2009 is our year to kill most of the debt!

**MomToTwoBoys** · 12-29-2008, 04:26 PM

I think I've created a monster!

I do so love DH for it, though. He's such a trooper with all of this debt repayment business.

He's been working really hard the last few days on getting Excel set up to where we figure out our debt repayment options. He wants to do a line of credit to not only consolidate all of our debts, but to get it at a lower interest rate than what I'm even paying on the Mastercard (he wants it lower than 10%, the Mastercard is 11.4%). He crunched the numbers and as it stands right now, we'll have the mortgage paid off in 21.5 years. That would put us at about 53 and 55 years of age, giving us ten years to add $700 per month into our retirement fund. That would be on top of what we'd not be paying in debts (which we pay about $500 per month now) and with ten years of at least $1200 per month into retirement, we'd be doing alright.

I don't think we'd realize how much money we actually have and actually spend on debt if we didn't do a budget and a debt repayment projection for at least the next five years. If we do the line of credit, we can pay off all our debts minus the mortgage in time to start putting towards both retirement and an education savings fund for Dakota.

As it stands right now, the MDG account is being paid off in February. We're putting $550 on a less than $800 balance at the end of January and then $253 onto it for February 16th's payment. Come March, DH is getting more overtime. We also have a tax return coming back that will go half to FIL for a personal loan (of $6,000) and the other half will go to paying off the smallest debt (that being the Best Buy account). If we can pay off Best Buy by April, we're free and clear to paying all of the snowball amount onto the Mastercard. We did charge something onto the Best Buy card in September and due to holidays, we didn't get to put much onto the BB card. It's a bit in the air right now because the VISA has a higher interest rate and higher balance, but the Mastercard has a lower balance and a lower interest rate. So we may end up going with the VISA to kill that debt off. We're not using it and the only thing we're paying right now is the retail interest and balance protection, which is more than the minimum payment. So the VISA will be the first big one to go, then the Mastercard.

We're also tacking money into savings to rebuild the EF and start the slush fund. $100 per payday will go into the EF and $100 per month will go into the slush fund (because DH gets like four times more money in his account than I do in mine). The slush fund would be for the kids' school things and then some Christmas goodies. We'd still have a cushion in the checking account in case we end up with higher expenses on a monthly basis than the last month.

I feel pretty good about 2009 and debt repayments. If we can eat up the Mastercard and just have the VISA for all of 2010, that'd be super!

**sunnysky24** · 12-29-2008, 05:38 PM

We are going to extreme measures in 2009 also. We just want to be debt free within the next 5 years (inlcuding morgtage). We have cut back to the max on everything from the dish to groceries. I want to have Jan a no spend month so we can really hit the debt a good one. Then I have putting extra into our income taxes so we should get a good refund this year and use it all towards paying off anything we owe on.

**homesteadmamma** · 12-29-2008, 05:51 PM

You might want to join the debt reduction challenge. It's stickied with the other challenges.

I applaud you for wanting to get rid of that debt. I'll be cheering you on as you do.

**AspiringToBeFrugal** · 12-31-2008, 12:26 AM

I would like to reduce or eliminate as much of our debt as possible so we can start really thinking about buying a house. My primary goal is to pay off DH's student loan by the end of the year if possible. Then we can add extra to DH's car payment and hopefully pay that off by the end of 2011.