I just got a comment asking what happened next. Well, we paid off all debt except for the mortgage in March, 2009. We have not taken on any debt since then. We've been slowly working on a 6 month emergency fund, if we should ever need it. We still owe a lot on the mortgage, but were able to save up a significant amount, about 3 or 4 months worth of living expenses in an emergency fund.
In December, 2009, my husband was laid off. Having this emergency fund puts us in a better place than most. With my salary and the savings, we could survive without him working for quite a while. We will get back to saving once he finds permanent employment again.
Saturday, January 16, 2010
Tuesday, March 10, 2009
All Consumer Debt Paid!
It has finally happened, we have paid back 100% of our debt. That's over $30,000 paid back in 18 months. It has been a tough and long 18 months, but we did it! We still have a mortgage, but no more car loans, student loans, or credit card bills! On March 1st, after getting our end of March paychecks, I was able to pay all of the bills and have enough left over to clear out the student loan! It is such an amazing feeling to finally be out from under all of that debt!
I can't even begin to describe the feeling, other than "wonderful"! I have to say thank you to all of the fellow personal finance bloggers out there. I read the Carnival of Debt and Carnival of Personal Finance frequently. Those stories helped to keep me motivated and to teach me more ways to save and it was very encouraging to read what other people were doing. The Dave Ramsey and Larry Winget books also put me on the right track. My husband and daughter were also great during this whole process, working together to stay within the budget.
After dinner, my husband and I were discussing how we're finally out of debt. My daugther replied, "Now we can be rich!" I told her we're not rich, but we will be able to save up money now, and hopefully not have to worry about it sometime in the future. She then took out her markers and drew the cutest picture. It is of my daughter holding lots of green money in her hands, with a big smile on her face!
Next month will be different, we'll be putting our money into savings rather than paying back loans! We will also finally "splurge" on a few important things we've been holding off on until we have the debt paid off. The plan is no more credit card use or loans, we'll save up for what we want and pay for it that way! The next step is to get 6 months worth of expenses into a savings account. After that, we'll be working on retirement savings and college savings. This is so exciting, I cannot believe that debt is gone!
I can't even begin to describe the feeling, other than "wonderful"! I have to say thank you to all of the fellow personal finance bloggers out there. I read the Carnival of Debt and Carnival of Personal Finance frequently. Those stories helped to keep me motivated and to teach me more ways to save and it was very encouraging to read what other people were doing. The Dave Ramsey and Larry Winget books also put me on the right track. My husband and daughter were also great during this whole process, working together to stay within the budget.
After dinner, my husband and I were discussing how we're finally out of debt. My daugther replied, "Now we can be rich!" I told her we're not rich, but we will be able to save up money now, and hopefully not have to worry about it sometime in the future. She then took out her markers and drew the cutest picture. It is of my daughter holding lots of green money in her hands, with a big smile on her face!
Next month will be different, we'll be putting our money into savings rather than paying back loans! We will also finally "splurge" on a few important things we've been holding off on until we have the debt paid off. The plan is no more credit card use or loans, we'll save up for what we want and pay for it that way! The next step is to get 6 months worth of expenses into a savings account. After that, we'll be working on retirement savings and college savings. This is so exciting, I cannot believe that debt is gone!
Saturday, February 7, 2009
Another Credit Card Paid Off!
I'm sorry that I really haven't been keeping up with this blog. We've been slowly saving money and paying back the debt. We had a frugal holiday season, and in January we were able to spend even less, staying under-budget and having just enough to pay off the other credit card.
On January 30th, we paid the credit card bill online in full. For the first time in 5 years, we have absolutely no credit card debt. This is such a great feeling. We only used credit cards a few times in 2008, and then immediately paid back whatever we'd charged. This really helped us to work at lowering the balance.
We were able to pay off such a large chunk of debt because of my husband's holiday bonus and raise, and also because he got 3 paychecks in January (being paid once every 2 weeks). That third check went entirely to the credit card payment.
In 2008, we paid back $24k in debt. I can't believe we have come this far. The remaining debt is college loans. Given that my husband and I haven't been to college in 9 years, this is our longest outstanding debt. If all goes well, we should have the college loan paid off by April.
I'm so happy we're finally making progress, and we'll be able to save for the future soon!
Personally, I never want to use a credit card again. I hope I never HAVE to use a credit card again. I haven't done the math, but I know that we've spent thousands on interest alone.
On January 30th, we paid the credit card bill online in full. For the first time in 5 years, we have absolutely no credit card debt. This is such a great feeling. We only used credit cards a few times in 2008, and then immediately paid back whatever we'd charged. This really helped us to work at lowering the balance.
We were able to pay off such a large chunk of debt because of my husband's holiday bonus and raise, and also because he got 3 paychecks in January (being paid once every 2 weeks). That third check went entirely to the credit card payment.
In 2008, we paid back $24k in debt. I can't believe we have come this far. The remaining debt is college loans. Given that my husband and I haven't been to college in 9 years, this is our longest outstanding debt. If all goes well, we should have the college loan paid off by April.
I'm so happy we're finally making progress, and we'll be able to save for the future soon!
Personally, I never want to use a credit card again. I hope I never HAVE to use a credit card again. I haven't done the math, but I know that we've spent thousands on interest alone.
Friday, November 14, 2008
Mid November Update: 1 Credit Card Paid Off!
I really need to write in here more often. Well, several big things happened to my family's finances this month. First of all, the month of October 2008 was our best month yet budget-wise. We pretty much stayed within the budget. We always go a little over budget, but this time it was really minor, about $20 over budget. This meant we had a lot more to put toward debt repayment in November. On November 5th, we paid off our Bank of America Credit Card Debt. I am so happy about that! This was our highest interest rate credit card, at 15% interest not too long ago. They have been lowering our interest rate as we've been paying it down though. It is such a relief to see that card at $0.00 owed. I hope I never need to charge anything on that card again, because I personally don't like Bank of America, and would rather stick to my local credit union for banking. We've had this card for 8 years though, it started off as Fleet or Fleet Boston or something, and it just kept getting sold in mergers and the interest rate kept going up. I am just SO HAPPY to have that card paid off!
My husband received a significant pay raise at work this past month, this will give us even more money to pay off the debt. When I entered all of my remaining debt into my chart, I saw that we've paid off over 50% of the debt we had in September, 2007 when I began this blog! This is amazing. At this rate, I hope all of our debt is gone well before the September, 2010 goal date.
The remaining debt is now on just 1 credit card and 1 student loan (and of course 1 mortgage, but that's not in my chart). We're going to aim at the last credit card for the rest of 2008, and the beginning of 2009. I have to say that I am proud of myself for working to get so much debt paid off. But, I'm even more proud of my husband for really improving his spending habits and working so hard to deserve that raise which will bring us more income. He is an amazing man, and we'd certainly still be drowning in debt if we weren't working together to budget and focus on debt repayment. This was our most successful debt repayment month yet. I know the next couple of months will be a little harder with the holidays, but I think we're on track to really eliminate that next credit card balance soon!
My husband received a significant pay raise at work this past month, this will give us even more money to pay off the debt. When I entered all of my remaining debt into my chart, I saw that we've paid off over 50% of the debt we had in September, 2007 when I began this blog! This is amazing. At this rate, I hope all of our debt is gone well before the September, 2010 goal date.
The remaining debt is now on just 1 credit card and 1 student loan (and of course 1 mortgage, but that's not in my chart). We're going to aim at the last credit card for the rest of 2008, and the beginning of 2009. I have to say that I am proud of myself for working to get so much debt paid off. But, I'm even more proud of my husband for really improving his spending habits and working so hard to deserve that raise which will bring us more income. He is an amazing man, and we'd certainly still be drowning in debt if we weren't working together to budget and focus on debt repayment. This was our most successful debt repayment month yet. I know the next couple of months will be a little harder with the holidays, but I think we're on track to really eliminate that next credit card balance soon!
Monday, October 6, 2008
September Review
Well, we did rather well sticking to our budget in September. I think I'm finally getting a handle on how the budget should work. On October 1st, we were able to put a couple thousand dollars toward paying off one credit card, bringing our total debt down to $17989. Not having the daycare expense is really helping, since now all of that money goes to paying off debt. We've paid off over 40% of our debt in 12 months- which makes me think we will reach our goal of having $0 in debt by Sept. 2010.
It is still difficult though, and there probably is more we can be doing to cut back and pay off debt faster. This month, I started clipping coupons vigorously. For the month of September, I kept track of my grocery store receipts- I recorded how much I spent, and how much was saved with rewards card savings and coupons. I saved 33% on groceries just by watching the sales closely and using coupons!
The goal now is to completely pay off our largest interest credit card by the end of 2008. We currently owe $2800 on that card...it will be so exciting when it is down to $0.
It is still difficult though, and there probably is more we can be doing to cut back and pay off debt faster. This month, I started clipping coupons vigorously. For the month of September, I kept track of my grocery store receipts- I recorded how much I spent, and how much was saved with rewards card savings and coupons. I saved 33% on groceries just by watching the sales closely and using coupons!
The goal now is to completely pay off our largest interest credit card by the end of 2008. We currently owe $2800 on that card...it will be so exciting when it is down to $0.
Saturday, September 6, 2008
Debt Finally Under $20K
I apologize again for the length of time between updates. I hope to get more detailed as I pay further attention to income and debt reduction. We went over-budget during the month of August. A large part of that was due to the purchase of school clothes and supplies, and the purchase of 2 new pairs of eye glasses. We also had most of the family's medical and dental check-ups in August- which ended up costing around $200 just for the co-pays. Despite all of that, we were able to make a hefty payment toward our debt on September 1st.
