Browsing Tag

debt-free

Money, Our Debt-Free Story

Our Debt-Free Story: Part 1 – “We’ve Had It!”

August 29, 2014

This is Part 1 of a 3-part series. Be sure to read the whole story!

Since we are running a Financial Peace Giveaway, it only seemed right that we formally share the story of how we became debt free.

This will be a three-part series and this post is the first installment. We hope to offer encouragement in sharing our experiences and perhaps a few laughs along the way.

So, let’s take a trip down memory lane back to yesteryear….

name-my-car-3In a Delorean.

Since we’ve all not-so-secretly wished we could travel in one.

The story begins on  warm summer’s eve when a guy with long hair walked up and  asked me to get ice cream later that night. I said, “sure.” He then high-fived me and ran away.

That guy was Jonathan and we’ve been inseparable ever since that first ice cream cone.

Our first conversations about money began that Fall. We both declared we had some students loans and had them on auto payments…student loans we likely never needed to take if we had both saved and worked through college. Whoops. Not a very deep or informative conversation but it got the ball rolling.

In late Spring…Holy Thursday to be exact, we got engaged and that is when the real shackles of debt began to rear their ugly heads. Now we had a wedding to plan with varying expenses and a honeymoon to pay for. Naturally we began to talk more details about what sort of financial means and baggage we were carrying at the time.

We were sitting in my car when the bomb dropped.

Between the two of us we had $24,500 in debt!!!

displeasedHere’s the breakdown:

Amanda: $8,000 student loans 

Jonathan: $13,000 student loans + $3,500 on a credit card 

What’s weird is I didn’t freak out about the $21,000 in student loans but I FREAKED about Jonathan’s credit card debt. Something about credit cards has always scared me and I just cringe at the thought of paying 17.235% interest or whatever they are. Gross. 

At that point, I had some savings I was holding onto. Why was I sitting on student loan debt with savings in the bank? Don’t ask. I really have no idea. Upon arriving back at my house, we got out of the car and I logged into my bank and transferred Jonathan the funds to pay off the credit card immediately

Later on I learned  Dave Ramsey says I shouldn’t have done that until we were hitched. Whoops.

It was paid. I felt instantly better.

Throughout our engagement we both began to read Dave Ramsey’s Total Money Makeover. It rocked our world. All the testimonies from individuals and families who have worked Dave’s plan and obtained financial freedom were inspiring. We started listening to the radio show and with every “debt-free scream” that aired, I would start to cry. We felt the weight and burden of debt and knew we wanted it gone as soon as possible.

But.

We had that thing called a wedding to plan.

We wanted to apply all of Dave’s principles right away but we were waiting to merge bank accounts until after the wedding and there were too many urgent tasks in the way that kept preventing us from starting to budget on our own.

We let the principles take a back seat and knew that after the wedding, there was no turning back.

We were going to do this.

We were going to kick Sallie Mae to the curb and never look back.

We were going to be debt-free and that is all there was too it.

We were finally “mad” about our debt.

And Dave Ramsey always says the first step to getting our of debt is saying, “I’VE HAD IT!” and being sick and tired of being sick and tired. We had arrived at that point.

In Part 2, we will talk you through how we got started working the baby steps as a married couple.

See you next time! Until then, jump over to our FPU Giveaway post to enter for a chance to win one of three FPU memberships!

Money

How To Furnish A Home For One-Fifth The Cost

August 1, 2014

Folks, here it is.

The post many of you have wondered, prayed, and dreamed for.

Today I will share with you our thrifty tricks on how we managed to furnish our first home for one-fifth of the cost!

