The most enlightening thing about this class is finally learning the truth about debt, your credit score, and myths. Some things we knew, like leasing a car is a terrible idea. Home equity loans? Terrible idea. Debt consolidation only works if you actually pay off your debt and stop your spending. Basically, debt consolidation is a con, those smaller payments keep you in debt for longer. If you can't pay cash for something, YOU CANNOT AFFORD IT.
Our assignment this week was to complete the Debt Snowball worksheet (click on that link to get your own copy). The great thing is we are set to get our Federal Income Tax Refund this week so a lot of the "smaller" balances are going to paid off using that. Then beginning in March we are using the snowball method to pay down our debts. Click on that link because there is all kinds of information, all of your questions answered and your skepticism put to rest. I promise you.
I know the biggest thing we are going to struggle with is that impulse buying. Sometimes we get lazy and we don't cook, it's easier to just stop and get a pizza. It might be easier, but it's costing us in the long run. Not only are we going to get our budget on track but we're going to get healthy as an added bonus. The other thing Matt and I have talked about is how we want to be positive examples for our kids. We don't want them to grow up and have credit card debt. We want them to be fiscally responsible and not make all of the mistakes we did in our 20's.
Next week I'll talk about week five which is called Buyer Beware. I think this is going to be a great session to maybe help us with impulse buying and learning how to be patient and wait for the best deal, and pay cash for it, rather than borrowing all of the time.