How we Got out of Debt: Filled to the point of overflow

Three years ago, my husband and I were in our young twenties and sitting in approximately $70 000 of debt. Some was necessary at the time, some was intended to propel business growth, some was just for fun, and a good heavy chunk of it was in an attempt to accrue points on our VISA card by putting gas and groceries on it and forgetting to pay it back.

All of it was sitting heavily on our shoulders, but we didn't know it.

Fast forward to winter of 2012: new parents to a less-than-one year old old baby, prepared with a downpayment and ready to buy a house (more on that here), and feeling a crazy stirring in our hearts that something's not sitting right. God began to lift the weight from our shoulders by showing us this debt that we'd ignored for so long was right there. Looking back, Aslan was on the move.

Friends of ours were hosting the first-ever Canadian CAP Course and invited us to join, and more in an effort to support them than to help ourselves, we went and invited my mom and her boyfriend. There, we learned things we had never heard (or let sink in): you can live on cash, you can own your car, you can have a realistic budget, and you can live your life freely too. At the same time, my dad gave us the book Total Money Makeover by Dave Ramsey and in an effort to become students of money management (and maybe contribute a little something to the CAP Course), we picked it up to read. Although Ramsey came at us hard (a lot of use of the word "stupid"... ouch), we realized that we were on a crash course toward bankruptcy if we continued on this path where we were living with the money the bank told us we could have, rather than the money we really did have.

Before this time in our lives, we never sat to crunch the numbers of where our debt really stood - but then we did: $42 000 in student debt, $10 000 (!) in credit card debt, and $19 000 in a car loan.

And then we both knew - God was calling us to pay off our debt. We took a deep breath, surrendered the idea of home ownership (for now), and made an action plan. I'm going to be completely candid with you about how all of this went down because I believe that if God calls you to do something, He will make a way for you to do it, and as crazy (or normal) as our story is, it happened and it's ours.

First of all, we already had around $21 000 sitting in a bank account ready to be used for a downpayment. We took this and sold / paid off car ($14 500 owing - you can read about the car debt removal process in detail here), purchased a new one ($4500), paid off our credit card ($10 000), and took a vacation ($2000). It was hard earned money and it was a hard sacrifice so we felt the vacay was well worth it. In the next season of our lives we endured a miscarriage, so having the vacation in our back pocket as a good memory was really nice to hold onto during a rough period of depression we both faced - we're glad we did it.

Getting out of Car Debt
Now, paying the car off wasn't a move I'd first suggest across the board as it was technically our "cheapest" debt: the interest on it was front loaded, meaning it didn't matter when we paid it off - now or later - the cost for the car would have been the same. But, losing the $270 / month car payment was really nice and freed up $270 a month to "snowball" into our other debts and the idea of truly owning something was really empowering.

Getting out / and in / and out of Credit Card Debt
We next turned our attention to our credit card debt, which we had unknowingly (this is why Ramsey calls us stupid I think) racked up to $10 000. Like I mentioned above, a really good chunk of this was a grocery shop or a gas fill-up that was charged to the VISA "for points" and never repaid, despite all good intentions. There were other big expenses for our business, but in all truth we could have paid those back much sooner than we did. This was a tough debt to get out of because every time we would would pay some debt off on the card, we would find the balance still swiftly getting higher and higher. We actually tried to pay off the credit card debt first (and we did), but it got racked up again! It's a revolving debt and for a few months we were frustrated with ourselves for not being able to kick these bad-habit shopping and grocery trips that could have been paid back at the time (we had the money planned in our budget) but didn't. We weren't fully living on cash yet and this really convinced us that no matter how many points your credit card offers you, you'll have more money in your pocket if you save the card for big purchases that you already can afford.

It was a period of 6 months to a year (somewhere around there) of breaking the bad habits we had with the credit card and living on cash, or at least in the non-overdraft portion of our debit account, and we now are in a good habit of either paying back the credit card on a weekly basis if it's used (sometimes it's necessary - online purchases and what have you), or saving up our money completely, booking something big (like our trip to Newfoundland back in June), and paying it back immediately. I honestly can't tell you how good it feels to have a VISA balance of zero. Ironically, after our balance was zero for a little while, VISA increased our limit to something outrageous. Good thing God captured our hearts before things could get really bad, huh?

