As I’m wont to do from time to time, I like to give an update on our Credit Card Free battles. We are currently approaching the end of year 8 (if I’m counting right) without a credit card, and we’re doing great. Our latest objective is to kill of our last non-house debt: The ever elusive and forgetful student loans!
I admit that I’m falling into a probably somewhat common trap in relation to student loans. I took them out back when I was in college, and at the time the rates were so low as to be laughable. Add in the reductions the lenders grant you for paying on time and setting up automatic payments, and our total APR is 1.125%. It’s hard to get worked up about a monthly interest payment that is literally less than a fairly boring pizza from a fairly boring pizza chain.
To keep myself focused on it, I’ve taken to talking more about the monthly payment, not the interest. We are still in deferment because of my masters, but once that ends, we will start paying around $140 a month again. That’s something to get excited about, and our goal is to set these student loans to rest before the deferment ends (June). A challenging goal for sure!
Going credit card free has been, for us, the best decision we’ve made financially. It’s also perhaps one of the best decisions we’ve made period. I often read how many marriage fights and divorces are centered around money, and I think back and try to remember the last time Courtney and I did that. To be sure, we’ve had a lot of talks about money and the budget, some of them a little more energetic than others, but a fight? A true, honest fight? I can’t remember one. I’m sure we haven’t had one since we got rid of the credit cards at the very least.
And we have yet to see a single one of those doom-and-gloom scenarios about not being able to rent a car or a hotel room (we’ve done both several times using debit cards) or get a loan (we just bought a house, and we bought a car two years ago which we paid off in 13 months).
So today we started the war on that very last debt. It was what I would consider a warning shot over the bow of that loan. Not enough to make anyone flinch by any means, but enough to say, “Here we come.”