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As you continue on your way to being debt free, there are going to be occasions when it is wise to pause your debt payoff plan. This could be to allow you to save up for something else that is very important.
When I say pause the debt payoff, what I mean is that you would continue paying the minimum payments on your debts, but only the minimums.
This would mean that you’re not sending any extra money to your debt, all the extra money you have right now is going towards whatever reason you have for pausing your debt payoff.
I know that for those that are really trying to focus their efforts on getting out of debt, pausing can be scary. It can create a bit of fear because we think we will lose so much progress.
The fact of the matter is that life happens and often requires us to be flexible. Here are some reasons to pause the extra debt payments.
Baby on the way
Congratulations! You’re pregnant, yay!
This is a great reason to pause the debt payoff because pregnancies require medical needs and that requires money. This is a major life change and many needs are going to arise. Needs like diapers, and possibly even covering a loss of income when mom is unable to work.
Pausing your debt payoff for pregnancy is a great idea, and I would stack all that cash in a savings account and earmark it for things like your medical deductible, money to cover the loss of income for a few months and any other unexpected costs.
Here’s the best part, if you take 9 months and set aside as much money as possible and don’t use all of it, at the end of the pregnancy and after everything is good, then you can throw all that extra cash at your debt. You’ll be right back to paying off your debts!
Another great life experience! I would suggest pausing your debt payoff to save up for a wedding, but I will put a stipulation in here.
If you have a lot of debt, I would consider a smaller budget on the wedding if you are having to pay for it all, and if you want some help with budgeting for your big day, check out my blog post on how to budget for a wedding.
The idea here is to pause the extra debt payments to save up the cash needed to pay for the wedding and not add any more debt to your life. Starting your marriage off with no wedding debt is a great goal and worth working towards.
Choose the amount you’d like to spend on your wedding, discuss it with your future spouse, then work on a plan for how you will save up and get to that budgeted amount.
Things happen in life and sometimes they are medical. If you are able to foresee the need for something medical, I would certainly consider pausing your debt payoff to build up some cash.
You may want to pause and save enough extra for things like your medical deductible, extra medications, or some time that you’ll be away from work and unable to earn a paycheck.
The important thing here is that you’re taken care of and know you can pay for whatever it is you are needing to, without having to worry too much.
Major Life Event or Change
A major life event could be a death in the family, a relocation, or something similar. Things in life happen… unfortunately, death happens and we are not always ready for it. Taking care of family and being there to mourn is important and pausing your debt payoff to be able to do this is definitely okay.
Sometimes, a loss of job and need to relocate can come up. This being the case, you have to do what you need to do and that would definitely constitute pausing your debt payoff.
The overall idea is that we must know that things in life happen as nothing in this world is perfect. Although we can never be fully ready, we have permission to pause our goals and focus our efforts on the things at hand.
Stick with it!
There are events in life that just happen. We cannot always be ready for them or plan for them, but they often cause us to focus our attention on them. Things like a baby on the way, an upcoming wedding, medical needs or major life events can be reasons to pause our debt payoff.
Just because you are pausing your debt pay off does not mean you are not going to be able to reach your goals. The key here in all of this is in the word pause. You aren’t stopping your debt pay off, you are simply pausing it until you get back to a position where it makes it possible to do what you were doing before.
I know if you’re anything like me, I over analyze the numbers and start thinking about all the “what ifs”. Don’t let yourself do that, simply focus on what is going on in the moment, taking it one step at a time. Your life hardship or great life celebration is a good reason to pause your debt snowball so you can pay cash for them. That’s a great place to be in, paying cash for something that was necessary, then going right back to paying off debt.