Getting out of John's Student Debt
As of January 2014 (around 1 year after our debt-payoff journey began), we still owed around $6000 to John's student debt + $21 000 of my student debt. We had been snowballing major payments onto it as often as possible while still maintaining my minimum OSAP payments of $300 a month. His minimum had been $100 a month, plus the $270 snowballed from the car loan, plus extra cash from bigger jobs or leftover money or even sacrifices from regular expenditures going into his debt. Around this time, we had an influx of deposits for weddings (a lot of people getting engaged around Christmas time, go figure) and a payment for a summer 2014 wedding - something I wanted to hoard and use as a safe cushion for the expectedly slow months of February, March and April (every year February to April is a squeeze). But John, being the dedicated man he is, offered the suggestion that we use the influx to pay off the remainder of his debt: instead of having a nice cushion to feel comfortably provided for the next three months, we instead trusted in God's provision, believed God wants us to be debt-free and dropped the cushion cash into his debt - we got a letter in early March to tell us that his loan was paid in full!

Needless to say, February, March and April were tough and at times very, very tight (and I got very, very good at baking bread and cooking soup, cheap meals) but we pulled through and met May with strength and moved forward toward paying off the remaining $21 000 of my student loan. We pushed it hard - having had a few tight months we just kept living like we were still in the midst of a tight month even if it was an abundant one, and dropped the amount owing to $19 621 by July 14th.

Getting out of My Student Debt
John always said that he believed our debt would be fully paid before our upcoming 4-month trip to Nicaragua. It was just something he knew that he knew, and he pursued that commitment to believing it even in the hardest moments when I didn't want to drop an extra $20 into student debt, I wanted to go out for dinner. He would coach me through it as I cried to him that this debt would never leave us. He kept believing it even when it seemed as though we might not even be able to afford our trip. And on July 22, the night we found out we had a house fire, we watched it all come together and (as distressed as we were) laughed our whole way home. (More on that here). We had house contents insurance. God had us in his hand.

The house fire itself didn't destroy everything; there were many items in the kitchen and living room that were damaged from being near to the situation but more than that, we had a slow moving insurance company who didn't actually get into the building to have an inspection until weeks after the fire. It was frustrating, annoying and absolutely discouraging - many tears were shed from yours truly - but because the smoke lingered for so long without our items being cleaned or removed, and because the basement flooded and made most of our stored belongings mouldy during the wait, a good 95% of everything we owned was counted as lost - and we got a cheque for replacement value.

A cheque that we received today and a cheque that just covers my remaining student debt, and a little something extra we felt God urging us to do back in June, but simply couldn't see a way to make it happen.

Today I cashed that cheque in the bank; today I called National Student Loans Service; today we became debt free. It feels so unreal that I felt I had to write it down.

In July 2013, I wrote a post called "Why We're Getting out of Debt: (Or, Why Drive when You Can Walk?)". I asked readers at the end to pray with us that getting out of debt would be a reality in our lives - and I want to thank you for doing that, because I know you have. I know that our debt-erasing journey has been fast tracked because of God's grace, your prayers, and because we have been called to leave this country, even if for a short time, owing nobody anything. I know that obedience has been blessed. I know that Aslan was, and is, always on the move.

That God never tells us to do something we won't be able to do.

I wrote the following words back in January and I had no sweet clue what was coming when I wrote it. Keep in mind now that we, now a family of 4, have been living in a bachelor apartment for the last 2.5 months and are preparing to pack what we have left of our belongings in 4 suitcases and head to Nicaragua over the winter:

"Each time God pursues us it feels as though we have less and less "stuff" to pour out, as though He is wringing us in His hands like a dirty towel to clean us from everything that we don't really need and yet again filling us to the point of overflow with love and peace and patience, and oh mama you should see the kind of man my husband is turning into and the peace I'm learning to embrace."

Truer now than ever. Amen and amen. Thank you Lord.

On The Freedom of Obedience

The last day of 2013 was kind of an abrupt one for me. The day itself came in slowly and beautifully, like most of my family's days, (until, of course, we encounter a toddler screaming on the floor and an exacerbated sigh of reviewing the to-do list and the clock) and we went along doing our thing - but I wasn't actually aware that the day it was, was the last day of 2013. Not until somewhere in the afternoon when a friend asked us what our plans were, for new year's eve... for that night. It was like someone had turned the lights on in the middle of a wedding reception and there we were, somehow at the end of it, ready to go home, although not quite finished dancing. Of course, I knew the year was coming to an end sometime soon but in the flurry of Christmas and family and preparing for a big event in our work year, I hadn't actually taken the time that most do to reflect and discuss and close the chapter that was last year.

So there I was, with just hours to look back and the busy-ness still in full swing, wondering what kind of year 2013 would be called for us. And the word I came on was blessed. 2013 was blessed. It was a blessed year.

It was a hard year, too. Blessed doesn't necessarily mean easy. And that night as John and I broke bread and shared a sip of wine to ring out the old year and draw in the new, we prayed a prayer of thanks for what the year was: for everything the Lord gave us, and for everything He took away.

