It has been a long time since I last posted about our Debt Snowball. By the time we sit down and have our monthly (sometime bimonthly) budget meetings I am exhausted. Knowing where all of our money is coming and going is hard work. In August we paid off our van eleven months early. Getting the title in the mail was completely liberating. We now own both of our cars! Our only debt is our student loans and our mortgages.
Conventional wisdom says that when paying off your debt with a debt snowball you start with your lowest balance and work your way up to your highest balance. In order of lowest to highest our areas of debt are my husband’s student loans, our small mortgage, more of my husband’s student loans, my student loans, our large mortgage. Theoretically we should pay off my husband’s student loan next but we are going to pay off our small mortgage instead. We will get more bang for our buck that way. It just makes sense to pay off the higher interest rate. Our debt snowball was recently slowed when we added one day of preschool tuition to our older daughter’s week and enrolled our younger daughter in preschool as well.
It was a little sad to slow our progress but then I remind myself that we are 29 and 28 years old and we are doing awesome. Our debtfree life is within arms reach and we will get there shortly.
How are you doing with your debt snowball?
Leandrea is a married mom of two girls, ages 13 and 12, living in Atlanta, GA. She is passionate about helping people save money one coupon at a time. Read more
We close on our 2nd house on Friday! That is going to free up 1 mortgage payment and payoff the loan we took out to pay for our fertility treatments that lead to the birth of our daughter! Plus we will pay off the home depot card that we started to update the house! That will basically free up 1100 dollars a month! Then we are going to start paying off credit cards! I cannot wait to have them paid off!
Congratulations, it sounds like you guys are on a roll!