I am paid once a month, but my husband is paid every other week. It turns out that he had 3 paydays during the month of August. The entire third paycheck, and our other extra money (because we have no more daycare expenses) went to debt repayment. Our debt is now below $20K. $19,999.99 to be exact...I had to throw that extra penny in, and vow never to go above $20K again.
We're steadily working at the Bank of America credit card now...I hope it will be paid off by the end of 2008. We will then focus on the credit union credit card, and then finally the student loan. I graduated college 10 years ago, and hate the fact that I'm still paying for it!
This fall, we have a family wedding coming up, so that will cost us a bit (clothes, gifts, etc). Our daughter entered public school, so the money that was going to daycare will now go toward debt reduction...this will really speed up the process. I have a few items to sell on Craigslist, and we're all working to be as frugal as possible. I'm becoming a coupon clipper and being really careful about the grocery budget- which is one of our bigger expenses.
We were able to put $10K toward debt payoff since last September when I started this blog. I hope we will be able to put a lot more money into our debt reduction, and be debt free (except for the mortgage) in less than a year.
I am paid once a month, but my husband is paid every other week. It turns out that he had 3 paydays during the month of August. The entire third paycheck, and our other extra money (because we have no more daycare expenses) went to debt repayment. Our debt is now below $20K. $19,999.99 to be exact...I had to throw that extra penny in, and vow never to go above $20K again.
We're steadily working at the Bank of America credit card now...I hope it will be paid off by the end of 2008. We will then focus on the credit union credit card, and then finally the student loan. I graduated college 10 years ago, and hate the fact that I'm still paying for it!
This fall, we have a family wedding coming up, so that will cost us a bit (clothes, gifts, etc). Our daughter entered public school, so the money that was going to daycare will now go toward debt reduction...this will really speed up the process. I have a few items to sell on Craigslist, and we're all working to be as frugal as possible. I'm becoming a coupon clipper and being really careful about the grocery budget- which is one of our bigger expenses.
We were able to put $10K toward debt payoff since last September when I started this blog. I hope we will be able to put a lot more money into our debt reduction, and be debt free (except for the mortgage) in less than a year.
Tuesday, July 15, 2008
Exactly What are We Paying Back?
If you haven't figured it out yet, I am a very detailed and organized person, I keep good records. So, when looking at that huge number of $18,000 in credit card debt- I asked myself "What are we paying back?" For a long time, when we were charging regularly, we'd pay back whatever we charged that month. If we charged $100 on a hotel room on June 1st, I'd send $100 to the credit card company on June 2nd. That was all well & good, but the debt wasn't going down. With interest and low monthly payments, it was staying the same or getting larger. I'd think I was paying back- hotel visit June 1, 2006....but I was really paying back grocery shopping from May, 2002...or whatever the oldest charge that hadn't been paid was.
So, I took out all my credit card statements for the 2 cards we owe money to. I entered each item- from the most recent onward, until I hit the total amount that we owe. I now know that when I make my next payment to card A- I'll be paying for a car repair on 3/23/2005, and some home improvement supplies on 4/19/05. When I make my next payment to card B- I'll be paying for a doctor visit from 4/21/2006. That's how far back it goes. If we don't charge anymore (and after that lapse, I don't plan to) I am going to use this file to help me see the truth of what I'm paying for. I'll delete the 3/23/05 car payment, etc. each time I pay & the balance gets lower until all items are deleted -ending with the camera & kites and a 0 balance. This isn't even accounting for interest...but now I know what I'm paying for when I send in as much as I can to debt repayment on the credit cards.
It is rather depressing to realize that I'm paying for groceries I ate 2 years ago, or gas my car used 3 years ago...but, that's what happens when you charge something and don't pay it back immediately. So, how did it get up to $18K? Well, I did some more math and about $7000 was charged on car repairs for our 2 cars- which are rather old. The other $11K is a mixture of business purchases setting up my husband's home office- laptop, printer, chair, etc. ; groceries and gas purchases when we had no money left in our checking account, clothing purchases, and just a long list of smaller frivilous purchases like dinners out, hotel rooms, Christmas & birthday gifts, etc. Things we didn't have money saved for and either didn't budget for or went over-budget buying.
It did take me quite a while to get that document together, but I'm glad I did. I need to be more determined to get out of debt, I need to be more focused and stick to the budget...this reality check will definitely help. And once the credit cards are at zero, I'm not charging again. Every purchase will be saved for and paid for in full from cash or our checking account. I don't want to be paying for the past...I want to be saving for the future.
So, I took out all my credit card statements for the 2 cards we owe money to. I entered each item- from the most recent onward, until I hit the total amount that we owe. I now know that when I make my next payment to card A- I'll be paying for a car repair on 3/23/2005, and some home improvement supplies on 4/19/05. When I make my next payment to card B- I'll be paying for a doctor visit from 4/21/2006. That's how far back it goes. If we don't charge anymore (and after that lapse, I don't plan to) I am going to use this file to help me see the truth of what I'm paying for. I'll delete the 3/23/05 car payment, etc. each time I pay & the balance gets lower until all items are deleted -ending with the camera & kites and a 0 balance. This isn't even accounting for interest...but now I know what I'm paying for when I send in as much as I can to debt repayment on the credit cards.
It is rather depressing to realize that I'm paying for groceries I ate 2 years ago, or gas my car used 3 years ago...but, that's what happens when you charge something and don't pay it back immediately. So, how did it get up to $18K? Well, I did some more math and about $7000 was charged on car repairs for our 2 cars- which are rather old. The other $11K is a mixture of business purchases setting up my husband's home office- laptop, printer, chair, etc. ; groceries and gas purchases when we had no money left in our checking account, clothing purchases, and just a long list of smaller frivilous purchases like dinners out, hotel rooms, Christmas & birthday gifts, etc. Things we didn't have money saved for and either didn't budget for or went over-budget buying.
It did take me quite a while to get that document together, but I'm glad I did. I need to be more determined to get out of debt, I need to be more focused and stick to the budget...this reality check will definitely help. And once the credit cards are at zero, I'm not charging again. Every purchase will be saved for and paid for in full from cash or our checking account. I don't want to be paying for the past...I want to be saving for the future.
I Finished Reading "Your Money or Your Life"
I finally finished reading "Your Money or Your Life". I got this book for Christmas, but I got severely sidetracked reading George R.R. Martin's A Song of Ice and Fire series...which has nothing to do with finances. Anyhow, I liked "Your Money or Your Life". The way the author discussed using your life energy & finding out what your life energy is really worth- looking at what you're being paid, and expenses that go with having that job. It was all really interesting- and eye-opening. Even though the book was written over 15 years ago, I like the idea of the wall chart and getting to the point where you can live off of your investments and live without working. His views on early retirement and having time to volunteer were interesting, a little preachy, but still great ideas. Some of the anecdotes used seemed far-fetched, but they apparently are true stories. It is motivational to know what these people did with their financial life, and how achieving the concepts in the book are possible...if you do the work and take the necessary steps. I'm still at the digging out of debt step, but I won't forget these ideas for the future. It is worth a read, especially if you already have your debt under control.
Kites & A Camera- A Spending Confession
Well, I wrote that last entry about not using a credit card for 6 months on June 30th. Unfortunately, that's how long our record of no credit card use went. Over the past two weeks, we've used the credit card for non-emergency purchases. I feel like I failed somewhere, and in a moment of weakness and numerous justifications- we made a charge on the card.
Confession #1- For the past 2 years, I've been borrowing a digital camera from work and using it to take photos on holidays & vacations. I found out that the digital camera is needed for work use during my vacation week, so I would not be able to borrow it this year. I really have used it A LOT, and after a long conversation with my husband and lots of research- we decided to purchase a digital SLR camera. At least we found the best price and the best camera for our purposes, and we probably won't buy another one for 5 to 10 years. The camera cost about $900, and was charged on our credit card. This was the largest purchase I'd made since I bought my car 5 years ago. The next few days, both my husband and I felt guilty, I felt depression too- for coming so far- 6 months without using the card, and then giving in. The camera has arrived- it is wonderful, and we're already using it daily- at least it will get a lot of use. After paying back over $5k in debt, we know we can pay this back quickly. If we'd had more time, we could have saved up for this purchase- but with our vacation approaching, we wanted it sooner.
Confession #2- we used the credit card again a few days later. This was frivilous, and unexpected. My husband does stunt kiting, and he pre-ordered 2 custom made kites. We did not know when they'd be ready, I think we assumed in the fall or winter. We were going to start saving up for these purchases in August, after the expenses of daycare, our vacation, and our daughter's birthday had passed. To our surprise, the kite designer had them ready much earlier than expected- the beginning of July. So, we ended up charging another $500 on the credit card to pay for those. My husband has spent about $2k on stunt kites & parts since he began the hobby in March. After last week's purchase, he has agreed to not buy another kite until our credit card debt is at zero. (it is at $18k right now). The kites arrived yesterday, he loves them, and will certainly fly them a lot- he flies 1 or 2 hours a day now. He tried listing a kite he no longer uses on eBay, but it didn't sell. I think that having a "kite at the end of the tunnel" when we get out of debt is a great motivator for him.
I think we both feel as though we failed in the no credit card use arena, and we definitely didn't need to buy the camera or kites...that's $1400 added to our debt. But, we're already back on track, and back on budget. I had to confess here to explain why my debt has gone up...and holding myself accountable is one of the reasons I started this blog.