Depending on how long you've been following me here (and yes, I know I've been silent over the last few months), you might remember that 2013 was the year we suffered an early pregnancy loss. We also waved goodbye to a house downpayment as we pursued a debt challenge. We moved... twice. But it was also the year that I learned how good God is, and how I know that I know that, even in the middle of a miscarriage. And how we experienced what it feels like to own a vehicle, instead of leasing one. (It's great, by the way, owning a vehicle.) We learned that our marriage can hold up to some straight-up trials as we stand back to back to conquer. We learned that God uses houses and cities as stepping stones, and that although He fosters community in our lives over the course of months and years, He brings it to our hearts in minutes, too. I began baking bread. We learned that we can dream big... big, big. And to top it all off, we got pregnant once again :)

But this post wasn't intended to be a reflection of 2013: this post is to let you know about the freedom that comes with obedience. 2013 was blessed and in a refining, stone-against-stone way because we were called to obeying God in the unique things He has been calling our family to do (or be, or say, or don't do, or give, or give up, or whatever it is in that moment).

Here's the story. Sort of.

At the beginning of 2013, John and I were lined up to buy our friend's house. I'm talking, signed offer and deciding on a closing date kind of lined up. The house was literally perfect for what we needed: 3 bedrooms, an attached office with big ol' gorgeous windows, a play nook (a nook, I tell you), an Ikea'd kitchen, an old staircase beside an exposed brick wall, a fenced backyard, on a cutesy street within walking distance of coffee shops in a safe part of a lovely city. And we had the down payment. And we had the plan. And then we got this feeling: This feeling that we were about to take a good-looking step in the exact wrong direction.

And somewhere in our pursuit of what this feeling was all about, we learned about a new style of financial management. In the period of just a few days, it was like our heads had been thrown into a martini shaker and poured on the rocks. Somehow, everything shifted; all financial priorities were given a whopping of newness and we were sure that we had to erase our debt (consumer and otherwise) before we got into a mortgage. We were (we are) confident that God was straight up telling us to use our 10% house downpayment to fix what we suddenly saw, as though with a new pair of eyes, as mistakes in financial management.

We made the hard call, we ended the offer, and we started the gruelling journey of getting out of debt.

Now, I don't want to lecture you on your financial management situation because it is nothing other than information between you and your accounts and God, and what God tells John & I to do is not necessarily what God tells you or your family to do. There are some really great financial leaders I'm happy to refer you to, but this sister ain't one of them. We were just doing what God was telling us to do, at this one point of time in our lives.

So we did. We obeyed and it was painful. We dropped a dress size in our debt, we kept renting, and we kept pursuing His voice.

And then, just a few short months down the road, an opportunity came up to house-share: splitting many living costs in half, gaining more work space for our business, and moving toward what we saw as a good opportunity for community. We felt like God was in it hard, so we did it. We moved cities and we house-shared, and I'm telling you right now, the situation crumbled as quickly as it came together.

Our little family of three (and soon to be four) had moved away from everything we knew to a new little town that seemed to offer small potatoes (you'll get it if you live here) in comparison with what we had, or what we could have had, if we had just stayed put. Or had bought that house. Or had kept our debt. We sat on nothing, in nothing, for nothing, and we were feeling stuck in the middle of a dark night with no moon. More specifically, we were sitting in the middle of a 2600 square foot house in the middle of a suburb with no money.

Why had we felt that God was calling us to something that was such a clear cut disaster of a situation?

...Twice?

And as the little whispers come and go when you listen for the voice of God, He began to move like the wind. Dreams began to arise about adventures bigger than we had thought possible (or probable... or smart). I baked a loaf of foccacia bread, and then I couldn't stop. We spent more time connecting in our new church. We decided to stay in the little town, to move into a rental apartment smaller and less affordable than our last, a further distance from our clients than we really should be, but with this community that we just couldn't and can't seem to peel ourselves away from even for a second and with a passion for continuing to obey.

Today, just today, another call for obedience came and we had to follow it because at this point, there's no sense in turning back. We've come this far and He has provided in abundance - and that doesn't always (or even usually... or even ever) mean cheques flying through our windows like paper airplanes -  I won't share the details until our dreams start to seem to come together with even some semblance of sanity, but here we were, called to obey once again.

Each time God pursues us it feels as though we have less and less "stuff" to pour out, as though He is wringing us in His hands like a dirty towel to clean us from everything that we don't really need and yet again filling us to the point of overflow with love and peace and patience, and oh mama you should see the kind of man my husband is turning into and the peace I'm learning to embrace.

God has called us to obedience beyond what I thought we could handle, and every time I pray "please, give us/him/me wisdom", we get it.

