Debt Free in 2013

Last weekend, Mike and I went out to dinner to celebrate a momentous occasion. Tucking into a plate of tater tots at Cambridge Common, we smiled goofily at each other, utterly giddy at what we'd just accomplished. You see, we had just reached a major life milestone shared by many people of our generation.

What could it be you ask? Did one of us get a big promotion? Did we buy a home? Did we hit the lotto?!? No, friends. It was better.

We paid off all of our student loan debt.

I know, I know. Not really that sexy. But work with me here. Mike and I will never have to write another check send another electronic payment to chip away at the debt we acquired getting the degrees that are now 10+ years old. We no longer have to pay thousands of dollars of interest to a bank. WE. ARE. FREE.

How did we get here? It started, as most things in our life do, with me getting a little obsessed. You see, after an expensive 2012 (our wedding, other peoples' weddings, vacations, kitchen island, not sticking to christmas gift limits, etc.) I started to take stock of our financial health. With no big expenditures on the horizon, what was the best thing to do with the little bit of extra money we had in our accounts at each month's end? Sock it away in an emergency fund? Save or invest it so we could buy a place? Contribute more towards our 401ks? Open up Roth IRAs? Start a college fund for our future children? Go on another vacation? Buy even more Apple products? Up Oscar's treat budget? The options were overwhelming.

My first thought was to see a financial panther planner. And we still may at some point. But I felt like I needed to get a hold on our basic financial strategy before I went to see someone who will likely just want me to invest my money. So I did a lot of Googling. And looked at savings interest rates. And retirement calculators. And home prices in our area (which was painful to say the least). And college costs in 2033 (perhaps even more painful). But none of that gave me any direction of what to do when. Then I went to brunch with a friend who mentioned she was attending a financial planning class based on Dave Ramsey's philosophy about paying off debt. And I was intrigued. So, I ran home from brunch, downloaded his book on my Kindle, and read it straight through.

You see, while I don't think Dave and I would get along personally (socially I suspect he leans further to the right than I'm generally comfortable with), we do have a shared hatred of debt. And paying interest. So his philosophy really appealed to me. You can read about his 7 Baby Steps here.

He outlines a clear plan to what he calls "Financial Freedom." Doesn't that have a nice ring to it? His path to this financial freedom can be a bit extreme, so I can't say we are following his plan to the letter. BUT, we did take one big step which put us in position to make the big student loan payoff. We sold Mike's car. And we took that money, and some savings, and we made the last payments on our loans. We decided to prioritize paying off debt over everything else. And I gotta say, it feels good.

Next step for us is paying off my car, which we are hoping to do in the next 6 months. Turns out you have a lot more money when you aren't making two student loan payments each month! Then, once we are completely debt free (in 2013!) we'll start our emergency fund and then start saving for our own little house or condo (Well, maybe. But that is a debate for another blog post. Is buying a house worth it anymore?)

It feels really good to be digging our way out of debt. And it feels even better to have a clear plan. So while 2013 won't be as exciting as our 2012, I think it will set us up for a better future. So here's hoping the sacrifice is worth it. I think it will be.

The Fiscal Diet

As I've mentioned in past posts, I’ve started training for a half marathon. And as with all my harebrained schemes, I first like to invest in various accessories to properly equip myself. “Retail before action” is my motto.

So I recently decided that I REALLY needed more capri pants for running. There was no way I could commence running in this heat (oh, the incessant heat!) without purchasing some new running capris. These capris were an essential element of my running wardrobe, and I was in desperate need of them.  Things appeared grim until I could acquire new capri pants.

I explained this pressing need to Mike. He appeared confused. “But sweetie, don’t you already have enough pants?” he asked, helpfully. Certainly not! He was surely mistaken. And how dare he question my need for new workout gear.

Then, during an expedition to my closet, I uncovered a treasure trove of workout pants. It turns out that I already owned eight pairs of capri running pants. Eight! Not including long running pants or running shorts, of course. Those I also had in spades.

This discovery was a bit sobering. And it was at this time that I began to wonder if I had a problem.

Maybe I should have recognized there was an issue when I was greeted by a new shipment from Amazon/Zappos/Gap/RueLaLa/Banana Republic/Endless every week. Or maybe I should have realized things were getting out of hand when I could no longer stuff any more clothes into the spare bedroom I’d turned into my closet. Or when I would discover various items of clothing lodged deep within my dresser drawers, with the tags still attached.  Or even the umpteenth time I bought an article of clothing, only to bring it home and realize I already owned the same exact item.