Confession #1- For the past 2 years, I've been borrowing a digital camera from work and using it to take photos on holidays & vacations. I found out that the digital camera is needed for work use during my vacation week, so I would not be able to borrow it this year. I really have used it A LOT, and after a long conversation with my husband and lots of research- we decided to purchase a digital SLR camera. At least we found the best price and the best camera for our purposes, and we probably won't buy another one for 5 to 10 years. The camera cost about $900, and was charged on our credit card. This was the largest purchase I'd made since I bought my car 5 years ago. The next few days, both my husband and I felt guilty, I felt depression too- for coming so far- 6 months without using the card, and then giving in. The camera has arrived- it is wonderful, and we're already using it daily- at least it will get a lot of use. After paying back over $5k in debt, we know we can pay this back quickly. If we'd had more time, we could have saved up for this purchase- but with our vacation approaching, we wanted it sooner.
Confession #2- we used the credit card again a few days later. This was frivilous, and unexpected. My husband does stunt kiting, and he pre-ordered 2 custom made kites. We did not know when they'd be ready, I think we assumed in the fall or winter. We were going to start saving up for these purchases in August, after the expenses of daycare, our vacation, and our daughter's birthday had passed. To our surprise, the kite designer had them ready much earlier than expected- the beginning of July. So, we ended up charging another $500 on the credit card to pay for those. My husband has spent about $2k on stunt kites & parts since he began the hobby in March. After last week's purchase, he has agreed to not buy another kite until our credit card debt is at zero. (it is at $18k right now). The kites arrived yesterday, he loves them, and will certainly fly them a lot- he flies 1 or 2 hours a day now. He tried listing a kite he no longer uses on eBay, but it didn't sell. I think that having a "kite at the end of the tunnel" when we get out of debt is a great motivator for him.
I think we both feel as though we failed in the no credit card use arena, and we definitely didn't need to buy the camera or kites...that's $1400 added to our debt. But, we're already back on track, and back on budget. I had to confess here to explain why my debt has gone up...and holding myself accountable is one of the reasons I started this blog.
Thrift is the New Standard
I just had to comment on how interesting I'm finding the reactions to the increase in gas prices and grocery prices. My family is deeply in debt- mostly because of the end of 2003 and most of 2004 when we had a baby, moved to another state, and were both jobless for many months. As soon as we got jobs, we bought a house, had to replace a car, and had to begin paying for daycare.
Anyhow, since November, 2004- I've been on the "debt reduction kick". Our debt has been reduced- and once daycare is done (next month!) it will be reduced even faster! So, I've been reading personal finance blogs, and books by Dave Ramsey and Larry Winget to motivate me and learn more techniques on digging out of the hole.
We're on a strict budget "on a very fixed income" to quote a "Seinfeld" episode- but by now my husband and I are used to it, we know a lot of tricks, and it is pretty much second nature- except for the occasional frivolous purchase. Even my daughter has picked up on my frugality, picking out only items that are on sale at the grocery store, and clearly stating to my husband that "Mama hates to spend money!" I'm pretty sure that being the daughter of a gullible mega-consumerist and a compulsive gambler have resulted in my hatred of frivolous spending and my extreme views on thriftiness.
In the past few months- being thrifty has suddenly become the "in" thing...because of the gas and grocery prices- many families are in the financial position that we were in late 2004. It has become so mainstream, that Money Magazine did an article about eliminating credit card use. I found the article interesting, and even recognized some of the families because they are prominent bloggers in personal finance. Yesterday, marked 6 months since my husband and I used a credit card. We've relied solely on our debit card and cash for all purchases. This has really helped us not take on more debt.
In the past 6 months, my attitude toward money has become more rigid. The consumerist lifestyle sickens me, and at many points I will groan at a commercial or simply change the channel (radio or tv) when the commercials come on. I'm not falling for these marketing ploys...and I don't care to keep up with the Joneses. Once we're comfortable (which we pretty much are already) and out of debt...money will go toward saving for important things, and hopefully never having to borrow again!
If you're at all interested in my no-debt anti-consumerism views, you should read "You're Broke Because You Want to Be" by Larry Winget and "The Total Money Makeover" by Dave Ramsey. Don't even get me started on how awesome I think Larry Winget's views on money are!
So, after 4 years of dealing with this budgeting stuff and being in the minority- it is becoming mainstream!
Anyhow, since November, 2004- I've been on the "debt reduction kick". Our debt has been reduced- and once daycare is done (next month!) it will be reduced even faster! So, I've been reading personal finance blogs, and books by Dave Ramsey and Larry Winget to motivate me and learn more techniques on digging out of the hole.
We're on a strict budget "on a very fixed income" to quote a "Seinfeld" episode- but by now my husband and I are used to it, we know a lot of tricks, and it is pretty much second nature- except for the occasional frivolous purchase. Even my daughter has picked up on my frugality, picking out only items that are on sale at the grocery store, and clearly stating to my husband that "Mama hates to spend money!" I'm pretty sure that being the daughter of a gullible mega-consumerist and a compulsive gambler have resulted in my hatred of frivolous spending and my extreme views on thriftiness.
In the past few months- being thrifty has suddenly become the "in" thing...because of the gas and grocery prices- many families are in the financial position that we were in late 2004. It has become so mainstream, that Money Magazine did an article about eliminating credit card use. I found the article interesting, and even recognized some of the families because they are prominent bloggers in personal finance. Yesterday, marked 6 months since my husband and I used a credit card. We've relied solely on our debit card and cash for all purchases. This has really helped us not take on more debt.
In the past 6 months, my attitude toward money has become more rigid. The consumerist lifestyle sickens me, and at many points I will groan at a commercial or simply change the channel (radio or tv) when the commercials come on. I'm not falling for these marketing ploys...and I don't care to keep up with the Joneses. Once we're comfortable (which we pretty much are already) and out of debt...money will go toward saving for important things, and hopefully never having to borrow again!
If you're at all interested in my no-debt anti-consumerism views, you should read "You're Broke Because You Want to Be" by Larry Winget and "The Total Money Makeover" by Dave Ramsey. Don't even get me started on how awesome I think Larry Winget's views on money are!
So, after 4 years of dealing with this budgeting stuff and being in the minority- it is becoming mainstream!
Thursday, June 5, 2008
May Recap- Using Economic Stimulus to Pay Debt
Well, we are slowly making progress at paying the debt. We went over budget during the month of May, but not by much- only about $150 over budget. This was due to 2 major things- going out to eat too much, and the rising cost of gas. Dinner out, grocery shopping, and gas were the only budget categories where we went into the red. Hopefully, we can stay under-budget for June.
This month, we were able to pay $2700 toward our credit card with the largest debt...$1500 of that was from the economic stimulus check- which I'll admit took a lot of will power to not spend on something "fun". We'll have a lot of fun when we don't have credit card bills to pay though!
Since September, we've paid back 19 % of our debt and that is just amazing to think about. We've also gone 5 months without using a credit card whatsoever- which obviously helps in seeing our debt decrease rather than remain the same or increase.
We only have 2 more months of daycare tuition to pay for, and once that is done, we'll have an extra $800 a month to put toward the debt. During the month of July, we do have our daughter's birthday and a vacation week coming up- so that will give us less to throw towards the debt in the summer. I have a feeling that we will make a lot of progress this fall. I'll be getting a small raise in July, but every little bit of extra money helps.
Our biggest challenge right now is to stay within the budget and plan and budget for future expenses- like gifts and travel money for July.
I have to say that I'm very proud of my family for working so hard at spending less and paying back the debt. This is the first time our debt is under $25K in years!
This month, we were able to pay $2700 toward our credit card with the largest debt...$1500 of that was from the economic stimulus check- which I'll admit took a lot of will power to not spend on something "fun". We'll have a lot of fun when we don't have credit card bills to pay though!
Since September, we've paid back 19 % of our debt and that is just amazing to think about. We've also gone 5 months without using a credit card whatsoever- which obviously helps in seeing our debt decrease rather than remain the same or increase.
We only have 2 more months of daycare tuition to pay for, and once that is done, we'll have an extra $800 a month to put toward the debt. During the month of July, we do have our daughter's birthday and a vacation week coming up- so that will give us less to throw towards the debt in the summer. I have a feeling that we will make a lot of progress this fall. I'll be getting a small raise in July, but every little bit of extra money helps.
Our biggest challenge right now is to stay within the budget and plan and budget for future expenses- like gifts and travel money for July.
I have to say that I'm very proud of my family for working so hard at spending less and paying back the debt. This is the first time our debt is under $25K in years!
Friday, April 11, 2008
Victoria's Secret- Attracting Pre-school Customers!
I had an interesting visit to Victoria's Secret a couple of weeks ago. I have been avoiding the mall for months, but I did buy something there the other day. I was with my 4-year-old daughter, and the clerk asked "Do you ladies have a Victoria's Secret Angels card?" I just said "No, and I'm not interested in applying for one."
When I got home, I thought about it some more. The clerk said "ladies"...she was actually asking if my 4-year-old had a store charge card...a lingerie store mind you, a place where she won't be shopping for years! Now that I've been following personal finance blogs, I am so much more aware of marketing techniques. Even at 4 years old, they are trying to get my daughter to become a customer. In fact, she already has that cute Pink brand puppy with the polka dots that they gave me for free with a purchase a few years ago! I don't know how I'm going to be able to help my daughter understand marketing ploys, so that she doesn't get sucked into these schemes when she's an adult (or even now).
When I got home, I thought about it some more. The clerk said "ladies"...she was actually asking if my 4-year-old had a store charge card...a lingerie store mind you, a place where she won't be shopping for years! Now that I've been following personal finance blogs, I am so much more aware of marketing techniques. Even at 4 years old, they are trying to get my daughter to become a customer. In fact, she already has that cute Pink brand puppy with the polka dots that they gave me for free with a purchase a few years ago! I don't know how I'm going to be able to help my daughter understand marketing ploys, so that she doesn't get sucked into these schemes when she's an adult (or even now).
