Dollars $$$$$$ and dollars

Our small group at church decided to do the "Financial Peace University" series this semester so for the last month we've been watching videos by Dave Ramsey, filling in our workbook, and doing homework - like coming up with a budget that puts a name on every single dollar coming in every month. We weren't able to make it to group on Wednesday night because we had to pick up Alexi's car from the shop and I had to be back to work by 8pm for some last-minute microscope time....so we listened to the CD together last night - the one on "dumping debt". I like a lot of Dave Ramsey's money philosophy and it's nice that he's laid out small steps toward what he calls "financial freedom" - but I REALLY liked the dumping debt session. Alexi and I don' t have a lot of credit card debt (just a small one we'll take care of quickly from our world travels last year) and we don't have huge car loans (just mine - which will be paid of within a year) - but we do have STUDENT LOANS. When Ramsey said that getting out of debt before you start saving for retirement means paying off everything except the house - we decided to consider that to mean that WE pay off everything except Alexi's medical school loans....our own personal mortgage. Thank God Alexi went to undergrad for free (smarty pants).

Until yesterday I had 4 student loans from undergrad - three Staffords and one private loan. All these are relatively small (certainly compared to Alexi's) since my dad paid for the majority of my college education (thanks dad!!). But what bothered me was that private loan I took out toward the end of my Houghton career to pay for a class that prepares you for the MCAT (the big test you take to get into medical school). It's funny now that I decided not to go to medical school and I still have to pay off that dumb loan - I think the total was $2500 to begin with. Anyways, the point - that loan is the only school loan I've been paying on while in grad school because I don't have to pay on any of them until I graduate. I'd put $50 here and $100 there over the last 4 years and last night after listening to that CD I looked up how much I have left on that loan - and it was only about $250 so I just paid it off right then and there! It felt so NICE to cross that one off the list!

On top of that - we're using the ancient envelope system with cash for some of our spending now and I've already found that I tend to spend WAY less when I'm using cash than when I'm using my debit card. For example, I'm much less likely to make impusle purchases at the grocery store or at Babys R Us if I have to pull cash out of an envelope that only has so much in it. I can remember my mom with those dumb envelopes YEARS ago when my parents were digging their way out of credit card debt - and it was so annoying when I wanted something and she would open the envelope and say "there's not enough for that this month". I hated it then, but I do know that they got themselves out of debt and it had a lot to do with my mother's discipline.

So far I'm really glad we're taking this class during this transition year in our lives. We'll be moving (probably) in a few months and Alexi will FINALLY have an income so we'll be more wise about how we use that money - and we probably won't be as quick to blow it all on flat screen TVs when we have a MOUNTAIN of loans to work through. It's pretty exciting to have something to attack together - and there will be a HUGE celebration when we've finally finished paying and we can use our money how WE want to - for Haiti.