Financial Freedom!

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I’ve written before about my progress towards financial independence. We have been lucky enough to remain employed during the craziness of the last year, and so we continued to chip away at our mountain of debt.

Yesterday I paid off one of our last remaining debts. When I first decided to work towards being debt-free, it seemed like an insurmountable hill. I did a bit of research and found Dave Ramsey and his snowball method. I figured I’d try it. Even though the method doesn’t make the most financial sense, it made psychological sense. So I aimed at our smallest debt first, even though it didn’t have the highest interest rate.

After paying off our smallest credit card bill successfully, I moved on to one of our car payments. After 6 months, that car loan was paid off. We kept plugging away, throwing any extra money we made towards a debt.

After over a year of being mindful of our spending and concentrating on paying down our debt, we are (essentially) debt free! Now, a bit of explanation here, because we do still have two debts – our mortgage and one car loan. However, using the snowball method, we have paid off a car loan, a bank loan, and 4 credit cards! That means that all the money we had been throwing towards debt can now start going into savings and other investments.

We are likely going to move, so paying off our mortgage isn’t a huge goal for us. Our mortgage payment is small and it’s only a 15-year loan. When we do move, the equity in this house should pay for our next house outright, as we are planning on downsizing quite a bit. So for us, the mortgage debt, while still there, is not a huge concern.

The remaining car loan is for my husband’s car, which he is currently not driving, since he has a company truck. It isn’t getting used for daily driving, which means he isn’t putting any real mileage on it. We will still be paying on that loan, of course, and I will pay extra, as always, but that car will likely be traded in as well when we move, so again, it’s not a huge concern to us right now.

The mortgage and the car loan both have low interest rates, so it was more important to us to wipe out the credit card debt first anyway. We were able to pay off the last remaining card with our tax refund this year, and paying off that balance felt so amazing! I can’t wait to get the next statement with that $0.00 balance on it. 😀

With our debt paid off and my oldest graduating with no student debt, we feel like we have achieved some amazing goals. We still have tuition for my youngest and those last two bills, but we will be able to put away a significant portion of our income each month, even after accounting for those.

When I first started this journey, it felt like we would never make it. Every time I turned around it felt like we had another bill to pay, so to have made it to this point is a huge weight lifted off our shoulders. I’m not abandoning my spreadsheets or budgeting planner, but instead of groaning every time I see a balance, now I can smile as I see our savings grow. My husband and I are excited to make plans now that we have achieved our goals – the future is definitely looking bright.

Financial Progress

One of my many goals this year is to pay down our debt as much as possible.  With two kids in college come this fall, we need every spare penny!  My husband is an essential worker, so even with all the current (and probably coming) craziness in the world right now, we’ve been able to depend on his income.

However, I am definitely planning ahead and trying to make sure if more strange things happen this year (murder hornets?!) that we are prepared financially – as much as we can be, anyway.

We refinanced our house earlier this year and were able to lower both our interest rate and our payment, which has helped a lot.  Our refinance also netted us some cash, so we were able to stick that into savings.

I think the last time I posted about our budget, we had the mortgage, a car loan, a bank loan, and 4 credit cards.  Yikes!  In March, we paid off one of the credit cards. 😀  We had some expenses that I thought were going to be on that card, but we ended up being able to pay those directly, so now that card is paid off.

In addition to that, we had been putting more money towards the bank loan, because it had one of the highest interest rates.  We used part of our tax refund and put it towards this loan.  Because of that, we were able to pay off that loan this month!

I am still tracking the rest of our debts on my snowball tracker, shown here:

IH Debt Snowball Tracker PNG

My next goal is to pay off two of the credit cards.  They are big box store cards that we used to get 12/18 months no interest and we are close to paying one of them off.  I’m hoping to have the money to do that this month as well.

If I can do that, it will leave us with just 1 credit card, the mortgage, and the car loan.  Which would be AMAZING!  Our house loan is only a 15-year loan and even though the payment was lowered with our refinance, I am still paying the old loan payment amount each month.  This will help us pay it off even faster.

Doing this would also let us put more money in savings every month.  We’ll see how we manage – my husband’s hours have been cut back and I won’t be getting a paycheck while I’m off for the summer.  So paying things off may be a bit trickier, but I’m still determined to get there.

What are your financial goals?