March Review- Turning Down a "Discount"
Sorry for the late update. March was a tough month. We went yet another month without using a credit card! We did however go over-budget. But, we had the emergency fund to bail us out. We went on a small vacation the first weekend in March, which ended up costing a lot more than expected. Then, we got more medical bills for our daughter's ear surgery. We also needed to have the landscapers do some much needed work that ended up costing over $1000. If not for those expenses, we would have been within the budget.
We did manage to pay down some debt this month. One of my credit cards (the one with the highest balance owed and highest interest) sent me a special "discount" bill in the mail. It said that this month the minimum due is only $15...but it will go back up to the normal amount (around $250) next month. I just laughed! They are charging me over $150 in interest every month, so it is worth it to them to have me pay less, so they can keep charging interest. So, what did I do? I paid $750 to them for this month, because that's how much extra I had to go toward the debt after refilling my emergency fund! If we can stay within budget in April, I plan to throw a whole lot more at that credit card debt, and all of our Economic Stimulus money will go toward that card too. I want that card paid off, I won't fall for their discount bill!
We did manage to pay down some debt this month. One of my credit cards (the one with the highest balance owed and highest interest) sent me a special "discount" bill in the mail. It said that this month the minimum due is only $15...but it will go back up to the normal amount (around $250) next month. I just laughed! They are charging me over $150 in interest every month, so it is worth it to them to have me pay less, so they can keep charging interest. So, what did I do? I paid $750 to them for this month, because that's how much extra I had to go toward the debt after refilling my emergency fund! If we can stay within budget in April, I plan to throw a whole lot more at that credit card debt, and all of our Economic Stimulus money will go toward that card too. I want that card paid off, I won't fall for their discount bill!
Thursday, March 6, 2008
February Review- Car Loan Paid Off!
The month of February included the following financial highlights:
Almost staying under budget (we spent $1203)
NOT using a credit card all month
Putting more money toward paying off debt
Dealing with a medical expense without resorting to credit cards
and Paying off the car loan (we now own both cars!)
Yesterday, the loan note on my husband's car read $0.00 Such a great feeling! Granted, the car is 13 years old and cannot pass an annual inspection without more repairs that cost more than the car is worth, but we own it...and we paid off the loan 7 months early! :)
This past month was really tough, we stayed within the budget until February 29th, when I realized I forgot to put something in the checkbook and went $3 over our budget of spending money outside of the bills. Oh well, that's the closest we've gotten to being within the budget in months!
I also made about $175 in extra income selling things on Craigslist and Half.com and that went toward paying off the car loan. I am just about out of items to sell, but I should see another $40 or so from Half.com in March. My husband also made extra money for a programming job he did through his home business.
My daughter had a minor operation (tubes put in her ears) at the beginning of February. The doctor's bills have started to pour in- fees for the surgeon, the surgery center, the anesthesiologist, the follow up visit, etc. The total without insurance would have been $6000. Because we have health insurance, it cost us about $700 out of pocket, but for once we had the cash to pay for it, and didn't have to use a credit card! It is still amazing that a 9 minute minor day surgery could end up costing so much.
The debt is starting to go down a little- we now only have 3 major debts outside of the mortgage: the student loan and 2 credit cards...and now it is time to work at the credit card with the largest balance ($11K) and the highest interest rate (13.5%). It will take a while to get rid of that card...but we're moving full speed ahead.
I'm not sure if we'll do as well in March because we have some much needed landscaping expenses to deal with. We'll see how it goes.
Almost staying under budget (we spent $1203)
NOT using a credit card all month
Putting more money toward paying off debt
Dealing with a medical expense without resorting to credit cards
and Paying off the car loan (we now own both cars!)
Yesterday, the loan note on my husband's car read $0.00 Such a great feeling! Granted, the car is 13 years old and cannot pass an annual inspection without more repairs that cost more than the car is worth, but we own it...and we paid off the loan 7 months early! :)
This past month was really tough, we stayed within the budget until February 29th, when I realized I forgot to put something in the checkbook and went $3 over our budget of spending money outside of the bills. Oh well, that's the closest we've gotten to being within the budget in months!
I also made about $175 in extra income selling things on Craigslist and Half.com and that went toward paying off the car loan. I am just about out of items to sell, but I should see another $40 or so from Half.com in March. My husband also made extra money for a programming job he did through his home business.
My daughter had a minor operation (tubes put in her ears) at the beginning of February. The doctor's bills have started to pour in- fees for the surgeon, the surgery center, the anesthesiologist, the follow up visit, etc. The total without insurance would have been $6000. Because we have health insurance, it cost us about $700 out of pocket, but for once we had the cash to pay for it, and didn't have to use a credit card! It is still amazing that a 9 minute minor day surgery could end up costing so much.
The debt is starting to go down a little- we now only have 3 major debts outside of the mortgage: the student loan and 2 credit cards...and now it is time to work at the credit card with the largest balance ($11K) and the highest interest rate (13.5%). It will take a while to get rid of that card...but we're moving full speed ahead.
I'm not sure if we'll do as well in March because we have some much needed landscaping expenses to deal with. We'll see how it goes.
Saturday, February 9, 2008
Jan. 2008 Review- No Credit Card Use & Emergency Fund in Savings!
Well, January didn't go as planned. We went overbudget again, largely in part to a water heater leak that cost over $200 to fix. However, I am proud to say that we did not use a credit card one time in January. Actually, we have not charged anything in 2008 to date! That is a huge victory for us, although it should be how everyone normally pays for things. We also saved up the entire $1000 for our emergency fund. No Credit Card use and an Emergency Fund in 1 month! That's just awesome. My husband's higher salary definitely helped with that one, it is also helping with some unexpected medical expenses this month.
We've paid back about $500 of our debt, and have not made any more debt this year. We're still trying to look at ways to save more money and pay back the debt faster. We only owe about $300 on the car, and it would be wonderful to own that 13-year-old car. Although, it does need at least $500 in repairs to make it road-worthy again. We're thinking about donating it after we own it, if we can get by with just one car. Now that my husband works from home, we may be able to do just that- and save on auto insurance too!
I will update again next month, or sooner if we can pay off that car loan.
We've paid back about $500 of our debt, and have not made any more debt this year. We're still trying to look at ways to save more money and pay back the debt faster. We only owe about $300 on the car, and it would be wonderful to own that 13-year-old car. Although, it does need at least $500 in repairs to make it road-worthy again. We're thinking about donating it after we own it, if we can get by with just one car. Now that my husband works from home, we may be able to do just that- and save on auto insurance too!
I will update again next month, or sooner if we can pay off that car loan.
Wednesday, January 2, 2008
December & Plans for 2008
Happy 2008! This past year flew by! I don’t want to look at my spending in December. It was way over-budget. Of course most of that was on computer supplies for my husband’s home office- which can be written off as a business expense. The rest was for holiday gifts, medical expenses, and too many dinners out. The holiday gift cost wasn’t as high as previous years because we won a gift certificate to Amazon.com because my husband filled out a survey there…that really helped us out. We “got by” for most of the month, and then had to resort to credit cards to pay for groceries and gas for the last week, when we ran out of money. I’m not proud of how December went, but I plan to put away $500 for holiday savings next year.
2008 looks to be a much better year financially. My husband just started a new job where he’ll be making a much larger salary- a 36% increase in pay from his previous job! And, he will be working from home, saving us a lot of gas and car maintenance money. We don’t plan to change our spending habits because of this increase. We’ll try to stick to a budget…and it may be more attainable now, since we’ll be able to put money in savings in addition to paying off debt.
On December 31st, we paid all of the January bills we had, and were able to set aside money for the bills that haven’t arrived yet. We’re still sticking with the $1200 in other monthly expenses budget…which gave us a little left over (about $100) to put in savings. We haven’t made much progress on debt reduction, but I am determined to not go any higher than before. Our current non-mortgage debt is $30,000 as of January 1st. The plan is to chop away at that credit card/car loan/student loan debt all year long and just see how low we can get it.
My husband and I are also going to stop using credit cards. We’re going to see if we can make it through the month of January without credit cards, and I hope we can make it even longer than that. Once we fill up our emergency savings fund, it will be easier to avoid adding more debt to our charge accounts.
I have high hopes for debt reduction this year- with a larger income and daycare expenses disappearing in September when our child starts kindergarten, using less gas, and sticking to a budget, and NOT CHARGING...we should be able to make some wonderful progress.
2008 looks to be a much better year financially. My husband just started a new job where he’ll be making a much larger salary- a 36% increase in pay from his previous job! And, he will be working from home, saving us a lot of gas and car maintenance money. We don’t plan to change our spending habits because of this increase. We’ll try to stick to a budget…and it may be more attainable now, since we’ll be able to put money in savings in addition to paying off debt.
On December 31st, we paid all of the January bills we had, and were able to set aside money for the bills that haven’t arrived yet. We’re still sticking with the $1200 in other monthly expenses budget…which gave us a little left over (about $100) to put in savings. We haven’t made much progress on debt reduction, but I am determined to not go any higher than before. Our current non-mortgage debt is $30,000 as of January 1st. The plan is to chop away at that credit card/car loan/student loan debt all year long and just see how low we can get it.
My husband and I are also going to stop using credit cards. We’re going to see if we can make it through the month of January without credit cards, and I hope we can make it even longer than that. Once we fill up our emergency savings fund, it will be easier to avoid adding more debt to our charge accounts.
I have high hopes for debt reduction this year- with a larger income and daycare expenses disappearing in September when our child starts kindergarten, using less gas, and sticking to a budget, and NOT CHARGING...we should be able to make some wonderful progress.
Saturday, December 1, 2007
A Look Back at November
Well, we made some progress in debt reduction. Sticking to the budget was a problem this month. We spent $500 more than we made- although $350 of that was for a much needed twin bed set for our daughter. The rest of the overflow was from medical expenses and going out for dinner too much. We're really going to focus more on sticking to the budget this month.
