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.
Saturday, December 1, 2007
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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