All the Dave Ramsey “nerds” out there are waiting on pins and needles…I saw you salivating as you read the word thrifty 🙂

I want to address a couple misconceptions first:

  1. Second hand does NOT always equal to dirty, nasty, or ugly. I hear people say things like, “Well we just haaaad to buy a brand new couch, since you know, all those used ones have lice or something.” That’s bologne. You can find some of THE BEST deals on lightly used items that are cute, trendy, clean, and easy on the wallet.
  2. Buying things used is NOT simply for “poor people”. Plenty of poor people only buy new things and plenty of billionaires buy things used. Buying things used and in good condition is SMART because you can take the savings and spend or invest it elsewhere.
  3. Buying and selling things used doesn’t take that much time. Yup, there is a learning curve to learning the art of wheeling and dealing but once you have a few transactions you will be amazed at how easy it can be.
  4. Buying things new is NOT a bad thing. I don’t want anyone to think I refuse to buy new things or am morally opposed to it. I definitely buy some things new, particularly if I can’t find a used item that is similar to what I was looking and hoping for. I simply prefer to minimize expenses on “stuff” so we can give, save, and spend doing things that have more value to us, such as experiences and adventures…oh and that thing called adoption 🙂

So, now that we have that covered, shall we dive right into the deets?

First let’s take a peek at our SOLD list and then we will tell you how we did it. I am a firm believer in turning unused items into cash so you can buy items you want/need. Look what we found laying around the house being unused:

BR Dress $76.00
Lucky Peach $99.99
Nike Shoes $36.49
Charm Bracelet $24.99
Women’s Clothing $17.25
Men’s Clothing $15.99
Pasta Machine $20.00
Leather Couch $50.00
Pub Table $150.00
books on amazon $46.97
Sage Couch $50.00
Vera Bradley Bag $52.99
Swimsuit $9.19
Kenneth Cole Bag $29.99
Skin Care Products $124.99
down comforter $25.00
Coach Bag $19.99
Sperry’s $24.99
green swimsuit top $19.99
Grey puffy vest $9.99
Gym Bag $34.99
Lunch Sack $15.99

Total: $955.78

Boo-ya!

Where did we sell these items???

ebay

Ahhh, my friend ebay.

For more than half of the items we sold, we used ebay since it has a wider network of individuals shopping.

For example – how many people in one city are looking for a Banana Republic dress in a particular size?

Maybe a few.

But on ebay I knew there would be several people probably looking for that type of dress…several people I could entice into a bidding war on my item to drive up the value. 🙂 So any item that would be relatively easy to ship and needed a wide audience got listed on ebay.

There are two types of ways to list an item – auction style or receiving a best offer with a “buy it now” price. We typically did the week long auction on common items, to drive up bidding wars.

On more specific items, like old patterns of Vera Bradley only a small handful of people want, I did the 30 day listing with “buy it now” or “best offer” options. With those items I always set my price at or slightly above competitors with similar items but was absolutely willing to take lesser offers to get the items sold. I always counter-offered to get as much as possible from the sale, aiming for at least 80% of asking price.

And for goodness sake people, the photos matter!!! I can’t tell you how many people take junky photos of a quality item and it makes the item seem lame or less valuable. Below is a collage of a few items we sold on ebay.

ebay.jpg

Craigslist

My other dear friend, Craigslist.

After spending some time on Craigslist, you realize it’s best for heavier, bigger items that no one would ever think about shipping or items that have common local interest. If you list something on Craigslist and it doesn’t get any hits within one week, try relisting for one more week. If no bites, try ebay to widen the audience,

When listing items on Craigslist, always ask above what you’d be wiling to take, since negotiations are key in this type of sale. By asking higher, you will likely be able to end up getting what you wanted out of a particular item. I always do this, assuming the buyer will try to offer lower. Sometimes they do, and I typically take the offer to get the item sold. Bird in the hand…

Sometimes they don’t offer lower and I feel a little bad…but hey, I was willing to go lower, they just didn’t ask. Not my fault! 🙂

Other tips of the trade – don’t arrange buying or selling when you are alone. Have a second person with you OR if you have to be alone, meet somewhere public. 99.9% of people are amazing and I have not once had issues with Craigslist weirdos but it always pays off to be smart and prepared. Below are a few photos of items we sold on Craigslist.

CL.jpg

We didn’t ONLY score deals by turning unused items into cash. We also bought things for the house at a FRACTION of the cost.