We did make $120 by selling used things on Craigslist...we're running out of used things, but any extra income helps. My husband is interviewing for jobs that will hopefully earn him more money. I may start looking for a higher paying job soon myself (although probably not for several more months). I am underpaid for the industry I work in, and work really isn't fulfilling anymore. I may look into a complete career change the next time I start job hunting.
As for the holidays, we don't have much to spend...but I think we'll make due. We did manage to pay down some of the debt this month, and we have a little bit left in December's budget for a few gifts, and many of our family members aren't exchanging gifts this year because they're in too much debt too.
We did make $120 by selling used things on Craigslist...we're running out of used things, but any extra income helps. My husband is interviewing for jobs that will hopefully earn him more money. I may start looking for a higher paying job soon myself (although probably not for several more months). I am underpaid for the industry I work in, and work really isn't fulfilling anymore. I may look into a complete career change the next time I start job hunting.
As for the holidays, we don't have much to spend...but I think we'll make due. We did manage to pay down some of the debt this month, and we have a little bit left in December's budget for a few gifts, and many of our family members aren't exchanging gifts this year because they're in too much debt too.
Saturday, November 10, 2007
The Upcoming Holidays
I'm going to be a curmudgeon here...I hate the holiday season. The time between November 1st and January 1st feels like a huge marketing scam, and no matter how hard I try, I'm always caught somewhere in the middle of it. I understand how good it feels to give gifts, and receive them too...but 2 months of preparation and basically every TV, radio and print ad just screaming at me to buy, buy, buy...I don't want any part of it. But, I will give in and celebrate a little, if for nothing else than to give my daughter some memories of family togetherness and happiness during the holidays. (We're not Christian, but just about everyone around us is, so we celebrate secularly, if that's possible).
We don't travel during the holidays, and I try to avoid the shopping centers. If we do any shopping, it is usually online or an off-hours trip to Target. The past 2 years, we've been on a strict budget for Christmas, and we've still spent about $500 each year. That includes all gifts, a tree, decorations, wrapping paper, cards, stamps, etc. This year, we don't have ANY savings for Christmas, and I don't want to go deeper into debt.
We've told relatives that we can't afford gifts, and ask them not to give us any. They still give gifts to our daugther, and then we feel she has to give them "a little something"...and a bunch of a little somethings add up to a lot. And we do like to buy one big present for our daughter each year and an ornament and stocking stuffers. This year, it will be her first bike.
The holidays in debt are just no fun. It is rather embarassing or hard to explain. My husband and I have a budget of $20 for gifts for each other. Then, after the holidays friends and co-workers will ask, "what did you get?" and I have to reply "a DVD"...when everyone around me is getting these extravagant gifts. And don't get me wrong, 1 DVD is more than enough for me, but the rest of the world seems to think that we all should be showered with gifts, and there must be something wrong with my family, if that's all they got me. I just hate consumerism. I think Christmas trees are pretty, I'm all for the togetherness of the season, but just because it is November and December doesn't mean we all have to go into more debt just to regret it in January.
We don't travel during the holidays, and I try to avoid the shopping centers. If we do any shopping, it is usually online or an off-hours trip to Target. The past 2 years, we've been on a strict budget for Christmas, and we've still spent about $500 each year. That includes all gifts, a tree, decorations, wrapping paper, cards, stamps, etc. This year, we don't have ANY savings for Christmas, and I don't want to go deeper into debt.
We've told relatives that we can't afford gifts, and ask them not to give us any. They still give gifts to our daugther, and then we feel she has to give them "a little something"...and a bunch of a little somethings add up to a lot. And we do like to buy one big present for our daughter each year and an ornament and stocking stuffers. This year, it will be her first bike.
The holidays in debt are just no fun. It is rather embarassing or hard to explain. My husband and I have a budget of $20 for gifts for each other. Then, after the holidays friends and co-workers will ask, "what did you get?" and I have to reply "a DVD"...when everyone around me is getting these extravagant gifts. And don't get me wrong, 1 DVD is more than enough for me, but the rest of the world seems to think that we all should be showered with gifts, and there must be something wrong with my family, if that's all they got me. I just hate consumerism. I think Christmas trees are pretty, I'm all for the togetherness of the season, but just because it is November and December doesn't mean we all have to go into more debt just to regret it in January.
November Update
I apologize for not writing last month. I had planned to post in this blog more frequently, but my debt reduction hasn't been moving as quickly as I had hoped. In the past 2 months, I've been able to reduce my debt by less than $500, and my savings account is still only $25.
Murphy's Law has come in to play, and we've had some unexpected expenses arise- such as medical expenses, plumbing, pest control, and our car insurance doubling due to a speeding ticket from last year. But, I can't be blameless in all of this- we went out to eat a few too many times, spent a lot on a Halloween party, and just didn't stick to the budget. My family is really trying to stick to that budget, but I think the budget is unrealistic...but, we don't have any money leftover after bills to make the budget any larger.
My husband's side business hasn't brought in any extra income yet...but hopefully that will change soon. The only extra income I made last month was from Craigslist- $50 from selling an old mower and car seat. I am listing my daughter's stroller, infant car seat, crib, and toddler bed for sale...maybe someone will want to buy those. Of course, my daughter has grown a lot, and we had to purchase a twin mattress set for her. We'd love to get her a whole bedroom set, but can't afford that yet.
I have other excuses- but really "life happens" and it costs money. Our debt hasn't gotten any larger since I started this blog...that is a very good thing. We're going to keep plugging away at this, and I hope to make much faster progress in 2008.
Murphy's Law has come in to play, and we've had some unexpected expenses arise- such as medical expenses, plumbing, pest control, and our car insurance doubling due to a speeding ticket from last year. But, I can't be blameless in all of this- we went out to eat a few too many times, spent a lot on a Halloween party, and just didn't stick to the budget. My family is really trying to stick to that budget, but I think the budget is unrealistic...but, we don't have any money leftover after bills to make the budget any larger.
My husband's side business hasn't brought in any extra income yet...but hopefully that will change soon. The only extra income I made last month was from Craigslist- $50 from selling an old mower and car seat. I am listing my daughter's stroller, infant car seat, crib, and toddler bed for sale...maybe someone will want to buy those. Of course, my daughter has grown a lot, and we had to purchase a twin mattress set for her. We'd love to get her a whole bedroom set, but can't afford that yet.
I have other excuses- but really "life happens" and it costs money. Our debt hasn't gotten any larger since I started this blog...that is a very good thing. We're going to keep plugging away at this, and I hope to make much faster progress in 2008.
Saturday, September 22, 2007
Total Starting Debt: Over 30K
Here are the numbers of my family's total starting debt. Tomorrow is the day we will start our debt reduction, it is our 7th wedding anniversary. We hope to be out of debt by our 10th anniversary.
Here are the starting numbers:
Husband's Auto Loan: $792.32
Credit Card #1 $10,545.57
Credit Card #2 $9,787.15
Student Loan $8942.22
Total Debt (9/23/07) $30,067.26
Please check back to follow up on my debt reduction process.
Here are the starting numbers:
Husband's Auto Loan: $792.32
Credit Card #1 $10,545.57
Credit Card #2 $9,787.15
Student Loan $8942.22
Total Debt (9/23/07) $30,067.26
Please check back to follow up on my debt reduction process.
An Update
Sorry I haven't posted here in a while. I've decided that posting my daily spending is too tedious a task. Instead, I will probably post about my spending once a week or monthly.
We have a calendar on our kitchen counter where we write every purchase. That is working well for us, along with the budget spreadsheet on the computer.
I am proud to say that my family went 5 weeks without using a credit card! We would have went longer if not for an unexpected expense with my husband's computer (which he uses for both work and his own business). Of course, we'll start all over again and see how long we can go without using a credit card.
The problem is, right now we have no savings...I'm trying to fill that up (baby step #1).
We have been staying under budget so far this month. However, there are 8 days left in September, and we have $8.37 left in our budget :( The big reason for this is a pre-planned plane trip that my husband and daughter are taking. After that, there will be no more trips until the summer.
However, we have enough groceries to last the rest of the month, so I don't think we're going to go too far over budget this month. That will hopefully leave more money available to start building up our savings.
On September 30th- I will post more about how we stayed under budget or went over budget in some categories.
We have a calendar on our kitchen counter where we write every purchase. That is working well for us, along with the budget spreadsheet on the computer.
I am proud to say that my family went 5 weeks without using a credit card! We would have went longer if not for an unexpected expense with my husband's computer (which he uses for both work and his own business). Of course, we'll start all over again and see how long we can go without using a credit card.
The problem is, right now we have no savings...I'm trying to fill that up (baby step #1).
We have been staying under budget so far this month. However, there are 8 days left in September, and we have $8.37 left in our budget :( The big reason for this is a pre-planned plane trip that my husband and daughter are taking. After that, there will be no more trips until the summer.
However, we have enough groceries to last the rest of the month, so I don't think we're going to go too far over budget this month. That will hopefully leave more money available to start building up our savings.
On September 30th- I will post more about how we stayed under budget or went over budget in some categories.
Friday, September 7, 2007
The Current Budget $1200
The Current Budget. This is my family's current budget...the total amount we have left to spend on things after all other expenses have been paid is $1200. As I mentioned before, I do need to tweak this a little bit- probably making a more realistic budget of $1500 a month. This will happen within the next couple of months, after we refill our savings account.
