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Why I’m Done Obsessing Over Debt

Last year we decided to get serious about our finances by building an emergency fund and tackling our debt. Ever since, I’ve been totally obsessed with getting out of debt.

We set goals, revised those goals to be more aggressive and then revised them again to be even more aggressive. I set a budget based on living lean and then I continued to scour the budget to find ways to cut our expenses even further.

And it’s paid off.

We’ve stashed nearly 8 months worth of expenses in our Emergency Fund and we’re on track to completely pay off our debt by the end of 2011.

Obsessing over debt paid off because we made a plan and stuck to it. Our plan is on autopilot and now it’s time to move on. Any energy I devote to getting out of debt now has limited returns because we’re doing everything we can do, we just need to keep doing it.

So now it’s time to move on. From this point forward I’m going to devote my energy to increasing our income. I’m a stay at home mom to my 2 month old son, so I’ll be focusing on online business opportunities. I’ll look at everything from monetizing this blog to starting an online business. And I’ll write about my journey here.

I hope by this time next year I’ll be kicking some butt on a new set of goals based on creating wealth.

For my friends in the UK, check out this page for some great tips on how to get out of debt.

16 Comments

  1. Good stuff. Now you can obsess about making money!

  2. Wow, very inspiring story. I need to learn to have that attitude so that I live debt free. Congrats on your achievements

  3. Congratulations on your emergency fund. It makes life a little less stressful when you know you can handle “unexpected” financial things.

  4. Hell Yeah! That is a great acomplishment and an exciting next step. Any ideas how you are going to make the cash?

    • Right now I’m researching affiliate marketing, specifically the Profit Instruments concept. http://profitinstruments.com/training/introducing-profit-instruments

      • You are a great writer ever think about doing up free lance writing on sites like odesk freelancer and ifreelance? I have been completing a project working with people on those sites they NEED an English speaking writer

        • Wow, thanks! I honestly never thought of it but I’ll check them out.

  5. Awesome awesome news! Congrats on paying off your debt by the end of the year, thats only a few months away!

    I am also really excited to hear about your online endeavors! best of luck to you! Keep us updated!

  6. Congratulations on your progress! It sounds like we’re going to be neck and neck in the race to be debt-free.

  7. This year I’ve been working to build our emergency fund. I came up with a number that I’m comfortable with based off our budget, but I’m curious how you calculated 8 months of living expenses. Did you include health insurance costs? Are only the 8 mos of basic month-to-month expenditures included? Or is it based off the amount of money coming in each month? If there is a post where you already talked about this, please point me that way.

    I’m one of a two income family with 1.7 kids (#2 due in November). Our emergency fund presently contains enough to replace either of our incomes for 5 months while continuing full-time day care OR both of our incomes for 3 months without day care PLUS an additional $2500 for emergencies (house/car/unknown). If all goes well and we don’t need the emergency fund, our plan it to increase the amount by 1 month each year until it doesn’t make me nervous anymore.

    • Hi Margot,

      It sounds like you’ve thought it through and have a good plan. For me it was all about getting to a place where we have piece of mind. Our fund is 8 months of current expenses. I originally wanted to go for 12 months but we decided that 8 months was sufficient until we pay off our debt. You might find these two posts helpful:

      http://cooltobefrugal.com/how-much-should-i-put-in-an-emergency-fund/
      http://cooltobefrugal.com/should-i-put-my-emergency-fund-into-a-roth-ira/

      And congratulations on your upcoming family addition!

      • Thanks for your response (and the congrats!). It really does seem to come down to a person comfort level with the emergency fund. I wish there was some magic equation that said ‘if you save this much, everything will be fine.’ In lieu of that, I so feel better having my fund where it is at now and I can add to it in smaller increments in the future to keep the happy feeling going. :)

  8. Your achievements are already very inspiring. I wish you good luck in your plans with online business. Looking forward to more articles about your progress.

  9. Good for you! It is horrible having debt hanging over your head. I have a suggestion for you and everyone else out there……move to a cash system as much as you can. My husband and I started budgeting for real this past January and one of the things we do is use cash for almost all purchases because it is so much harder to spend cash then use a debit card or credit card. You really think twice before you pull cash out of your wallet. If you are interested in learning about the system we use go to: http://www.mybudgetbox.com

  10. Great post and congrats on doing what it takes to succeed financially!

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