There is freedom in obedience because when God calls you to do something, His plans are great for those who listen. What we have is far less and yet far more than what I could have ever been comfortable with in January of 2013.

2013 was blessed because there is freedom in obedience. We have lived the way we feel we have been asked to, and life is more fun because of it. We make-do with less because of it. We are more creative because of it. I bake bread because of it.

The freedom I realized that God gives was like learning to use speakerphone for the first time: we're hands free, and He still provides. When we slip up, when we seek our ideas and our notions first, He's there to bring us back and steer us right again.

He opens doors for community - He releases us of fear - He brings us closer as a family, as a husband and wife; He gives us freedom from ourselves when we just obey.

Sometimes, Things Don't Work Out: Then What?

Sometimes, we make the best plans, and they don't come together like we'd hoped, or prepared for, despite every good effort.

This blog post is about that "sometimes".

A few months ago, John and I decided to do co-living with my dad; the arrangement looked something like, we pay 60% of all costs, he pays remaining 40%; he gets master bedroom with ensuite and enough room for a private living room; we get two smaller (but still spacious) remaining bedrooms for our family; we all share the remaining living space (two living rooms and a 'reading area'). The benefits - financially and otherwise - would have been great. Unfortunately, coming together didn't work so well, for reasons I'd rather not share, and it turned out to be a very expensive decision, in the midst of a season when we need the really inexpensive decisions.

Some lessons you learn sooner than others. This one was quick. (As a sidenote, John & I are still pro-community-living!)

So here we were (still are here!), in a 2600 square foot house that never really felt quite like home, trying to determine our next step. Why did we come to this town in the first place? Technically, there is nothing really here "for us"; it was a great city for compromising location between us and my dad, but now that it's just us, we could be closer to Toronto, we could be in a more self-employed city, we could find other places.

But then God started to bring things together for us: there's a reason we're here right now in this city, and it's a good one. I'm sure in time we'll see all of the pieces come together, and we're confident they're community driven reasons, which is good enough for us. We have found a great little place to move into within the next week (at a lower overall cost!), and are believing that we'll be dedicating the next year to building community.

You can get this awesome graphic and desktop background here. It's been such an encouragement to me!

To us, it's becoming obvious that we are "supposed to" be in this town for this season, in this community for this season. So, while we believe that some awesome things could have come together had we all been all in on community living, God has faithfully provided and won't let us down.

Sometimes, we make the best plans, and they don't come together like we'd hoped for, or prepared for - and I am confident this "sometimes" will happen many more times in our lives in the future: We're people and people are flawed. God, however, never lets us out of his gentle gaze.

So when the "sometimes" comes along, we can pick up, brush off, discover a creative solution, and move forward with every confidence that we can still continue to live in His will. If this happens to you, don't sweat it. You're not alone: we've all made plans, sometimes even ones based on how God has called us to live, and they fall apart. You can still move forward; you don't need to save face (we all mess up, let's own it); and you can see it as an opportunity to trust the creative things God is going to do next.

Home Tour / Moving News

The last few weeks have been so crazy I can barely catch my breath! But here it is, big news: we're moving!

Okay, we're not just moving, we're house-sharing. It's a take on communal living, but only a slight one, because the person we're house-sharing with is my dad. And no, we're not "moving in" with my dad - instead, our family & my dad have gone out together, chosen a home to rent, and are splitting the cost.

Why are we moving? A few reasons:

1. The basement is mouldy and it's making our daughter sick pretty often. I'm talking, constant water on the floor, yellow fungus on the walls, smell through all the vents. We've dealt with it until now but 'nuff is 'nuff.
2. The layout isn't practical with a toddler: the home is about 100 years old (if not older), and most components of our living space were sort of tacked-on to the original design. The kitchen is separate from the office  is separate from the playroom is and I can't see The Caterpillar from one room when I'm in another. This is problematic because I think I'm in the kitchen or the office a good chunk of the day, and she's in the playroom a good chunk of the day. In terms of square footage, our place is gigantic, but in terms of usable space, a little less so.
3. Renting or owning a house is the next logical step for our family. Renting on our own would cost around $300-400 more a month than house-sharing when we factor in the cost of utilities, cable/internet, and rent itself. (And that's for a smaller house than the one we'll be moving into!)

In some ways, house-sharing is a big deal: sharing a home means making some sacrifices in terms of personal space, personal space, and more personal space. Your routine gets interrupted because suddenly you need to share it - not only with another member of your family, but basically another family altogether. Because John and I are married, we are one "family" and my dad is a "family" unto himself. And our separate families have their separate routines which will now need to be accommodating of one another. And also, we need to pray for grace.