Groceries/Household Items $600
Gas $290
Dinner Out $100
Clothing $80
Doctor Visits/Prescriptions $40
Car Repairs/Maintenance $20
Babysitter $20
Movies/videos/games $20
Gifts $20
Hobbies $10
Misc. $0
To look at these items line by line:
Groceries/Household Items- $600 for 3 people for the month. This is pretty much on target, we sometimes go over when we have expensive toiletries to buy, or if we host a dinner or cookout...but, $150 a week is where we stand. I search for sales in the weekly ads, and write a menu and a list, and pretty much stick to the list. (I'm planning to keep my budget at $600.)
Gas- $290 a month. Depending on the cost of gas, this can be over or under budget. My husband commutes 50 miles a day round trip to work and I commute 25 miles a day round trip to work. I try to combine other outings on the weekend, but if we do go on a day trip anywhere, it obviously costs more money for gas that month. (I may bring this category up to $300/mo)
Dinner Out- $100 a month. This is definitely where we go overbudget- $100 a month will give our family 4 cheap meals out, 3 good meals out, or 6 trips to fast food places. We usually mix it up throughout the month- but I think I need to raise our budget. Last month, we spent $297- but we were on vacation one week. My husband and daughter go out to breakfast once a week (spending $10-15 a week), and then there are times when we don't feel like cooking. We're trying to limit our eating out to the weekends only...but it is hard. When we have friends that want to go out to lunch or dinner with us, it really brings us overbudget...and we don't want to kill the little social life that we have. (I plan to raise this category to $150/mo.)
Clothing- $80 a month. That is basically one or two new articles of clothing per month per person...and if we need shoes...uh-oh! If we limit our trips to the mall and don't buy much online, we should be able to stay within the $100 limit. My daughter's clothes all come from Target or Old Navy...and sometimes they have great sales. Old Navy is a favorite of me and my husband as well. (I plan to raise this category to $100/mo).
I however do enjoy more expensive clothing such as American Eagle, NY and Co, and The Gap...it is good quality and stylish...but it costs more. I will admit that I have a lingerie addiction, and there have been months where I've spent hundreds on lingerie alone...I am working hard to control that addiction and avoiding Victoria's Secret and other stores and websites where I used to throw my money. We recently found an outlet mall that has The Gap and Banana Republic outlets, so if we go there a couple of times a year, maybe I can find nice clothing at a more reasonable price.
-Note: I have tried Target clothing for myself, but it only seems to last a few washes before things start falling apart. My daughter does better with the Target clothes, since she grows out of it in one season. As for cheap, nice looking clothes that last about a year- Old Navy wins my vote.
Doctor Visits/Prescriptions $40 a month. Sometimes we're on target, sometimes we're over or under...this is a tough one. I have $20 co-pays, so this leaves room for 2 doctor visits or 1 doctor visit and 1 or 2 prescriptions a month. There are deductibles and other things, so sometimes I get bills to pay more than my co-payment...it depends on what time of year it is. My insurance year re-starts in July, so we seem to spend more on this during the summer months. (I plan to keep this category at $40 a month for the time being).
Car repairs/Maintenance $20 a month. With oil changes, car washes, and any other general repair on our 8 year old and 12 year old cars...we need all the money we can in this category. Last month, I think we went $2500 overbudget on this category and had to resort to credit cards. (I plan to raise this category to $40 a month, and hopefully have enough savings in place to handle major repairs).
Babysitter $20 a month. Sometimes we spend nothing on sitters, but if we want to go out alone for more than 3 hours a month, I'll need to raise this category. We have family members that babysit for free...but we don't want to ask too much or take advantage of their kindness. A babysitter charges anywhere from $7 to $12 an hour to watch our child...and we usually go out after she's asleep. It is hard to pay someone that much just to sit in your house and watch a movie. But, she is watching the most important person in our lives, so it is worth it. We're going to avoid getting a sitter for a couple of months and see how things go...that will save in this category. (I plan to keep this category at $20 a month for the time being).
FYI for non-parents- a typical night out for us- let's say 6 hours: $50 for the sitter, $30 for the dinner, $20 for the movie....that's $100 out the door in one evening (and that's for a simple outing!)... we're going to try to watch DVDs at home, and just stay in more for the time being. Going out is fun, but our wallets can't handle it!
Movies/games/videos: $20 a month. We've been staying under budget with this. My husband has stopped buying new computer games and he gets used X-box games occasionally for a low price. If we don't go out to see a movie in a month, we can stay under budget. We can rent 4 movies at Blockbuster for this price...that works out well for us. (and no, we don't use NetFlix or Blockbuster online...sometimes there's only 1 movie a month that we want to rent, so it doesn't make sense for us to pay for a service like that). ( I plan to keep this category at $20 a month).
Gifts: $20 a month. This works if only 1 person has a birthday each month. When you factor in a card, wrapping paper, and a small gift- it is a minimum of $20 per person per occassion. And this isn't factoring in the holiday season, which is coming soon! (I plan to raise this category to $60 a month...not sure what to do about the holidays yet).
Hobbies: $10 a month. We've actually been under budget lately- that's because my husband has stopped his more costly hobbies a while ago. This $10 will buy us 1 book a month, that's about it. For now, we're sticking with inexpensive hobbies (if you don't include the monthly class fees...which are factored into our monthly expenses). Our current hobbies are: Dancing and cheerleading for my daughter, dancing and writing for me, and volleyball and reading for my husband. (I'm going to keep this at $10 a month for now)
Miscellaneous expenses: $0 a month. Things always come up...we have a house and yard to care for and maintain...and sometimes we end up buying other things that don't fall into the above categories. (I plan to put $200 a month into this category)
There's our $1200 budget- which we've been trying to live on for the past 2 years...most months are unsuccessful. I plan to tweak those numbers and give us a $1500 a month budget, while using all remaining funds to pay back debt. This will continue to be difficult. We do want to have money to enjoy life- but to do that we need to get out of debt!
Groceries/Household Items $600
Gas $290
Dinner Out $100
Clothing $80
Doctor Visits/Prescriptions $40
Car Repairs/Maintenance $20
Babysitter $20
Movies/videos/games $20
Gifts $20
Hobbies $10
Misc. $0
To look at these items line by line:
Groceries/Household Items- $600 for 3 people for the month. This is pretty much on target, we sometimes go over when we have expensive toiletries to buy, or if we host a dinner or cookout...but, $150 a week is where we stand. I search for sales in the weekly ads, and write a menu and a list, and pretty much stick to the list. (I'm planning to keep my budget at $600.)
Gas- $290 a month. Depending on the cost of gas, this can be over or under budget. My husband commutes 50 miles a day round trip to work and I commute 25 miles a day round trip to work. I try to combine other outings on the weekend, but if we do go on a day trip anywhere, it obviously costs more money for gas that month. (I may bring this category up to $300/mo)
Dinner Out- $100 a month. This is definitely where we go overbudget- $100 a month will give our family 4 cheap meals out, 3 good meals out, or 6 trips to fast food places. We usually mix it up throughout the month- but I think I need to raise our budget. Last month, we spent $297- but we were on vacation one week. My husband and daughter go out to breakfast once a week (spending $10-15 a week), and then there are times when we don't feel like cooking. We're trying to limit our eating out to the weekends only...but it is hard. When we have friends that want to go out to lunch or dinner with us, it really brings us overbudget...and we don't want to kill the little social life that we have. (I plan to raise this category to $150/mo.)
Clothing- $80 a month. That is basically one or two new articles of clothing per month per person...and if we need shoes...uh-oh! If we limit our trips to the mall and don't buy much online, we should be able to stay within the $100 limit. My daughter's clothes all come from Target or Old Navy...and sometimes they have great sales. Old Navy is a favorite of me and my husband as well. (I plan to raise this category to $100/mo).
I however do enjoy more expensive clothing such as American Eagle, NY and Co, and The Gap...it is good quality and stylish...but it costs more. I will admit that I have a lingerie addiction, and there have been months where I've spent hundreds on lingerie alone...I am working hard to control that addiction and avoiding Victoria's Secret and other stores and websites where I used to throw my money. We recently found an outlet mall that has The Gap and Banana Republic outlets, so if we go there a couple of times a year, maybe I can find nice clothing at a more reasonable price.
-Note: I have tried Target clothing for myself, but it only seems to last a few washes before things start falling apart. My daughter does better with the Target clothes, since she grows out of it in one season. As for cheap, nice looking clothes that last about a year- Old Navy wins my vote.
Doctor Visits/Prescriptions $40 a month. Sometimes we're on target, sometimes we're over or under...this is a tough one. I have $20 co-pays, so this leaves room for 2 doctor visits or 1 doctor visit and 1 or 2 prescriptions a month. There are deductibles and other things, so sometimes I get bills to pay more than my co-payment...it depends on what time of year it is. My insurance year re-starts in July, so we seem to spend more on this during the summer months. (I plan to keep this category at $40 a month for the time being).
Car repairs/Maintenance $20 a month. With oil changes, car washes, and any other general repair on our 8 year old and 12 year old cars...we need all the money we can in this category. Last month, I think we went $2500 overbudget on this category and had to resort to credit cards. (I plan to raise this category to $40 a month, and hopefully have enough savings in place to handle major repairs).
Babysitter $20 a month. Sometimes we spend nothing on sitters, but if we want to go out alone for more than 3 hours a month, I'll need to raise this category. We have family members that babysit for free...but we don't want to ask too much or take advantage of their kindness. A babysitter charges anywhere from $7 to $12 an hour to watch our child...and we usually go out after she's asleep. It is hard to pay someone that much just to sit in your house and watch a movie. But, she is watching the most important person in our lives, so it is worth it. We're going to avoid getting a sitter for a couple of months and see how things go...that will save in this category. (I plan to keep this category at $20 a month for the time being).
