Debt Free Journey

Recent Progress

Bye Bye Student Loans!

We paid off the rest of our student loans! What a relief!

Once we could see the light at the end of this Quarantine-Tunnel, we decided to start dumping that Storm Mode back onto our debts! We were able to finish the very last group of student loans and then put a good chunk on our very last debt (a car loan)!

When we graduated and got married almost five years ago, we had a little over $30K in student loans from my husband’s undergrad. The second we said, “I do,” those student loans became mine because that’s just how it works!

Coincidentally, the payment cleared exactly FIVE years after my husband’s graduation! When we graduated five years ago, we honestly thought we’d be carrying these student loans around for 10 years (the standard 10 year repayment program)…but God (and Dave Ramsey) has others plans!

It is such a relief to have these student loans GONE forever!

We’ve got one more debt left in the snowball…a car loan that would’ve been paid off in 2022 or 2023…and instead we should have it paid off in July (2020)!

All the sacrifice and dedication is worth it, we are almost #DebtFree!

Enter Storm Mode…even if that means postponing progress

At the beginning of March we entered what Dave Ramsey calls, “storm mode.” Storm mode is when you pause all progress on the debt snowball in order to pile up money. It still means living with a budget (possibly even more stringent budgeting) but all money is gathered…for the greater good – until you can see the rainbow at the end of this metaphorical storm.

In March, the COVID-19 pandemic was getting more prevalent and I started to get a feeling that I may not be working for a bit. As a dental hygienist, the services I typically perform are considered “elective.” As an advocate of the oral-systemic link, I could give you about 50 reasons why dental hygienists should be considered “essential.” However, I’ve done much research and do understand the need for “elective procedures” to be postponed – I’m not mad about it, I get it! And I would rather keep my patients, my team, and my family safe – so again, I totally understand why it needed to happen.

As I mentioned previously, I had an inkling that I may not be going to work for a bit. It was the general buzz on all my dental hygiene Facebook groups. My husband and I had a few good conversations about entering storm mode and in the end we knew it was the right thing to do. So we decided to postpone all extra snowball payments for now.

If there’s one thing this Type-A gal doesn’t like…it’s uncertainty. I love security, and plans, and knowing what’s going to happen. In fact, this whole quarantine/pandemic and not going to work has been a great soul-strengthening measure that has taught me so much surrender.

So we paused all progress on our debt snowball – and instead have been piling it up for almost two months now.

I’ve already mentioned that I don’t like uncertainty…but when it comes to our #DebtFreeJourney, I also don’t like not seeing progress.

I love progress. I love updating that Debt Free spreadsheet with every payment. I love coloring our debt free graphic we have hanging in our bedroom. Progress. I’m all about progress.

So we’ve halted progress…but aren’t halting the budgeting or the planning. If anything, we are more stringent with our budget now. We like seeing that pile grow and with every deposit we feel more and more secure. We are piling up our snowball and planning on an avalanche when all this is over, but the important part is that we have those finances saved up just in case we have an emergency during this time.

Being in storm mode is also giving us a sample of what Baby Step 3 is like (building your full emergency fund of 3-6 months of expenses). We are getting a glimpse of what is to come and learning to use those saving muscles and that’s been very enlightening.

I can’t help but feel grateful that we found and applied Dave Ramsey’s principles when we did. If we were facing these circumstances even two years ago when we didn’t have a budget, or a plan, or the tools to discuss finances in a productive manner, it would certainly have been a more stressful situation. It’s still a stressful situation for us and for many other people – but I’m so thankful that we have a plan.

To me, that’s what this whole Dave Ramsey thing is about. Sure, it’s about the budgeting, learning contentment, and paying off debt, etc. – but it’s also about the plan. Our plan can change, or God’s plan can change…but we are open to the plan and I think that’s what matters most – being open to the plan.

Cleaning up our past so that we can prepare for our future

A topic that’s been on my mind lately is preparing for the future, financially speaking. But how can we prepare for our future when we are still paying for our past?

When my husband and I first sought out to fix our finances, we didn’t know what we were doing. We didn’t even know the extent of the financial damage we had imposed on ourselves. We thought we did everything right – got the college degrees, the careers, then bought the house, next came the cars…we felt like we had deserved to “level up” in items since we had worked so hard to complete college and get our careers going. On top of that we were growing our family. We made some foolish decisions: I had to get an SUV (even though we only had one childat the time)…we had to finance a brand new car for my husband…we had to get the newest and nicest phones…and we had to get the credit cards for the points (we thought we could build wealth from rewards points).

