I never want to let money run our lives, but that would be easier if we had more.....
So I don't know what everyone else has said, so sorry if this is a repeat but I do have something to say.
The sacrifice we make to be the BEST MOTHERS we can be, whether financial, physical, emotional, etc. is pleasing unto God. There is no greater counsel than to follow the guidance of the Holy Ghost. The world will teach you to value money and God teaches that where your treasure is, there will be your heart also.
Don't let Satan sway you from feeling confident in doing the Lord's will. The prophets have counseled us to be wise with our spending...and to be present in the here and now...and that no success out of the home can compensate for failure in the home. You my friend, have always been very aware of your spending...don't let it make you crazy, it should bring peace. The debt was for the future well being of your family...take peace in that. And might I add that you guys have a job that provides for your family and aren't you thankful for that!! Law school helped you to get where you are...what a blessing!
We are counseled to keep our bodies healthy and to do physical activity...that is a good thing and if Gold's Gym membership is what helps you do that, great! It's worth the investment to maintain your sanity...that's what helps you be the best mom you can be...that a GREAT thing. Also, you and Doug having a getaway so you can maintain a strong, healthy married is a good thing. You want that weekend to be enjoyed...not analyzing every penny...that's not rejuvenating. By coming back from a weekend of L-O-V-E you'll both be ready to meet the parenting demands with more energy and love.
Ok, I'll get off my soap box...I love you and YOU, my friend, are an amazing mother, wife, daughter of God!
Hallelujiah, a-MEN!! to Amber. Well said.
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