FYI for non-parents- a typical night out for us- let's say 6 hours: $50 for the sitter, $30 for the dinner, $20 for the movie....that's $100 out the door in one evening (and that's for a simple outing!)... we're going to try to watch DVDs at home, and just stay in more for the time being. Going out is fun, but our wallets can't handle it!
Movies/games/videos: $20 a month. We've been staying under budget with this. My husband has stopped buying new computer games and he gets used X-box games occasionally for a low price. If we don't go out to see a movie in a month, we can stay under budget. We can rent 4 movies at Blockbuster for this price...that works out well for us. (and no, we don't use NetFlix or Blockbuster online...sometimes there's only 1 movie a month that we want to rent, so it doesn't make sense for us to pay for a service like that). ( I plan to keep this category at $20 a month).
Gifts: $20 a month. This works if only 1 person has a birthday each month. When you factor in a card, wrapping paper, and a small gift- it is a minimum of $20 per person per occassion. And this isn't factoring in the holiday season, which is coming soon! (I plan to raise this category to $60 a month...not sure what to do about the holidays yet).
Hobbies: $10 a month. We've actually been under budget lately- that's because my husband has stopped his more costly hobbies a while ago. This $10 will buy us 1 book a month, that's about it. For now, we're sticking with inexpensive hobbies (if you don't include the monthly class fees...which are factored into our monthly expenses). Our current hobbies are: Dancing and cheerleading for my daughter, dancing and writing for me, and volleyball and reading for my husband. (I'm going to keep this at $10 a month for now)
Miscellaneous expenses: $0 a month. Things always come up...we have a house and yard to care for and maintain...and sometimes we end up buying other things that don't fall into the above categories. (I plan to put $200 a month into this category)
There's our $1200 budget- which we've been trying to live on for the past 2 years...most months are unsuccessful. I plan to tweak those numbers and give us a $1500 a month budget, while using all remaining funds to pay back debt. This will continue to be difficult. We do want to have money to enjoy life- but to do that we need to get out of debt!
Wednesday, September 5, 2007
September 2007 Finances
Well, this month, things are still a little screwed up. You see, we spent about $900 more than we earned in July paying for August. We had vacation, car repairs, medical expenses, ate out too much, etc. So, in calculating September's finances- I factored in a -$900 for August's overbudget category. I'm hoping to be able to eliminate the "overbudget" category soon.
So, we then have about $1000 left for all other expenses during September. I've currently budgeted $1200 a month for other expenses, but that is being VERY frugal. In reality, we may be able to get by with a budget of $1500 a month after all bills and utilities are paid. In any case, we're starting off September 2007 with -200...IF we stay in budget. And I don't know where we can find $200 extra dollars or how we can only spend $1000 this month.
Savings: our savings is $25 right now. I want to put $975 more dollars in that account before we start tackling our debt...which is around $30K, not including the mortgage.
This will be a challenge! My family is trying to go the entire work-week (luckily it is only 4 days this week) without spending ANY money. This is difficult...we've made it 1 day so far! If groceries and gas for the week are already paid for...and we don't eat out...and no unforseen expenses arise, we'll be able to do it.
Then this Saturday will be the day to refill the cars with gas and stock up on groceries for the next 2 weeks. If we find that we can do it this work-week...we'll try it again next week. Maybe with 4 weeks of living like that we WILL spend less and break even, or at least be less in the negative as opposed to this past month.
So, we then have about $1000 left for all other expenses during September. I've currently budgeted $1200 a month for other expenses, but that is being VERY frugal. In reality, we may be able to get by with a budget of $1500 a month after all bills and utilities are paid. In any case, we're starting off September 2007 with -200...IF we stay in budget. And I don't know where we can find $200 extra dollars or how we can only spend $1000 this month.
Savings: our savings is $25 right now. I want to put $975 more dollars in that account before we start tackling our debt...which is around $30K, not including the mortgage.
This will be a challenge! My family is trying to go the entire work-week (luckily it is only 4 days this week) without spending ANY money. This is difficult...we've made it 1 day so far! If groceries and gas for the week are already paid for...and we don't eat out...and no unforseen expenses arise, we'll be able to do it.
Then this Saturday will be the day to refill the cars with gas and stock up on groceries for the next 2 weeks. If we find that we can do it this work-week...we'll try it again next week. Maybe with 4 weeks of living like that we WILL spend less and break even, or at least be less in the negative as opposed to this past month.
How I Pay Bills
This is the habit that I've gotten into for paying monthly bills. First of all, I use the PREVIOUS month's pay to pay for the following month. I didn't always do this, and there have been issues in the past when a paycheck was coming later than expected and we had 19 cents in our checking account. With this, at least I don't miss a payment or go into negative numbers in the checking account.
For example: I got paid on August 31st, my husband got paid on August 10th & 24th. I add up the total of those three paychecks, and that is how much money we have to live on during the month of September.
On September 1st, I pay ALL of my bills that are due in September. (some haven't arrived yet, but I estimate the cost, and pay them as soon as the bill arrives.) About a 2 years ago, I asked for e-statements for all of my bills. I flag all the e-statements in my inbox, and pay them on the 1st. I only write checks for daycare and dance lessons, since they currently don't have online payments available.
I have a spreadsheet file that has really helped me out. I will post a sample soon. In it, I keep track of all due dates, the amounts or expected amounts due, and subtract those from the total of the previous month's paychecks.
The leftover money is what we have to live on for the month...our budgeted expenses. Any amount over our budget goes directly to savings or debt repayment. It used to go to debt repayment, but some issues last year depleted our savings...so right now, it is going to refill savings.
For example: I got paid on August 31st, my husband got paid on August 10th & 24th. I add up the total of those three paychecks, and that is how much money we have to live on during the month of September.
On September 1st, I pay ALL of my bills that are due in September. (some haven't arrived yet, but I estimate the cost, and pay them as soon as the bill arrives.) About a 2 years ago, I asked for e-statements for all of my bills. I flag all the e-statements in my inbox, and pay them on the 1st. I only write checks for daycare and dance lessons, since they currently don't have online payments available.
I have a spreadsheet file that has really helped me out. I will post a sample soon. In it, I keep track of all due dates, the amounts or expected amounts due, and subtract those from the total of the previous month's paychecks.
The leftover money is what we have to live on for the month...our budgeted expenses. Any amount over our budget goes directly to savings or debt repayment. It used to go to debt repayment, but some issues last year depleted our savings...so right now, it is going to refill savings.
Monday, September 3, 2007
Labor Day Weekend Spending
Well, the start date for the debt reduction plan was September 1st. I hope to make it through the month without needing to rely on credit cards. So far, we've spent $272.91 over the past 3 days.
Here's how it all adds up:
Groceries $220.49 - That includes other household items such as detergent, trash bags, toiletries, etc. It does add up quickly. That's only for 1 week's worth of groceries for 3 people...next Saturday is the larger bi-monthly shop.
Gas $31.45 - This was just topping off the tanks on my car and my husband's car. We shouldn't need to fill up again until the weekend...(we hope)
Eating Out $20.97 - This included $15.50 at Waffle House for my husband and daughter. We're trying not to eat out much at all- but we make an exception for the Sunday morning father-daughter outing. It is a nice bonding experience for them, and it gives me a couple of hours to sleep in, shower, and relax alone in a quiet house. It is "my time"...and really my only alone time...I'd say all of that is worth $15.50. He also takes her to a park playground afterward- which is free...a great price! :)
The other dining out cost was $5.47 at McDonald's tonight. This was for 2 milkshakes & a sundae. It was very cheap, but I was reluctant to go. Since it was technically "the last day of summer"...we did it...as cheaply as possible. My husband will be working 11 days in a row after tonight, he deserved a treat.
Free things we did this weekend: We took 3 trips to the neighborhood pool. (Of course, we pay HOA fees, but we pay them whether or not we use the pool.) This gave us hours of fun out of the house. We took 1 trip to our neighborhood playground, and my husband and daughter to one trip to a local playground. I also returned some library books, but didn't have time to check out new ones. At home, we did yardwork, organized closets, I worked out to DVDs I own, we watched 2 DVDs that we own, blew bubbles outside & my daughter played with games and toys that she got as birthday gifts.
I will post more about how I pay bills and our monthly budget soon.
Here's how it all adds up:
Groceries $220.49 - That includes other household items such as detergent, trash bags, toiletries, etc. It does add up quickly. That's only for 1 week's worth of groceries for 3 people...next Saturday is the larger bi-monthly shop.
Gas $31.45 - This was just topping off the tanks on my car and my husband's car. We shouldn't need to fill up again until the weekend...(we hope)
Eating Out $20.97 - This included $15.50 at Waffle House for my husband and daughter. We're trying not to eat out much at all- but we make an exception for the Sunday morning father-daughter outing. It is a nice bonding experience for them, and it gives me a couple of hours to sleep in, shower, and relax alone in a quiet house. It is "my time"...and really my only alone time...I'd say all of that is worth $15.50. He also takes her to a park playground afterward- which is free...a great price! :)
The other dining out cost was $5.47 at McDonald's tonight. This was for 2 milkshakes & a sundae. It was very cheap, but I was reluctant to go. Since it was technically "the last day of summer"...we did it...as cheaply as possible. My husband will be working 11 days in a row after tonight, he deserved a treat.
Free things we did this weekend: We took 3 trips to the neighborhood pool. (Of course, we pay HOA fees, but we pay them whether or not we use the pool.) This gave us hours of fun out of the house. We took 1 trip to our neighborhood playground, and my husband and daughter to one trip to a local playground. I also returned some library books, but didn't have time to check out new ones. At home, we did yardwork, organized closets, I worked out to DVDs I own, we watched 2 DVDs that we own, blew bubbles outside & my daughter played with games and toys that she got as birthday gifts.
