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$37,977.38 paid off in 22 months! Sue and Jeremy are DEBT FREE!

Sue and Jeremy are debt free!  How did they do it?  Let’s find out, Sue’s been kind enough to allow me to pick her brain. 

Sue, can you give me a little background on yourself? 
My name is Sue and my husband is Jeremy, we are college sweethearts who are now thirty-something’s (how does that happen so fast?).  We live in a suburb of Minneapolis, MN and we have been married for over 8 years.  We have a very energetic 4-year-old son and a very sweet 2-year-old daughter. 

So…how did you first hear about Dave Ramsey? 
I was watching Oprah one day a few years ago and a show about debt was on.  Out of all the experts offering advice, Dave was the only one that really seemed to have a solid, doable plan to me.  I bought his book, read it, and let it sit on my book shelf for a couple of years thinking it would be too difficult…until May 31st, 2009.  I was sitting on my computer trying to raise the credit limit on my 15k card as I was needing more money.  The limit increase was declined and I was starting to sweat and freak out.  I swiveled around in my chair and it was almost like a light was shining on “The Total Money Makeover” book.  I grabbed it, re-read it, got my husband to read it and we began.  Our backs were against the wall and we knew it.  We had no choice but to make this work because we just weren’t making it and we felt so trapped….this was our first glimmer of hope.

Interesting.  Was your husband immediately onboard after reading the book?
The first time I read it and mentioned it to him, he wasn’t on board.  The second time (5/31/09) he knew something needed to change because “our way” wasn’t working.  The whole process has actually been easier for him than me because he doesn’t like  retail therapy as much as I do.

When did you become debt free? 
April 8th 2011!

That’s not that long ago!  Has it sunk in yet?
I don’t think so but when I do have the rare moments to try to absorb it, I feel very happy and free.

How much total debt did you pay off, how long did it take?
We paid off $37977.38 in 22 months; we also cash flowed $4800 to the IRS during this time and $1200 to a car repair shop.

Do you have a mortgage, if so do you have plans for it?
We do have a mortgage.  While our house needs some work and is a little on the small side, we love our neighborhood and community and we hope to stay.  Our ultimate goal would be to have the house paid off by the time the kids graduate from high school so we can sell it and buy a condo here in Minnesota and also somewhere warm! 

Nice game plan!
Did you call Dave Ramsey to do your debt free scream on the show?
I left a message on their voicemail but sadly have not heard back.  I do not think our numbers are the attention grabbers like some of the other callers.  Really, I just wanted to go on the radio to show that if a normal family like ours can do this, anyone can!

What was your largest single debt?
Our largest debt was my car; we owed $14940 when we started the plan.  The credit card was close behind at $14610.

Which of those two debts felt better to pay off?
For sure the credit card, that thing has been an anchor dragging me down for half my life.  I was always transferring balances and opening new cards, etc.  I never thought I would be free from credit cards and I even remembering telling myself that it is normal to carry a balance and it is OK as long as the balance stays below 10k.

What’s your favorite part about not having any payments?
Honestly, the day the debt was paid off I walked around my house looking at everything and thinking “I own all of this!”  I have had a huge, revolving credit card debt probably since the age of 18 (free t-shirt with a credit card application in college!) and I never could remember what exactly was charged on the credit card.  I never really felt that I owned the stuff around me until that day.  Not that the stuff is particularly nice or anything but it just gave me a great feeling of pride to know it is ours, free and clear! 

How did you celebrate?
We had hopes to go to a local hotel and stay for a night (so we could sleep in for once!) and go to a restaurant attached to the hotel and order anything we wanted and not think twice about the cost.  Unfortunately, these plans didn’t materialize (at least not yet) as we decided to throw every extra cent we had to pay off the debt a month early.  We were able to go to a fun restaurant and play a little bocce ball and have a couple beers before sitting down to a nice dinner.  We had a toast during dinner and talked about how far we have come and what our hopes are for the future.

Did friends/family think you were crazy during this process?
YES!!!  About six months into the plan, we realized that we were in trouble with all of the gift exchanging we were doing with our families and friends.  We knew we could get a lot further if we stopped the exchange temporarily so we sent out an email asking everyone if we could bow out.  It was well received by some folks who were likely relieved to not have to buy presents for our family of four but some people had a hard time understanding us and didn’t like this change.  I must admit there were some uncomfortable birthday parties where we would only bring a card while everyone else brought birthday presents.  A lot of times I felt guilty and misunderstood but I think people are getting used to it now.

