When we got married about 4 years ago, our debts were a big part of our lives.
When we met, I had about $7,000 of credit card debt and about $3,000 left on my car loan. When we got married I had about $10,000 of credit card debt and $750 left on my car loan. The wedding is the cause of some of the extra charges, but my husband to be was also out of work the whole time and actively looking for a job out of state. So a lot of the financial burden was on me, and I only made $30,000 a year! We ended up moving 12 hours south 3 days after the wedding, so moving fees also got dumped on the card. (I also had student loans-maybe $4,000 that my parents were paying for me).
My husband had a $5,000 loan that he got from one of those checks they mail you. He also owed about $1,000 and $2500 on two store credit cards. He graduated from college right around the time we met and although he was actively looking for work, none was to be found. (He also had around $27,000 in student loans in deferment).
The big difference between our debts (which were about even) was our credit rating/payment habits. I had great credit and never made a late payment...ever. He was barely getting by and had no extra money to put on bills, so all of his debts were in collection.
Today we have about $450 left on a credit card, which is only because our oldest car broke down (yes the one I paid off right after the wedding) and we didn't have enough to pay cash for it set aside. We also own our own home and are making payments so that it will be paid off 17 years from now. We also have a second car (we went without for almost a year) and are putting money in a savings account and a retirement plan.
* I forgot to mention that although my students loans are all gone, his will be with us for a long time still!
We have a long way to go before we are "debt free" and may never totally get there, but we're working on it, making good decisions, and feeling great about it.
Here are a few tips I've found that really help with debt repayment:
-Use found money to pay down debts: I've fought my husband tooth and nail on this, and we occasionally have to compromise and blow half of the money on "stuff" and use the other half for debts, but it really works. We got $7500 as fist time home buyers, and $6000 went to our "worst" debt. The rest was gleefully spent by Charles at Lowe's!
-Get by on one car for awhile: It will save on insurance, maintenance, and of course a car payment. We went for one full year with one car. I woke up early and dropped hubby off at work and then drove myself later. He had to hitch a ride home about half of the time, and we couldn't have done it without good friends, but it really saved us! When we did finally get a second vehicle...it was appreciated so much more, too!
-Budget money for fun things or else you will fail: It is unrealistic to expect me and hubby to never go out to eat, go to the bar, see a concert/movie, shop, or travel. We love these things so I made a realistic budget. We both have $150 a month we can spend on whatever we want with no accountability. We also have another $300 in the budget for us to spend however we want together. I figure it's $75 a weekend (30 at a restaurant, 25 at the bar, 20 at a movie) but the money is flexible so we can have fun however we want. And if something major comes up, this is an extra $600 that we can use for an emergency and we'll just do without for the month.
*Don't let me leave you with the impression that we've always run through $600 on "stuff and entertainment", that first year it was probably more like $75 a month...it has grown as our income has grown and our debt has shrunk!
-Coupon: I save a ton of money every month by shopping the sales and using coupons. We now have way more in the cupboards and spend way less on the stuff we use everyday. If you don't know much about couponing I suggest checking out southernsavers.com or iheartpublix.com.
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