I don’t know if I have come out and said it on the blog, but it has certainly been hinted at that Z. and I are on a debt free journey. Between a graduate degree, a very expensive private school second BA, and a car loan, we found ourselves with over 100k in consumer debt that we have been hustling to get paid off.
Z. and I were both raised to be very familiar with Dave Ramsey’s principles, so we had many conversations about whether that was the right path for us. What we decided was sort of…
What we like…
- The general principle of the baby steps. It gets the debs paid off, but continues with principles that grow wealth. Z. and I dream about having a healthy retirement with lots of travel for all our years together. It takes planning to make that happen.
- We love the principle that you need to have emergency savings to keep from going into further debt.
- The debt snowball makes so much sense. I ran the numbers and the debt avalanche would get us there slightly faster. But just slightly, and the thrill of debt snowball gives me more personal motivation. It is a thrill to pay off each debt. Plus, you really don’t notice the money rolling over into the next loan because
Where we disagree…
- is not a gazelle intense kind of guy. Living the lifestyle that is required for being truly gazelle intense was going to make him miserable and he was open about how he did not want to put our lives on hold to be debt free sooner. So, we make a budget that allows a generous going out fund and plenty of travel.
- Having only 1k in emergency savings. That is baby step 1 on the Dave Ramsey plan, but realistically 1k will hardly cover the most basic of emergencies.
- And since it is taking us a little longer to pay off our debt, we made the choice not to stop our retirement contributions.
- We did not cut up our credit cards. I do believe you can learn personal responsibility, which is so much more important than blaming a card for your problems. But you do have to be very responsible.
So, if you are debt free, did you follow Dave Ramsey? Did you deviate?