Monday, September 9, 2013

OUR JOURNEY TO FINANCIAL FREEDOM

Dave Ramsey has a saying - to "live like no one else so you can live like no one else." This means that you live frugally and attack your debt like no one else in order to become debt-free and build wealth like no one else.  You sacrifice till it hurts, save and pay down debt like a crazy person (he dubs it "gazelle intensity") in order that you can enjoy the freedoms of being debt-free and give generously to others.

My husband and I have been married for nearly 13 years now.  The first several years of our marriage, we were saddled with debt: a mortgage, a hefty law school loan, credit card debt, and 2 car loans.  Not a great way to start a life together.  The Bible says in Proverbs 22:7, "Just as the rich rule the poor, so the borrower is servant to the lender."

But we thought this was normal.  Everyone else had similar debt.  I didn't think we were in trouble.  We weren't living extravagantly.  After all, our house was (and is) the smallest house of all our friends and family. We were just trying to keep up with our friends' lifestyles.  After all, we were paying our bills on time and always paid off our credit cards each month.  We just didn't know where all our money was going and why we couldn't seem to get ahead or make any traction.

Many people don't see any value in paying down debt.   The focus is on acquiring more beautiful things, a larger house, a nicer car, a second home, impressive vacations, and fine dining.  Money used to pay down debt is seen as money which could have been invested or used to buy more things.  Paying off debt is undervalued in our society.  It is viewed as a part of life, something that will always be there.  It is normalized in our society.  It is even perceived as a bargaining chip or a springboard to gain a better life.  For example, borrowing money to pay tuition to invest in your "future," or borrowing money to buy a car so you have a means to get to your job to produce a decent income, or borrowing money to buy things you enjoy because you can pay it off later at a low interest rate.  Get it now, pay for it later.  Debt is the means to the end.

The first few years we started applying The Total Money Makeover (Financial Peace University) principles, we were viewed as strange.  We stopped giving birthday and Christmas gifts.  Actually, for a few years we made candles for our families and gave those as Christmas gifts. I started couponing like mad.  Coupons for food, toiletries, oil changes, clothes, etc.  We gave things up.  We gave up having allowance or "blow money" for ourselves to just make impulse buys.  We stopped buying coffee on the go and we packed a lunch for work every day.  We downsized our cell phone plan.  We cut out frivolous items we could do without.  We canceled the cable TV.  We stopped ordering food and going out to eat as often. We did not hire landscapers or house cleaners (still don't).  We took a vacation a family member's second home which they generously allowed us to use for free.  We attacked our debt at an intense pace and with God's grace and family support we were able to pay off all our debt but for our mortgage.  It took us about 3 years to pay off our debt of about $100,000 and build up an emergency fund of 6 months of our income and fund our retirement savings. We are now close to paying off our mortgage after being homeowners for 13 years.

If it weren't for my husband having read the Total Money Makeover and  leading us in the right direction, we would not be where we are today.  I'm so proud of and thankful for him.
Here we are enjoying dinner at Kokkari Estiatorio in San Francsico, CA on our recent vacation in July, 2013

Thanks to the grace of God and our support from family, we have almost finished our long journey of becoming debt free.  The Lord has used our experience to allow us to bless others with our story and encourage them on in their journey to become debt free.  We have been able to support missionaries, give to Christian organizations and tithe as we believe the Lord commands us to do.  We have argued less often about finances than we did when we were deep in debt.  We now set financial goals and reach them.  We can now afford restaurants and vacations we couldn't before.  We try to give more thoughtful, generous gifts now that we can afford it. Yes, we still live in the same small house, but we have redecorated, remodeled and made the improvements we've wanted to make.  We've purchased a lovely dining set I've wanted for a long time (and paid cash for it, and yes, got a deal for paying in cash).  But most importantly, we can say that we have striven to be good stewards of the money God has given us, and that we still seek to honor him with our choices about money.

If you are interested in taking the Financial Peace University Class, you can check Dave Ramsey's website to find a location and date which suits you.  If you are interested in taking the class we are leading which starts next week (9/18/13), you can sign up here: http://www.daveramsey.com/fpu/locations/org/25761/class/230414

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