Debt-Free
A month ago today, I became debt-free – made the last
payment to a relative who'd lent me some money. This loan had allowed me to
throw a big chunk of cash against credit card debt accrued during divorce
proceedings. (Lawyers bill by the hour, you know.)
Once the credit card was paid in full, I started repaying
the family loan. As money came in through diligence or chance, I'd let it build
to $300 and then write a check. I'm not sure why $300 became the magic number;
it just sounded good.
Now I'm debt-free: no student loans (I'm blessed with a
scholarship), no car payment (please let it last another six or seven years), no
credit card debt (and there won't be any more).
It feels about how you'd think it would: pretty darned
great.
'A perpetual grin'
This relative wasn't dunning me. But it bothered me to owe money. Some people
count sheep; at night I would lie in bed counting ways to stretch available
funds to reach the next $300.
Reading some postings from a Smart Spending message board
thread, I found others who have recently come to share this worldview.
A reader posting as "luba30" changed her life in just six months. "I had no savings, no budget, no retirement, living paycheck to paycheck," she wrote.
So she created a realistic budget that prioritizes
retirement funding and a savings account, while allowing for some discretionary
spending for her and her husband. Currently they have more than $2,500 in
retirement funds and thousands more in savings. And luba30 has "a perpetual
grin."
Another reader, "Pepperdoo," hit the wall seven months
ago. It happened when she paid a few bills – not all of them – and realized she
and her husband had $25 left. For two weeks.
Pepperdoo started keeping track of every penny spent. She
and her husband packed lunches and ate all other meals at home, allowing
themselves $40 for groceries every two weeks. Pepperdoo also combed the
Smart Spending message board for tips on economizing, and threw whatever she
saved at vehicle loans. Their car and truck are now paid off and the "extra"
$500 per month goes into savings.
"Room to breathe has no price tag," Pepperdoo wrote. "It's
hard to make the changes at first, but once you do you'll see results."
The choices we make
Without that family loan, I still would have paid off my credit card debt –
eventually. But I would likely have paid several hundred dollars in interest
charges. I also would have fretted, a lot.
Now it's my job to continue to live below my means. Not
only will that keep me out of debt, it will allow me to put aside some money.
I'm building an
emergency fund, and recently started a
Roth IRA to augment the retirement benefits I accrued during 17 years of
newspapering. And some day I'd like to have mortgage debt like everybody else.
My efforts are neither unique nor remarkable. Plenty of
people out there have been standing up under much heavier debt loads. A reader
named "Kalikala1980" is paying down a credit card balance, a car note and a
grad-school loan. To get there sooner, the reader has cut back on all
unnecessary spending, while still faithfully funding a retirement account.
"It's all about the choices you make and how much you want
to be debt-free," Kalikala wrote.
So if you're working to pay down debt, keep at it. If you
backslide, start over. And if you think you'll
never get out of debt? Please try it anyway. Get personal-finance books from
the library, contact the
National Foundation
for Credit Counseling, read the
MSN Money message boards for tips and support.
Kalikala phrased it quite nicely: "While paying off debt
is painful, the freedom of being debt-free is indeed priceless."
As we say in New Jersey, I'll testify to that in court