Have you convinced any of your friends or family to go down the same path?
I do have a coworker who read The Total Money Makeover and started the plan with her husband and my husband’s good friend started working on the program recently as well.  I try not to talk too much about what we are doing with others (although sometimes I can’t help myself).  My good friends and family know what we have accomplished and if they want advice or a copy of The Total Money Makeover, I will be happy to help.

What has being debt free allowed you to do that you could not have otherwise done?
It allows me to think about what would be best for my family – me staying home with my kids or continuing to work.  There is such a freedom there; this is something that would not have been feasible with 38k of debt hanging around our neck like an albatross. 

What was the hardest part about this journey?
Probably getting used to bringing a calculator along to the grocery store and paying cash for our food.  I remember a couple embarrassing moments when I didn’t have enough cash with me and had to pull items out of my bags to return (and people behind me were offering to pay the difference).  I learned quickly to pull a couple non-essential items aside and tell the cashier that I would decide if I wanted to buy them once I saw the grand total. 

What was the easiest?
Once we found the budget that really worked for us, it was amazing how easy it was to follow it and how nice it has been to not worry about where our money is going. 

How has this affected your marriage?
We are definitely closer.  I think there is really something to be said about accomplishing a shared goal together.  I know a lot of couples fight and struggle over money and that is one of the areas where we are the strongest. 

What advice would you give someone who is just beginning their journey of becoming debt free?
STICK WITH IT BECAUSE PEACE AND FREEDOM ARE WORTH EVERY SACRIFICE!!!  Find the spend /debt payoff balance that works best for you and your family and remember that it is not a black and white process.  You are not a failure if your budget doesn’t work one month, just tweak it and move forward.  Always remember that financial freedom and peace are the ultimate goals and sometimes you will lose the battle (such as overspending one month, etc) to win the war.

Wow…that is GREAT advice.  So has being debt free as fun as you thought it would be?
It is better than I thought it would be.  I was emotional about it the entire week leading up to the last payment being credited.  I don’t think I realized what a freeing feeling it would be, I am still in shock a little bit.

What’s your next financial goal?
To get 3-6 months set aside for emergencies.  We are trying to stay as intense on this step as we were in baby step 2.

So can you share some of your budgeting secrets?
We just follow a simple excel spreadsheet that I made up at the start (it has changed a lot over the months) and I tweak it when I need to.  That is really the only way to make this work is to have your plan written down and to follow it (or make changes if it doesn’t work).  Now I am at the point where I think about my finances probably about 20 minutes per month when I pay the bills because I know where everything is going.  It allows me the freedom to put my focus and energy where I am really needed, with my family!

Awesome job Sue!  Thank you so much for your time, I really appreciate it.

 
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Posted by Slow Roasted Money on April 13, 2011 in Personal Finance

 

INTERVIEW: John and his family are debt free after paying off over $65,000.00!

John and his family are debt free after paying off over $65,000.00!  How did they do it?  Let’s find out.

Before I start tossing around the hard ball questions – can you give me a little background on yourself?
I am married to a wonderful woman who was born, thankfully, without a spending streak.  She’s one of the most patient, encouraging, and frugal women I’ve ever met…and all of those became obvious after marrying her.  I hit the spouse lottery with her.  We have been blessed with three children: Jacob (6), Sarah (3) and Anna (1).  I work as a HR manager at a large corporation and she works as a stay-at-home mom.

How did you first hear about Dave Ramsey? 
I heard about him during a very difficult time in my life.  My wife and I had moved to Ohio with work and ended up buying a house with rotten windows and a kitchen that was falling apart.  $25k and almost a year later my manager started talking regularly about eliminating half of the department.  We were far from family, $65k in debt from our home improvements, cars and student loans, and the stress mounted.  I began having panic attacks and confided in a friend of mine in the company.  She asked me if I had ever heard of this Dave guy and gave me a print out of the Seven Baby Steps.  I read them and started that day down the path.
 
So how long were you doing the Baby Steps before you started to feel less panic about your personal finances?
I think it was after I paid off those stupid windows.  I was so happy to have that payment in the rear view mirror.  Once they were paid off I saw a path to paying off everything else within a year. 

Was your wife immediately on board?
I guess my answer is yes and no.  She was not completely on-board with all of Dave’s teachings, but she saw how much stress debt caused me so she was on-board with anything that would ease that anxiety.  The one she had the hardest time with was Sallie Mae at 2.75% interest, but she never fought it.  With her not being a big spender, her lack of buy-in on that front wasn’t a hindrance, it was just an area of light philosophical disagreement.  
 
