I’ll do my best to paint the before-and-after picture to give you a better idea of what I’m talking about.
Our family of five was like many other families: We owned a home, took a yearly vacation, often dined out and never had a plan for our money. When life happened unexpectedly — events like a car repair or an appliance breakdown — we did what we thought was normal: We used a credit card to pay for it. With little to no cash savings, that was our plan for these type of things.
My wife and I communicated very little about this. We just used plastic and slowly built up a pile of debt year after year. We justified this behavior by telling ourselves if we could manage the monthly minimum payment it was OK. Little did we realize, the additional money we were paying in interest, and the long-term effect a plan like this would have on our finances.
This plan worked well for close to 10 years. One credit card turned into five, and as balances ballooned, the stress of the monthly payments crept in on us. We started communicating more frequently in the form of disagreements and fights about our spending. The defining moment came when we were close to maxing limits on all five of our cards and could not finance our family summer vacation.
As the one who managed the money in the house, I felt like I had let my wife and children down. It was time for a change.
I began to educate myself on strategies to get out of debt. Finding the debt snowball technique, I was able to build a plan and our first budget. I took it to my wife for review and shared our $109,000 worth of consumer debt we had built.
We sat and decided on a plan for our money going forward for the first time as a team. We agreed that it would be difficult to change our bad behaviors, but needed to make the change for ourselves and for our three children. We also decided that we needed to continue to communicate about our money often, setting up periodic check-ins. We realized that we were better working as a team than individuals when it came to accomplishing the payoff of our debt.
More on Open Communication: 6 Ways Happy Couples Talk About Money
Having a clear “why” really helped us stay motivated, too. Within the first few months of our repayment, with only a few thousand dollars knocked off of the debt, we began to feel the stress reduced in our lives.
The simple fact that we had built a plan as a team, and were working together helped strengthen our relationship. This has brought us closer together than we had ever been before. It’s a whole new life together.
Click to read more about how 2 simple rules stop this couple from fighting about money.
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