Really happy with real progress!
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| Thu, 12-08-2005 - 9:19am |
This week I learned that my bonus for this quarter will be more than 4 times what it was for the quarter one year ago. (I get paid a base salary and a quarterly bonus.) Naturally this is happy news, since it means I can pay off 5 of my 9 items of unsecured credit. However, the thing that makes me happiest is that it is a *direct* result of my decision 18 months ago to take charge of our lives financially. If I had not made that decision, and the decisions that followed it, that bonus would be just a small portion of what it is going to be.
The reason I'm sharing this is not to gloat, but to show that just as I made several poor career and spending decisions that got us into tremendous debt, I'm also capable of making good decisions to get us out of it, permanently. For a couple of years, I closed my eyes and ignored the fact that our debt was going up while my income was going down. I couldn't do much about my income, since that was happening all over my industry and changing jobs wouldn't have helped; but I could have been much more proactive about controlling our spending. When I decided 18 months ago that we could not keep going on the way we were, I knew I had to think about not just controlling spending but changing our income so that we would not just get out of debt but also have a future for ourselves and our 3 kids.
It's kind of like weight reduction - if you want to lose weight, you can exercise or eat fewer calories, but you get the best results from doing both. In debt reduction, you can reduce spending or increase income, but you get the best results from doing both. So DH started working on the weekends (he's a SAHD), we started figuring out how we could cut back our spending further, and we got on a debt management plan so we could finally make some inroads on the principal we owed. A couple of months later, I decided to change jobs within my company to be on a track to make much more money. Because I did that, I got promoted this spring and was in a position to make money for my company and therefore for my family. That change also allowed us to meet the challenge of our rented house being sold. With a down payment from my parents (which we are paying back), we were able to take on the mortgage, taxes, and HELOC to fix up the house, and we bought the house we were renting.
None of those things seemed momentous or dramatic when we did them. Nor have we worked our way out of the hole we were in. Even after paying off 5 credit cards and loans, we will still have LOTS of unsecured debt, plus a HELOC, plus repaying my parents for the down payment. We drive 5yo & 10yo cars, our house is 60yo, and DH has to fix something in the house at least weekly. Nonetheless, if we hadn't made some *good* decisions, we would not be able to afford the braces my oldest kid is now wearing, we wouldn't be paying off a big chunk of debt in one stroke by the end of the year, and we wouldn't own a house. We also wouldn't be able to see our way out of this mess. Now we can.
I'm telling the story not because it's over, but just to show that there's more than one way to tackle debt reduction. Some people on this board have made dramatic lifestyle changes to reduce their expenses so they could reduce their debt. We made dramatic lifestyle changes to increase our income and less dramatic financial choices to reduce our expenses so that we could reduce our debt. Either way, it is really exciting to see the results of making GOOD choices.
Kelly

Becky
CL of 4th, 5th & 6th grade Scoliosis
Kelly, thanks for sharing. That's just wonderful.
Congrats!!
MYM
Congrats! That is awesome.
If you don't mind me asking, what debt management program are you using? I am looking for a reliable company....or if anyone else has any suggestions, I would really appreciate it.
Thanks!