When we last left the ‘Getting Out of Debt’ story, we were doing the right things with our money (retirement, no credit card debt), but we still had no overall plan and were spending a lot of money as a result. To go back and read parts 1-3 start here:
As the curtain opens on Part 4 of our story, a huge change has occurred – the arrival of our dear daughter. For the first two years of her life I continued to work at my professional career, which entailed a long commute and a day care bill closing in on $10,000 a year. Even more pressing was a growing desire to be home with her. My boss was very family-focused and I continued to work by reducing my days in the office, and eventually, job sharing with a friend and fellow mother at work.
Over Memorial Day weekend, 2007, I tuned into a TV show that radically changed our direction. The show was The Dave Ramsey Road Show. As Dave outlined his financial plan to ‘live like no one else’ we discovered we were already pretty far along.
- Emergency Fund of $1000 – Check
- Pay off all debts excluding your house – Check
- Emergency Fund of 3-6 months expenses – Check
- 15% income into retirement – Check
- Save for kid’s college – Check
- Pay off your mortgage – BINGO!
- Build wealth and give like no one else
We had never even considered paying the mortgage off early. Dave Ramsey’s plan made so much sense to both of us. We decided to attack the mortgage so that we could be free of payments and get to a point where I could stay home with our daughter. Having a specific goal and a vision of the way we wanted to live gave us a laser-like focus on our finances. We were about midway through a 15 year mortgage so our additional payments made a decent impact on the principal. My daughter began to think every balding man was Dave Ramsey. Instead of take-out from the Cheesecake Factory we were rocking the beans and rice at home!
As the mortgage ticked down, I was able to leave my professional career when my daughter was 3. By the time she was in kindergarten, I took a part-time bakery job to earn extra money to throw back on the mortgage. That same year we were able to make a final lump sum payment and finish the mortgage off! When you need a large cashier’s check from the bank it makes you feel like you are participating in one of those scams to send money to a “prince” in Nigeria! Mailing the check was exhilarating to say the least. When my daughter went to her 6 year old check-up that week she announced to the pediatrician, “We paid our house off!” The pediatrician said “What? No one does that!!”
Since paying the mortgage off three years ago we have been focused on saving like no one else so that we do not have to take loans out in the future. We have been able to enjoy more travel opportunities and I continue to work part-time in a job that lets me primarily be home for our daughter. If you are interested in what Dave’s plan involves, I recommend getting the The Total Money Makeover: A Proven Plan for Financial Fitness book from your library. If you want to give yourself extra inspiration, check out Dave’s video from the radio broadcasts. Watch and read and do the steps until you find yourself beginning sentences with “Well, Dave says…”
Thanks for reading our story!