My DEBT FREE Date

God willing, March 30, 2017, I will be DEBT FREEEEE.  By that point, I will have paid off over $30K in student loans. My daughter will turn 3 that month, and by April 1, 2017, I will have completed the required hours for my LCSW license, which, by the way, takes 2 years to complete. And when my daughter turns 3, I will legally be able to relocate closer to my support system…hopefully.  My stomach churns when I think about how much money I will be throwing towards my debt over the next 20 months but I’m all in. I’m soooo ready to save money in the long run. If you’re ready to make the next step towards becoming debt free, these are some tools that help to guide my progress:

1. Read Dave Ramsey’s Total Money Makeover or participate in the Financial Peace University class. I bought the home study program because I wasn’t sure that I’d be able to commit to attending every week. Purchasing the class will temporarily gain you access to online member tools including the Gazelle Budget software (which is basically the same as the budget worksheets except on a computer) and the Debt Snowball- which is where you list all of your debts, and you can calculate your payment schedules and enter the interest rates in order for it to compute your debt payoff date.

2. The FREE Excel app.  So, I recently downloaded the mint app and DR’s every dollar app to track my budget and spending, but they are a little too complicated. For me, less is more.  I don’t need several apps to control my money, I do that on my budget and the excel app. I prefer to keep it simple. I really like the excel app because it has SEVERAL blank spreadsheets with formulas already entered for you. For example, it has a “credit card payoff” spreadsheet, which I use for my student loans. Enter the total amount, the interest rate, your minimum payment, and a proposed monthly payment, and then it gives you a BAR GRAPH that gives you a visual of how many months it would take you to pay off your debt with a higher monthly payment vs. just your minimum payment, AND it compares how much you would spend in interest if you pay just the minimum payment vs. your proposed higher monthly payment.  See the pictures below to see what I’m talking about. For example, my student loan payoff bar graph in my excel app shows me that if I continue to pay $300 a month, I will end up paying over $21,000 in interest and it would take me 200 months to pay off all my loans. 200 months = 16 years. No thanks. The same graph shows me that if I pay the maximum amount that I’m [hopefully] able to pay, God willing, that it will take me 20 months to pay off all my loans and I will only end up paying $1,800 in interest.

Excel app examples:

bar graph ex quick start ex

Sooo hopefully these pictures are not complicated for anyone, but it’s ok if they are since this might be new. Basically, the grey picture on the right is your monthly budget. The red box at the bottom next to “student loans” is the money you have left over after all of your monthly expenses to apply to your debt. My student loans are highlighted red because that is currently the debt of focus while I’m working on my debt snowball. The picture on the left is that amount in the red box, $1077 that is the proposed payment amount to your student loan debt of $32,400 and it shows you a comparison of how much interest you pay if you were to pay $1077 every month vs. just paying the minimum payment of $270.

Who doesn’t like to save money? The quicker I eliminate my student loans, the more money I save in the long run. Now, I don’t know about you, but I can think of A LOT of things that I can do with that $20,000 difference in interest that I would save if I pay off my loans ASAP. Let’s see…I could beef up my emergency fund, I could take my dream vacation to Bora Bora, and I could save up for a down payment on a house. Saving the difference in interest would allow me to do all three!

By the summer of 2017, I will head to Dave Ramsey Headquarters (Located on Mallory Lane 🙂 –coincidence? I think not) Anyway, I’m going to head to DR headquarters to do my debt free scream live on his radio show.

Mark my words, everyone!  March 30, 2017 is the day that my chains will be broken free!

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HOW I paid off $12,720 of debt in TEN months

I couldn’t believe it until I actually sat down a few weeks ago and calculated how much debt I’ve gotten rid of since I started this mission. Which is why I started this blog to make sure I keep it up until my balance is ZERO; and, if someone else gets inspired along the way, then it will all be worth it.  When I started, the mountain of debt that laid in front of me seemed impossible.  I was paying over $1,000 a month towards my debt! Today, I have now eliminated: car payments, credit card debt, attorney fees (I’m surprised she didn’t send me bills for her coffee each morning), and medical bills. So, how did I do it? I was committed to three not-so-secret secrets:

1.  I went to work and then I worked some more, and more, and then some more.  And I still work a lot.  I picked up extra shifts on Saturdays at the hospital. I already work 40 hours during the week and I committed to working almost every Saturday during a 3 month period while one of my co-workers was out on maternity leave. It paid off, because during that time or soon after I was able to pay off my car.  Freeing up the money I was using towards my car payment was a real game changer. Keep in mind that I have been following Dave Ramsey’s debt snowball. Part of my plan was to find a way to create a second source of income to add to my debt snowball.  I thought about trying to sell hand-made items or get on board with one of those self-distributor companies. Instead, I decided to choose something that would have the potential to advance my career in social work. So, I reached out to a friend who knew someone in another hospital that was in need of weekend coverage.  I got the job, and I really love it. I’m so grateful to have the opportunity because for a second job, it is quite ideal. I think that reaching out to people in your network and putting yourself out there is a good first step to trying to find a second source of income/second job.

2. Live below your means. I stick to a humble budget.  When I first started using Dave Ramsey’s budget worksheets, it gave me an overview of where I could decrease some of my expenses. One of the areas I cut down on was food. I was spending way too much on food for a household of one-and-a-half people. I limited the amount of money I spend on groceries, and I even stopped buying meat for several months. I stopped eating out. I started making my own lattes at home. If there was free food at work, I took some home. If someone invited us over for dinner, we went. Food is a big expense more than you may think. I also cut down my expense on cable. I don’t have cable. I just have the internet and the local channels. I still think it’s over priced and I might get rid of even that soon.  I slashed my cell phone bill in half when I switched from Verizon (over $100/month) to Metro PCS ($55/month). I really think that making a budget each month and sticking to it is imperative in order to meet your financial goals. Just like Dave says, finances are 20% head knowledge and 80% behavior.

