Early 40th Birthday Present – I am debt free!!

[Irin997]

Congrats!!! We mail off my husband's last car payment in November! Of course next summer we're adding to our debt load by purchasing our first (and possibly only) home.

 

[lisaross]

That is WONDERFUL news! At how young u are!!!

I think u should splurge perhaps and go away for the weekend! Its not counterproductive ...u have to be able to enjoy as well! Time to Celebrate! What great role models for your daughter.

 

[piperdown]

That is GREAT. How did you do it?!

congrats! And yes, please, if you can, share how you did it.

A lot of hard work combined with wonderful generosity on the part of my in-laws.

Four years ago, we had a $200k mortgage, two car payments, and over $40k in credit card and medical debt. About half of the credit card debt was from my finishing my college degree, but the other half was just frivolous spending. We were making the minimum credit card payments, and had a few late payments on the mortgage and the cars. Things were spiraling downward fast.

Then an unrelated event presented an opportunity for a major change. Due to his declining health and mobility, my in-laws convinced DH’s 89 y/o grandfather to move to an assisted living facility, which left his home unoccupied. The plan was to sell the house, and use the funds to pay for his care because he had no assets beyond his social security and the house.

However, GF and FIL didn’t really want to sell the house, so we came up with new plan. We moved into the house. While we didn’t pay rent, we paid ¼ of the assisted living facility cost, plus any incidentals (groceries, pharmacy, etc.) for GF which was about equal to what we would have paid in rent for a comparable house. However, it was about half of what we were paying in mortgage payments and property taxes.

Big plus for GF was having family nearby, especially when he got to the point where he couldn’t drive. The only downside was that we moved from a very good school district in a nice suburb to a barely decent school district in a small town. Luckily, DD is very bright, and in some ways has had more opportunities than she would have had in the better school district (big fish, little pond).

We had a good amount of equity in our house, so we were able to walk away from the sale with enough to pay the medical bills and about ½ of the credit card debt. Luckily, the house sold about 6 months before the housing financial crisis.

The move was far enough away to require job changes for both of us. We took jobs with pretty big pay cuts, but better job security. We cut up the credit cards, and lived cash/debit only. We created a budget and stuck to it, and over the past four years have paid off the cars and the rest of the credit card debt.

This past January, DH’s GF passed away at the age of 93. We will cherish the four years we had with him, as we truly believe he would have not lasted another six months had he not changed his living situation. DH had almost daily contact with Pop, which we know he greatly appreciated in his last years.

With Pop’s death, the house (which was held in a living trust) went to FIL as the beneficiary of the trust (FIL is an only child, as is DH). Prior to Pop’s death, FIL had discussed splitting the ownership of the house 50/50 with us. I never gave it much thought because I assumed the house would have to be sold at the point where Pop needed more care than the assisted living facility could provide. Nursing home care was almost double the cost of the assisted living facility.

However, after his death, without discussion, FIL signed the house over to us, free and clear. It was the most generous gift we will probably ever receive, and we will be forever grateful.

So here we are….debt free, thanks to a little luck, great generosity, a strict budget, and the willingness to embrace a significant change in lifestyle.

 

[Kitzka]

This is awesome and what an incredible family you have. The extra time with your GF will mean more in years to come than anyone can ever know.

Lara

 

[ceemys]

That's great!! Congrats!

 

[craftymama71]

Congratulations