I bet your friend at work that pointed you towards the Baby Steps is proud of you!  Does she know you’re debt free? 
I called her when we left our house to drive to Financial Peace Plaza.  I told her to be listening and she went ballistic.  She was extremely proud of us and was excited that she was about to become a celebrity (her words, of course, and I let her have that moment of fame!).  I mentioned her by name on the radio show and it made her day.  I was happy to let her have the day when she gave me financial peace for a lifetime.

When did you and your family become debt free? 
We paid off Sallie Mae, our last debt, on March 4th (a wonderful day to start a new way of living: “March Forth!!”) 2010.How much total debt did you pay off, how long did it take?
We paid off $65k in debt and funded our fully funded emergency fund in 25 months (we did the fully funded emergency fund alongside our final debt due to expected medical expenses that thankfully never materialized).
 
Along the way did you ever struggle?  Any lapses in sanity?
We struggled slightly about halfway through.  I had a major accident involving my garbage can and a bungee strap which threw a few unexpected medical bills our way (it’s OK to laugh).  You never know where an emergency is going to come from so the emergency fund is essential to all of this.  I tried to have a self-made lapse of insanity by leaving Sallie Mae on her regular payoff schedule, but my friends on the The Total Moneymaker message boards (John is BigRedWarEagle at TMMO) brought me back to earth.  We took our 6-month emergency fund, reduced it to 3 months and threw money at the student loans and were done with them in one big lump sum payment.  Thanks to Peacebug and Greenwoman from the boards for giving me that electronic tongue lashing!

What was your largest single debt?
Our largest single debt was my $13k of student loans that paid for graduate school and a small amount for undergraduate.
 
I bet that one felt good to get rid of?
I was so happy to be done with that because we shared the loans with our parents.  Getting rid of them gave us much-needed peace around the dinner table.  After paying them off we immediately started putting money towards our children’s’ college education.  Lord willing they will never know the joy of getting Sallie Mae out of their lives.

What’s your favorite part about not having any payments?
My favorite part was completely unexpected.  I was anticipating excitement, joy, peace, and a sense of filthy-richdom.  Instead, what I still revel in is the feeling of completely walking away from a home project when it’s done.  I never realized how much the projects followed me when I still owed on them!  The first time I felt it was when I put up some extra insulation in my basement and was walking back up the stairs to our family room.  Halfway up the stairs I literally started laughing.  It was such an unexpected and freeing feeling.  That feeling persists for vacations, projects, and dates out with my wife.  It’s truly priceless.

How did you celebrate?
We drove to Nashville the very next day and did our debt-free scream from Dave’s lobby.  On the way back home I stopped at an antique store and bought my wife the bench that she desperately wanted for our foyer.  That was a nice feeling.
 
So did you get to meet Dave Ramsey?  What was that like?
Frankly, it was surreal.  He looks exactly like he does in all of the pictures I’ve seen and he sounded just like he does on the radio.  It was difficult not to hug him and tell him that I had a man crush on him.  I opted instead for the stock photo and handshake.  It was worth every mile of the drive.

Did friends/family think you were crazy during this process?
Absolutely!  Now most of them, and I do mean most of them, are somewhere in the middle of their own Total Money Makeover.

What has being debt free allowed you to do that you could not have otherwise done?
It allowed me to move closer to family and work without fear.  I take bigger risks at work and work for the joy of it instead of feeling like I need a certain raise, promotion or bonus to pay off Home Depot / Lowes / Subaru or any other organization.   

What advice would you give someone who is just beginning their journey of becoming debt free?
You have to focus on the end.  The joy of scrimping and saving will come, but it usually doesn’t come until you’ve been into the process for a while.  What will get you through the first critical months is the hope that you will make it out the other end in a better place than when you started.  As Dave Ramsey says, “I never said it would be easy.  I just said it would be worth it.” 

Is being debt free (except the house) as fun as you thought it would be?
Yes. Absolutely. With the Baby Step 4,5,6 experience in the bag, I can taste the freedom of having no mortgage.  I giggle like an idiot when I think about it.

What’s your next financial goal?
I am 33 and my wife is 31.  We plan on having our $350,000 house paid of by the time I’m 39. 
Wow!  That’s fun…is your wife as pumped as you are?
She is.  She is more subdued than I am so I wondered at first.  Once I saw her posting on couponing sites about our path and responding to questions on money message boards I realized that she had a bit of a nerd in her, too.  We’re both excited about paying down our mortgage and what the future holds for us and our 3 children.
 
