We Reduced our Debt by $11,276.69 (In One Day)!

As if paying off that much debt wasn’t great enough, we reduced our monthly expenses by $386.00 as you can see in my Budget – Before and After Baby (In Theory)

How did we do it?

We sold one of our cars!  Seems like a simple solution, right? It actually was, but we didn’t expect it to be.  We have (had) a 2011 Ford Focus with right about 76,000 miles on it.  I loved that car, with her leather seats, moon roof, SYNC, and seat warmers, but it was a bit small to have a car seat in the backseat, and we were paying a whopping $386 per month on the payment for it!

Really, we only need 2 vehicles.  We have a 1994 Toyota Truck that is paid for, and while it is kind of old, it runs great, gets pretty good gas mileage, and will probably run forever :-)  We are upside down on the loan we have out on our Cruze, so selling it wasn’t an option, but I really wanted to get rid of at least one of our car payments, so we decided to try and sell the Focus.

I took it to a friend’s house to detail it and get it ready to photograph and list online, and while she was helping me clean it, she kind of took a liking to it.  She and her husband were thinking about buying a smaller car for her (she has been driving a big dodge truck up until now :-) and the timing seemed perfect!  I wasn’t sure she was actually going to go through with it, but yesterday she called and said she had a check for me!

Net Worth Effect

So, the payoff amount was $11, 276.69 and they offered us $12,000, which seemed fair, and even if it was a little bit low, it saved us a ton of work finding a buyer :-).  Today is a good day!  Essentially, we increased our net worth by $12, 000 today!

Budget Effect

I assumed that we were selling the car in my Budget – Before and After Baby (In Theory), but just so you know, we are reducing our auto car payments by $386 per month, and our Auto Insurance by about $75 per month.  I factored the car payment change into our after-baby budget, but not the auto insurance change.

Our gas may increase just a bit because I will be driving the truck to work until Baby RB40 arrives, and it gets less MPG than my Focus did, but I drive 15 miles per day, and am going on maternity leave in 4 weeks – or less!

Also, for the first month or so, our auto maintenance budget will increase because the Toyota needs new tires before winter gets here and they are $60 a piece plus whatever they charge to put them on the actual truck.  Can you tell I have almost never bought tires :-)

I am thrilled that we were able to sell our car for more than we owed on it, thrilled about the new-found freedom in our budget, and thrilled that our net worth went up!  Have you ever thought about selling a vehicle to get rid of the payment, or have you done it?  How about moving to driving an older vehicle because it is paid for?  Financially, to me it makes sense, but I will miss my pretty little Focus…

Have a great weekend!

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