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Confession: We’ve Taken On A Little More Debt


This update isn’t one that I’ve been looking forward to sharing on the blog. In general, everyone here in the debt-free community is making strides to decrease their debt, no matter the cost. While I really have made some fantastic progress in our debt freedom journey, debt is sometimes necessary in today’s world. We’ve been trying to build our credit to buy a home – which requires taking on some debt. Additionally, we desperately needed a new car that fit our new family.

So, without further ado, here’s my confession and a look at the latest debt numbers.

Why We Took on More Debt

There are a number of reasons our family decided to take on more debt after we’d paid a generous amount off. First, I recently talked about how we’d like to buy a home this year. To do that, we need to have a good payment history. As you know, in the past, many of our bills went into collections before they were settled. So, keeping things current is relatively new for us.

It’s exciting because, after time, it will allow us to build the life we want. However, taking on more debt wasn’t ideal. It never is.

On top of needing to build up some credit, we also had some medical emergencies that needed to be paid for. That went on the credit card! Things are tight and that’s how it is sometimes.

We also desperately needed a new car. Our little hatchback Golf GTI was no longer cutting it, especially on road trips. Between the car seat, stroller, highchair, and any luggage we needed, the car was slammed full. If we wanted the dog to tag along, forget about it! So, we decided to upgrade to an Audi Q3. It’s nice, reliable, and something our family will be able to drive for some time. Most people will say we didn’t need to spend that amount on a car, but we’ve got a good plan for paying it off early.

A Look At The Numbers

Now, the moment you’ve been waiting for. Here’s a look at the updated numbers…

Credit cards: $1,108 (up from $0 last year)
Collections: $1,205
Car loans: $34,640 (up from $16K)
Student loans: $24,185

Two notes here – our credit card balances are higher right now due to paying for a medical emergency, as mentioned above. Additionally, I have not made any payments on my student loans as the Biden Administration is still figuring out what is going on there. Tentatively, I will have 50% of my loans forgiven, which would be fantastic. So, we are just waiting on the decision from the state of NC now.

Where the car loan is concerned, we are paying more than the required monthly payment. We will also be looking into getting it refinanced within a year or so.

Our Philosophy Moving Forward

We definitely have more debt than we did this time last year, but things have changed drastically for our family. Our new philosophy moving forward is to change with what our family unit needs. Whether that is a bigger, more reliable vehicle that is still under warranty, or it is buying our own home (hopefully later this year), we are willing to bend and change for whatever is needed.

Readers, have you ever found yourself taking on more debt when you didn’t expect to? Let me know about your experiences in the comments.

Read More

Valentine’s Day: Money and Marriage Reflection
How Much Money Do You Need To Put Down On A Home?
Bills Are Going Up And We Want To Move
My 30th Birthday: Reflections

The post Confession: We’ve Taken On A Little More Debt appeared first on Our Debt Free Family.


  • Reply Jane |

    Welcome to BAD, Amanda. How about an introduction post? Are all your posts just going to be cross-posted from your website?

    • Reply Amanda Blankenship |

      Hi Jane! Thanks for your note. There will be some cross-posting, but I am going to also update the blog directly. I’ll have an intro post up later today.

  • Reply Laura |

    Update? This is your first post here. Context and an introduction would be helpful, along with original articles that aren’t cross-posted from another website.

  • Reply Shanna |

    hi! Totally understand your reasoning for taking on the car debt, you clearly needed a bigger car! However, I am curious about choosing an Audi versus a more basic and bigger SUV. Audis are known for expensive upkeep and frequent maintenance versus other small SUVs (Mazda CX5 or 7), RAV 4, etc. Also, that is a really small SUV, not knowing your family set up, you could outgrow it very quickly as child gets older or you add more kids to your family. Was the GOLF paid off or did you still owe on it? Is your second family car (if you have one) paid off?

    • Reply Amanda Blankenship |

      Hi Shanna! Thanks for your comment/questions. As far as choosing the Audi over other vehicles, my husband works on VW, Audi, Mercedes, and Porsche. While he’s taken a job at home since COVID, he still has connections that make the upkeep about the same price as it would be for another vehicle (i.e. we buy parts and someone lets them use their lift at the garage).

      We still owed a little on the Golf, but with the price of cars right now we got more than we owed for it. So we used that for money down on the Audi. Unfortunately, I cannot have any more children. So, our little Dahlia will be the only child. We also both work from home and only have one car. We’ve shared a vehicle for about 7 years now and haven’t seen the need for a second car with our lifestyle the way it is. Even when my husband had to go into work, I’d drive him in on days that I needed the car. It works for us!

So, what do you think ?