Do the kids know what’s going on?  What do they think about all of this?
They do!  Our oldest, Jacob, understands that borrowing is bad and that he doesn’t want to do it.  He and Sarah, the second child, ask me on Special Dada Day (Saturday drives to Dunkin Donuts) to play our debt-free scream on the drive.  They scream along with the family scream, which they were part of, and laugh afterwards.  I am going to make sure they never forget why we were all screaming that day.
 
WOW!  That is so cool!  I love that!

So tell us some of your budgeting secrets – any good tidbits to share?
I am not sure it’s a budgeting secret so much as it is a Baby Step 2 secret.  Sit down regularly and write down how much you have paid that month in interest.  Remind yourself that you’re paying that amount for the right to have bought something before you had the money.  That’s what it is, after all.  If that number doesn’t motivate you, not much will.  I dare you to buy things on credit cards after seeing that amount.

Thanks you so much!  Great Interview, awesome job John!  It’s been an honor.
I am glad to be doing this if it motivates somebody to go through the pain to get to the other side.  It is absolutely worth every dime, minute and bead of sweat.
 
Great job!  I really appreciate it.  Thanks so much John!

 

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INTERVIEW: $16,000.00 left to pay…John and his wife are gazelle intense!

Before we jump in, I would like to thank John and his wife for sharing their journey towards debt freedom with Slow Roasted Money.  You guys are crushing it!  Thank you so much for taking some time with us.

John a Project Manager for his father’s construction company and his wife graduated from Dave Ramsey’s Financial Peace University in January 2011.  Prior to that John read Dave’s book The Total Money Makeover in a weekend.  Let’s hear their story…

So how much debt are you paying off?
My wife and I are on Dave Ramsey’s Baby Step 2. We have been working our debt snowball for the past 6 months. We have $16,000.00 in student loans left to repay.

How did you first hear of the Baby Steps?

I have several friends and family members who took Financial Peace University. I started to read the book, My Total Money Makeover and was hooked. I read it from cover to cover in one weekend!

WOW, so what is your projected debt free date? 
Our projected debt free date is a lot further off than first anticipated. Our first goal date was November 2011 however my wife recently lost her job and the job hunt hasn’t been very successful. Our new goal is June 2012.

Has making that adjustment been difficult?
Not really we stared Financial Peace University and our budgeting the week after we got married. The change of the marriage outweighed the changes of the baby steps. Plus we’re gazelle intense, we make the sacrifices we need to make and it all equals progress.

In five words or less can you describe what you’ll feel when you make your last payment on debt?
I have always thought debt was dumb and I had been debt free for a year before we got married. When I got married in September my lovely wife brought a few student loans to the table.  My five words to  describe that feeling would be. 1) FREEDOM 2) FREEDOM 3)FREEDOM 4)FREEDOM and last but not least 5) FREEDOM!

What will you and your wife do to celebrate your achievement?
We have our honeymoon scheduled for South Africa in October 2012 to celebrate our wedding and being debt free!
 
NICE!  That sounds like fun!  How did you two pick South Africa?
My parents have been several time, we found a great deal at an auction a few months ago for a price we just couldn’t refuse.  
 
What advice would you give to someone just starting down this road?
Work the steps just like Dave Ramsey says. They have worked for several of my friends and family. Get mad! Get intense! And don’t give up!
 
What will be the best part about being debt free?
We are going to save for a down payment on our house. Our goal is 100% down. I know when we aren’t sending our money out in payments on debt each month that we can pull it off. As Dave says, “studies show that 100% of foreclosures happen on homes with a mortgage”. The only way to guarantee not to have a foreclosure is not to have a mortgage!

That’s awesome, how much do you estimate you’ll need?

Right now in our neck of the woods we can get a very nice house for $120,000.

That will be fun!  So what’s been the most difficult part of the journey?
The most difficult part so far has been not running out and buying things. We need to pay for it with MONEY not plastic. If you don’t have the cash to pay for something…you can’t afford it! 
 
What are a couple of items you really want that you can’t just run out and buy?
I’m a big gadget freak I want a new HD Video camera and a new laptop. I know that if I save for a few months the price will come down and I can pay in cash and get a better deal.    
 
What’s been fun about it?
The fun part has been seeing our debt shrink. We have a picture of Africa on our refrigerator and we color a little in each month as we pay down our debt and work towards our honeymoon. I love it when our friends and family come over and ask what’s with the half colored picture. I tell them it’s our countdown to FREEDOM.

Do your friends think you’ve gone nuts?

Most everyone supports us. But my mom keeps us laughing, she is proud of the progress we are making but she thinks our budget it too tight and we need to slow down. She slips my wife extra cash each month, but little does she know that my wife gives the money to me for our debt snowball!

