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« Reader Profile: Rod Ferguson | Main | Festival of Frugality: All Messed Up Edition »

April 11, 2011

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Darn! I made so many grammatical errors. I'm ashamed.

I'm the "reader" asking the question above. Since I emailed FMF, I had talked to my wife about my (ours?) money problems. I told her that since we are married I should give her a tour of my finances. We were watching funny Youtube videos. We stopped and I opened up the Excel sheet with all of my debts listed in descending orders. The total debt was exactly $30,033.50. Since then my wife has been very supportive of my plan to get rid of this debt. I think my wife is on board already. She hasn't bought anymore flowers. I told her that we don't have to completely stop buying flowers. We can buy a dozen every couple of weeks. She says we don't need to spend money on flowers at all. We settled on buying fake flowers from farmer's market vendors.

That's not the best part. The best part is, my friends, my debt it is no longer $30,033.50. It is now $22,588.29. Yes. You didn't read incorrectly. I did reduce my debt by $7,445.21. That's 24.79% reduction. By the end of April 2011, I have a solid plan to knock off anther 5%. By end middle of June, my goal is to reduce the debt to $15,000.

Without talking to her, I assumed my wife would be difficult to get onboard. All I needed to do was talk to her. I'm looking forward to all the excellent advice from FMF readers and the author.

Unless there is more income than what you detailed above, I think paying off $30k of debt in less than a year when you take-home $42k is unrealistic.

Surely you have living expenses - rent, utilities, car insurance, food, etc.

I'm a big fan of Dave Ramsey's baby steps. I don't agree with him 100%, but I think they provide a good framework.

First, a budget. Budget every dollar. Include blow money for you and your wife (I assume flowers would come out of this).

Then, use the 'extra' money to fund a baby emergency fund of at least $1k (I recommend more like 1 months expenses), so if anything happens (like that clunker needing repair), you don't have to take out more debt.

Then attack the debt. DR goes smallest balance to highest balance. Whatever motivates you is fine.

No new car until the debt is paid off.

Oh, and I meant to say both of you should read "Total Money Makeover" by Dave Ramsey to get on the same page. Even if you agree to certain deviations from the overall plan (most people have at least 1!), it will motivate you and give you a framework for discussion.

I think it would be helpful to think of ways you can get enjoyment from life without spending a lot of money - that way, you can focus what money you have "free" toward debt elimination. For instance, consider growing flowers instead of purchasing them from the store. They'll last longer, bring more satisfaction, and come out cheaper. Also, entertainment for the family (not something you mentioned, but still something relevant in the average person's life) should be doable for less - 7 people can make game nights in the house fun, snag cheaper group rates when attending occasional special events, and still escape gratuity fees at most restaurants.

For further info, Indigo, would it be possible for your wife or someone else in the family to look for work? Most people will tell you that buckling down in the short term can leave you debt free for life.

First of all, you recognize the mistakes you've made in the past and are working toward a solution. You are one step ahead of most people in that regard.

First, I would set up little motivators for your debt reduction. For example, when my wife and I were paying down debt, we made mini copies of $100 bills and taped them together. It stretched all the way down the hallway into our bedroom. When we made a debt payment, we got to cut off and throw away the equivalent number of bills. You find yourself attacking that bill chain, so much so that you actively seek other areas in your budget in order to pay extra each month.

Second, I would set up rewards along the way. For example, plan a nice dinner date with your wife or go to a fun concert each time you pay off $2000 worth of debt. Or make a nice dinner at home and buy some champagne, something that makes that dinner special. Name it your $2000 Dollar Dinner or something silly like that and you will really start to gain momentum.

I wish you the best of luck in your journey!

Thanks for all the replies so far everyone.

@Amanda: My $30K debt is now $22.5K. Shocking as it may sounds, I did pay off $7.5K between me emailing FMF and 9-APR-2011. Since 3 months of the year are over I will only make another $32K this year. I am hoping to live on only $10K and pay the rest to debt. My rent will be about $6K. That'll live me with only $4K to play around with for food, clothings, utilities, phone, entertainment, petrol. My goal is to be completely debt free by the end of 2011. If I have a few thousands left over debt, I would still feel successful.

@Evan H.: I love your ideas. I've already printed 450 $50 notes (to account for $22.5K debt. When I go home tonight, I am going to ask the wife to help me cut them into individual $50 note. Then we're going to stick 'em on the wall. A already have couple of ideas for a name for the wall. Wall of Shame. Wall of Debt. Wall of Mistake. Each $50 we pay off in debt, we're going to take a $50 note from the wall of shame until there's nothing on the wall anymore.

And ditto on the dinner idea. When the debt it down to $20K (by early May '11) we'll do a celebration. Great advice everyone and thanks a lot.

