This is the chronicle of three years of trying to escape debtor’s prison…
Part 1 begins with stupidity, denial and education.
It was January ’08…
We had two small children at the time and we were living paycheck-to-paycheck. We had two car payments, 5 credit cards and a loan payment. What the h.e.double hockey sticks were we thinking? **smacks head into desk**
So one day, while I was browsing the local library, I came across some finance books. No, silly…not textbooks, I wasn’t that bored. These were the books where the been-there-done-that-ers explain to us common folk how to stop spending every dime on junk and how to get out of debt. Sign me up!
I don’t really know why I never thought the term “debt” applied to us…maybe it was De-Nile? No, no, that couldn’t be it…that was a river in Egypt…
I am even a product of parents that racked up a lot of debt trying to start a business, and then they struggled for years before eventually paying it all off. Maybe it was because our debt wasn’t that much compared to the $100k that other people were struggling to get rid of, or maybe because we were so young? Let me tell ya, it wasn’t just denial, we were swimming upstream in it with blindfolds on!
Looking back, I don’t think the reason matters much other than that it was just plain irresponsible and stoooooopid to live paycheck-to-paycheck with two small children. Period. End of story, there is no “but” to it.
So anywho, I ate the books up in one afternoon during nap time. I knew I could make this work, I just had to work out the plan ahead of time to present it to my husband. I photo-copied the budget and repayment forms in the books and got to work. When hubby came home, I explained the process and showed him all of my work. He was definitely on board if it meant making life easier.
“All I need is three years!” I exclaim with glee. **Insert music coming to a screeching halt here** “Three years?!? Are you sure this is going to work?” I’ll admit I was a little worried about having to eat carpet fuzzies to make it work, but to date, there have been no carpet fuzzies served.
Here is a great how-to article on creating a realistic budget, courtesy of Gail Vaz-Oxlade:
Here’s a repayment worksheet similar to one in the books (and the plan we chose to use):
So on to part two another day, and I’ll share some advice on how to start digging yourself out of the red debt hole. Until then, check out the links…