However, some people are more extreme and committed in getting out of debt through house-sharing, and that's amazing! This past weekend, we heard of a family who is sharing six people in one bedroom (4 kids, 2 parents) of a two bedroom house - and another family is taking the second bedroom! We hope to make many small changes now so that we can secure a mortgage before our family grows, and large changes like that won't be necessary for us.

So. Why are we house-sharing? Well, we're self employed. And when you're self employed, getting a mortgage is slightly tougher than when you have a "steady job". (Although I'm out to lunch on the logic here, because "steady jobs" become unsteady all the time, but hey.) Being self employed requires a minimum of a 10% downpayment, and for a modest single-family home that's about $20 000, plus fees. However, being self employed, the CMHC (Canadian Mortgage Housing Corporation), tacks on roughly $10 000 in additional fees to insure your home, because you look risky, because you're self employed.  But: cash is king. And when you come to a mortgage broker or a bank with a larger downpayment - even more than the minimum - CMHC fees tend to decrease, and getting qualified becomes a little more possible.

Right now we're on the journey of getting out of debt, so this is a huge step towards getting totally out of debt (including student debt), securing a sizeable downpayment, and getting ahold of our monthly budget (I swear sometimes we overspend and I don't even realize what happened until it's too late.)

We have done house-sharing before with a friend, and in our opinion it was a big success: we saved a lot on rent, which meant that we could spend our money elsewhere. At the time, we needed the extra savings to purchase some large investments for our business (camera, computer, etc.) and we're so glad we did it.

The amazing thing, though, is that our next place has been such a blessing on so many counts: it's far larger than our current place, and our monthly costs will be only about $100 more than our current place, let alone the cost in comparison with renting a smaller house on our own. It's brand new, never been lived in, in a subdivision, which to me screams "Community!!". On the down side, it's about an hour away from where we are now, which means we'll be seeing a little less of Nana than her tri-weekly visits, and my great group of friends will be far away.

But, this "sacrifice" means we can take some steps towards the new goals. I put sacrifice in quotations because seriously people, this next place is awesome.

And in the meantime, to celebrate our move & our past home, let's take a look at the home tour.

You'll notice that I didn't tidy up for you.

We (Stayed) Out of Debt: Daniel & Brianna's Story

John and I have just begun the journey of getting out of debt. Sometimes it can feel overwhelming or dejecting to put every extra dollar into, sigh, things we can't see.

That's why I've begun compiling stories from real life friends who have get-out-of-debt success stories. Seeing that others have done it makes me feel like we can do it, too. 

So today I introduce you to Daniel & Brianna. Like many readers, they have no debt & began their marriage with no debt. But they have made a decision to keep it that way. Getting out of debt is tough; staying out of debt can be even tougher. Read their story below.

Meet Brianna.
Hey there! My name is Brianna and my employer is a very rambunctious little girl named Penelope (also known as my daughter). My husband is a youth pastor and graduate student. He is currently an intern, which means we are living on a very minimal income. I also blog at Tea with Bri.

Here's Their Story.
My husband and I were married in May 2011 at 21-years-old. Thankfully, we entered our marriage with no debt, but also with no money either. When we returned from our honeymoon we were shocked and amazed to find out that we’d received a substantial amount of money through various wedding gifts.

At the time, we had minimal expenses. No car payment, the cheapest rent you could imagine, and no children. Still, we knew that we needed to save this money. Two weeks later our 1990 Camry died, and we had to make a fast decision regarding what kind of car to buy. We could make a small down payment on a new (or almost new) car, and have a minimal monthly payment. This would allow us to keep most of the cash for other expenses. Or, we could spend a large chunk of our brand new nest egg on a reliable family sedan that would last us for many years, and have no car payment to worry about.

We decided to buy a 2007 Pontiac G5 for cash, and kept the remainder of our nest egg in a savings account. A few months later I was pregnant with our first child, and shortly after I was laid off from my job. We worked hard to save money over the next year, but at times we had to dip into our savings. We were so thankful that we didn’t have a car payment looming over our heads, and that we weren’t irresponsible with the remaining cash.

Today, my husband is working at an internship, and our family of 3 lives below the poverty line. We are blessed to have savings, and unlike 47% of the country, we have never lived pay-cheque to pay-cheque. When we can, we work to build up our savings.

At the end of the year, that nest egg that we saved two years ago might be gone. But, we know that God has been faithful to see us through this difficult financial season. By making the choice to save rather than spend, my husband was able to find a job that will ultimately help him in his career.

What's Next For Them?
Once my husband’s internship is completed, we know that our income will increase. We will use our increased income to build our savings again, and start to save for a home and a bigger car. We pray that we’ll never have to live pay-cheque to pay-cheque, and that we’ll never have credit card debt, car debt, and possibly even a mortgage looming over our heads (we haven’t decided yet on the mortgage!)

