Tracking the money we spend

We made another extra payment on a loan yesterday! Loans can be so complicated with their interest rates, different due dates, etc. For example, when I went back to school to get my EdS, the loans fell under a different category (for whatever reason). If your loan total is over $30,000, you can spread your payments over 25 years to make your monthly payment lower. This isn't the best plan for interest, but if you plan to pay it off early, it can't hurt! We have done this for most of my loans even though we hope to pay it off MUCH sooner. This allows us to have money if we need it instead of HAVING  to make a very large monthly payment (about the same as our mortgage!). My EdS loans could not count towards that $30,000, meaning that the cost to get that degree (approximately an additional $20,000) had to be repaid in the standard ten-year repayment plan. That being said, we are focusing on that large loan. It started at $18,000 with a 6.8% interest rate (interest is terrible!!). We have gotten it to just below $5,000 in a little less than a year. Each time we make an extra payment right now, it goes directly to that loan because it has the highest monthly payment. Once it is paid off, we will make extra payments on another specific loan. Doing this allows us to pay smaller figures off which creates a lower monthly payment, which allows us to save more money to put on other loans, etc. It is all a big circle...but it is fun seeing that circle getting smaller and smaller as the overall amount due drops and drops:) Consolidating loans is a not a smart option in our situation. We could never pay the loans off early if we had the lump sum to pay (and unless I get on a game show, that's never going to happen). Keeping the loans separated allows us to focus on one amount at a time while we are making our standard monthly payment (with any extra payments possible). Doing it this way helps us to get the overall debt total lowered.


We keep track of our spending on a monthly budget in excel. It's pretty simple. Some months we go over certain categories (i.e. we have about ten birthdays in September and October so our gift budget for those months is shot); however, we are under budget in other categories or at others times in the year so it all balances out. Below is a list of our GOAL spending each month. It is doable:)

• Food- $300 (for two adults, includes eating out)
• Gas- $200 (includes oil changes)
• Miscellaneous $100 (includes entertainment; things at the store that aren't food items like paper towels, napkins; animal care; etc.)
• Car insurance $120 (we are now under this thanks to being over 25 and for being 'safe drivers.' Rockingham Group is the best!)
• Utilities $165 (heating/cooling and water- in Staunton the water bill is every other month)
• Doctor/Dentist $65 (this obviously isn't something we use every month)
• Cell phone $140
• Cable/Internet $120 (direct TV keeps us way under that these days! Especially if you refer a customer- if you are interested in direct TV, let us know! We can both save $10 a month off our bill for 10 months)
• Blow money $120 (Luther and I each get $60 a month to spend on whatever we choose)
• Gifts $40

I enter receipts into the excel sheet throughout the month and it keeps a running total for me. At the end of the month, I look at the excel sheet to see how much money we had left over in all categories combined. I take that amount, plus the difference from our promotions that were never figured into our budget, and make a transfer to savings. Within a few days, we call good ol' Aunt Sallie Mae and make an extra payment:)

We don't budget in our mortgage, regular school loan payments, or tithing because they come out every month before we start our monthly budget. More on tithing in a future post. Let me know if you have questions! 

The beginning- working on a debt-free life

Debt...many of us have it. Sometimes it can feel overwhelming. Some debt is a necessary and normal part of life and other debt is caused by making reckless and sometimes even materialistic choices. We have a lot of debt from school loans for going to a private, Christian university. Going to Liberty University is an experience I would never trade in a million years. That being said, private universities are pretty expensive. Luther received one degree from there and I received three. We are working hard on paying off school loans and have done pretty well so far. So well that we have had several people tell us that we should write about how we are paying off debt. One close friend even said we are her 'most grown up friends' which makes me laugh every time I think about it. This blog will be dedicated to our journey to becoming debt free. Hopefully it isn't too boring and maybe it will even help someone else out there learn how to pay off debt in a practical and easy manner:)

Here's the background:

• Luther and I met in 2005 at Liberty and began dating in 2006.
• Luther's degree in Criminal Justice resulted in approximately $28,000 in school loans. He graduated in May 2008 and we began paying on those loans December 2008 (after his six-month grace period).
• I finished my bachelor's in Dec 2007 but began my Master's immediately, meaning I didn't have to start paying on my loans yet because they were still in deferment. I graduated December 2009 with my Master's and my grace period ended June 2010. I started on my EdS in August 2010, putting my loans back into deferment. I finished that degree in December 2011 and began making payments immediately after since my six-month grace period was used in between my Masters ending and my EdS beginning. Approximate total for all three degrees- $90,000.

Before Luther and I got married in January 2009, we completed premarital counseling and worked on a budget. We still use that budget to this day. It only keeps track of our every day purchases (i.e. food, gas, insurance, utilities) but it allows us to see where we are spending our money. The major thing that has helped us is that we made that original budget on our beginning salaries and haven't changed it since. On paper, we had an extra $30 per month when we first got married. Talk about being scared! I remember my parents talking to me about tithing when I was younger and they told me that when you tithe, you will always have enough. We began tithing as soon as we got jobs and we have never needed money. God is our provider. We have since both gotten raises and/or promotions but we have not added that to our budget. We still spend money like we are on our original salaries and we save the difference...hence our plan to get debt-free. So far it is working...we have paid off close to $50,000 in four years but more details on that to come. And so our journey to become debt-free continues...