Like most people, I used to wing it with money. I was normal. I had a car payment. I carried a credit card balance month to month. I was putting some money away for retirement, but not a lot. As my income increased, I got better at avoiding debt and no longer carried a balance on my credit cards from month to month, but did still use them regularly. I paid off my Jeep and wasn't looking for an upgrade anytime soon. I sort of kept track of where my money was going, but too often I was a little surprised at my credit card balance each month when I went to pay it off. I really spent that much?? I was putting money in savings, but not always as much as I should have been able to. I was doing better... but it wan't enough. Then in October, 2013... I bought a house.
I started listening to Dave's radio show about a year after buying my house. I would stream an hour a day through a podcast app. (Now, all 3 hours are available as a podcast to stream or download.) I had already been paying extra on the mortgage so I could drop the PMI (private mortgage insurance) I was forced to pay because I hadn't had a 20% down payment, but I realized I could be doing so much more! Then I checked out The Total Money Makeover from my local library. Mistakes had been made that I didn't even know I was making. If I'd only had this great advice sooner! Since we don't have access to time machines yet, all I could do was work to remedy my past mistakes and move forward. Thanks to working massive amounts of overtime, I was able to refinance last February with no PMI and a lower interest rate (not to mention the new 15-yr loan term).
These days, I have no credit cards at all -- yes, I had that irrational momentary panic when I closed the last account over a year ago, but now? I don't miss them one little bit! There are no surprises! If there's no cash in my wallet? I don't spend anything. =) I'm still driving that paid for Jeep and I use cash for most things (aside from mortgage and utilities paid online). I built up an emergency fund and have other savings for non-emergencies that come up. Those unexpected expenses? They may be a little annoying, but they aren't crises anymore. No need for a credit card when you're prepared!
And thanks to sticking to a budget, look what I got to do this week!
Woo hoo! I've officially paid off 1/4 of my original mortgage total! And... my next payment will leave me with less than 6 figures in debt which makes me even happier! Progress may have slowed a bit since reorganizing my priorities and making time for a life again, but it's all good. I'm still on track to pay off my home in only 10 years (versus the 30! I originally signed up for) and that is enough. Debt is bad, but so is not having time to relax and enjoy life. =)
If you're looking for a plan to get out (and/or stay out) of debt, I can definitely recommend Dave's plan. He's full of common sense advice. There are no quick-fix promises. It takes work and time, but becoming debt free is definitely possible! And absolutely worth it. I'll get there and so can you!