That’s hilarious….so do you have any kids?
We don’t have any kids but just got one puppy…if that counts!

Any final nuggets of knowledge for the Slow Roasted Money readers?
Cash and a budget!  Cash and the budget are the keys for us. You can’t spend the money if you don’t have it.  We only use our debit cards for medical expenses. We work our budget from the first Sunday of every month to the last Sunday.  Every dollar on paper, on purpose, with a name and only spend cash! That’s what works for us.

Thanks John, awesome job.  I can’t wait for interview number two after you guys do your debt free scream!  Thanks again!

 

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INTERVIEW: $45,275.00 Paid Off – Two Rock Stars and their four Children are DEBT FREE!

I am so pumped to share this interview today!  Before we start, I’d like to thank Maria for taking the time to connect.  She’s an online content writer, blogger and mom of 4 little ones (ages 7, 6, 4 and 1) and she’s currently expecting baby number 5 in July!

Maria and her husband John were married in 2002 with their only debt being student loans.  A few years later they added more debt, including a truck and two maxed out credit cards.  Their income would fluctuate as John worked in construction following his service in the military and they would make ends meet by using credit cards for gas, groceries, and annual taxes.

Sounds gloomy huh?  So how did they achieve rock star status by paying off over 45k to become debt free?   Let’s dig in.

Maria, how did you first hear about Dave Ramsey?
I first heard about Dave Ramsey from some women on a newlywed’s message board of which I was a member. Unfortunately, I didn’t really know what they were talking about and didn’t pay attention. A few years later, when our finances had gone downhill, I saw a link to Dave’s book The Total Money Makeover and requested it at our library. They purchased it (I didn’t even have the $10 to buy it myself!) and I was the first to check it out.

That’s interesting. Do you ever wonder how many other people have checked that book out?
Yes, I do! To this day, it’s the only Dave Ramsey book in the collection (we have a small library). I looked it up online the other day out of curiosity and it was checked out.

When did you become debt free?
We became debt free on April 5, 2011 when we completed our final payments via online bill pay. My husband and I along with our three oldest all clicked the “Confirm Payment” button at once.

That’s fun!  Do the kids understand what that meant?
Definitely — they understand about paying bills online and have been very aware of our baby steps — my son (now 7) cut up our credit cards in the beginning and would cut up any cards that came in the mail. Once he cut up my new debit card; he was that concerned that we not have any more credit cards in the house.

That’s hilarious.  So how much total debt did you pay off, how long did it take?
Our total debt, when we began the Total Money Makeover journey, was $45,275. It took us four years from the time I read the book until we would be debt free, but Baby Step 1 was lengthy and Baby Step 2 itself was just over three years long.

That’s a long time.  Did you every think that it wasn’t worth the effort?
No, never crossed my mind — we had a goal and were determined to meet it!

Does that include home and everything?
We still have our mortgage debt, but we have completed baby step 3 (saved 6 months’ expenses) and are now starting baby steps 4 (investing 15%)  and 5 (15% college funding for kids) so we’ll be tackling the mortgage (Baby Step 6) very soon!

What’s your favorite part about not having any payments?
The best part about not having debt payments is the freedom to tell all my money where to go each month –  not having to budget in for MasterCard and student loans and medical debt — it’s amazing not to have those deadlines and minimum payments looming.

How did you celebrate?
We are celebrating by going out to dinner as a family (we rarely eat out!) and each of the kids has been long promised a “debt-free toy.” Now they can pick them out — I think my oldest son (7) and middle son (4) want Playmobil sets and my daughter, who previously said she wanted a doll house, now is insisting on a  pocket knife. Hmmm, we’re going to have to do some negotiating on that one. As for the baby, we’ll get him something just because the kids insist he needs a present, too. We may also take a weekend trip/ mini vacation this spring. We didn’t take any vacations while working on Baby Steps 2 & 3.

Did friends/family think you were crazy during this process?
Yes, some did — especially our neighbors. We even thought we were crazy at times. As part of our plan to cut expenses and increase income, in 2008 we moved from a 1200-square-foot finished home into a 700-square-foot cabin needing lots of work. At the time, we were a family of five. By the end of 2009, we were a family of six and it was really crowded. It was worth the sacrifice, though, and we were able to make a ton of progress — our monthly payment for that house was only $537 and utilities were minimal.

What has being debt free allowed you to do that you could not have otherwise done?
Becoming debt free has opened up for us the ability to invest some money every month and to possibly send our children to a private school this fall, something we could never afford with debt payments.