Here’s our BUY list:

Couch, Chaise, Lamp $350.00 $760.00
Table + Chairs $300.00 $773.94
Ceiling Fan $64.95 $118.37
Bathroom Rug $5.95 $20.00
Euro Pillows $17.90 $40.00
Kitchen Lights $30.00 $43.03
Bathroom Shelf $0.00 $25.00
Vizio 5.1 $230.00 $290.00
Sectional Couch $340.00 $750.00
lamps, drapes, etc. $250.00 $400.00
mattress + box $100.00 $700.00
coffee table $0.00 $119.00

Total: $1,688.80

The price on the LEFT is what we paid for the item. The price on the RIGHT is what we should have paid, had we paid retail.

Where did we do all this bargain buying?

You guessed it…our friends ebay and Craigslist. For good measure we threw in a local thrift store and even snagged some deals with manufacturer’s rebates at Costco.

On the buying side, the tips I have for you are to always offer fair but under asking price. Don’t be that guy who low balls everything. Do your research on what the competitors are offering and then try just a bit under that. Use this tactic on Craigslist and ebay “best offer” items. In general, I try to snag snag 40%  off the asking price, which is already low since item is used.

For the ebay auction items? Click “watch item” and DO NOT BID until the last MINUTE it’s up for auction. This way, the bidding isn’t being driven upwards all week long. The person “winning” the item feels comfortable…like they are the only ones who want the item so will they be at the computer during that last minute? No. You will likely walk away with the item and the best possible price by waiting to bid until the end.

Below are some of the items we purchased second hand:

usedfurniture.jpg

Every item was brand name but just happened to be second hand. We bought the dinning room/living room matching Ikea sets from a girl moving to Seattle. The lights were all Hampton Bay. The lamps were from World Market.

All classy and clean, my friends, but very easy on the wallet! 🙂

For all you math nerds out there wondering how we came up with saying we paid only one-fifth of the price to furnish the home?

We took the amount we paid ($1,688.80) and subtracted what we sold ($955.78) for a net total of: $733.02

Then we took our net total ($733.02) and divided it by what retail price would have been ($4,039.34) for a total of 18% which is approximately one-fifth of retail cost.

If anyone has questions or stories about deals you’ve snagged – fire away in the comments section. I want to hear from you!

Have a great weekend! 🙂

Money

Saving for a Down Payment

April 26, 2014

Jonathan and I sat down in August to have a conversation about where we were going financially. In the process, we reviewed the Total Money Makeover and we were technically in Baby Step 3B – time to save for a down payment. I was feeling like I needed more encouragement, as the Denver housing market is pretty intense.

So I called Dave Ramsey himself. In his own words:

“The Denver market is white-hot and you should scrape together a down payment as soon as possible.”

He also said that he could tell we were focused and intentional about our finances – how did he know?!?! 🙂 I guess he has a sense about these things. It was the highest compliment we could get from Dave himself.

Into Baby Step 3B went we!

It’s not technically one of the “7 Baby Steps” but it’s between Baby Step 3 and 4. For those wanting a refresher on Dave’s Baby Steps:

dave-ramsey-baby-steps

We didn’t quite go back to beans-and-rice-gazelle-like intensity but we’ve been close. We have definitely lived like no one else so later we can live like no one else. As you can guess, we won’t be doing this home buying process like the average American.

Check out Dave’s home-buying standards:

  • Be completely debt-free and have a Fully Funded Emergency Fund of 3-6 months of expenses (otherwise Dave says Murphy will move into your spare bedroom and bring his cousins Broke, Desperate, and Stupid)
  • 100% down is preferred (OK being realistic, we are NOT doing this)
  • 10-20% down payment minimum (20% preferred to avoid PMI aka wasted mula)
  • Total payment <25% of your take home pay (most Americans qualify for a MUCH higher monthly payment…making them susceptible to being house poor)
  • 15-year fixed rate mortgage (Dave has studied how the 30-year mortgage hurts people long term. He also says if you think you will pay a 30-year mortgage like a 15-year mortgage, you are kidding yourself)

Pretty different approach to the typical American home-buying behaviors. Sure, Dave’s advice is fairly conservative but I know this – it will never lead to our harm. Will we follow ALL Dave’s recommendations? I really hope so but sometimes I get impatient and want to compromise…as there is so much to factor in. For now, things feel a little touch and go. Currently the Denver real-estate market is the 7th most overpriced in the nation. Ouch. There is talk of a “bubble” happening again. Maybe. Maybe not.