Here's The Moral.
I believe it’s important to live within your means, and save as much as possible. If God blesses you with a large amount of money, whether it is through wedding gifts, an inheritance, or a high paying job, use wisdom and discretion in how you allocate those funds. Always remember that there is no way to anticipate the future, and it’s always best to be prepared financially. If you are living pay cheque to pay cheque, sit down and figure out what you’re spending your money on. Are all of your expenses necessary? Probably not. Find ways to save so that you can be prepared for anything that may come up.  If you’d like to hear more about my family please check out my blog Tea with Bri, where I share my faith, talk about my family, and provide lots of money saving tips!

Making a little apartment, a little bigger.

When John and I moved into our current apartment, we were astonished with how much space we had. A 2 bedroom apartment within steps of "downtown", with a dining room and living room? To past Torontonians such as ourselves, this was a dream come true.

But, once we started to move our stuff into this space, and our stuff grew into more stuff, our office requirements doubled, and our family of 2 became a family of 3, who now needed toys and cribs...

Well, this large space seemed much smaller. With buying currently out of the question, we needed to make do.

So over the last year, I think we've done a great job at maximizing our in-home space: we converted a dining room into an office & TV room, a living room into a play room & dining room, and managed to squeeeeze a King Size bed into a bedroom which, arguably, shouldn't host a King Size bed. Another time I'll post a home tour, but in the meantime, check out six simple ways we've made our little home seem a little bigger.

First, we tackled the kitchen.

By painting all of the shelving units & cupboards a bright white, and removing the doors anywhere possible, we created a more open and functional space which in turn made our home seem a little larger. Granted, we have very (very) little countertop space; and no, our cupboards don't have proper shelving units... but: it feels spacious. And that's half the battle in feeling organized.

Clear jars are used to display cooking and baking products and open the shelves up to feel slightly larger than they would if we had opted for dark or coloured containers.

In my kitchen I can move, I can breathe, I can organize.



We then hid the "necessary" clutter in our bookshelf.

Unsightly coin jars, cigar wrappers (ahem), and books we will one day... one day... read, all find their home in our bookshelf. Installing a shelving unit with a door is a great way to maximize and create space. Fortunately for us, this bookshelf came installed in our home. Originally it was painted black, so we brightened the room up by giving it a fresh white coat.

We emphasized the size of the room by facing a mirror to a window.

You can't see it in the above photo, but the large mirror above directly reflects our front windows. This helps to create a larger, brighter look to our living room / playroom / dining room and is a great way to save a little energy in the evening as we can keep the lights off that much longer. ("That much" = about 30 minutes.)

We took advantage of floating shelves (versus side tables).

 
Our room is small, so side-tables were out of the question. And, while we tried to push forward without them, (first world problems, am I right?) there's something sweet about my own bedside lamp and a small place to keep my treasures.

I've seen people successfully accomplish the book-stacking side table (my aunt in particular - you guys rocked that for a few years and it actually worked) but John & I couldn't pull it off. Imagine Naomi Klein's Shock Doctrine / Gabriel Garcia Marquez' One Hundred Years of Solitude as home to my teacup and bible. I'll keep all my pretentious literature on my bookshelf, thank-you-very-much.

Source 1 / Source 2 / Source 3

 (As an aside, here is what it would look like. Awesome, right? But I mean, look at the titles you need to have, to really make it work! What if someone asked you about one of these books? "Oh yeah, Oscar De La Renta", I would say. "Good dude.")

We make the most of our "outdoor space"

 We use the porch as though it were an extension of our kitchen because, well, it basically is. And that gives our space an added 10'x10' room for us to enjoy. It's a little noisy and dirty, but it's ours. Sort of. (That horrible floral set belongs to our neighbors but we'll take what we can get.)

We have begun to grow things.

  Inspired by my Aunt (this is what you get for reading my blog: shoutouts) we decided to start a herb garden and are loving how greenery really does add to a space. I'm not sure if it's the scent of basil or the fact that we're actually using a windowsill (which means, we've extended our space usage by 2 inches) but plant life makes a little home feel a little larger.

I found this website helpful for beginning my herb garden indoors.

There you have it.Six simple ways we made our little apartment, a little bigger. We are thankful for the space we have - and we are thankful that we can operate both a business and a family from our home - and are always looking for creative solutions to improve the life we live (in a cost-effective way).

Thanks for letting me free my inner-interior-designer. I promise she'll stay tucked away for another few months!

We Got Out of (Car) Debt: Our Story

In January 2013, John and I resolved that this would be the year we'd take major strives towards getting out of debt.

