The first major debt I had was a 2009 Toyota Camry.
It was time to move out of my 1997 Honda Accord with over 211K miles (which is still probably running around somewhere) to something a little more reliable. So, after loads of research and patience, I found something I liked that was just in my price range. Monthly payments were $283.00 a month for 72 months… But, I knew I wouldn’t keep the payment around for that long. I went with 72 months for security. I knew I could pay the 48 month level payments, but what if something happens? Knocking the payment down by a little over $150 a month could make a big difference if I were to get in to a pinch for money. Life happens.
Before buying the new car and going into debt, I had roughly $1,000 dollars saved as an emergency fund. The plan was to pay $300 a month. I’ll admit, I wasn’t as worried about aggressively paying the car off. I assumed a little extra was enough. After a few months, I increased the amount to $415, then $500. This amount wasn’t large enough to put me in a bind; instead, to make sure i paid attention. It was a goal, and a good goal is one that is a bit of a stretch from the norm, but not so much that it’s out of reach. Some months I would pay a little more, and others a little less as things came up.
In a little under three years, I clicked that “pay” button for the last time! Three years of allocating bonuses and found money, I was finished! Having that off my shoulders was a great feeling that made all the sacrifices along the way worth it.
Kicking debt isn’t fun; it’s worth it. But, with enough focus and hard work, you can balance responsiblities and enjoying life. Think of it as a game with some great benefits if you play well!