What do we do? Get in quick or wait? Buy a house (the most overpriced type of real-estate) or a town home (priced more appropriately)? Do we buy something we will have to move out of in 4-6 years as our family (PLEASE GOD) grows? Or do we buy the bigger house we could stay in for 10+ years that would require us to take a 30-year mortgage (at this point in time)? Or do we go for the cheaper fixer upper on a 15-year fixed mortgage but have to put $30K in updates/repairs during it’s first couple years? Or do we wait one more year, hope interest rates don’t climb and the market doesn’t keep inflating? What are the longterm affects of delaying retirement savings another entire year? So very many options. Enough to make ones head spin.

We will be using this mortgage vs buy calculator for many varying scenarios to calculate the smartest move possible. But there will always be risk we just can’t get rid of. Dave’s standards help minimize that risk, thankfully.

We are currently going through the “pre-qualification” process and from there, we will either begin looking at homes in there area or decide to wait and save longer. We are committed to that 10% down minimum but are going to shoot for as close to 20% as we’re able. Join us as we continue this home-buying journey! I will keep yall updated as we make various decisions.

Anyone out there have any advice? Regrets? Encouragement? I look forward to hearing from yall!

Money

7 Paths to Financial Freedom in 2014

February 20, 2014

Many of you enjoyed the last post on 7 Ways to Go Broke in 2014. Or now you are mad at me for exposing that your habitual behavior will actually lead to your financial destruction over time. Sorry, not sorry. I wanted to follow up with that post by diving into what you can do to begin a path towards financial peace this upcoming year. We want everyone to experience this blessing.

How do you get started though? Below are 7 Paths to Financial Peace:

1. Acknowledge the problem in the mirror.

dog in mirror

Anytime I can work in a dog photo, I am happy.

“I’m Starting With The Man In The Mirror I’m Asking Him To Change His Ways And No Message Could Have Been Any Clearer If You Wanna Make The World A Better Place (If You Wanna Make The World A Better Place) Take A Look At Yourself, And Then Make A Change…..” Michael Jackson

The first step in changing anything let alone your financial world, is to stop and ackowledge the problem: You. Personal finance is 20% head knowledge and 80% behavior. If you aren’t experiencing financial freedom, you gotta look at you and your behavior first. Therein you will find your problem. Owning that is the first step towards any healthy changes to come.

2. Attend Financial Peace University – FPU

fpuThis past Fall Jonathan and I coordinated our very first Financial Peace University class. It was awesome!!!

We had a group of about 35 people who met once a week for 9 weeks. In that time we watched videos, reviewed our budgets, had great discussions, and held one another accountable. This class is completely worth signing up for! Visit this website to find a class beginning near you today. And no, we didn’t get paid to host the class or to endorse it in any way whatsoever.

3. Read The Total Money Makeover

tmmmoIf you haven’t read this book…you need to. Get it here today. Super easy read with lots of inspiring stories to motivate along the way!

4. Begin walking through the 7 Baby Steps

baby stepsRemember Doctor Leo Marvin from “What about Bob?” Possibly the world’s most hilarious movie. Well, his Baby Steps book has absolutely zero to do with the Baby Steps I am referring to.

Dave Ramsey’s materials will walk you through the 7 Baby Steps on the journey towards Financial Freedom. Walking up these steps is a lot of fun and are incredibly motivating.

5. Embrace the budgeting process.

YNAB

 

The very first thing to do after you assess your financial situation and get a grasp on how much money you have and or owe is to set up a monthly budget and begin implementing the budget process. Why do you need a budget? Visit this blog post for a few reasons. Now, do you have to use software like You Need A Budget (YNAB)? No but we have chosen to utilize that tool and have completely fallen in love with it. Pen and paper, envelopes, budgeting apps, etc. are perfectly fine but you need SOMETHING to help you implement your budgets once you create them.

