Thursday, 21 May 2015
Huge Credit Card Debt to Zero Fast
In October of last year, my wife and I sat down and really looked at our finances. The facts were not pretty. Beyond the house and cars, we were staring at $36,000 in credit card debt. Ouch! We also knew Christmas was coming soon and that our debt would get even worse. After reading Dave's book and getting encouragement from colleagues, we decided it was time; time to get debt free and more importantly change our behaviors that got us to to this point. We sat down and did our first real budget. We wrote down everything we could think of that we would need to budget for on a monthly and yearly basis. We used the tools from Dave's book. We created our zero dollar budget. We grabbed some envelopes and got started working with cash again. Who knew working with cash daily made you so much more disciplined. We were able to quickly find $1000 for our emergency fund. Next, we started in on our debt. We had a garage sale and were able to raise some money. I had a truck that was paid off and just sitting there. I had only driven it three or four times last year, so we decided to sell it. Next, we put every extra dollar we could toward our debt. Extra money that we had when budget items came in lower than expected, our tax return money, anywhere we could find money we put it toward our debt. We utilized gift cards we received to go out to eat when we needed to. We stopped the trips to stores where we would spend money we didn't have on stuff we didn't need. We also stuck to our budget for Christmas and didn't add to our debt. Now, May has rolled around and we just made our last payment to the credit card. $36,000 in just 6 months. Awesome! We went out and celebrated with ice cream. Now on to the cars and the mortgage.
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