We find encouragement in the stories of others, and so we thought it would be appropriate to share our current journey with you, while highlighting the success of friends and family we know. So far, our friends Chris & Keeleah have shared how they removed $30 000 of debt in less than 2 years. Whaaaat.

I'm going to avoid giving you a figure of our debt until we're nearly finished, because I know figures can provide more opportunity for comparison. "They have way less debt than I do. What they did won't work for me." vs. "They have way more debt than I do. My situation isn't so bad." Poppycock.

Our four major debt sources, in order of size, as of January 2013 were:

1. Credit Card
2. Car Loan
3. John's OSAP (2 year education)
4. Sam's OSAP (4 year education)

On the advice of some wise mentors in our lives (all of them over the age of 50, might I add. We need more 50+ friends. The older, the wiser, the better), we evaluated our debt in order of interest accumulation. The most "expensive" debt was our car debt at $14 500 and a whopping 6.9% interest. (We're young & self employed; 0% financing isn't a possibility for us quite yet.) 

You might be wondering why we didn't tackle the credit card first. Well, we did. And then it got racked up again. So we thought we'd leave it for a bit and tackle non-revolving credit/debt.

When we purchased the car, we thought we were in good standing because it was used: a 2009 Toyota Matrix, good family car, and with a 2-day-old baby we needed to find something that would fit our car seat.

Prior to the Matrix we had another car we were paying off on a loan, and it was essentially a clown car. (One time, at the Ranch, three guys picked it up and moved it from one parking spot to another as a practical joke.)

 It was time for the clown car to go, so we thought we'd better get something that would last. We also thought....we're always going to be making car payments. So why not get something a little pricier?

Crazy kids. Out of your limits!

Our payments were $270 a month, which we thought was reasonable at a bi-weekly rate of $135.

What we didn't consider was how much $270 a month could get us! If we saved that $270 monthly for other purposes (savings, or future cars), we'd have an extra $3240 a year to have some freedom with!

So we began saving, and we bit some very foul tasting bullets.

1. First, we had to figure out the value of our $14 500 car to a new buyer. We found a local dealership to buy the car for $10 500. It was still in really good condition, and 2009 model.

2. Second, we needed to calculate the remaining balance on the loan & incidental costs. That meant we still needed $4 500 to pay off the car, plus about $1000 extra for penalties (you have to pay to get out of a loan) and other incidentals.

3. Third, we needed to set a reasonable and realistic cash budget for a new car. We need a car that will be safe for a baby to ride in, able travel to Toronto and home around 3 times a week (that's 260 KMs a trip), plus town driving, and is good on gas. Our budget was originally $3000 but we upped it to $4500. (If you are doing this, and aren't doing a trade-in, remember to factor in taxes on your new vehicle.)

4. Fourth, we needed to save. Between the remaining balance after we sold the car & the cost for a new car, we needed to save $10 000 to get out of our debt. That's a-freaking-lot of money. 

5. That meant we needed to trust God and have patience. Like I said when we first started this journey: God won't call you to do something you won't be able to do. John had to remind me of that, like, all the time. Good on ya, honey. This part took a little while.

6. We then had to pay off the loan in full. In Ontario, you can't sell a car that has a lien on it - that means the full $14 500 + + + had to be paid off before even getting the sale price for the car. Overwhelming much? This was why we chose to work with a local dealership: they had the flexibility to give us the $10 500 cheque in advance, which meant we could pay off our lien in advance. In reality, it was a same-day process so we weren't without a vehicle.

7. We completed a trade-in (which meant saving tax!) We traded in our Matrix and purchased a Legacy from the same dealership who was buying the Matrix. This is likely why they were so flexible and happy to help us out: it was a good deal for everyone. We all worked together. The benefit here is that we saved the tax on the "purchase" of the new car, because it was technically a trade-in. Otherwise the costs were the same.

8. And we drove away with $14 500+ 6.9% interest off of our shoulders. All the waiting, the planning, the saving... worth it.

9. Now, we're snowballing our debt. The $270 monthly payments are going into other debt! Wahooo!

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Keep following us on our get-out-of-debt journey! 

Next, our goal is to tackle the credit card & decide which steps to take to stay out of  and keep out of credit card debt.

Please pray with us that God will provide us with the opportunities & resources we need to get out of debt so we can give more and save more.

If you're looking for resources to help you on your journey, check out CAP Canada courses and Dave Ramsey's resources, including the bestseller Total Money Makeover. With these two simple tools, we're changing our lives!

Why We're Getting Out of Debt: (Or, why drive when you could walk?)

About six months ago, John and I really began to feel that we should be paying off our debt. This was a new feeling to us (well it is a new feeling to us) and only weeks prior, I was telling someone that our combined student debt (six years of combined schooling entirely on loans), plus our car debt, was healthy debt. You know, debt you need. So it's healthy.

