Back to School without Debt
contributed by Susan
Financial Advice for Newlyweds
How Newlyweds Can Minimize Financial Stress
Staying Motivated to Continue Digging Yourself Out of Debt
My husband and I have been married for eleven months. We had a few huge financial goals we wanted to accomplish from our first few weeks of engagement. We had a $15,000 wedding coming up and a car loan of $17,000. My husband wanted to go back to school for two years and he wanted to do it soon. That would cost another $40,000. Neither of us was comfortable with loans and we wanted out of the car loan.
How did we manage? Well, my husband was living at home and I was in an apartment so I found cheaper accommodations. We put everything we had into that car loan to get rid of the interest. I read The Dollar Stretcher website daily for three weeks to get ideas on how to manage with less money. We implemented everything from home cooking and freezer meals to cheap or free dates to budgeting and crash money diets. We even made a thermometer and filled in the amounts as we paid off the debts or saved what was needed.
We worked a few extra hours here and there and lived on essentials. We put everything we made above basic living expenses on the loan. It was paid off in four months.
We then realized the wedding expenses were still going to put us in debt, so I took all of my accumulated vacation and found extra work for the two months of my vacation. That helped a lot, as we were then able to pay for the wedding and save before tax time.
My brother then told me to put the extra money into an RRSP (retirement savings) because we would get all of our income tax back if we did so with this year's return. He also mentioned we should take out a loan to cover the money we would get back with our return and pay off the loan as soon as we got our return. We can now borrow against our RRSP money to pay for Dave's education (an RRSP education loan), and if we can't pay it back within 12 years, it gets recorded as income. Not a bad deal. We were glad he told us that before we filed our income tax for last year. It gave us what we needed to pay for my husband's education. We are now able to relax as he starts his first year of school.
We did have to pay to move ourselves. If I find full-time work in this new city, great! If not, we will be able to start a family on what we have saved and still be debt free! We will need to pay back the loan from our RRSP, but if for some reason we can't do it, there will be no stress involved because it will not give us a bad credit rating and it is our money. Stress Free and Debt Free!
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