Thursday, May 1, 2014

Debt Free by Thirty


It has been a goal of mine to be debt free by the time I turn 30. When June 24th hits, I will have exactly 4 years to accomplish this. 30 feels far away but when I look at that massive red number, it feels a little REALLY overwhelming. But a dream doesn't become a goal until there's a plan in place so it's time to really dive in and make this happen.

As of today, my debt number is $64,202. Ugh. What a painful thing to type. Rather than dwell on the overwhelming mountain, I'm going to try to think of it as a challenge.To make it more achievable, I'm going to break it down into smaller goals.

I need to pay off $16,050.5/year in principle alone. Including interest, I will need to pay $20,000/year to stay on track. Trust me, typing this is making me want to throw up. But I can't accomplish it if I don't face the facts.

If I'm looking at $20,000/year, that breaks down to $1,667/month in debt payments. Honestly, I'm not sure that's even possible. Currently I pay anywhere from $500-$1,000 each month and I can't imagine an extra $600 magically showing up in my bank account each month.

And if I'm really being honest, that number freaks me out big time. I have anxiety boiling up in my stomach and I want to cry thinking about all that money drained from my bank account.



BUT!

By paying it off in 4 years, I'm paying a total of $80,000 and after that point I will have $1,667/month to do what I want! If I were to pay my minimum payments of $500/month for the next 20 years left on my loan, I would be paying $120,000 total and I would be waiting until I was 42 to have spare money each month! Sounds like it's worth the sacrifice to me! 

It's time to figure out just exactly how to make this happen without eating strictly ramen noodles for the next 4 years!