My name is Bridget and I’m a shopaholic.

So I’ve put myself on a fiscal diet. Specifically, I’ve decided not to buy any “things” for next few months. I’m on month two of said diet, and I’ve discovered something a bit unexpected. Now that I’ve decided I’m not going to buy anything, I feel, well, relieved. I don’t have to read the five million emails I get daily about new discounts and sales. I don’t have to spend hours trolling the internet for deals on things I don’t need. I don’t have to buy another ugly tank top that I’d never wear just because it is 70% off.

And as for all that money I’m saving by not buying things I don’t need? Well, don’t worry. I’ve already spent that on a honeymoon to Mexico. Because if there is one thing I CAN justify spending money on, it is white sand beaches and cocktails with my husband. And ten years from now when we look back at this time in our lives, I guarantee Mike and I will have better memories of our travels than we do of my capri pants. At least I will. Mike really likes capris.

The Birth of the Family Meeting

Okay, the picture is somewhat deceiving. We don't have little monkeys yet. Also, we're not monkeys. But this little clan huddling together -- mostly likely talking about the Affordable Care Act or the taste of flies -- made me think of our new family meeting.

You might be asking: Why the hell do you guys have a family meeting? Can't you just, like, talk like normal people?

The answer: First off, relax. There's no need for profanity or attitude. We're all friends here. The truth is Bridget and I talk all the time, but a week ago, we started to realize we weren't really getting anywhere with some of our bigger conversations -- stuff like vacation destinations, money, and kids. Over and over, we'd just rehash the same conversation about "You know, we should do this. No, wait. We should go here!" We were like a drunk windsock with ADD. Perhaps you and your husband/wife/boyfriend/girlfriend/significant other do the same thing.

Thus, we came up with the family meeting.

The five rules are simple:
1. Each family meeting must be planned in advance.
2. Each family meeting must be an actual meeting at a table.
3. Each family meeting can focus on only one topic.
4. Each family meeting must not exceed 30 minutes.
5. Each family meeting must have an outcome.

Before our first family meeting, we weren't sure all this was such a good idea. Meetings, traditionally, particularly in a workplace setting, are a giant waste of time. They take too long. There are too many of them. They aren't productive. In fact, there's even a book called Death by Meeting. 

But so far, in three meetings, we've been fruitful. We've decided where and how to invest our money in the next few months, where to travel this fall (not Hawaii -- booo!), and when to start trying to have kids. (Oddly, the middle debate was the most heated.)

The meetings haven't been perfect, but we've done our best to stick to the rules. And, more importantly, they've helped us communicate more effectively -- especially about little monkeys.

The Art of Arguing

Looking back on our first month of blog posts, I'm realizing most of them are of full of wine and roses. Laughs about big fans. Jokes about bangs. Serious talks with dogs. And, well, that makes sense because Bridget and I are quite content. We are very happy we found each other and three months into this marriage thing, things are pretty damn good.

But, like everyone else, we argue.

We argue about little things (that cup you left on the table has been there for, like, two days!), we argue about medium things (well, fine, maybe I will go by myself!), and we argue about bigger things (yeah, let's spend our money on that ... are you serious?). We argue because that's what happens when you spend a lot of time with one person. You get on each other's nerves. Little things turn into big things. Conversations filled with jokes become conversations with folded arms.

And for us, it's heightened because neither of us is very good at being wrong. I wouldn't say Bridget is like a mule. I'd say she's like a mule stuck in mud with her hooves nailed to the ground. Me? I'm the exact same way, but you can add quicksand to the imagery. In other words, we are both stubborn -- very, very stubborn.

But since we both appreciate this reality, we're getting much better at arguing. We're better at diffusing the situation and saying, "Hey, you know what? I'm wrong. My bad. Let's be in love."

And one other very important rule has helped us argue the right way. The rule? Argue in the moment. Never bring up something from the past. It's not fair. 

For example, if we're arguing about Bridget and her cup-leaving tendencies, I can't say, "This is, like, the fourth time this month. You left the plate on the nightstand last week. You left a fork on the toilet 10 days ago. And you left a spoon in the cactus 13 days ago." Nope. Not fair. So, instead, "Hey, darling. Can you take care of this cup? It's been here for quite a while."

Is this technique fool-proof and perfect? Of course not. But it's served us well in the first 2+ years of our lives together and the first three months (BTW, Happy Anniversary, Bridget!) of our marriage.

Have a rule of arguing that you follow? Feel free to comment below ...