To those who climbed out of debt 100%, how did your life change?

Thanks for the replies everyone.

A big mortgage and smallish student loans are our only debt right now. We never carried a credit card balance and just paid off our second car. First car was bought cash. The mortgage payment is big enough though that we both have to work full time at high stress jobs if we want to pay down debt.

We do have a decent emergency fund in the bank that could last around 6 months in the unlikely event we both lost our jobs at the same time.

All things considered I think we are in good situation looking at mid 30's and owning a home outright. I'm glad to hear from all of you that the sacrifice is worth it.

Brian

Yeah in this scenario I dont see a ton of difference either, but there are some benefits of choosing to wait a year to save up for this item:

1. You might decide during hte course of year saving that you dont really want/need it.
2. Noone can predict the future with 100% certainty and who knows if you will be able to keep making hte payments after purchase
3. Buying on credit just reinforces the "gotta have it now" mentality that traps many americans in the debt cycle where saving up for the year can have the opposite effect

We are debt free, but still have the stress. Currently we don't have a regular income, so there is still stress over the bills you can't get away from~~house/car insurance, utilities, taxes, etc.

But I can't imagine having added to all of that credit card bills, mortgages, or car payments. Being debt free has enabled us to survive with a roof over our heads and we still see options for us.

Gary, your approach is a wise and frugal one, just as long as you keep your job.

Right now a lot of people are not keeping theirs, or are worried that they might not. Even a 0 interest balance can be a problem if your income gets much reduced.

I would say that when we were no longer out of debt it was a big deal to us..as my husband is mentally disabled and unable to work and i must be here most of the time to care for him..and i'm partially physically disabled as well..so working for hire is very difficult for me to do.

Not having money worries is a big deal. What we did with our money after getting out of debt was to do things to make us more and more self sufficient.

first we bought a tractor, that way we were able to do things for ourselves, and we bought a pick up truck so we could haul our own lumber, manure, mulch,etc.

then we bought an outdoor woodburning furnace, to eliminate the need to heat with propane and to eliminate the mess in the house to use the inefficient fireplace..

we bought plexiglass and we enclosed our front porch to make a sun trap and we added a 12 lite door to the porch as well..we bought plexiglass and got salvaged sliding doors to enclose our rear porch and put a roof over it. so that is nearly enclosed..we'll finish it next year hopefully.

the last thing we have purchased was a propane genearator..which just arrived last week.

all the above items we bought with cash after we were out of debt.

we own our home, 3 vehicles plus a tractor, lawn tractor, snow blower, 2 tillers, push lawn mowers, chipper, d r trimmer, chainsaws..etc..all bought with cash..

we built outdoor building additions and lots of remodeling and stuff for cash.

we have put in perennial fruit trees, nut trees, berry bushes, landscaping etc..all with cash and dug a large pond..

we own no credit cards and use only cash, checkbook and debit cards..

we do NOT keep a large savings account..as with inflation it is cheaper to buy the things when you need them and use them rather than to keep a lot of money tied up in savings..at least that is how we have always operated.

we don't purchase something we don't need..we tend to try to not be wasteful.

we also do not do things like garage sale ..as we give all of our extra stuff away to charities..

we try to keep things moving out of our house that we don't need..

we also shop for things ahead as a habit, buying things when they are on sale..so rather than having money in the bank, we have resources to use..if an item is something we use regularly, we watch for it to come on sale and then buy enough ..if it won't spoil...for up to 6 months or more..like i buy laundry soap, deoderant, shampoo, etc way ahead..we always keep enough staple foods in the house to last us about a year if we were to have the sudden need for it..as well as paper products..they are always bought on the cheapest sales and rotated.

we try to budget well and plan months ahead of time..for all of our needs..right now all the birthday presents for this year are already bought, wrapped and labeled and stored for giving..and we give only baked goods or fruit/food to our family for Christmas except my son and husband..who get a small boughten gift..we don't send cards..but we do send personal letters..cards are just tossed away and are meaningless.

we rotate everything, including clothing..the older items becoming everyday wear when nicer items are bought to replace things thrown out.