Student loans were another burden we had weighing on us. We just accepted that we would be paying on student loans for ten years…just like the payment plan says. We had occasionally thrown some extra money at the student loans but it wasn’t planned and it did not happen as often as we’d like. We didn’t have a plan to pay them off before the ten years were up, and honestly we just accepted the defeat and trudged along with the payments.

I look back at our lives back then (barely one and a half to two years ago) and I cringe every time I think about it. I cringe because I thought we were normal, we thought we were doing the “next logical step” that society leads you to believe.

 But I knew there had to be more to it. I knew this wasn’t what I wanted for my life or my family’s life. We worked hard every day but it felt like we were dogs chasing our tails. Round and around we went – money in, money out.

When I looked to the future and realized it looked bleak at best, I turned to our budget (or lack there of). I researched to find a concrete number that we should be putting towards retirement, a concrete number that we should have saved for an emergency, and a concrete number to tell me how much we should save for our children’s college. I turned to our budget, which was more like an expense report each month (instead of planning our expenses I just tracked them after the fact), and realized we needed help.

I found Dave Ramsey and the Baby Steps and, as they say, the rest is history. My husband was reluctant but also quick to try anything new that I felt we should give a shot.

Our total debt payments each month were about $1,200 (just going to our debt like cars, our credit card, phones, student loans, etc.). Again, I still cringe every time I think about this “past life” of ours.

How could we plan for our future if we were still paying for our past? How could beever be prepared for an emergency if we were still paying for our past? How could we hope to save for our children’s college if we were still paying off our past?

Turns out, if we didn’t have that $1,200 going towards debt payments each month, we could save for emergencies, contribute to retirement, and even save for our children’s college!

Turns out, if we didn’t have payments we could be more generous with our time, talents, and finances.

So we got to work on the Baby Steps.

Baby Step 1: Save $1,000 in a starter emergency fund – done (thankfully we already had this one completed…it doesn’t seem like enough but it covers basic emergencies and fuels you to get debt out of your life)

Baby Step 2: Pay off your non-mortgage debts from smallest to largest using the debt snowball (this is the step we are currently in and anticipate to be done with my the end of 2020)

Debt Snowball = pay minimum payments on all debts but the smallest debt

– Any extra money you have or can find by making budgetary cuts goes to the smallest debt

– Attack that smallest debt with a vengeance and once you pay that smallest one off roll those payments into the next smallest debt

– And keep rolling and rolling the debt snowball to each successive debt on the list, it will grow and grow!

Baby Step 3: Go back to your emergency fund and build it up to 3 to 6 months of expenses (this turns into your full emergency fund that is to be touched only in the case of emergencies – this step is also when you can bump up in car or save for a down payment for a home)

Baby Step 4: Contribute 15% of your gross income into retirement (401K, Roth IRAs, and/or Traditional IRAs)

Baby Step 5: Save for children’s college (This one is harder to figure out depending on all the variables involved but it may not take too long to fund this step for your children)

Baby Step 6: Whatever is left in your budget, pay it towards the house…pay the house off early! (Imagine a world without a mortgage)

Baby Step 7: Live and GIVE generously!  

We are diligently working to pay off our debt right now (Baby Step 2). All extra money goes to debt.

We are in the midst of our student loans right now – we’ve seen more progress on the student loans in the past 6 months than we had seen in the first three years since graduating! It’s amazing what focus and diligence will do for you and your finances! It’s amazing what paying attention to and having a plan for your finances will do for your family!

Don’t do what we did. Don’t fall down the trap of careers/jobs, house, cars, phones, credit cards, etc.! Don’t fall for it! We put ourselves in a position that was detrimental to growing our wealth and preparing for our future. We are paying for it now – but we can see the light at the end of the tunnel!

Pay off your past so you can prepare for your future!

Half-Way Update!

We started our Debt Free Journey in November 2018. We recently hit a YEAR of doing Baby Step 2 (use the debt snowball to pay off your debts, smallest to largest). It’s been quite the year! We’ve made many lifestyle and financial changes while also being mindful of other obligations.

In December 2018, we got gazelle intense and started making cuts in the budget anywhere we could! We cut out the car wash subscriptions, cut out unnecessary bills, got a handle of a predictable grocery list and grocery budget, stopped going to the movies (as much) and topped going out to eat. We were never big on restaurants but date nights always consisted of a meal + movie. We do still go to the movies but it’s not as often (maybe once every 2 months now) and we only go when we have excess in the budget.

However, we still remained mindful of various obligations throughout the year- holidays, birthdays, birthday parties, and trips. I was asked to be in a wedding and we cash flowed all the expenses that involve being a bridesmaid (which was not too many expenses in this case): A trip to New Orleans, an affordable bridesmaid dress (that I got my dad to hem for me – save any way you can, right?!), and other expenses that come along with being in a wedding. The thing is…we still make sure we enjoy this chapter in our lives because we plan to enjoy it. We plan to enjoy it by using cash and setting up a sinking fund months in advance! That way when last minute things pop up, we aren’t turning to credit cards in a pinch.

