Greetings all,
I'm in need of some objective (read: non-judgemental) opinions on my efforts to finally get my family debt free.
A little background: my wife and I have been married for five years, we both brought some fairly large debt into the union (catastrophic medical debt, student loan, and poor spending habits). We have two kids under three. Over the five years, my wife and I have improved our debt situation exponentially truly out of necessity because we have moved around a lot (4 cross-country moves in 5 years). Now our work/life balance is getting a little better. Our family income is a little over $100k, but, alarmingly, our debt is around $50k.
My problem is that even though I have come leaps in bounds to increase efficiency, become creative with the debt and balance transfer to 0% for 16 months to stop the bleeding, I feel we are still getting nowhere. It seems every time I input new figures in our spreadsheets and calculate new numbers for when we could *Possibly* be debt free it is always two years out. For five years now we have been two years from debt free. This outcome may have come about from my wife's very conservative approach to debt reduction where she believes it's more important to save and invest than pay off or increase debt.
Just recently we came into a large windfall of cash that I covertly used the bulk of to pay off some debt. The trouble is that this windfall, in the mind of my wife, was already earmarked for a debt (or gift) that was given to us from her parents for when we needed to sell or house. I didn't spend the entire sum, but instead saved a portion just in case tempers flared. Honestly, no one in the family was that upset, my wife was a bit peeved and still expects us to pay her parents back immediately. I'm ashamed to say that I explained to her that we could pay back her parents if we had to by selling off all of our investments and that the money was still there. Only I'm not that sorry. Doesn't it make more sense for us to pay our real debts first, the ones that keep us in this predicament before paying back a gift? Honestly, once we are debt free we could pay them back much quicker with the available cash flow.
Anyway, step two of my plan includes using the rest of the gift money plus the money from our investments to pay off a huge chunk of our debt. I really feel that I need this small victory on top of the strides we've made in frugal living to see us fully over the finish line.
I guess at this point I really just need some constructive advice and encouragement to know if I am doing the right thing.
Thanks!
Mike