etc.

yes i can seay it changed our life completely being out of debt..the worries are nearly completely gone..sure you have concerns over a serious health situation or a serious breakdown of an appliance or vehicle..but other than that..we are never needing to worry about anything..

i always pay my bills the day they come in as well

Of the two of us, I have been debt free twice. The biggest mistake was getting back into debt. You can plan and believe all you want that you will be able to handle the debt but life has other plans - and then you're stressed. We live so cheaply we are looked down upon by plenty of people but I wouldn't trade it now for any material item. Aside from being stress free, the biggest advantage is being able to take advantage of great deals when they present themselves - especially when they are on our "will need in the future" list. This happened to us this summer with a car. We bought a 1996 Crowne Vic for $800 with 100,000 on it; all new tires and two new spares on rims; and an immaculate interior and no rust. When we spotted it, we felt for sure we couldn't afford it but we turned around anyway and got the phone number. I nearly fell to the ground when the man told us what he wanted for it. Then I thought there must be something wrong with it. DH is a handy mechanic and looked it over thoroughly after test driving it. NO problems and it was put to use three days later when the truck was disabled.

When others are scratching their heads about us being able to survive on so little they have a tough time understanding it's because we have decided what's really necessary: food, shelter, heat and lights. For them it's movies, bar-hopping, dining out, poker games, casinos, shopping and a zillion other wasteful things that contribute nothing to their security.

We earn under $8,000 a year and are forever giving food and clothing, etc. to other family and friends who make up to 10 times what we do. It's all a matter of priorities!

Being debt free is synonymous to me as having discretionary income. Having discretionary income affords numerous opportunities that I never knew existed when I was in debt. Fortunately by working two jobs and making personal sacrifices the wife and I managed to shed debt a long time ago. I often tell those that want to get debt free to start reading the menu from right to left and approach other purchases in a similar manner. Get good value for what you buy and buy only what you truly need.
Opportunities abound when one has the capability to purchase without delay. I have bought land, homes, vehicles and machinery, livestock, etc. for cheap because the seller wanted to sell now. Most of these items appreciated over time and were used to great benefit or sold(mostly land) for good profits.
Being out of debt goes a long way toward a good nights sleep when the financial future is in turmoil as it now is.

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Agmantoo
If they can do it,
you know you can!

I second what Tracy Rimmer said. We still have a mortgage but otherwise, we are debt free. It brings relief and peace. As she said, it helps the marriage improve and the relationship with the children.

We involved our kids from the beginning. It was hardest that first year. As we learned to say "NO!" to just buying and buying, it became easier and now is just a way of life. My kids are so frugal now too. Our oldest worked for the last year to save money for a year of travel. He is in Australia now and then New Zealand. He is learning much.

Change did not happen over night - so hang in there. It will creep up on you gently and one day, you will be be aware that life is better and you feel better.

Good luck!

I can understand where you are coming from, Gary.

I think the problem with most people is that they can't control their spending and or debt. Buying on credit for lots of people is like tying their own noose.

For us, I was adamant that I would not be dependent on someone else, and that we could not grow our wealth by having loans on cars and making credit card payments.

I am very thankful now that I paid off all of our consumer debt. I have had some severe health problems, and my income has been cut by more than half.
Being debt free removed a ton of stress because we didn't really have to change our lives and work when my health went down the tubes.

We are self-employed (we make and sell crafts for a living ever since 1985 full time). Our income is very seasonal and we used to always have to wait until fall to pay off credit card debt accumulated throughout the year. We often weren't able to and it was always stressful worrying about it and paying high interest. By the grace of God and much credit given to following advice in Dave Ramsey's books, we are completely out of debt and have been for a few years now.

The last couple of years haven't been so great financially and it is such a relief not to have to worry about what if we don't make enough to pay our credit card bills, etc. We just have to live more frugally than before, but we don't owe anyone, so the big stress just isn't there anymore. It makes for a much more peaceful life.

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Robin Hood was not a hero; he was a thief!