6. Learn how to say “No.”

no cat

 

This is pretty self explanatory. There will undoubtedly be 1,000 opportunities, desires, temptations, reasons, etc. to NOT follow your budget, attend FPU, read the Total Money Makeover, etc. Matthew Kelly once said, “If you can’t say no, your yes means nothing.” Or maybe he said, “You can’t say no unless you have a deeper yes.” One of those…but both are good and true. You will not haphazardly improve any area of your life. Saying “no” to lots of things that come up and “yes” to intentional decisions that will aide you in your goals will be vital to changing your life.

7. Live like no one else.

live like no one else

 

“Live like no one else so later you can live and give like no one else.” Dave Ramsey

Jonathan and I didn’t sell our Nintendo, eat rice and beans, tell friends no, or sleep on a donated RV mattress for nothing. We lived like no one else so we could live and give like no one else. We’ve already begun to see the effects of this in our life and are pumped to see many more ways down the road.

There you have it folks. PLEASE keep in touch with me if you begin implementing any of these! I would love to be your cheerleader, coach, accountability partner, etc. Whatever you need me to be, I will be it! 🙂

Money

Teixeira Debt-Free Scream!!!

November 14, 2012

Want the whole story? Check out our 3-part series about Our Debt-Free Story.

Many of you celebrated with us when we became debt free back in August. You may have even read the blog post about our financial journey. It was a great day and we decided going to Nashville to do our “debt-free scream” in Dave Ramsey’s Financial Peace Plaza lobby was something we definitely wanted to do. We wanted to stamp our freedom into the fibers of our family, marking our hard work and achievements in our memory for a lifetime. But we had a super busy Fall…in our line of work the Fall Season is our busiest time as we are launching a new year of ministry on college campuses across the nation. So the scream got pushed aside and we were in a “holding pattern” waiting for an opportunity to get away and visit Dave.

In mid-October an opportunity came up for both Jonathan and I to travel to Tennessee for some FOCUS work at University of Tennessee and Vanderbilt. It worked out to fly into Nashville and so we saw it as a perfect opportunity to schedule a visit to finally meet Dave!

We arrived just before the show began and we met Martha and even tasted those infamous “foo-foo” coffees and deserts Dave is always talking about on the radio. They were as delicious as I had imagined! 🙂 We took our seats on a couple of chairs in front of Dave’s studio and got to watch the show through the glass! It was so cool to see it all happen in real life!

Our view of The Dave Ramsey Show happening LIVE as we watched from chairs outside the studio!

It was then our turn to get ready to do our live, in lobby, debt-free scream! I was nervous. Jonathan was pumped. This is a typical response from both of us. I am good at hiding it but I swear I was near panic attack when this photo was taken.

Maybe I am not that good at hiding my nerves…I look stressed out. Whoops. Jonathan is excited!

The moment finally arrived and we could still see Dave through the glass but this time he was talking to us! AGH! You can listen to the entire audio clip below. My favorite part of the call was at the end, after the scream, when Jonathan threw fake money all over the lobby and Dave loved it! He came out laughing and gave Jonathan a high-five! 🙂

The Teixeiras with Dave after our scream!

Afterwards, we have a friend who actually works for Dave Ramsey and he was kind enough to give us a tour of the building. It was such a great milestone for our marriage and something we will always look back on. God-willing we have children someday, they will listen to the audio clip and our stories so many times they will probably be sick of it…but by golly they will know the truth about debt and the freedom that comes being completely debt-free!!!! Sometimes I look back and I wonder how we did it…when I look at the numbers it’s crazy because Jonathan and I as a married couple lived on less money every month than what I lived on when I was single! That shouldn’t even be possible but we did it! It was actually FUN to find ways to save money and make it work harder than ever for us.

We are debt-free but are complete “deal-a-holics”. Not in the sense that we can’t pass a deal up but in the sense that we can’t help but find a way to get a deal. We get out of paying retail ALL THE TIME and it’s fun!!! I love seeing my money stretch father every month because of using some good old bargaining. Try it sometime! 🙂 We also seem to win stuff on a regular basis…I really think that God rigs contests because He loves to bless His missionaries and show us His provision in radical ways. In Matthew 19:29, Jesus did say,”And everyone who has given up houses or brothers or sisters or father or mother or children or lands for the sake of my name will receive a hundred times more, and will inherit eternal life.” I consider us blessed a hundred times over with the way God takes care of us.