What advice would you give someone who is just beginning their journey of becoming debt free?
We just became debt free … it’s been built up for so long in our minds that it’s hard to believe it’s real. I feel like we have our whole lives ahead of us and will never make the same mistakes again –but it hasn’t completely sunk in yet that we’re really there!

What’s your next financial goal?
Our next financial goal is to make smart investments and pay off our mortgages.

So tell us some of your budgeting secrets – any good tidbits to share?
Budget tips –  In the beginning, re-evaluate your budget every week as there are usually things you’ve overlooked or left out. Make it a team effort if you’re married as there’s no way to do it if only one spouse is putting forth the effort. Watch food, clothing and retail purchases like a hawk as those are usually problem areas. Also, look at the other side of the equation: how can you earn more money? For us, there was so little room for cutting expenses. We decided to work harder on earning more — and we did.

So you mentioned writing to make some extra bucks…tell me about that?  And I know you have a blog can you tell me about your blog?
We realized early on that there was little room for us to cut expenses further but we had all the room in the world to increase our income. As a work at home mom, I began building residual income through online writing and marketing — content articles, blogs, niche sites, and the like. Over time, I built my income up from a  few hundred dollars a month to several thousand. This made a huge difference in our ability to pay off debt. Along the way,  I started blogging at http://mywahm.blogspot.com to share my progress and help others who want to earn extra money online through writing.

Maria, you and your husband are total rock stars!

Thank you again for finding time to connect!  I really appreaciate it.  Awesome job.

 

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Slow Roasted Money Wants to Interview YOU!

Are you a Dave Ramsey fan working towards becoming debt free?  Or maybe you have already screamed “I’m Debt Free!”

Slow Roasted Money wants to interview you.

How it works: Send an email to Matt@slowroastedmoney.com, tell me if you’re working on paying off debt or if you’re already debt free. 

I’ll then email you a list of 5-10 questions.  We’ll email back and forth a few more times after I add a few more questions based on your original responses.

This is about a one hour total time committment from you.

Once I feel like we have an interview worth sharing…I’ll ask your permission to post the interview and voilà, you’re an instant legend among like-minded debt destroyers.

Why it works: People are looking for inspiration and your story gives it to them!  See past interviews here and here.  This is fun!

A couple more details: We don’t need to use your full name, I realize everyone at work, school and church may not know that you’ve lost your mind…and that you actually think you can become debt free…you’re so silly. 

Let’s get a move on it!  I can’t wait to hear from you.

 

 

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SLOW ROASTED MONEY INTERVIEW: Civil Engineer, Mom and Household Budget Master Discusses Paying off $129k, Changing Her Family Tree and Purchasing Underwear

What a great day!  I’m so excited to post another interview for the readers of Slow Roasted Money.  October and her husband began their journey towards financial freedom by reading Dave Ramsey’s book The Total Money Maker.  Then they went on to graduate from Financial Peace University in December of 2010 and have been members of MyTotalMoneyMakeover.com since July of 2009.    
 
October is a civil engineer, mother and household Budget Master while her husband is an accountant at an engineering firm.  She say’s, “we have a big shovel, but some big debt too.  I think that most of the time it’s proportional.  You think you have all this money, and you spend it and more.  We are still embarrassed by how much debt we racked up, but not as embarrassed as when we weren’t doing anything about it!”
 
Before we get this party started…did you know you can be interviewed over email by Slow Roasted Money?  Email Matt@SlowRoastedMoney.com and fame and fortune will be around the corner.  I just completely over promised, but you will help inspire others with your story!  That’s almost more fun!
 
Hold on tight folks, here we go…
 
Let’s not dance around the subject…are you working towards being debt free?  If so how much are you paying off? 
Yes, we are working to become debt free and have been for the last 27 months.  We are paying off approximately $129,000.00 plus interest.  Ugh…it still hurts to say that.
 
27 months is a long time to stay focused, was it difficult to get started?
It wasn’t difficult to get started, just to stay focused!  We both love to spend money.  Me on clothes and electronics and Hubby on guns, ammo, and electronics.  I should have said that we both used to love spending money.  It’s just painful now to even buy the semi-necessities like sheets.  Sheets for a king size bed are expensive!  It’s funny that Hubby and I were just having a “fight” about buying undies because those are pricey too!  Yes, I am the budget nazi!
 
