Debt. Just get rid of it.

 I hate debt. It keeps our cash tied up. It prevents us from being able to spend for our future, because we're paying for the past.

So, how do we get rid of it? We pay it off. But with a plan. And that plan is called the "Debt Snowball".

You may have noticed that there was a category in the budget, under debt, called "Snowball". What's it for? It's for getting ride of debt.

I set our Snowball amount to $100 - I'm pretty aggressive that way - but whatever you can allocate extra to throw towards debt, is good. Here's why -

Let's look at those credit cards - 

I have a $30 payment for my Macy's card - that card has an interest rate of 29% (ouch!), and I'm carrying a balance of $640. With my minimum payment of $30/month, it will take me 57 months to pay that balance off, and I'll have also paid over $430 in interest.

My Citicard is a bit better with interest - it's 17%. But I have a balance of $1000. It will take me 60 months to pay it off, and I'll have paid almost $500 in interest.

Here's where the Debt Snowball takes care of business. We'll take our lowest balance first - the $640 balance on the Macy's Card, and pay an extra $100 every month, in addition to the regular $30 payment to pay it off. With that strategy I would be free of that bill in about a year, and pay about $100 in interest.

After the Macy's bill has been paid off, I can then take that money, and allocate it to the Citicard bill, and instead of paying $50, I'll pay that, plus $100 from the Snowball, and $30 from the previous Macy's payment, which we've paid off. Using that extra money, the $1000 balance will be paid off in about 2 years, and spending about $300 in interest. 

Everything paid off in 2 years, vs 5 years. I'm sold. Imagine what could be done after 2 years, and then you'll have an extra $180 to spend...

There's another similar method called the "Avalanche", where you attack the highest interest debt first, as opposed to the lowest balance. This can save a few dollars in interest payments, but it only changes the payoff time by a month or two. For lots of debt I like the Snowball, because there's a real psychological payoff seeing each debt get knocked off quickly, and then rolling into the next. There are a couple of calculators you can experiment with at unbury.me and undebt.it - they're free, and invaluable.

What about using a credit card to get points, air-miles, or cash-back? Once you've got your discipline ironed out, and have *everything*, including your credit card on autopay, go for it if you want. You just have to be scrupulous about paying the entire balance off every month, and only spending within your categories. That's an advanced technique I won't cover here, and will likely never use, because personally, I hate debt.

As far as a mortgage goes, that most certainly can be attacked as well. You can opt for a 15 year mortgage, biweekly payments (you'll get an extra payment in per year), or just throw as much money as you can for as long as you can until your house is paid off. It's up to you.