This is How We Do It – Part Six

Hey guys, I’m winding up my part of this series today. Thanks so much for submitting your questions and sticking around while I answered them! I hope you learned some things – I did! Tomorrow Barry will wrap things up by answering the last question. Today is the last day to enter the giveaway at the bottom! For the other parts in this series see: Part One, Part Two, Part Three, Part Four, and Part Five.

• What tips do you have for new homeowners and paying off a 30 year mortgage early? Also do you have any frugal ways to buy new furniture for our new house?

Congrats on being a new homeowner! It’s fun, huh? 🙂  I know there are plans out there that you can purchase that help you pay your home off early….but, I gotta tell you, that’s dumb. I’m blunt. Don’t buy something like that unless you just like burning your money. I’ll tell you how to pay off your house early – pay extra on the principal each month. You don’t need a plan to tell you that! Each month you’re paying some interest (a LOT at the beginning) and some on the principal……when you can add more money onto your principal payment, the total is going to go down – also helping you pay less in interest. Anytime you have extra money (a bonus, a yard sale, a raise, etc.) put that money directly on your principal….you’ll easily pay your 30 year mortgage off early. Make sure that your mortgage doesn’t have a penalty for paying it off early – some do.  This will be referred to as a prepayment penalty.

I love buying frugal furniture. In fact, only three pieces of furniture in our home were purchased new, but they were on sale (that’s for YOU, Brandy Nichols). The rest we purchased used. For more info on how I save money on furniture, check out my post about that.

• We have been trying to live debt free for years, after thoroughly trashing our credit rating, history, everything, the works.  We finally swam out of that mess, and have been debt free for/or almost for over 12 years.  We had 2 small ones in that time, but paid them back way early, no mortgage, don’t own cards, they don’t own us, haven’t had cable tv of any kind for over 15 yr.  Vehicles are old, but paid for.  But even after all the work, studying, and working hard, we still can’t save any for the rainy day expenses that come.  Still too much living month to month.  Doing most of the right stuff, still need help saving.  Any thoughts, and yes, we pay our tithes.  Thanks.

Barry –> If your monthly expenses match up with your monthly income even after you’ve cut your expenses (as it seems you have), then that leaves no room for something to go wrong.  That’s a dangerous place to be.  It sounds like most of the things I would suggest you’ve already done, but I wonder what happened to your income?  If you’ve been able to pay off a mess of debt including a mortgage, cars, etc. your income has had to shrink a great deal or the money is going to something else that you’re not keeping track of.  What happened to the income you used to pay off that debt?  I suspect now that the debt is gone you should have the extra to save.  Are you doing a budget?  If not, that would be the biggest step in the right direction you could make.  Even if you’re debt free, you still need a budget.  If you don’t have one, start NOW!  Sign up for Stacy’s daily email to get a free copy of my guide on how to do a budget and that should help get you started.

• We have about $21,000 in debt (not including the mortgage) & we are a two income household. We’ve gotten rid of 4 cards so far but it seems like it’s taking forever to get rid of the next card. How do you stay patient without making more debt? We are using the snowball technique by Dave Ramsey.

Woot for getting rid of four cards!!!!!!!!!!! That’s GREAT! 😀  First off, I’ll tell you – never pray for patience. Because if you do, God will send things into your path to test your patience. I learned the hard way. Ha!

How do you stay on the path when it’s taking a long time? Look back at where you used to be. On a regular basis, look at those old credit card bills. How much better do you feel knowing that they’re gone? Do you really want to add something like that back into your life just because you’re tired of waiting? No, of course not. The bondage is starting to fall off – don’t pick those chains back up. Just think about how much better you’re going to feel when the next one is gone…..attack it with that same force that you attacked the first four – do not let it overcome you. You are stronger than Visa. And if you need a cheerleader, I’m the girl for the job! Email me whenever you’re discouraged and I’ll give you a kick in the pants. 😉  As Annie says “that’s my job.”

For all the posts in this series, see links below:

Part One

Part Two

Part Three

Part Four

Part Five

Part Six

Part Seven