I will post more about how I pay bills and our monthly budget soon.
Monday, August 20, 2007
Friday, August 10, 2007
The Plan
In following with Dave Ramsey's "baby-steps" plan...I am back to step 1. First, I need to save up an emergency fund of $1000. It should probably be more, but that is a good start.
After that, the goal is to pay off the $900 we owe on my husband's car. It is our smallest loan and also our lowest interest loan. But, the car probably won't last another year, so we want to own it, incase we need to sell it or trade it in for a more functional vehicle.
Once that is paid for, we will begin to put all extra income toward Credit Card #1. It has over $10K owed, and the highest interest rate 14.24%.
When that is paid off, we will focus on putting all extra income toward Credit Card #2. We owe $9600 on that one, but at a lower interest rate of 10%.
When that is paid off, we'll focus on paying off the student loan. And somehow during that time, we need to either save up for another car or take out a car loan. I expect it to take 3 or more years to clear out all of this debt, but I guess it all depends on our commitment and our income over those few years. Once our daughter is done with daycare (Sept. 2008) we'll have an extra $800 a month to put toward paying off the debt.
I am not sure about the mortgage, we may want to move by the time all of the other debt is paid. I really want to focus on eliminating the $30K of car, credit card, and student loan debt first.
So, that is the plan. I'm going to use this blog to keep track of spending and earnings and most importantly- debt reduction progress and strategies.
My goal date for eliminating all debt except the mortgage is September 1, 2010. That will also be the month of our 10th wedding anniversary- maybe we'll be able to afford a trip to celebrate!
After that, the goal is to pay off the $900 we owe on my husband's car. It is our smallest loan and also our lowest interest loan. But, the car probably won't last another year, so we want to own it, incase we need to sell it or trade it in for a more functional vehicle.
Once that is paid for, we will begin to put all extra income toward Credit Card #1. It has over $10K owed, and the highest interest rate 14.24%.
When that is paid off, we will focus on putting all extra income toward Credit Card #2. We owe $9600 on that one, but at a lower interest rate of 10%.
When that is paid off, we'll focus on paying off the student loan. And somehow during that time, we need to either save up for another car or take out a car loan. I expect it to take 3 or more years to clear out all of this debt, but I guess it all depends on our commitment and our income over those few years. Once our daughter is done with daycare (Sept. 2008) we'll have an extra $800 a month to put toward paying off the debt.
I am not sure about the mortgage, we may want to move by the time all of the other debt is paid. I really want to focus on eliminating the $30K of car, credit card, and student loan debt first.
So, that is the plan. I'm going to use this blog to keep track of spending and earnings and most importantly- debt reduction progress and strategies.
My goal date for eliminating all debt except the mortgage is September 1, 2010. That will also be the month of our 10th wedding anniversary- maybe we'll be able to afford a trip to celebrate!
Things We've Been Doing to Save Money
Over the past couple of years, we've been trying to save money. All of our furniture has been hand-me-downs or purchased used- mostly on Craigslist. Also, we frequently clean closets and sell items on eBay or Craigslist. Unfortunately, we don't have many items left to sell, and since we've been trying to spend less for over 2 years, we actually don't have many possessions, other than second hand furniture. We decided that we will not be having any more children, so we did make a good amount of money by selling a lot of our daugther's baby items...and we usually donate or sell clothing as soon as she grows out of it.
We've had birthdays and other holidays where we buy one small gift or nothing at all to save money. We don't travel much, and only get a sitter and go out for a "date night" once every couple of months. We rent movies for $1 at the grocery store, we borrow library books, we attend free town events, and visit free museums and parks. We try to limit our spending to 3 locations- Gas Stations, Grocery Stores, and Target (since they are cheap and have just about everything). Dining out has been cut back, but it is still a work in progress. I make bi-monthly menus and only buy food on the grocery list, and usually only food on sale. Little steps like this should be saving us money, but getting caught up or getting ahead with debt repayment is still difficult.
My husband recently started his own business from home- so he'll work full-time at his regular job and do side jobs on nights and weekends. I will take over more of the childcare duties while he does this work. Hopefully this will get us the money we need to get out of debt, but of course we have to be concerned about taxes as well.
I have created a monthly budget, which I will probably post and discuss later. This does help, but we have been unable to stick to it because we always have unexpected events that end up putting us overbudget. We do keep track of every penny and have a calendar in the kitchen where we write down every purchase every day and how it was paid for. We try to stick to the debit card, but that is usually empty by the end of the month, and then we need to rely on credit cards.
We've had birthdays and other holidays where we buy one small gift or nothing at all to save money. We don't travel much, and only get a sitter and go out for a "date night" once every couple of months. We rent movies for $1 at the grocery store, we borrow library books, we attend free town events, and visit free museums and parks. We try to limit our spending to 3 locations- Gas Stations, Grocery Stores, and Target (since they are cheap and have just about everything). Dining out has been cut back, but it is still a work in progress. I make bi-monthly menus and only buy food on the grocery list, and usually only food on sale. Little steps like this should be saving us money, but getting caught up or getting ahead with debt repayment is still difficult.
My husband recently started his own business from home- so he'll work full-time at his regular job and do side jobs on nights and weekends. I will take over more of the childcare duties while he does this work. Hopefully this will get us the money we need to get out of debt, but of course we have to be concerned about taxes as well.
I have created a monthly budget, which I will probably post and discuss later. This does help, but we have been unable to stick to it because we always have unexpected events that end up putting us overbudget. We do keep track of every penny and have a calendar in the kitchen where we write down every purchase every day and how it was paid for. We try to stick to the debit card, but that is usually empty by the end of the month, and then we need to rely on credit cards.
Actual Numbers (or pretty close)
I have everything down to the cent on an spreadsheet that I frequently update, but here are the debt numbers (not including mortgage):
Car Loan: We only owe $900, but the 12 year old car will definitely need to be replaced soon after it is paid off.
Student Loans: About $9,100 and 3 years left on that loan.
Credit Card #1: $10,000 at 14% interest
Credit Card # 2: $9,600 at 10% interest
The estimated cost of daycare this year: $10,500
Car Loan: We only owe $900, but the 12 year old car will definitely need to be replaced soon after it is paid off.
Student Loans: About $9,100 and 3 years left on that loan.
Credit Card #1: $10,000 at 14% interest
Credit Card # 2: $9,600 at 10% interest
The estimated cost of daycare this year: $10,500
About My Debt
I've read many blogs, and everyone has a story as to how they accumulated their debt. Mine isn't too complicated. My husband and I met in college, accumulated lots of debt with student loans- we consolidated our student debt together in 2000 when we were married. In 2003, my daugther was born and we moved from Massachusetts to North Carolina (for the lower cost of living and better weather). I was planning to be a stay-at-home parent, but that didn't work out. I was unemployed for 7 months, and my husband was unemployed for 9 months. We had about $30K saved up for a down payment on a house at that time, but most of that went to living expenses while we were taking care of an infant and job hunting.
In 2004, we found jobs, and were approved for a mortgage. 2 weeks after we moved into our first home, my husband's car needed lots of repairs, so we had to buy another one (a used one). In October, 2004- my husband's job went full time and we needed to put our daughter in daycare full time. So, that's when it became difficult to make ends meet- between the mortgage, car payment, student loan, and high cost of daycare- we've been floundering ever since. We have been accumulating more credit card debt- mainly from home maintenance and repairs and numerous car repairs.
We've been trying to use the snowball method to pay down the debt. We had paid off about $3,000 in the past 12 months, but last week our cars needed thousands of dollars in repair...so we're pretty much in the same situation we were in last year.
Here's how our monthly payments break down right now:
25% to the mortgage
25% to daycare
25% to our debt- auto loan, student loan, 2 credit cards (unfortunately usually only the minimum payment)
and that leaves about 25% of our salaries for food, gas, utilities, and other expenses...and even with budgeting, this is not enough.
In 2004, we found jobs, and were approved for a mortgage. 2 weeks after we moved into our first home, my husband's car needed lots of repairs, so we had to buy another one (a used one). In October, 2004- my husband's job went full time and we needed to put our daughter in daycare full time. So, that's when it became difficult to make ends meet- between the mortgage, car payment, student loan, and high cost of daycare- we've been floundering ever since. We have been accumulating more credit card debt- mainly from home maintenance and repairs and numerous car repairs.
We've been trying to use the snowball method to pay down the debt. We had paid off about $3,000 in the past 12 months, but last week our cars needed thousands of dollars in repair...so we're pretty much in the same situation we were in last year.
Here's how our monthly payments break down right now:
25% to the mortgage
25% to daycare
25% to our debt- auto loan, student loan, 2 credit cards (unfortunately usually only the minimum payment)
and that leaves about 25% of our salaries for food, gas, utilities, and other expenses...and even with budgeting, this is not enough.
Wednesday, August 8, 2007
Welcome
Welcome to Fountains of Debt. This is my first blog post. I'm not sure how interesting this will be for others to read, I am creating this blog to keep better track of my debt repayment process and really to motivate myself. Everytime I have a setback or make a bad financial decision, I will have to confess to it here in my blog. I have been following Personal Finance Blogs for about a year now- my favorite is No Credit Needed. Reading his stories about getting out of debt and now saving for the future have really been inspirational for me.
I've had my own personal blog/journal on another site for 6 years, so I am not new to being open about things online. However, this public blog about how I spend and save my money will be a new experience for me. So please, read on if you're interested- help motivate me and/or call me on my mistakes. Enjoy!
I've had my own personal blog/journal on another site for 6 years, so I am not new to being open about things online. However, this public blog about how I spend and save my money will be a new experience for me. So please, read on if you're interested- help motivate me and/or call me on my mistakes. Enjoy!
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