Wow!  Our first underwear reference…this could get ugly. How have you stayed motivated during that time?
We have always focused on the WHY we are getting out of debt, to ultimately change our family tree.  Hubby and I grew up poor, there’s no other way to describe it.  Our families were on welfare for a while and then when we weren’t, our families’ incomes were well below the poverty line.  We took out student loans to go to college because it really was the only way that we knew how.  Then we got the big jobs, thought we had more money than we did, and got ourselves into consumerism trouble.  Now we are focusing on our family and being good stewards of God’s money.  We are changing our family tree so our son will come out of college without debt and know how to handle money!
 
What initially pushed you to start this journey?
We suddenly realized that we made way too much money to be broke.  We made that realization before I ran across Dave Ramsey.  We started paying extra on the highest interest debt first but we were going after it at a snail’s pace.  I don’t even remember how I heard Dave Ramsey’s name, but I do remember looking him up on the Internet and then listening to the radio show and hearing about baby steps and The Total Money Makeover book.  I had to read it!  And the rest is 27 months of history.
 
What is your projected debt free date? 
June 2012.  I see the light!  It’s amazing how much faster the second half of debt payoff goes once you can see that light at the end of the tunnel.
 
Yes! I’ve noticed that too.  The momentum of the debt snowball helps also!  What was the first debt you paid off?
The first debt we paid off was a stupid timeshare.  A friend of my Hubby’s gave us a free week at her timeshare in Grand Cayman for our honeymoon.  That in itself was awesome, but then we decided to mess it up by purchasing a timeshare while we were there.  It was the highest interest rate at over 16%, so even though it wasn’t strictly The Total Money Makeover way, it felt right to us and it was paid off in no time.
 
That must have been fun!  Did that help motivate you?
Yes, it helped to motivate us to pay that first one off, but we still had a long list of stupid!  Like I said earlier, I feel more motivation now that I know our debt freedom date and it’s just over a year away!
 
In five words or less can you describe what you’ll feel on that day? 
I won’t believe it’s real.
 
What will you do to celebrate your achievement? 
First we are going to Nashville to meet Mr. Ramsey to say “thank you” and to make our “WE’RE DEBT FREE!” scream.  Then we will save a fully funded emergency fund of 6 months of expenses and then on to Baby Step 3b which is a down payment for a new house!  I know that is a little boring, but it’s what we really want.  
 
What advice would you give to someone just starting down this road? 
Be on the same page with your spouse.  This is the most important thing, if you’re married obviously.  We have been on the same page the whole time, and it’s made our marriage that much stronger.  Also, use the cash envelopes!  You wouldn’t believe the number of items you can justify buying when you are swiping the debit card.  Believe me, I’ve done it.  But with cash, you really don’t have that option.  It’s the number one key to sticking to the budget.  One more thing, don’t let a slip up keep you from sticking to the plan.  We all buy things we shouldn’t or blow the budget every now and then.  Just don’t get into more debt and start budgeting again with your next paycheck.
 
That’s great advice.  Were you hesitant to hold your first budget meeting? 
I’m the spender that had to change my ways to be the nerd, so I’m the one who does the budget every month (even though he is the accountant).  I wasn’t hesitant to have the first budget meeting because we both realized that we had a mess to clean up.  However, the only thing that Hubby wants to know is if we can budget money for this or that, and when are we paying off the next debt.  I know that some people will find that appalling, but he really doesn’t care to be included in every minuscule detail.  He has complete access to the budget spreadsheet and our bank account so nothing is “hidden”.  He tells me that I’m doing a great job and so I just keep rolling with it.
 
What’s going to be the best part of being debt free? 
The absolute best thing about being debt free will be our ability to live on one salary.  It’s funny that we’ve been doing the math just this weekend to determine how much money we will need to live on, without all of the debt payments.  I will easily be able to stay home with our son and any future children.
 
Wow that’s fun!  Thank you so much for your time. Anything else you’d like to share?
If you are reading this and you haven’t already, then you should start your debt free journey as soon as possible!  It’s the best thing you can do for yourself and/or your family!!!
 
October, thank you so much for your time!  You crushed it!  This was so much fun for me and I hope the readers of Slow Roasted Money get inspired by your enthusiasm to change your family tree.  Awesome job – thanks again!  Let’s reconnect for Interview No. 2 after your family screams, “We’re Debt Free!” in Nashville.

 

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Baby Step Seven, Check. An Interview with Kirk Munsch.

Kirk Munsch, also know online as ProfessorMoneyWise, has been kind enough to accept my offer to interview him.  Kirk is a Dave Ramsey Certified Counselor and is very passionate about debt-free living and strives to make what many think is a boring subject not so boring. 

Let’s dive in, nine quick questions with Kirk Munsch.

