Why You Need a Money Plan w/ Steve Stewart

Name

Steve Stewart (Debt Squad code name: Radar SOS)

Blog URL

http://MoneyPlanSOS.com

Why do you think it was so easy to fall into the debt trap?

We were taught that debt was a way of life. Our culture told us it was normal to have a car payment and the ONLY safe way to buy things was to use a credit card and leave the cash at home. Peer pressure allowed us to rationalize spending money we didn’t have to buy things we actually couldn’t afford.

What was the defining moment that made you realize that you needed to get out of debt?

I don’t remember there being a specific event. I always believed the ultimate goal was to retire with money in savings. Having a bunch of credit card debt at age 65 didn’t seem like the way to make that happen, so we made the decision to cut them up and stop borrowing more money.

We started paying attention and stopped paying interest.

What obstacles did you have to overcome in paying off your debt?

The biggest obstacle was getting restarted on the moneyplan when unexpected or forgotten yearly expenses popped up. Getting started and staying motivated until it was all gone was the hardest part.

How much total debt did you have?

In 2005 we borrowed $12,500 on an SUV.

How long did it take to pay off your debt? (If still paying on it, list how much you’ve paid in what time)

13 months for the SUV. We still have 38 payments left on our house but are working towards being completely debt free before the end of 2015.

What are your best tips for someone who finally wants to get out of debt?

  1. Stay current on all your bills
  2. Save $1,000 in cash for emergencies. Stop saving for everything else until this is done.
  3. Get mad at your credit cards, cut them up, and pay them off. Your wallet will thank you for it.
  4. Don’t stop until all your non-mortgage debt is eliminated
  5. Did I mention you need a budget?