Chains of Servitude Update

It’s been almost exactly one year since I told my wife that we were either going to take control of our finances or file bankruptcy.

At that time, we were spending at least $500 more each month than we made, and often, it was $1000 more.   We had more than $5000 accumulated on our overdraft line of credit, more than $30,000 in credit card debt, $2500 on a student loan, $12,000 on a car note, and our mortgage.

Our savings were nonexistent.   We had automatic deposits established, but we’d transfer the money out right away to cover other expenses.    Everything that came up was an emergency and a surprise.  We had no real idea how much our lifestyles cost or what it actually took to maintain.

Maintaining our finances took several hours every payday to balance the checkbook and pay bills.

Fast forward 1 year.   The student loan is gone, the line of credit will be gone next month, and the car loan will be paid off before the end of the year.   We’ve reduced our total debt load by more than 20%.

We have a useful emergency fund and we’re meeting our other savings goals, including a college fund for the kids.    We don’t have extremely high balances, but it’s reassuring to have more than a couple of months of expenses in our savings accounts.

We’ve automated almost everything and gone to a cash-only system.   I now spend about 20 minutes a month balancing the checkbook and less than 5 minutes paying bills.

A year ago, we were in a hole, digging as fast as we could.   Now, we can see the end of the debt tunnel and we are rushing as fast as we can to get there.    According to my debt spreadsheet, we will be completely debt free in just under 4 years, ignoring any money coming from our side-hustles and work bonuses.

We’re making better progress than I had hoped for, and it keeps getting easier.    Smart spending is becoming a habit, instead of a just wishful thinking.

Update:  This post has been included in the Carnival of Debt Reduction.