The job issue is why I specifically said non collateral loans. If you dont have the money to pay the loan then you dont pay the bill. Thats the risk and part of the cost of a lender offering credit to people. I know some people have this signma will owning but I see it as a fact of credit.. The one time I was out of work , I didnt like not being able to pay a bill on time but after a few months I got a job and resumed my payments. I am not suggesting getting out of paying your bills, but stuff happens and that the risk the lender takes. I am willing to take that risk as well.

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Gary in Central Ohio

I dont make to many impuse buys so I decide if I want/need. something.

If that happens then thats the risk the lender takes with the loan. I am not going to worry if the loan cant be payed back or not. I will pay it back if I am able. If I am not then so be it. I AM NOT suggesting you ignore debt but if situation changes then you deal with no be consumed by it.

Very true, it can be a trap, A trap that many folks are in and its a fine line that you need to watch. I just dont think credit is bad if managed correctly.

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Gary in Central Ohio

When you do not pay your bills then your credit is poor.

In the 80's we were able to move to where jobs were because our credit was GOOD.

ANY debt is a problem when your income is dcreased.

Terri,

On the flipside, being land poor canbe a problem as well if one runs into financial difficulties.

Properly managed and used sparingly credit/debt is a tool. OVerused or abused it can be a harsh taskmaster. DW and I could never have bought our farm without the use of debt.

I'm not saying everyone should run out and start buying things on credit. I do believe that the mantra of having absolutely no debt as the goal can be just as risky for some that follow it as the use of credit is for others.

As usual, just my 2 cents.

Mike

If your not able to pay your bills you dont need any more credit so who cares is your credit is poor.

Debt is a problem for the lending institution when your income decreases not you.

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Gary in Central Ohio

Of all of the folks I know who paid off creditors I have never, ever heard a single one say, "Boy, I sure do miss making payments on that ---. I wish I still owed on it!"

We were broke. The CC is how we got to where the jobs were. We ate off of the CC and we got gas off the cc and we got to where DH had getten a job.

Without good credit in the form of the CCs we would never have been able to follow the jobs.

So, we DID need good credit.

I agree with those who say that credit can be a useful tool. We first were debt free in 1999. Before then and since we have bought and sold a series of houses, some of which we carried a mortgage on as we renovated them. Now we have two houses and a rented commercial building, plus two separate five acre lots, paid for free and clear. Our vehicles all are paid for, and we have no credit card or other debt, plus we have cash reserves, retirement accounts and so on. We never would be in this position if we had not used credit to make house purchases. I still have a home equity line of credit, currently with zero balance owed, on which I can draw if I decide to buy something else that I think might be profitable to turn around. I don't have plans to, but you never know.

A long time ago I read "Your Money Or Your Life" and it really struck a chord with me. My goal in becoming debt-free was to eliminate my dependence on full-time work. Not that I don't like my job (I am an industrial safety engineer) but I really wanted more of my own life. Now I have been able to pare back to three days a week, which is a good balance for me. My wife also works part-time, to cover her horse expenses, and on our two fractional paychecks we seem to have enough money for our fairly simple needs. It's a big change from the days when I sweated making all the monthly house and car payments!

Have been totally debt free for several yrs. It's like having a big weight off you. Still have to budget & really plan ahead for big purchases, new truck, & insurance. Essential to have medical insurance & a savings for emergencies, but it is sure nice.

We've never had a mortgage, paid our original farm off in a few years on a land contract back in the late 1970s, built a house "pay as you go" and are still debt free. We did it so we could avoid working as much as people with big debts, and things have worked out well. Never have had fancy new cars (well, did have one in 1971 I think, new but not fancy). We have managed to raise 3 sons, live well, install our own solar and wind electric systems, and now I am retired, with a modest income, but we never needed more than that to live on all these years. We had good jobs that we didn't much like back in the 1970s and used that income to pay off our land and build our original house. Our sons seem to be doing all right along the same lines, no debts, and the youngest just bought a house for cash. He always was a real tightwad and needed someplace to put his money that was better than the bank.