Shortly thereafter we got kicked in the pants by our brains and our God and and had a transition into realizing that no debt is healthy debt.

It might be necessary. But it's not healthy.

Here's the analogy I came up with, and it's not perfect and it has flaws, so please don't get stuck on the details:

If I want to get from one place to another, say from my house to the park, I need a means of getting there. I have three options:

1. I could walk to the park.
2. I could bike to the park.
3. I could drive to the park.

The distance of the park will determine whether I choose option 1, 2 or 3.

1. If the park is down the street, I will probably walk. 
2. If it's across town, I'll bike. 
3. If it's in another city, I'll drive.
   
   That's the logical thing to do.

However, the options for transportation are not fixed.

I don't have to walk to the park that's down the street... I could drive there. It would be a short drive, and it would only use a little gas, and I'm getting exercize at the park anyways, so why not drive?

Or, I could bike down the street - it would get me there quicker and I would still receive the benefits of the outdoors.

However, (and this is the point that I suppose I never considered) even if I'm going to another city, I could walk. I don't have to drive. I don't have to bike.

It would be a long walk, and it would require some preparation (I would need to pack snacks and water bottles, and maybe a change of clothes for when I get to where I'm going), but I could do it.
I could walk to another city. I don't have to drive.

The same is our life with debt.

1. Imagine with me that my "walking" is living with cash. 
2. Imagine that my "biking" is a partial reliance on credit - in the same way that a bike is a partial reliance on technology. You're still using your legs, but your wheels are making them move faster than they otherwise could. In my analogy, the bike is debt that you use and pay off before interest accrues. Using a credit card to book a plane trip, gain the points & pay it off. That kind of thing.
3. And, imagine that the car is debt - full debt, major loans which are larger than any income you've seen at once. For me, this is a car loan. A mortgage. Things like that.

What I've come to realize is that it is possible to "walk" everywhere. No matter the income level of a person, if there is appropriate planning and a 0-sum debt balance, you can actually walk... everywhere. You might need to pack some snacks and it'll take a lot longer to get where you're going, but think of all of the fresh air you'll get on the way.

Of course, when it comes to a mortgage, I might drive most of the way. But I can walk much more of it than I thought.

I've started to look at verses like this in a new light:

"Owe no one anything, except to love each other, for the one who loves another has fulfilled the law." - Romans 13.8

"The rich rules over the poor, and the borrower is the slave of the lender."
- Proverbs 22:7


“If your brother becomes poor and cannot maintain himself with you, you shall support him as though he were a stranger and a sojourner, and he shall live with you. Take no interest from him or profit, but fear your God, that your brother may live beside you. You shall not lend him your money at interest, nor give him your food for profit. I am the Lord your God, who brought you out of the land of Egypt to give you the land of Canaan, and to be your God."
- Leviticus 25:35-38

God did not intend for us to need to borrow from each other. God intended for us to work and live in community with each other.

This means giving where it hurts, to each other. This means living together. Beside each other. Living without interest. Sharing. Really, it means sharing. Because although God did not intend for us to need to borrow from each other, He knew that in this life we'd face troubles. He knew we'd be poor sometimes. Or a lot of the times. But He knows that we have it in ourselves to protect each other from the storms of poverty.

I think that God is merciful, and He understands your financial situation. I think He's going to work with you and answer your prayers, and if what you need is financial breakthrough, He's going to give it to you if you ask for it and do what you can to see it.

In our lives, this means taking extra work sometimes; selling items that might be easier to simply drop off at Goodwill; shopping at Goodwill (thankfully thrifting is cool now); and budgeting realistically.

I'm not saying to have an entertainment fund of $10 a month - or to sit at home and be bored out of your eyes - or to live off rice - but I'm saying to set realistic goals and limits for yourself and ourselves that are achievable and, well, limited. When the money's gone, it's gone. Come back at the beginning of next month. I'll talk more in an upcoming post about how we're doing that with the envelope system, and share some tips from people who have been succeeding with a cash lifestyle for much longer than we have.

What we're learning is that we can walk everywhere we set our minds to. We can realize the benefits of getting the fresh air, of having a world that is, for us, cash based. (And yes we still have a bank account, and no we don't keep anything under the mattress, we're not that extreme. Props if you are.)

John and I are choosing to get out of debt because we don't want anyone to rule over us, and we want to be able to share with those around us. Please pray with us that getting out of debt is going to be a reality in our lives, and send me an email or message below if you'd like me to pray with you that getting out of debt is going to be a reality in your life.

God never tells us to do something we won't be able to do.