Over Two Years and Still Out Of Debt

This past week, I was in a conversation with a coworker about cars.  You see, ever since I decided to be done with debt and my wife and I decided to have our third child, we’ve only owned one car—a 1997 Dodge Grand Caravan SE.  It’s old, but it has low mileage for the age and it’s served us well.  Until I started to drive back and forth to work for my new job.

You see, vehicles of this era have problems with oxygen sensors.  I think that when I get the one that just blew out replaced, it’ll be the second or third one on this vehicle.

Why Don’t You Get a New Ride?

My coworker suggested that I just trade it in and purchase another vehicle.  He told me that I could get a good, reliable, 2-year-old van for $150 a month, if I got a loan.

And there was the rub.  You see, I prefer to save and pay.  I’ve been doing the saving part (of course, I would be further ahead had I not lost my job in May!), but I don’t have the money to buy anything reliable at the time.

My choice has been to decide not to go into debt for practical purposes.  I’m choosing the saving route because of the economy and because it makes more sense to “own” than it does to “borrow”—especially on items that depreciate in value as quickly as a vehicle does. However, a 2-year-old vehicle is wise, and that will be my goal.

How to Get Out of Debt and Stay Out

The thing is, if you’re going to make the decision to get out of debt, you have to have your reasons.  For me, I saw how I always was paying part of my paycheck towards interest.  For me, that interest was low because I performed some debt consolidation to cards with fixed rates or 0% rates back when that was possible.

But the trick was that the banks let you know that you could always get more money if you wanted it.  And they also know that even if you usually pay off the entire balance, if you get a balance they have a chance that you won’t.

So in order to avoid throwing your money at interest, you need to learn patience and deferral.  You need to master your money and not let it master you.