Featured customers currently enrolled in a CareOne Debt Relief Plan, share journey to become debt-free; hear how they juggle family, finances, and more.
Your final payment has been made, and you've contacted your CareOne representative to let them know you will be finished with your plan.
Wow! You are officially debt free! It's so exciting that you can hardly contain yourself. That one payment you had been struggling to make for years is now yours - all yours. So now what?
I figured since I didn't use my monthly payment for four years, I wouldn't miss it, and should start to save it.
I watched my debt go down month by month, now it was time to watch my savings go up. The big question was: What should I do with my money?
Again, I'm not a financial advisor. However, I do work for a private club that has a few wealthy members.
They gave me a few suggestions; you can also do your own research on the internet or read some of the financial blogs on the CareOne website.
In the meantime, here are three basic things you can do once you've paid off your debt.
1. Increase Your Retirement Contribution or Start One: I started a retirement fund at my job almost immediately, but wasn't putting much into it while trying to pay down my debt. Once it was paid off, I increased my 401k contribution from 4% to 10%, and increased it again to 12%. The great thing about a 401k is you don't really feel the deduction, as it's automatically taken from your paycheck, and most companies will match a percentage. This is a long-term investment you'll be glad you started and it certainly falls under the "pay yourself first" motto. Wouldn't it be great to be able to retire?
2. Add a Long-Term Savings Account: Put at least 40% of your monthly payment into a savings account for the long term. Do a monthly automatic transfer from your checking to your savings so you're not tempted to spend it. Once you have a few thousand dollars, you can put it in a CD or a money market account to get a better interest rate. Imagine, a few thousand dollars that isn't debt? Although interest rates aren't great right now, you'll make some money on your savings and will have better investment opportunities once the economy gets better.
3. Increase Your Emergency Fund: My emergency fund was approximately $500 while in the DMP. Since then, I have increased that fund. My goal is to have enough to live off of for six to eight months in case I ever lose my job or I'm prevented from working due to illness, etc. I use this same account for car repairs, unexpected bills, etc. I do an automatic transfer to this account every month. Although it fluctuates depending on what's going on in my life, it is growing at a steady rate.
These really are some basic suggestions to get you started. If you have children, you should speak to a financial advisor concerning their savings or college savings.
If you can continue to live without the monthly payment you made to CareOne, then invest it, save it, and watch your money grow!
You are starting a whole new chapter in your financial life - one without debt! What are your financial plans once you are debt free?
Cheryl Bigos graduated from the DMP in 2008, and blogs as a graduate in the My Journey out of Debt blog. She works as a Purchasing Manager in Los Angeles, teaches Pilates, and lives with her boyfriend of four years. Cheryl is looking forward to connecting and sharing with others in the CareOne Community. Compensated CareOne Blogger.
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I am sorry mama, I never meant to hurt you oooo, I never meant to make you cry but tonight, I am coming out of the closet
Cheryl, another way to build wealth is marriage. Isn't it time for you and your boyfriend to 'do the "I do's"?
How does marriage build wealth? My wife had us with $125K credit card debt and $70K home equity debt with a house that was under water and a combined income of $350K. I'm recently divocrced after 24 years (no kids).
I'm single, so having an emergency fund IS a big deal. I got to experience a friend out of work for almost 6 months with a broken ankle, so that was a real eye-opener. We had a hard time getting it thru her boss' head that you can't be driving while you're on pain killers. My goal is $12K and have about $7K stacked up, so I"m gettin' there.
yeah but how do you repair your credit score? i just got back to zero! but the years of fiscal irresponsibility has left my credit score low. whats the fastest way to get it up? i have no credit cards or owe anyone anything.
You should also look into life insurance and disability insurance. These two things dont cost nearly as much as your DMP but are a must to have! In the article she states her emergency fund if she were disabled, if you are disabled wouldnt it be nice to have insurance that pays you directly? Alot of you also have children and morgatgess, if you have life insurance it is a wonderful investment not for you but for your family to secure their lives that they are a custom too. Just food for thought! I am a State Farm agent and i am not soliciting buisness but am making you aware of things that you need in your life.
While you're paying down debt, the sacrifices are big, and the wait is sometimes long. But when you're done, it's really great knowing you can treat yourself to something you've truly earned that you won't regret.
It's the sense of competition. We all want to be the best. And while that may be healthy when it comes to sports, it's not really healthy when it comes to your wallet - especially if it's an empty wallet.
This is where great math skills come in handy. I'd like to offer some information on the differences between leasing and buying, what to look out for, and when the math becomes important .
For those who have a larger amount of debt, finding relief from those monthly payments is often a priority. The problem is that a good credit card debt relief program can be hard to find. The credit card companies are calling, the collection agency has threatened to sue, and your biggest wish at the moment is to find a debt relief program that actually works.
Remember that being debt free doesn't end life's needs, upsets and obligations. It only ends paying interest on them. Don't spend more, spend less once you are debt free. Save!!! You need income, ample cash assets, and low expenses to remain debt free. That's life!
That's what feels good.