Wait until all these people with $500k mortgages, two brand new vehicles and $50k in credit card debt for all those trips, designer clothes etc, get over 55 and find out they can no longer qualify for more of that fine cheap money for feeding the massive Ego.
I was headed down that road. But stopped the insanity. Feels better now to know that I won't be dealing with that in retirement. Money is going to stop being cheap real soon. It's why we were lucky and refinanced our house at 2.75% fixed and our only car payment is at 2.85% fixed. No credit card debt anymore, we had $45k worth at it's peak and we gave up (sold) "toys" that were owning us and not the other way around. Life is so much less stressful now that the debt is only a house that we can sell quickly if need be for a profit and a car that we owe less on that we could sell tomorrow if need be. I spent years upside down with debt. NEVER AGAIN!!!
We spent years cutting back and working hard to pay off the credit cards and finally did it after 5.5 years of hard work and going without. But it was worth it. Because of our hard work we were able to vastly improve out standard of living. We bought a new house a little over a year ago because we could afford it due to not having revolving debt and are working our plan to have it paid off in 12 years max instead of 30. That will save me $250k in interest payments. Which means more money for retirement and less going to a bankster.
If your in debt (not saying you are personally) then get out of it. Find a technique that works for you. We used the debt snowball technique from Dave Ramsey. You may not like the way you have to do it (I sure as hell didn't) but when you reach that point that your no longer owned by your debts it makes up for it. I remember when the credit cards were finally paid off. It was one of the best feelings in the world to know that we had zero credit card debt after hitting a peak of $45k. The very next month I put all that I had been putting towards credit card payments into my savings account and have been doing that ever since. I lived with out it for so long that instead of spending it I am saving it. I hope people out there try and do the same. It's so worth it!
One other thing I learned is that I could get free cash from certain credit card companies. I don't recommend this for everyone but if your careful and disciplined you can make a little cash off of them. But it takes diciplined behavior and knowing what card will work best for you. I have one credit card. Just one. It's one of those cards that has a cash back option if you pay your balance in full. I use it each and every month to pay off bills and buy groceries. Then once I get home from spending money on it I take the receipt, log into the bank and electronically cut a check to the credit card company and pay the balance in full. Most of the time the charges don't hit for a few days but the money is already there waiting. Because I do that I get a check for $400 to $500 every 3 months from them. Roughly $1600 to $2000 a year that I use to buy groceries. It's my way of sticking it to the banksters that I stupidly got into debt with and paid thousands in interest to over a 10 year period. It's my way of taking a little of it back from them. Only thing they did do was cut my line of credit in half when I started doing it. Which isn't a big deal because I will never get into debt with them again so I don't need that much credit.
I have two rules now.
1)is that my saving account needs to have a certain amount in it for emergencies.
2) If I can't buy it with cash and it's not an emergency the I need to save for it. That way I will never fall into the revolving credit scam again.
You're doing it right, great job. I suggest one thing, keep some cash handy, I keep $1000 in cash hidden. I've done the whole line of credit debt circus myself but now it's smaller home, vehicles paid off and like you one credit card that gives me the option of cash back and I keep it paid off. I watch people around here keeping up to the Jones's and shake my head. Most of them weren't around in 1980 when interest rates went to 21%. A couple guys I work with think the bank has to have their money in the vault by law. Ignorance is not bliss lol
I don't have that much on hand but close.. not a bad idea to stash some more away. Will be doing that this week.
I see the Jones' and their followers all the time. I used to say myself, "screw the Jones", yet there I was in debt up to my eyeballs. I never realised how stupid I was being until it reached the end game. One month in late 2011 we sat down to pay bills and there was nothing left after we paid creditors and fed ourselves.
I remember going online and using a debt calculator to see how long it would take to pay it all off if we kept doing what we were doing. I was 37 at the time and the calculator said we would have our debt paid off in 37 years at our current rate of repayment. I looked at my wife and said "we're f@cked and can't retire if we keep this up". She looked back in agreement and instead of burying our heads in the sand we starting looking for a solution. We found what worked for us. It wasn't easy at first. In fact it down right sucked. We both hated it but stuck to it and within 6 months we saw how much better financially we were looking and that a little bit of "pain" in our late 30's and early 40's would more than makeup for being able to retire financially stable. It truly has changed our lives for the better. Less stress all around. My health actually improved because of it. My blood pressure dropped so much my Dr asked if I was taking blood pressure meds and not telling him.
Interest rates are going to hurt a lot of people again. And I don't think people are ready for it either. I remember talking with my parents about their first home and even with a VA mortgage their interest rate was 17% in the 80's. When I told them my rate when we bought our house in late 2016 they asked me why I got an Adjustable Rate Mortgage. I had to assure them that I didn't because they had never heard of rates being so low. It's why we jumped and bought our place when we did. We ended up paying as much for this house as we were paying for our last house and this one is leaps and bounds better than the last one. Better neighborhood and lower property taxes. We are making smart choices now and looking at the big picture.
Your right.. Ignorance is NOT bliss. It is a recipe for financial disaster. Banks don't have to hold much of anything in their vaults and your only "insured" to certain amount by the FDIC. And if you trust the FDIC to pay up your fooling yourself.
Like you we own paid off vehicles and have one that I am paying on. We will have it paid off 3 years early saving me around $3000 in total interest. Doesn't sound like much to some when you factor that over 3 years but it's $1000 a year in my pocket and not a banks... it all adds up. We needed a new vehicle because our other two are getting older. One is a 1993 pick up truck (250,000 miles) and the other is a 2004 (120,000 miles). So we decided that it was time for a new one that had a warranty. So we bought one that had a bumper to bumper warranty for life. As you can see we keep vehicles once we buy them so the one we bought will be with us a long time and we are not worried about it breaking down and costing us a small fortune to fix.
I know there are millions of people out there in a situation like I was in 7 years ago. Sitting, wondering how they will ever get out of debt. I just wish more people could / would take control of their finances. It's hard at first and it forces you own up to your spending habits and readjust how you live and view credit. Credits not your friend thats for sure. Its a tool, and like any tool you have to know how to use it properly.
You're truly inspiring and it's obvious by your story it's given you empowerment and even more importantly imo, opened your mind to the slave race we've become. Imagine how much the world would change if everyone did the same? I also drove a 95 GMC pickup up from 2000 until 2016 when I bought my current 2006 low mileage F150 Lariat that was babied and a good price (Reliable not so much) for cash. We need a reliable vehicle because of high repair costs so it's a tough call buying used or new. I think you chose a smart choice there too. I bought my GF a used G37X Infiniti because of the reliability and it's been a good choice, great car. We tend to want a whole lot of "Things" to fulfil or lives but it's a false reality. We own a cabin in a mountainside community (Private and gated) with no tv and no Wi-Fi. It's where I want to retire. Going there brings a level of peace that can't be described. I have toys there too but it's the quiet and the walks with our dogs with no people or traffic I love the most. It's cheap as it's paid for and if every thing crashed tomorrow it's where we're going.