@Christian: Thanks for your reply. My wife is new to America. I can't push her to seek out a job. I'd feel very selfish asking her to work to help me pay the debt off. Her plan is to go to school. After she gets a degree, she will work. Meanwhile, I'm going to carry the burden. It's only been a few months since she moved to America. So she might work yet.

Even though there are 7 people in the house, for all practical purposes and intent, at least when it comes to finances, it's only me and my wife. The remaining 5 members earn their own monies and manage their own finances. I just have to help them out now and then.

And good advice on growing flowers. I have totally forgot to mention that me and the wife started a garden. She grew up in a sheltered household and never gardened. So she was totally excited to get her hands dirty with me. We planted tomatoes, broccolis, purple cabbages, potatoes, corn, spinach, basil, cucumbers, and string beans. We are going to plant some eggplants soon. This garden is going to increase our water bill but I figure it was worth it since we're going to get lots of exercise tending to it and lots of together-time plus fresh produces down the line.

Brilliant ideas so far. Agree about waiting on the car if possible. Try seeing if your wife can perhaps work a few hours a week; perhaps she can sew, cook, clean, type, file, walk dogs etc. Anything that she can help bring in to either pay off debt or save toward education will make her feel like she is contributing. She should also do coupons and look for deals at the grocery stores.

Trim down other expenses as possible like entertainment by using town resources. Towns often provide free or cheap entertainment. Your local library is a great place to start. Is there any chance for you to advance in your career? Will you get a raise soon?

30k is a lot of money. Your salary will make it quite difficult. Budget something for you to regularly splurge. Even just 20 dollars will be a motivation to continue quickly. Good luck!

Indigo, OK from your first comment it seems like your original problem of getting your wife on the same page has since been resolved by simply talking to her.

"I am hoping to live on only $10K and pay the rest to debt. My rent will be about $6K. That'll live me with only $4K to play around with for food, clothings, utilities, phone, entertainment, petrol."

That seems like an extremely tight budget. Thats like $500 a month for food, utilities, etc for 2 people. Its great that you want to be aggressive in paying off your debt but you might burn yourself out if you allow yourself so little to live off of. I mean a typical American would be paying over $200 a month for gasoline alone. Maybe your budget is practical, but it may be too ambitious. Make sure your budget is reasonable so that you don't set yourself up to fail.

Indigo, just wanted to commend you on recognizing an issue, setting an aggressive goal for addressing it, and executing your strategy for reaching it. 2011 may be a "lean" year, with every spare cent going toward debt repayment, but 2012-onwards will be so much better for it.

The best advice I can give you is to implement the concept of "paying yourself first." Here's a FMF post on the subject: http://www.freemoneyfinance.com/2006/11/how_to_pay_your.html. You might also consider reading David Bach's book "The Automatic Millionaire," which does a nice job covering the concept. It will be an invaluable tool in helping you knock out that debt.

Good luck!

Indigo, Congrats on the reduction in debt. First, you mention you made mistakes and that is good. The fact that you know about it. However, don't beat yourself up on it. You mention several "wall" names. I will keep anything negative out of it. Getting out of debt is mental as well. View it like trying to loose weight. I do. Every time you walk past that wall, you need to feel good that you have paid something down, not that you still have $22k+ left. If if may, I will suggest something like Wall of Freedom or even Wall of $ucce$$. You are making that small, so be proud of that.

Like Jim, I feel that you will be very tight on the budget. Don't make yourself miserable by trying to get out of debt too quick. Enjoy life. Will it be so horrible if you are out of debt three months later? Just remember that when you paid off the debt, the money that goes now towards debt reduction, will be yours to do whatever with. Yes, it is nice to save all that money, but what good is saving it for retirement if you cannot do anything in retirement. I know of a quite a few that spent so much time saving for retirement that they don't have hobbies or a way of enjoying their money for when they retire. I am all for savings but as always do it in moderation. I cannot run 10 miles to save my life, but that doesn't keep me from walking for miles on a beach...and enjoying it.

You will get there, enjoy the ride.

What if you tell your wife, any money she earns is "fun money" for the two of you to enjoy in the month when she earns it? That way, you still take responsibility for your debts, and she will feel she is contributing to making your lives more enjoyable? That could make it more fun and provide some stress relief for you two.

Consider asking your wife to work part time at some place like walmart - not for the money, but for the discount employees receive.

You've got some pretty good advise and I can't add much. However, I also have a wife who was new to the USA. All I can say is be aware of your single-minded focus and don't let it consume you. Show your wife, who may be going through quite an adjustment, that you love her now and again.

My hubby is not from the US. He's now a US citizen but I remember what it was like when we were first married. We had about $12,000 in credit card debt. We made a budget and planned how we would get rid of our debt. It took us 1 year, although I was a grad student and 1/2 of that year he didn't work because he was waiting for his work authorization/green card to come through. Make sure you budget some money at least 1 or 2 a month to do something fun as a treat to yourselves.

