This morning I made a debt payment for $309.15 and I could not be more excited because that means we’ve gotten every small item off our debt snowball and all we have left now are our student loans and our car.
We didn’t do our debt snowball exactly to the Dave Ramsey plan, so here is a quick outline of what we did:
- Paid of the small debts (everything less than $500) in order from smallest to largest
- Started making the biggest regular payments we could afford on our remaining debts
- Paid larger debts with my income as I had new clients or one-time jobs outside of our regular budget and applied extra money like cash back to our largest debt just to reduce our overall balance.
- Waited for a 50% settlement for our one final debt.
Several months ago when I called the company to pay off this final debt, I was treated really rudely. I had an old offer letter that was delivered to my in-law’s house that they didn’t tell me about, so when they finally brought it to me several months later I called and tried to make the payment, but the woman on the other end of the phone was so rude that I told her I wasn’t going to pay it then and I would just wait for the next settlement offer. This month, the offer letter came and I paid it immediately.
Since I’ve started paying off debt, I have brought my credit score to 350 from just over 530. While my starting score is really terrible and I know that anything in the 500’s isn’t great, I’m really proud of the progress I’ve been able to make in the last year.
This last debt we paid off today was the only negative thing on my credit score so I expect them to jump again here in the next month or so when my score updates. Yahoo. Of course, once we’ve paid off our debt it’ll eventually be back down to zero, but for now it’s good to be removing all of the negative things off the report and having the measurable success.
Now that we’ve got a great stockpile for Logan coming and since we made our goal of having a $1,500 emergency fund in the bank back in this month, I am now using our Digit savings to go toward some larger expenses like the new dryer I’m going to need very soon.