Dear Dave Ramsey,

Dear Dave Ramsey,

We’re debt free and doing great with step 3!

When Ben and I got married two and half years ago, we had no problem doing a budget together. We read several books, and were able to talk about finances and come to agreements easily.

I was fortunate to be debt free, but only because I had sold a home, been fortunate to make a great profit, and paid off about $30,000 in debt (from credit cards and a car) just before we got engaged. At the time we got married, our debt was about $50,000 plus our house. That came from Ben’s student loans, credit card debt, and car. The car “debt” was actually a lease, but we planned to purchase the car at the end of the lease with all cash, so we treated the total buy out amount as a debt. Clearly, Ben and I were both in need of a total money makeover, but we got to that realization gradually.

We waited until we said “I DO”, but we paid off the credit card balance as soon as we were married with cash I had from the sale of my house. That left us with $45,000 in a consolidation loan, student loans, and the car. We both agreed we eventually wanted to be debt free, and started with the car “debt”. Since paying off the credit card balance we have NEVER carried a balance on a credit card farther than the next pay day. We BOTH learned how easily that got out of hand during our single days and promised one another, before we got married, that, as a couple, it was not going to happen again.

A few months after we were married, my husband read one of your books. He told me about it, and my response was that I was glad he was “gung ho” about getting rid of the debt, but I wasn’t ready to reduce our savings (I think we had maybe $15,000 cash and I did not want to stop contributing to retirement-- I was convinced it would be giving up free money since I had a matching contribution at my job).

Then two summers ago, while driving in Washington and Oregon, Ben brought your podcasts along for the long car ride, and- of course- got me hooked on your plan just as he was. All the sudden, our financial decisions became even easier as we considered “What would Dave do?”. Giving up a little of the extras was easy because of the success stories we read in The Total Money Makeover and on your show.

Our debt reduction was doable, so we didn’t feel we needed to be at the “beans and rice, rice and beans” level. We were serious, and committed, though. We got just a little stricter on our budget, and started holding each other accountable for larger purchases. I learned how much I tend to spend on gifts, so we planned our Christmas expenses and baby shower budget ahead of time. A quick call home would help decide-- “should I get a new microwave because I want one and see one I like at Costco? No, honey, ours works just fine” OR “Sure, we do have enough money for it and that sounds like an excellent deal for clothes you need!” We based our budget on having two pay days a month (we’re both on the same biweekly pay schedule), and as if Ben might not get any bonus money. We threw all of Ben’s bonuses at the debt, we used our tax refunds towards debt, and we used a good portion of those two “extra” pay checks in the 26 pay periods schedule toward debt. Since we’d done our budget without depending on those things, we barely noticed!

I remember one day when I got tired of looking at the smaller student loan of about $7,000, and said, honey, I think we should just use some of our savings and pay that off. I have never had a rush as exciting and refreshing as checking the balances on the students loans and seeing that one gone!

Meanwhile, we found out we are infertile. Now, four years ago, I wouldn’t have batted an eye at choosing to try IVF even though it would cause $12,000 or more in debt and might not even work. I also wouldn’t have considered it a bad idea to just charge the expensive tests Ben needed that weren’t covered by insurance. It just so happens though, that we’d already caught the “Dave Wave” so we did think twice. We paid for all the needed tests in cash, and if we couldn’t afford it, we waited until we could. We prayed about what we should do, and we had total peace when we decided adoption was a better option for us. We couldn’t imagine what it would be like to either become parents with a huge new debt like that, or how awful it would feel if we’d tried IVF, it was unsuccessful, and we’d still have to pay on a loan for it! It didn’t fit for us, especially in light of our Total Money Makeover!

I work as a claims representative for Social Security. I can not express how horrible it is to take claims from hard working people who suddenly find themselves too sick to work, but so deep in debt that they will loose their house. No emergency fund, they just bought a brand new car- with a loan- a year before so they will loose that too, and they are not sure how they will feed their family since they lost their job. No disability insurance- or somehow they don’t qualify, their long time job let them go at a drop of a hat when they mentioned their illness or missed too many days for doctors appointments, and now their Social Security decision will take a good 5 or 6 months.

You know what else is horrible? When a 62 year old comes in wanting to retire and realizes there is no way they can afford to live on Social Security alone-- they have 15 years left on their mortgage, no pension, barely any savings, and their spouse just died and left them nothing except one income instead of what used to be two. They can’t even afford their mortgage anymore.

I share that because my work helps me see the reality that people face on a regular basis. Not one of those suddenly disabled people thought they’d be disabled even three months before it happened. And as for those people who want to retire, I betcha in hindsight, they aren’t thinking all those debts were good decisions. You know what I love, though? Taking claims from people who are facing disability or ready to retire and won’t even need their Social Security check. They’re financially ready for whatever happens. These are the happiest, most relaxed people I meet. People who have lived like no one else and now can live like no one else!

Ben was told he was going to be let go effective January 1st. What a horrible crisis that could have been a few years ago. But not for us in the beginning of 2008! We were close to debt free, had been fortunate to see increases in both of our salaries since we got married, and just had one little $70 monthly minimum payment for the last student loan. We’d already purchased the car, and of course we had our baby step 1 $1000 emergency fund in place. We glanced at our budget, saw living on my salary alone was going to be no problem at all, and didn’t miss a beat. Once he got the news, and while he was still working, we just diverted our debt snowball money to savings in case we needed it for living expenses while he was looking for a new job.

Of course, Ben got a new, better job and ended up without a single day unemployed. And I got transferred to a new office doing the same job I was doing, but in a location I am more excited about. We were approved for adoption, but needed to wait until the next round of classes.

Well, here we are, ages 35 and 38, debt free except our house. We’ll have our baby step 3 of saving 4 months of expenses done in less than 4 months! Our adoption classes begin in March, and we are confident we’ll be able to afford the adoption fees when it comes time for us to bring home a baby to our “forever family”. We’ve enjoyed being able to give just a little more to ministries. Our house is on the market, we’ve been able to pay cash for all the expenses of getting it ready, and we’re looking for a new house that will be a better commute for BOTH of us. We are committed not to place an offer on any house without ours being under contract, and we’ve got a much bigger allowance for our next house than I ever imagined possible. It will be no problem to keep on your plan with that new mortgage, because it will, after all, be our only debt. And we won’t be buying more house than we can afford. And no worries, Dave, we can’t wait to get it paid off long before our kids reach college age!

Regarding Marriage and Money: We’ve always gotten along when discussing finances, but gosh. It did amazing things for our marriage as we repeatedly got to look at one another, realize we just met a goal of paying something off, give a high five, and say “Go Greenwalds!” in unison! I am so proud of my husband for leading us to this point! We became debt free just before Valentine’s Day. The love I felt for my husband at that nice restaurant we could totally afford is more amazing and greater than the love I felt for my husband on our wedding day.

What was the hardest part? Letting go of the comfort and safety net of having savings and contributing to our retirement.

What was the easiest part? Sending that last payment to Sallie Mae! Whew, what fun!!!!!

What was the most surprising? How easy it was to rearrange our budget and come up with so much more money.... boy, were we wasting money on needless things! And we don’t miss those things at all now. It is actually fun to be at a store, tempted by something I see, and be able to say: “nope, don’t need that, I’d rather that $25 be in our emergency fund!”

Thanks for your message, Dave. We love your books and your show. Your teaching has made a huge difference to us, our marriage, and our family. We’ve started on an entirely new path for us and our future children, and we’re skipping along on it!

Jennifer and Ben Greenwald, Atlanta, GA

get the podcasts, order a book, or read more about Dave Ramsey at www.daveramsey.com