3. Any extra money I received was put towards my debt. Trust me, I did not get very much extra money through bonuses, gifts, etc during this time. The real difference was from #1 above. Was I tempted to spend any extra money on myself? Absolutely. Every little bit helps. Me and my fellow “social fire fighters” have to be on-call for 8+ hours overnight for one week each month, and that extra money was added to my debt snowball. Yes, that’s right, I work full-time, and I work two weekends a month at a second job, and I’m on call for 7 nights about every month or so. And I’m a mom. No excuses, it can be done!

And I’m still standing. Being able to have self-control over my spending and tell my money where to go has been empowering. During this time, I still had unexpected expenses, and every now and then I spend more than I planned, but that’s ok. Life is still going to happen and I don’t beat myself up about it.  Working more than usual has also taught me how to turn off the work switch in my brain once I walk out that building to go pick up my daughter.

This is only for a season.

“Live like no one else so that later you can live [and give] like no one else.” – Dave Ramsey

Click here to find out more about Dave Ramsey’s 7 baby steps.

Why I’m Dumping Debt

June 10, 2014, was the day that my relationship ended and my daughter and I were on our own.  I live five hours from my family and couldn’t just run back to my hometown. The friends that I had gained during that relationship were nowhere to be found.  It was an ugly breakup, to say the least. There was nothing peaceful about it. I packed our bags and we left, not sure where to go.  My daughter was only 2 months old and it was the first time that I think I ever experienced desperation. I was losing my job and looking for a new one, I was still recovering from a c-section and a breast abscess that was the result of mastitis gone very wrong. The dream I once had was shattered.  It was a time that should have been the focus of so much joy but depression took over. I can’t help but cry when I think about the struggle during that time. Man, it was hard. My daughter and I were staying with friends for several weeks before I was able to find a place to live that was affordable once I had found a new job.  I am so grateful for their generosity and willingness to welcome us into their homes.  My baby would wake up every few hours during the night, but they never complained.  I don’t think I could ever repay them. One of the friends we stayed with, Salorya and her parents, were so helpful and her mom was so encouraging and spoke words of hope and strength into me that I carried with me.  One of my best and closest friends, Kristyn, was another friend who welcomed us in, and we had several long talks in which she told me that I should feel empowered for being a single mom.

It was soon after that that I started to figure things out and redefine my life.  My daughter didn’t deserve to suffer, I leaned heavily on God for guidance and had to trust that He would make a way when I could not see one. Everything fell apart but I was determined to put my life back together better than I had ever imagined before. The job that I was losing before was super stressful and paid less than $40,000 per year.  I had just found a new, higher paying job that was a better fit for me.  I found a good daycare for my daughter. We went to court.  I found an affordable apartment. I was determined to increase my support system, and discovered This Side Up, a non-profit in my area for families and single parents. It was there that I met my friend Diane, who has become a close friend. She is so supportive and awesome!  I’m not sure I could have made it this far without her support! She really has become like family to my daughter and I.

It was at the first Single Parent meetup I went to that I met Diane and she gave me a copy of Dave Ramsey’s Total Money Makeover. It was perfect timing, really, because I was trying to take control back over my life and my debt was piling up. I was so determined to being able to provide for me and my daughter, it was the book that I needed to read because it had a plan.

As a single parent, my reasons for getting rid of my debt are part of my story.  If I were ever unable to work and lose my income for some reason, the interest rates on my debts would cripple me, and who knows where me and my daughter would end up.  And I refuse to let that happen.  I refuse to live with the possibility of my daughter having to suffer because of my past foolish financial decisions.  I’m getting out of debt once and for all because the amount of money I pay each month could go towards building wealth for me and my daughter. I’m getting out of debt because I want to give back to others that need it.

Disclaimer & Introduction

Hello, world! Thanks for stopping by my blog. My name is Mallory, and I’m a twenty-something single parent to a beautiful little girl.  My life took an unexpected turn last year when I became a single mom. The purpose of this blog is to share with you my journey to financial freedom and living a debt free life. On September 21, 2014, I calculated my total debt to be $50,147! It’s not that hard to do when you have student loans, credit card debt, medical bills, car payments, attorney fees, etc.  Prior to my financial reality check, I had no idea how I got there because I was living in such denial. After reading a copy of Dave Ramsey’s Total Money Makeover was given to me by a dear friend, I decided to make a change. I was paying hundreds of dollars a month towards my debt. I am so proud to say that since I started my debt free journey last September, I have paid off a total of $12,720! My remaining debt is my student loans, and I will later write about why it’s important to me to share this with you. In my blog I will also discuss affordable activities that I’ve discovered to do with my daughter.

I want to give my daughter the best life possible. I decided to make a change because I realized that with the amount of money I pay each month towards my debt, that was money that I could be putting towards our future. I could use that money to build wealth.  I could use that money to invest in her college fund, retirement, mutual funds, put towards an emergency fund, save for a down payment on a house or even to be able to afford extra curricular activities for her to do once she’s old enough like dancing or swim classes.

I also want my readers to know that I am a Christian, and that in my blog posts I may make references to verses or Christian related principles.  My financial journey is very much spiritual, and my faith is what got me through the dark times in my life. My faith is not a tool to make others feel offended or discriminated. With that being said, this is not a blog just for Christian readers. I would like all people from different backgrounds to feel welcome to read my blog because we can all relate to money!

I work as a social worker in a hospital setting and I choose not to disclose my employer’s name, but still would like to say that the views and opinions expressed in my blog are my own and not those of my employers or any third party.