Happy New Year everyone! I am happy to tell you that this year Color Me Frugal is participating in the Debt is Not Forever Movement. What is that, you ask? Well, this year dozens of bloggers are participating in a group effort to help people the world over get out of debt! We aim to do this by helping people get in touch with the reasons why they want to be debt free. The reasons are likely different for each and every one of us. Some may want to pay off their student loans so they can start saving for a house. Some may want to get out of credit card debt so they can finally start saving for retirement. Others may yearn for the day they can throw that last dollar at their last debt so that they can finally know that they are truly DEBT FREE.
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I think the most frustrating thing about debt (for me anyway!) is that many of us incur debt when we are young. We buy cars on credit, we take out student loans to go to college, and we take out mortgages to buy homes. I did all of those things within a few years of graduating from high school (well, ok, I guess the mortgage did not come along until I was maybe 27-ish). Suffice it to say, I got myself in a whole mess of debt at a young age. In other words, before I really knew enough to be extremely cautious about debt.
(Unfortunately I went to college before the days when there were cool websites like Scholarship Owl that help you find and apply for lots of scholarships at once- far less painful than it used to be! I still applied for scholarships in college- it just took a lot longer. 🙂 )
I think the best advice for those who do NOT have much debt at this point is to think very very carefully before you take on debt. As in, run through the numbers on what your payments will look like, how long you will have to make payments, what type of salary you may be able to bring in (especially in the case of student loans), etc.
However, this article is not really directed at those without debt. I am writing this article for you, my fellow debt-strugglers! Mr. CMF and I have been working to pay off our debt for the better part of a decade now. Granted, we didn’t wake up and smell the coffee (and start making more than minimum payments!) until about two years ago. We’re fortunate that it’s not credit card debt- it’s mostly a mortgage and student loan debt at this point- but debt is debt no matter the kind.
I’m proud of the progress we made in 2014- we paid off about 16% of our total debt. We think it should take us about 5 more years until we are free of ALL of our debt. We feel confident that debt is NOT forever.
I think it’s important to repeat that. Debt is NOT forever. I think that too often in today’s world debt seems normal. Everyone you know has a mortgage, a car loan, a student loan, and credit card debt (if not all four, certainly some combination of those, right?) Before we axed cable I used to watch the Suze Orman show on CNBC, and some of her guests had truly frightening financial situations. How would you like to be a 70 year-old with a $200k mortgage? Or a 60 year-old with $50k in credit card debt?
What is normal about having that much debt at that age? Nothing. I know there are folks that would argue that a mortgage is good debt, but personally I do not think any debt is good debt, especially in the so-called “golden years.”
Debt is Not Forever
I think that ditching the “Debt is Normal” mindset is a critical piece of achieving debt freedom. For us, it took stepping outside of that mindset to realize that we were feeling WAY too comfortable with WAY too much debt. Once we started “re-framing” our thoughts about debt and began to see it for what it was (in our case, a chain that was binding us to our jobs and keeping us living in a city that we did not want to be in), our mindset changed.
When we started to see that debt was holding us back from the things that we really wanted in life, we knew we needed to make a change. We put debt payoff at the top of our priority list and let that guide our financial decisions going forward.
It’s hard some days. Many of our friends are not as passionate about getting out of debt as we are. So sometimes it’s awkward in certain social situations when it becomes apparent that we live our lives differently than most. But we try not to let it bother us too much. We have our reasons for living the way we do, and some of our friends are aware of that and others are not.
We know that our debt will not be forever. One of Dave Ramsey’s quotes often comes to my mind when I think about our debt payoff journey.
“If you WILL live like no one else now, you CAN live like no one else later.”
This quote sums it up for me. I think paying off debt is about making choices now that will ALLOW you to have more choices later. For example, I think it will be beyond awesome when Mr. CMF and I one day get to reap the fruits of our labor and retire early. I certainly think that will be a lot better than the alternative, which would be to have no choice but to continue working much longer than we would like into our golden years!
Debt is NOT forever. There is a great life out there beyond debt, just waiting for you (and us!) It will take a lot of work, but I know it will be worth it.
Will 2015 be the year that YOU take a stand against debt? If you are already debt free, tell us about your journey to debt freedom! What’s YOUR big “why”?
Suggested Reading: Dave Ramsey’s The Total Money Makeover has been an inspirational read for us on our debt payoff journey. I think this one is a must-read for those serious about taking a stand against their debt and creating an overall family financial plan!
CMF’s favorite FREE money management tools!
Some of the best online tools out there for money management are at Personal Capital, and the awesome news is that they are all FREE! Cash flow tracker, 401(k) fee analyzer, investment checkup, net worth monitoring, and many more! I’m a net worth junkie, so the net worth monitor is my favorite. Check out my Personal Capital review here, or click here to check out all the awesome tools for yourself!