During our Operation Staycation 2020, Mr. BMM and I got to talking about paying off debt. We asked each other a lot of questions. During our walks we asked “How do you feel about debt?” During car rides we asked “When do you want to be out of debt?” While relaxing around the house we asked “How much money per pay could be set aside for debt?”
In addition to my car and student loans, Mr. BMM and I have some joint debt. Our mortgage turned into a home equity loan years ago. Then we took out two more additional home equity loans for a new roof and a new kitchen. The interest rates range between 3-5% as well as the loan amounts and terms. Mr. BMM estimated a biweekly number that we would each put towards our joint debt. Me being the slightly OCD one of the marriage quickly downloaded biweekly/monthly amortization excel templates to verify his estimated number and determine where we should put the extra money to save the most amount of interest.
P.S. His estimated number was spot on.
Since it’s joint debt and Mr. BMM opts out of the public social media presence, I will not be disclosing the real numbers except two. We will save close to $18,000 in interest over 5 years of paying off our joint debt.
As a result of this change to my personal budget, I am re-evaluating my own debt. Which loan do I pay off sooner? Where will I save the most amount of interest? How much do I put towards debt while still saving money? Where am I going to park my savings? Is it in a Vanguard account? Savings account? Mutual fund? How much extra will I make at the salon each week? Where will my salon pay fit into my budget and debt pay off?
After worrying about job security over the past couple of months, I really had to refocus and re-evaluate my debt pay off journey. I was not comfortable only have $1,000 in an emergency fund. I read Dave Ramsey‘s book but I needed to personalize my debt pay off journey to fit my life, my needs, and Mr. BMM’s needs. My goal is to have a plan in place for August.