Debt Free Blog

I’m getting out of debt! No, I don’t have bill collectors hounding me. We haven’t had a car repossessed. We can afford our monthly payments and then some.

So why, you ask, am I hell bent on getting out of debt? Think about it for a minute. We have a mortgage at a great interest rate (6%), two vehicles that are financed (used to be three), credit cards, student loans and business debt.

Even though we have more than enough money to make minimum payments and even pay extra on each every month, when you add it all up and look at the interest you pay on debt, it’s ridiculous.

Let’s look at a hypothetical. Let’s say you have a total of $150,000 in debt (including your mortgage) and your average interest rate is 8% (including all credit cards, loans, mortgage, etc.). I know this is overly simplified, but bear with me… it’s just for illustrative purposes.

Now, that 8% APR equates to 0.0067% per month interest charged on all your debt. That’s not even 1%, but figured on $150,000 that’s still $1,000 a month in interest.

That’s right, $12,000 a year goes straight to some banking institutions. You might owe twice that much just on your home. I’ve even heard of some people who had that much just in credit card debt!

My point is simple… if you have debt a huge chunk of your money goes to keeping the banks in business.

That $1,000 a month in the example above, if invested in modest mutual funds over 40 years, would net you over $11,000,000. That’s right, $11 MILLION.

The purpose of this blog is to educate people on how to get out of debt, to log my familiy’s journey getting out of debt completely (even our house), and to provide people with the resources necessary to take control of their financial future.