Also, depending on what country you an your wife are from/how much experience she has with debit and credit cards I recommend giving her cash, especially if she does not have a job yet (or she's waiting on her social security number). My hubby is from a country where most purchases are made in cash (only a very small number of businesses accept debit). Early on we would review our finances every pay day, and I would give him cash to spend as he wished. Once he was comfortable (after he spent a lot of time with me shopping for groceries, using the ATM, etc.) he started using his debit. Giving your immigrant spouse cash also helps them adjust to using US currency if they have any difficulty in this area.

The new(er) car is want rather than a need. After reading everyone’s comments and other blogs, I’ve decided to just do a $1000 maintenance on it rather than go into at least $10,000 in debt. The car always has “maintenance required” light on. It has been on for past couple of years without any problem. Now “check engine” light is on. I’ve checked all the things I can check myself. Everything is good. I need to have a professional look at it now.

Paying off $30,000 appeared very daunting at first. But now that I have managed to drop it down to $22,000, I have great a desire and proper motivation to get rid of it completely. Out of the $22,000, $12,000 of it is student loans. If nothing else, I want to get rid of all the debts beside the student loan. But my goal is to pay off all of it. I set my goals high among the heavens. Even if I miss, I will end up among the starts. Thank you, the banner outside the guidance counselor’s office, circa high school years.

After getting a glimpse of my financial picture, my wife is very adamant about spending on anything. She continues to encourage me to pay off the debt ASAP. Then we can have a bit of fun. As part of the financial walkthrough with my wife, I showed her my 401K and explained to her what it was and how much money we will have if it continued to grow at 10% a year and if continue to contribute what I have been contributing consistently. So it wasn’t all gloom and doom.

About the wall idea, wife and I decided to make two humanoid shapes using the fake money. Then we are going to make globe above them as if the two figures are carrying the globe (i.e. like Atlas carrying the world.) As we pay off our debt, we’re going to take a piece off the ball and gradually reducing the burden on the two people below.

When taking on debt reducing measure, you should always consider your living expenses and other contingencies. You may also ask your wife to help out in the earning process. Communication and openness would not lead to damage if done properly, specially if it involves financial matters in the family.

Can you make a wildflower bouquet instead of paying the florist?

@Mike Hunt: First, lol @ name. Secondly, I have always been a person who appreciate flowers on a plant. Picking a flower diminishes its life. And if you think about it really, you are giving your most precious person something that you KILLED and something that is life less. So I prefer giving flower plants. Though I never had the opportunity to do that until now. Instead of spending $48 again for lowers, I bought my wife a hanging strawberry plant. It looks great. No flower yet. But we're hoping we'll see some in next few days. This will give us natural oxygen in the house and some delicious strawberry to boot. The plant cost me $12. We also started gardening. So far we planted a bunch of things which are just starting to come out from the ground.

My wife grew up in a rich household. She never gardened or got her hand dirty in the mud. So this is proving to be very entertaining and enjoyable for her. She's positively radiant to see things she planted start to grow. She calls her mother and talks about the garden in detail almost everyday.

Since those $48 flowers, she hasn't bought any flowers. I hope eventually I will have paid my loans and have enough saving to indulge in $48/flowers without having to worry too much. I dream of that and I'm working for that day. :) Thanks for your suggestion.

Oh, we went to a state park yesterday and appreciated all the wild flowers. We didn't pick any. We also saw couple of deers. Apparently, this is the first time my wife saw a live deer. She's in for the ride of her life since we have way too many deers around here. I won't lie. When we were driving back, I wished there was a deer accident. I could've had protein for for many weeks. :p

Move into an inexpensive apartment with your wife, alone. Let the rest of your family fend for themselves, or, make them chip in for the rent and bills. Tell your wife how much debt you have and then tell her that you want to pay that off by the end of this year, or as soon as possible. Keep your clunker. You don't need a new car with so much debt. Buy your next car with cash, preferably a good used vehicle, after you pay off your debt. Make it clear to your wife how important this is, because, if you don't get control of this debt now, your chances of a happy marriage will turn unhappy quickly.

If anyone was curious about my situations anymore, I have knocked off $9,000 from my debt. My total debt is $21,021.24 now. That's not the best part. I calculated my net worth. And I'm in the positive now after Yay! The wife has been helping a lot. I wanted to buy some flowers for her to show gratitude but instead I ended up giving the money to someone on the street who deserved it. I had to take the charity amount of the wife's flower budget. I'm am not heartless completely. I did take the wife to a beauty parlor. She totally splurged on $25. :P That $25 was planned expense in my budget. It feels awesome to be in control. But now I only have $24.17 to last me until the end of the month.

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