Overcoming Debt: How We Eliminated $30,000 While Planning Our Dream Wedding

Debt can feel like an insurmountable weight, especially when it stems from years of financial missteps. My journey began with unintentional overspending—money I didn’t have spent on things I didn’t need. Upon getting engaged, my fiancée and I confronted our financial reality and made it our mission to eliminate debt while preparing for our wedding.

Facing the Numbers: A Financial Awakening

Before setting our wedding date, we decided to have an honest discussion about our financial situation. This was the first time we looked at our debts in stark numbers: my fiancée had $10,000 in credit card debt, while I was carrying $17,500 in student loans and an additional $3,500 on my credit cards. The total? A daunting $31,000. It was at that moment we realized we had to make a serious change.

The Commitment to Change

With our wedding date set just 16 months away, we quickly became determined to conquer this debt. I dove deep into personal finance literature, devouring books like “Rich Dad, Poor Dad” by Robert Kiyosaki and “The Richest Man in Babylon” by George S. Clason. I absorbed tips from financial luminaries like Dave Ramsey, realizing that mere research wouldn’t suffice; it was time to take action.

Step 1: Establishing a Budget

The first significant move we made towards financial control was establishing a budget. Using a budgeting template based on Dave Ramsey’s “The Total Money Makeover,” we were able to categorize our expenses meticulously. We adopted the envelope system, allocating cash for specific categories—gas, groceries, etc.

In a bold move, we also decided to shred our credit cards. While some might see credit cards as convenient, we understood they were harmful to our financial health given how we previously used them.

After the first month of tracking our expenses, we refined our budget, identifying areas of waste and revealing a clearer financial picture. This eventually evolved into a comprehensive Excel spreadsheet, which we still refer to today.

Step 2: Strategically Paying Off Debt

Equipped with a solid budget, we calculated how much money we could allocate each month toward our debt. To increase our income, I took on a side job, funneling all earnings toward our debt repayment.

We explored popular strategies: the Debt Snowball (paying off the smallest debts first) and the Debt Avalanche (focusing on debts with the highest interest rates). We initially employed the snowball method to build momentum, but shifted to the avalanche method to save on interest over time, ultimately finding it more effective for long-term financial health.

The Debt Snowball Method

1. List debts in ascending order.
2. Make minimum payments on all debts.
3. Allocate extra funds toward the smallest debt until paid off.
4. Repeat with the next smallest debt.

The Debt Avalanche Method

1. List debts in descending order of interest rate.
2. Make minimum payments on all debts.
3. Focus extra funds toward the highest-interest debt until it’s cleared.
4. Roll that payment into the next highest-interest debt.

In the end, the avalanche method allowed us to pay off $31,000 of debt more efficiently while saving on unnecessary interest payments.

Step 3: Saving for Our Wedding

With our budget in place, we began saving toward our wedding cost of $15,000. It seemed ambitious at first, but the numbers indicated it was achievable. We opened high-yield savings accounts to maximize our interest earnings and separated funds for specific expenses—photographer, flowers, honeymoon—allowing us to track each goal clearly.

Every paycheck saw money earmarked for savings, making our goals feel prioritized rather than secondary.

The Big Day: A Celebration of Accomplishment

Fast forward 16 months to our wedding day; I still had $1,000 left on my student loan. While not entirely debt-free, we had accomplished remarkable financial feats. The journey taught us discipline and transformed our relationship with money.

Key Takeaways: Lessons Learned

1. Debt Doesn’t Have to Control You: Acknowledge your debts and face them head-on.
2. Try Different Payment Methods: What works for one person may not work for another; experiment with various repayment strategies.
3. Prioritize Happiness: While tackling debt, allow yourself small pleasures to ensure that the process remains enjoyable and motivating.

Ultimately, our story of overcoming $30,000 in debt while saving $15,000 for our wedding illustrates that commitment and a strategic approach can lead to extraordinary financial success. Takecharge of your financial future; it’s never too late to make a positive change!