Debt

[mshu7]

Originally Posted by aabablusaan

I just bought the Dave Ramsey book tonight...I'm impressed by his website, so I decided to check out the book. Luckily, I learned that I've taken care of some of the baby steps, and even though I won't pay off that student loan quickly, I'm going to see just how far I can take his plan.

Which book did you pick up? We are reading Financial Peace for the FPU class but I just started reading Total Money Make Over as well this week.

[jnmttu]

Originally Posted by aabablusaan

It's good that you want to pay off her loan debt quick... I just had no other option, so I took the 30 year amortization KNOWING that I wouldn't be paying on it until I was 56 years old. I wanted the lower obligation to be able to pay more when able, but pay the minimum when money was tight. However, my current system has worked well for me, and due to the frozen interest rate that will probably beat inflation, I wasn't super concerned with carrying the note for a few years. At this rate, I'll have it done in my late 30's, as I'm 29 now.

That is basically how we have set up all of our debts. Her student loan is for 30 years and our mortgage is for 30 years as well so if we ever get in a pinch, we have the lower obligation to help soften the blow. I realize that we will pay slightly more interest this way but, like you, it gives me comfort of knowing that if we ever get into a financial crisis we can still make the lower payment and when we can afford it, we can pay it off quicker. With our first child due in April, there is a good likelihood that our financial priorities may shift some, so the lower payment may give us some flexibility there.

[Accumulator]

aabablusaan & jnmttu- You went into debt the smart way- you knew what you were doing and did the proper cost/benefit analysis before you made the decision and you allowed for contingencies.

slick61- Glad to hear you came through that OK. I agree about keeping enough liquid to cover the essentials. And it's nice to see market downturns as buying opportunities instead of reasons to panic- gotta have ready cash for that (at least to do it safely).

pennypacker- Yeah...every time I think my investments are too conservative (friends always seem to be finding the hot stocks and buying/selling at the right moment, or so they say you know ) I remember what my real priorities need to be; it *can* happen to anybody. My maternal grandparents were "overly conservative" too..but then they rode out the depression just fine while so many others didn't.

[bumoftheday]

I just picked up Dave Ramsey's Total Money Makeover. I will get through it in it's entirety before buying a car.

I have only just got into it and seen a little bit of his show, but it kinda makes sense though, if I don't buy a car yet, invest and save and buy it in cash... I may not get what I want now, but I will never be paying someone else's salary to pay for a car. It doesn't mean that I cannot have what I want later, even if that later is only 3 or 4 years down the line. Although I still kinda have that feeling to just get what I want now while I'm young and can do it.

[aabablusaan]

Originally Posted by bumoftheday

I just picked up Dave Ramsey's Total Money Makeover. I will get through it in it's entirety before buying a car.

I have only just got into it and seen a little bit of his show, but it kinda makes sense though, if I don't buy a car yet, invest and save and buy it in cash... I may not get what I want now, but I will never be paying someone else's salary to pay for a car. It doesn't mean that I cannot have what I want later, even if that later is only 3 or 4 years down the line. Although I still kinda have that feeling to just get what I want now while I'm young and can do it.

Amen to that! I too, after reading and participating in this thread, I picked up the TMM and TMM workbook, watched Dave Ramsey last week instead of the O'Reilly Factor and Countdown with Keith Olbermann, and I've made daveramsey dot com one of my daily stops along with Autopia. I especially like the "If you live like nobody else..." line.

I even removed $30 for NXT 2.0, UQD, and an air freshener from my "Detailing" envelope before going to Target this morning!