Kirk, I saw on your profile you’re debt free!  When did you become debt free?  Completely and totally out of debt, house included, on April 1, 2010.  I picked that date on purpose to be a constant reminder about how debt is for fools and I’ll never be a fool again. 

Does that include home and everything?  Yes, as mentioned in the first question, thankfully home and everything.  I like to say, “my pile of stuff may not be as big of a pile as the next guys but I own everything in my pile.” 

Can you tell us a little about your work as a Financial Educator/Coach?  Do you do that full-time?   What’s your favorite thing about it?  My Coaching is a part-time thing at present but is what I hope to move to full-time later on.  My favorite thing about it is the “ah hah” moment that counselees reach when the realization sets in that this is all very simple if you let it be.  While the world is pounding us with marketing and high-minded financial terms and concepts it really comes down to a simple math equation.

What’s the most difficult part of being a Financial Coach?  I need more players.  There is such a stigma to asking for help when it comes to money that the majority would rather fly blind than ask for some help.  Human nature I suppose.  You know they never taught us how to how to raise our kids, stay married or manage our money.

I understand you’re a Dave Ramsey certified counselor.  What advice would you give someone who is thinking about attending his certified counselor training?  Excellent, excellent, excellent.  Training put on by Dave’s team is fantastic.   My soul, my mind and my body were all fed during my week with Lampo.  Personally I waited until I was on Baby Step 7.

How much total debt did you pay off, how long did it take?  In 1994 I had my “ah hah” moment.  At that time I was about $20,000 in debt.  Now that may not seem like much but when you are making about $38,000 a year it is a lot.  Off and on between 94 and ’04 I meandered in and out of debt as I was using it as a tool.  Little did I realize the one being used was me.  It was about that time I saw Dave Ramsey on TV and added “well I’ll be” to my “ah hah” knowledge.  It was so simple, it made so much sense.  All those who were complicating it (TV talking heads, friends, etc) were having a wonderful time telling me what to do with my money.  I thought then and there I was going to simplify things and give it a try.  7 years later, I like it.

All totaled I estimate about $50K in non-secured debt and a house at $290K.  And to buy a house I’ll take this opportunity to say don’t even consider buying unless:

  • Your are debt-free
  • Have a fully funded emergency fund (3 – 6 months living expenses)
  • Have enough down to avoid PMI (usually 20%)
  • Take on no more than a 15 year fixed mortgage with a total PITI+HOA of more than 25% of your take-home pay.

And remember, it costs to live in them too.  1% – 3% of your homes value needs to be set-aside for things that break, things that need gas, things that grow, etc . . . these are not emergencies, these are going to happen.

What has being debt free allowed you to do that you could not have otherwise done?  Peace.  Financial Peace that is.  Being debt-free does not solve all the problems one would have but it sure removes the money part of the equation.  The mind-set you achieve is the blessing.  You learn to value your blessings, not just money, and you expect others to value them as well.  You expect to get what you pay for on the money side and you just don’t over extend yourself.  I’ve never met a former smoker that does not still think of having a cigarette.  I’ve never met anyone who has lost weight that all of a sudden does not like chocolate cake.  But I’ll be darned if I have met anyone who got on a plan, got control of their finances and got out of debt who wants to go back into that mess.

What advice would you give someone who is just beginning their journey of becoming debt free?  It is hard, but as Dave Ramsey says, “it is soooooooo worth it.”  One step at a time.  Keep it simple (because it is) and as Winston Churchill once said, if you find yourself going through hell, keep going.  The Total Money Makeover by Dave Ramsey is what I recommend as a guide.  Married folks do this together, equal partners, no one has it over the other.  Single folks find an accountability partner.  Someone to tell you NO!.  And always, always, always use your mirror.  If you start getting some wild ideas say it out  loud to that person and see what that person thinks.

What’s your next financial goal?  Debt-freedom to building wealth to cheerfully giving.  There are only three real uses of money.  Have fun with it, invest it and give it away.

AWESOME JOB KIRK!  What an honor for me, I can’t thank you enough for your thoughtful responses, you were a delight to work with. This is the first in a series of interviews that will appear on Slow Roasted Money.  Would you like to be interviewed through email?  Send me a note at: Matt@slowroastedmoney.com, and we’ll get started.  You’ll be a star!

We talked about Baby Step 7.  Would you like to learn more about all the Baby Steps?  Visit the money master at DaveRamsey.com

 

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Are you debt free?

Are you debt free or working towards debt freedom?   Slow Roasted Money would love to hear about your journey, please leave a comment or email me at Matt@slowroastedmoney.com