Using out Microsoft Money Debt Reduction Planner (which takes all of your debts and liabilities, looks at minimum payments, interest rates and terms, and the maximum you can pay toward debt to determine a payment plan), we can project that our Out-of-Debt Date is….. July 20, 2012. Yes, that seems like it is quite a ways away, but it is so much better than “never.”
My husband and I have already agreed that any additional money that comes in (non-salary or payment for a job) will be split up the following way:
10% – Charitable Contributions
10% – Savings
15% – My mad money
15% – His mad money
50% – Debt reduction
We think this is a balanced approach that will address the knee jerk reaction of “let’s go play” with what might feel like a bone crushing “we have no fun for 3.33 years.” All of the financial guides (including the bankruptcy counseling) said that it is important that we make sure that as we are responsible, that we balance it with things that will rejuvenate and excite us so that we can continue to be productive.
We are supposed to be matched up with a Financial Counselor from our church’s program soon. The committment is a 4-6 month time of working on the steps that they identify. I am very curious to see what else they would suggest – we’ve REALLY made a lot of changes in the last year (especially the last 6 months) so I’m wondering what else we could do. I’m excited that we have the opportunity to learn even more and that there could be something else that would make our “out-of-debt” date come even closer than 3 years, 3 months, and 1 week.