Wednesday, December 9, 2009

101 in 1001 - #5: Pay down our credit card debt by 25%

As of December 4, 2009, Mr. Lukie and I are officially debt free!! We exceeded this goal (of paying down our credit card debt by 25%) to eliminating it completely.

Mr. Lukie's sweet grandmother passed away in the Spring. She owned the house she lived in (the house that she raised Mr. L's dad in!) and left it to the 3 grandchildren. It took many, many months to get the house ready to be listed on the market. We finally got it listed the first week of November and anticipated it to sit for 6-12 months, due to the downturn in the real estate market. Imagine our surprise when the Realtor informed us that at the first Open House (held 1 week after it had been placed on the MLS), a woman walked through and put in an offer! We countered, she countered back...and we accepted. She wanted to close escrow the Wednesday before Thanksgiving! (A two week escrow!)

Escrow closed, as anticipated, the Wednesday before Thanksgiving. We received our portion of the money the following week and used part of it to pay off all of our debt. Part of the remainder of the money went to setting up an emergency fund (with 3 months of income & living expenses "just in case"), some went to fully funding each of our Roth IRA's, some of the money was gifted to my family as they struggle through unemployment, and the rest of the money has been placed in an account to be used as the down payment toward purchasing our first home together. We know that Grandma would be so proud.

I struggled with posting this, because I know so, so many people are hurting financially right now. Mr. L and I are experiencing this pain in our own immediate family currently, and it is heartwrenching. I know it is not an uncommon story to hear about the breadwinner being laid off, using up any and all resources/emergency funds that had been available and then to be stuck in a dire situation. We are both so grateful for this wonderful gift that his Grandma left to us, and we are completely aware of how incredibly blessed we are to have received this gift.

When we called each of our creditors to request a pay off balance, we not only paid the balance in full, but we also requested that the close each of the accounts. We will never, ever use credit again. (I know some of you are freaking out about this right now...no credit cards?! Never use credit again?! You people are nuts! But this is what we have chosen to do, at the advice of our financial planner and per the Total Money Makeover plan that we followed prior to receiving this money from Grandma).

For those of you who are struggling to pay off debt, or aren't struggling but wish to pay it off faster than you are currently, I strongly, STRONGLY urge you to check out this book. As cliche as it sounds, it really is life changing. (And no, I am not getting paid or compensated in any way to promote this book. It's just really that great!)

15 comments:

  1. I think you guys should be so proud of yourselves it's fantastic to work towards a goal and accomplish it.

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  2. GOOD FOR YOU!!!!

    I think more people should talk about responsible uses of credit cards, or not using them...obviously, in some situations it is pretty much unavoidable, but for the most part people just don't understand the difference between wants and needs. Which I don't blame them for because it can be difficult...

    I think I am going to have to buy that book for my husband. He and I have different perspectives on the use of credit cards. Thanks for the recommendation.

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  3. So happy and excited for you guys! Congrats!

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  4. Congrats! Being debt free is a huge accomplishment, and one that I hope we are able to achieve some day!

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  5. I am so sorry about the loss of your loved one.

    What a blessing she left for you two...a new beginning.

    Congratulations on your hard work and meeting your goal!

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  6. Did I miss a post about the ball? I am so looking forward to hearing about it!

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  7. Did I miss a post about the ball? I am so looking forward to hearing about it!

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  8. Good for you guys! I am sure that you are sleeping much better at night...What a great thing for you both! Congrats--you deserve it!

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  9. That is awesome! There is nothing more free than being debt free. Good job! Most people your age, would have gone out and blown that kind of dough. We are doing the Dave Ramsey Zero Budget and it has been amazing. We were able to be debt free (except our house) about four years ago. God blesses us when we are good stewards of the money he has given us.

    Again, great job!

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  10. Way to go! I think every young married couple should read Total Money Makeover! We vowed never to use credit cards from the very beginning, and living (virtually) debt free is amazing. We have our house payment, but it's 50% paid for, and one car payment. I tell you, it's liberating. ;)

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