I hope you enjoyed our story and received some inspiration to continue living debt-free or are encouraged to go down that road and accomplish it soon! Seriously, if we can do this…anyone can. We don’t make crazy amounts of money but we had crazy gazelle-like intensity and if you’ve got that…you will get your debt done in no time and begin getting your money working for you instead of the banks! Be a person who makes interest, not who pays interest!!!!!!!! Let us know if you need cheerleaders along the way, we would love to be there for you! Visit The Dave Ramsey website to get started!

Money

Our Total Money Makeover

April 30, 2012

Jonathan and I got married this past October. By November we read Dave Ramsey’s Total Money Makeover and got pumped up about our finances! We even started listening to his podcasts every single morning while we get ready for the day. We were sick and tired of seeing so much of our paychecks go to student loans! Since we fundraise our entire income, working for FOCUS – Fellowship of Catholic University Students, we take every paycheck seriously. The money we live off of is the hard earned tithe to God from so many generous family and friends we’ve made through working in campus ministry. We owe financial responsibility not only to God and ourselves, but to these people who are donating to us, who desire Jesus Christ to be known in our world. It was time that our money started working for us and not some bank! I can think of a LOT of great ways to give & spend that money I see whisked off to Sallie Mae every month…now it’s time to kick the old woman out of our house!

After going through all the necessary changes from getting hitched – name, driver’s license, SSN, address, etc., we were ready to start our new financial  journey in January. We had around $21,000 in student loans at that point and have been working the baby steps. We got our $1,000 in an emergency fund set aside and then began with gazelle-like-intensity to pay down our debt as soon as possible!!!! We have lived on next to nothing, literally. We chopped up the credit cards and started paying cash for our purchases. Every date night is spent playing board games at home and eating home cooked food. We took a “stay-cation” over Spring Break under our own roof instead of traveling to see family or go on a mission trip. We haven’t bought any clothes or anything non-essential. We’ve eaten beans and rice…a lot.  I’ve been selling things so fast, I wonder if we will have anything left by June! We splurged once, to see The Hunger Games with friends, but it was in the budget 😉

Despite it seeming like we haven’t had much of a  life in some people’s eyes, we are so HAPPY! Living frugally has forced us to come up with new ways to have fun, create a budget and stick to it every single month, to communicate about what we buy and why we value certain things, to dream about all the ways we desire to give and spend our money once we become debt-free, and to have a less distracted life by the fact that we don’t have “stuff” to distract us as often. Thankfully we have amazing and supportive friends who like to do free things together and working for FOCUS provides us with so many exciting adventures with college students built right into our daily lives. So we don’t feel like we miss out on too much since we are surrounded by a great community of joyful people.

So, we’ve got four months under our belts of our gazelle-like intensity and we have seen results!!! As I said earlier, we started out with close to $21,000 in debt. I am excited to say that today, we only have $10,461.09 left on those student loans. Our income fluctuates, but we’ve been paying 50-65% of our income towards debt each month. I don’t share those numbers to toot our own horns and to show how great Jonathan and I are…but to INSPIRE anyone reading this who wants to dump their debt too! If we can do this, anyone can!!! We are set to be debt-free sometime between August and September 2012. We originally thought we would need 12 months to pay it all off but once the ball got rolling, we got more and more excited to see our loans GONE, it truly became a snowball effect.

We aren’t at our final goal yet, but it’s close on the horizon and we are already talking about how to celebrate being debt-free.  We aren’t sure about what we’ll do but we’re certain we’ll be paying cash 🙂 You can bet we’ll be calling Dave to do our “debt-free scream!” Thanks be to God for the ministry of Dave Ramsey and his team of workers. Their hard work is truly paying off in the lives of so many people and we are just one of many. YOU CAN BE NEXT!!!! www.daveramsey.com