A big thank you to Lady A for sharing her story today. I’m always willing to protect the names of the innocent around these parts so if you’ve been hesitating in sharing your story (because friends or family read this blog) realize that we can create a cool mysterious pseudonym for you. Lady A lost some friends in her family’s quest for becoming debt free. Her husband was laid off. She quit a job. She realized there was no such thing as “good” debt. She’s a rule breaker and a Debt Slayer. She a rebel and best of all she’s recently debt free. Read her story!
Hey everybody. So glad you stopped by today. Freedom Friday is when I bi-weekly let you in on how we’re doing with our pursuit of paying off debt. It’s also when many of you have e-mailed me with your story (with either “Freedom in Progress” or “Freedom Achieved” in the subject line) so I can share your story to encourage others, too.
I never thought we would say this, but we are now living debt free (only the mortgage is left). We paid off my college loan and credit card this month. It’s not that we had that much debt, but my husband and I both had the mindset that a little debt was okay.
Luckily, my husband and I are not big spenders and have mostly operated on a cash basis. Our debt though began to pile up and our cash reserves dwindled when my husband, an airline pilot, was laid off after the September 11, 2001 terrorist attacks. Unfortunately, he lost his job less than one year after we bought our house. It took him seven years to get back to the same job level he was at. With the birth of our son, I could no longer work 60 hours a week especially since my husband was only home three days a week to help. So I left my job and that meant a $60,000 pay cut from our budget. Ouch!!
We had always been good at saving and not buying things we really didn’t need, but we still had some fat. I immediately canceled cable movie channels, bundled phone services, began shopping at Aldis, learned how to use coupons and price matching among other things to cut what we could. We almost lost two of our closest friends because we said no to a friends trip with several couples because what they wanted to do was not within our current budget. (They are a charge, charge, charge family.)
It wasn’t until I left my job and knew we were going to become a “paycheck to paycheck” family that we decided to get money smart and read Dave Ramsey’s The Total Money Makeover Book. We had actually already been doing many of the things he advised to do, but not necessarily in his order. For example, we had our 6 month reserve fund, but still had debt. I remember actually saying to my husband, but it’s a good debt and it’s a very low interest rate. Ahh, we live and learn!
One of the biggest eye openers for us reading Ramsey’s book though was life insurance. We had universal life/permanent policies. Not anymore! We know have small whole life policies and much larger term life policies. (Yes, I know this is not 100% Dave Ramsey). We used a portion of the money we got back from our universal life policies to pay off our remaining debt, the rest we put back into investments.
But with just that one move, we more than doubled our life insurance coverage, paid off our debt and freed up about $200 a month of debt payments. It’s amazing that when we now pay bills we can say this is where I WANT my money to go, not this is where my money HAS to go. It’s a feeling you really can’t describe until you experience it. It’s worth the journey!
CONGRATULATIONS Lady A! We are SO proud of you and your husband here in the Queendom. You have defeated the odds and braved being different. You don’t have debt dragging you down anymore and we can feel the freedom in your footsteps. When the Queen grows up, she wants to be just. like. YOU!
Share your debt slaying story or journey with the other Lords and Ladies in the Court of the Queen of Free. We’re better together and with us uniting in the fight, that Debt Dragon doesn’t stand a chance.
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