My Debt and Plan for this Spring

This is our current debt in order of smallest balance to largest:

1. Sallie Mae Student Loan: $919
2. Car Loan: $4357.94
3. Mobile Home Loan: $8292.74
4. Sallie Mae Stafford Loans @ 6.88%: $8305.00
5. Sallie Mae Stafford Loans @ 1.88%: $8500.00
6. Federal Perkins Loans @ 5%: $9000.00
7. Sallie Mae Consolidated Loans @ 2.87%: $21,438.95
8. Citibank Private Loans @ 3.5%: $73,414.96

Total Debt: $134,228.59

I may be off a little on the federal loans due to interest but I'll update that as I get better numbers. This debt will be the target for the debt thermometer at the bottom right of my blog.

Here is another breakdown for the student loans. Like I said, I've been in school for 8 years. Here is how much each year has cost me:

1. 2002-2003: $9,125
2. 2003-2004: $13,625
3. 2004-2005: $26,850
4. 2005-2006: $26,970
5. 2006-2007: $23,022
6. 2007-2008: $6,788
7. 2008-2009: $4,410
8. 2009-2010: $10,500

Our goal this spring is to knock the first 4 loans off the list. This is our plan:

1. For spring semester of 2010 I am getting a loan of $5500. But I'm not taking as many courses as I expected so I'll be getting a refund of just over $2200. I will use this to pay for my textbooks (~$400) and then pay off the first SL of $919 this month. This will leave about $1000.
2. We have just over $4000 in our savings right now but Dave Ramsey recommends in "Baby Step 1" to have an emergency fund of $1000 and then move on to step 2 (Pay off debt). We are more comfortable with $1500 savings so I will use the $1000 + $2500 from savings to pay on the car loan. This will leave about $900 on the car which we will pay off then by the end of March!!
3. Finally, we will be moving in May and will be selling the mobile home. We will pay off that loan and hopefully be left with around $7000.
4. Using the $7000 plus tax return money and anything else we can scramble up from fruggle living we hope to pay off the 4th loan for $8305.

So, by the end of May 2010, we should have already paid almost $22,000 of our debt!! Not bad for our first 6 months. That will be great motivation and inspiration to really tackle my larger loans (5-8) at a balance of $112K.

We will be renting in our new location because Dave Ramsey advices not to incur any new debt if possible. He also recommends not buying a home until you can do it with 20% down and 15 year mortgage. We will rent until we have that and hopefully avoid lots of property taxes, home insurance, and home maintenance fees in the meantime.

Keep us in your prayers as we work to be diligent and faithful with our finances!

Godbless,

Thomas