I’ve been doing the Dave Ramsey Thing for almost 7 years now. I became debt free in 2007. A year later, I paid cash for my wedding and honeymoon and by 2010 we had paid off Mrs wizardpc’s credit cards and student loans, and had also purchased a house with a 20% down payment. We have been debt free except the house since October of 2010. We’ve had 6 months of expenses in the bank since this past spring. We were about to start paying off the house early the day we found out lilwizard would be joining us.
At every point in my journey, there have been people who have said “Well, that’s great in theory, but just wait until X! You’ll have to borrow money then!”
So far, the values for X have been:
- When you get a girlfriend.
- When you get engaged.
- When you get married.
- When you get a house.*
- When you have kids.
And I have a few ideas about what the next ones will be. At every point, I’ve just trucked along without any problems.
I’ve done this single. I’ve done this while trying to convince a girl I was worth marrying. I’ve done this while keeping the wife happy and increasing her standard of living. I’ve done this as a renter. I’ve done it as a homeowner. I’m about to do it as a parent.
No matter where you are in your life, you can do this. Just like quitting smoking, though, quitting debt is hard. You have to want it.
I want $17,000,000 at retirement more than I want a new $35,000 truck instead of a $2,700 Cherokee. I want to be able to buy my kids houses as wedding presents more than I want to live in a $400,000 house 5 minutes from work. I want my wife to be able to be a stay at home mom if she wants to more than I want all the cable channels.
Life is about trade-offs.
*Yes, I got a mortgage, but that’s not what I’m referring to. People kept telling me I’d need to build my credit. We bought a house, but I got a mortgage. With a 15 year fixed rate conventional mortgage and 20% down, I was able to get a 4.375% mortgage during a time where 4.5-5.25% mortgages were the norm, despite not having any consumer debt since 2005 or any debt at all since 2007. I didn’t have to go out and “build my credit” like so many people told me I was going to have to do. The wife had a much more recent credit history but adding her to the mortgage would have negatively affected our rate. Think about that. ETA: mrswizardpc reminded me last night (and in comments today) that the problems we had adding her to the mortgage were related to her just having graduated college and therefor having less than a year of professional work history.