Since embarking on this journey a year ago, we made tremendous progress and communication within our marriage has improved as well. When you learn to be a good steward of God’s money, it truly does transform every other aspect of your life!

Here are some numbers for you so you can see what we’ve been able to do in one year!

November 2018: $55, 616 (one credit card, one phone, two cars, and student loans A-G)

November 2019: $26, 816 (student loans A-D and one car)

That means we’ve paid off over half of our debt. It hasn’t necessarily been fun or easy to make lifestyle changes and to squeeze our budget so much, but it’s been worth it. And looking at our planned trajectory, we are aiming for being DEBT FREE by December 2020!

You can do this stuff!

You can make a budget.

You can live on less than you make.

You can live like no one else…so that later you can live and give like no one else!

We paid off three groups of student loans…

Most student loans are grouped. This is how the loans from my husband’s undergrad are. When we started this journey, we had groups A-G. Note: it’s from his undergrad, but it’s our debt.

So for us, that was seven loans to the tune of just over $24K (it was much larger when he first graduated but we’d been making the regular payments so by the time we started The Baby Steps, it was just over $24K).

In May, June, and July we were able to pay off Groups E, F and G. In total, it was over $9K that we were able to pay off! We still have about $15K to go on the student loans but are working by group with the loans lined up smallest to largest, just like Dave Ramsey recommends.

We are currently working on another loan within the group of loans. It feels so good to see progress on these student loans because when we first graduated it seemed like these loans would be living with us for the next ten years!

But, it doesn’t have to be that way. Just because you’re on a ten-year payment program, doesn’t mean you have to live with these payments for ten years. Ultimately, your income is going to payments so it can’t go to building wealth, giving, or saving.

The student loans are totaling just over $15K now and we are making some great progress on these suckers! Again, it feels so good to see progress on these loans!

In about 9 months, our debt total has gone from $55K to $29K! We are just about half way there!

Seriously, you can do this! It’s not easy, but it’s worth it!

Small sacrifices now lead to big gains later.

Full Debt Free Journey

In November of 2018, my husband and I started Dave Ramsey’s Baby Step system – a system to help you start an emergency fund, get out of debt (except your mortgage, fully fund a real emergency fund, start funding kid’s college and retirement, and to start building wealth.

Ultimately we got tired of the hustle and bustle – of making money and watching it go out so quickly. I personally got so sick of feeling like I had no idea where my money went at the end of each pay period.

When you’re ready, you’re ready.

It is only when you feel sick and tired of being sick and tired about your finances, debt, and current situation that you’ll finally decide to change your ways.

We decided that we were ready to change the way we were living – we decided that we’d better get a handle on our finances now while our sons are little as opposed to sticking to the monthly grind of having money come in and watching it slip away.

When we added up our debt, we were shocked to find out that we had just over $55,600 in debt. This was two cars, two small credit cards, and student loans. The most insane part to us (now) is that we thought we were normal! We were just chugging along and living what we thought was the typical life for two twenty-somethings with a family.

We decided that we were sick of being normal.

The following is the story of our DEBT FREE JOURNEY. We update it as often as we see fit or if something major has happened along the way!

We are currently in “Baby Step 2” and I will update our progress at the top of the page…but to read our journey and to see how you can (and should) get started, keep reading below!

If you have any questions, please reach out to me! I’d love to help you get started or point you in the right direction!


We started in November 2018…

I sold my beloved SUV

Okay, it was just a car. But it was a car I loved, my beloved Chevy Traverse…my mommy-mobile with a 3rd row and tons of space for alllllll the things. Yes, I gave it up. I sold it. Actually, I traded it in.

In December of 2018, just one month after starting this journey, we started to make some drastic changes.

I went from a big fancy SUV to a small and humble Sedan. The truth is, my SUV was simply too much car for me at this current phase in our life. And it just made sense while we work through these Dave Ramsey Baby Steps. My Chevy Malibu is perfect for us at this stage in our life and it saves us a ton on gas!

I have no shame in saying that my “new-to-me” car is three years older than the SUV I traded in. It’s a simple car, and fits into our financial goals. Cars are only things and I was sick of putting so much value in things.

I got a great value on my SUV and had a ton of equity in it – this helped me find a reliable Sedan that’s better on gas and more economical for us.

Dave Ramsey always recommends driving a $1,000 car and I just knew that wouldn’t feel feasible (or safe) for me to do with two small children (at the time we had a 7-month-old and a barely-two-year-old). However, I traded it in and got a small loan for $3,500.

Since it was our next smallest debt, it went to the front of the snowball list and became the next thing we attacked with our snowball.

The entire transaction took over $10K off of our debt total. I’ve come to the realization that new cars are not a smart investment – in fact, a new car loses about 60% of its value in 4 years (this means if you bought a car for $28K, that becomes $11K in four years). My ultimate goal is to never finance a car again, I aim to only pay cash for my next car (which I’ll save up for when we’re debt free).

And to be honest, once I started giving up my worldly luxuries and telling myself no, God has been showing up in BIG ways. We are so incredibly blessed.

It’s funny how things start to happen once you make some small sacrifices.

Learning to be content with what you have is a humbling experience. However, you’ll find that once you learn to be be content with your life, you’ll no longer wish for more – because you start to see your life for what it truly is…Blessed.


We took Financial Peace University

In January of 2019 we decided to take Financial Peace University (FPU) at a local church.

FPU is a 9-week course that Dave Ramsey (and other Ramsey personalities) teaches to walk you through the Baby Steps and through various financial necessities like budgets, retirement plans, mutual funds, etc.

One of my co-workers said her church was hosting a class and even though we have a home church, all were invited to take the class.

We purchased the class materials and signed up for the class.

Even though we had already been working through a budget and debt payments (basically we already knew everything we needed to do), we decided to take the class because it was important for us to be within a community of people that had the same goals as us.

From January to March we went to class each Sunday evening with amazing FPU coordinators and we learned so much stuff and we also met so many nice people that wanted nothing but the best for us!

FPU is an investment in yourself and your future. And it comes with so many other services that come in handy as well! I highly recommend FPU for anyone and everyone no matter what situation you are in! It is an investment and you do pay for the course materials, but you are also investing your time each week to work through the programs.


We paid off that car 3 months later

That car we got when we traded in my Traverse? A 2014 Chevy Malibu…yeah, we paid it off!

By March of 2019, we had that small car loan paid off!

We were totally not expecting to pay it off so early. In fact, we thought we wouldn’t be able to pay it off until the end of 2019. It was all during a time when I was working a lot of extra days at my office to help cover another hygienist’s schedule – so it was a huge financial blessing to have that extra income!

No more car payment for me, however, we still have another car to pay off (the one my husband drives), and student loans.

I’ve said it before and I’ll say it again: Amazing things will happen when you start to make some small sacrifices!


I finished my Master’s Degree (DEBT FREE)

In May of 2019 I finished my Master’s Degree without having to take out any student loans! Super exciting! I took one class at a time which made my public, state school very affordable (it also helped me keep my sanity while pursuing a Masters with two kiddos and a career)! I used the remainder of a GI bill from my undergrad to get me started but one of my goals was to never take out student loans EVER again.

Budgeting has proven to be soooo helpful and beneficial to not only our finances but also our marriage. We’ve found that when we are on the same page with everything (including finances), it’s just better all around (obviously)!

When it comes to paying off debt, quick wins matter! And they help keep the momentum going. With that said, we recently decided to break up Carlos’s student loans – they are grouped from A-E and the loans range in value. We arranged the various loans from smallest to largest (instead of the lump sum of the loans) and are finding that these quick wins are helping us stay on track.


We paid off three groups of student loans…

Most student loans are grouped. This is how the loans from my husband’s undergrad are. When we started this journey, we had groups A-G. Note: it’s from his undergrad, but it’s our debt.

So for us, that was seven loans to the tune of just over $24K (it was much larger when he first graduated but we’d been making the regular payments so by the time we started The Baby Steps, it was just over $24K).

In May, June, and July we were able to pay off Groups E, F and G. In total, it was over $9K that we were able to pay off! We still have about $15K to go on the student loans but are working by group with the loans lined up smallest to largest, just like Dave Ramsey recommends.

We are currently working on another loan within the group of loans. It feels so good to see progress on these student loans because when we first graduated it seemed like these loans would be living with us for the next ten years!

But, it doesn’t have to be that way. Just because you’re on a ten-year payment program, doesn’t mean you have to live with these payments for ten years. Ultimately, your income is going to payments so it can’t go to building wealth, giving, or saving.

The student loans are totaling just over $15K now and we are making some great progress on these suckers! Again, it feels so good to see progress on these loans!

In about 9 months, our debt total has gone from $55K to $29K! We are just about half way there!

Seriously, you can do this! It’s not easy, but it’s worth it!

Small sacrifices now lead to big gains later.

Nina Pena View All →

Catholic wife and mom. This blog is my attempt to trust the Holy Spirit and write what’s on my heart.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s