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Dipping Into 5-Digit Debt

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You guys! I have another fun debt-related thing to celebrate today!

After nearly TWO YEARS of blogging here (officially started in March 2014. Here was my first “application post“), I’ve FINALLY and forever more fallen below the six-digit-debt threshold! When I started blogging two years ago we had $150,000 of debt. Our combined household income at the time was not quite $50,000/year. After paying off  over $25,000 in our first year and over $26,000 in our second year, we’ve FINALLY crossed this major milestone in our debt-repayment journey. Never ever (aside from mortgage) will we EVER have six-digit level debt. That’s insane! We still have a long way to go, but it really feels like we’ve started gaining speed and making good traction. Our only remaining debts are medical and student loan (which, to this point, we’ve been paying mostly minimums on). I CANNOT WAIT to really start making some headway on those bad boys!

Here’s our January debt update:

PlaceCurrent BalanceAPRLast Payment MadeLast Payment Date Original debt, March 2014
Capital One CC-17.9%-Paid off in March 2014$413
Mattress Firm-0%-Paid off in May 2014$1381
Wells Fargo CC-13.65%-Paid off in May 2014$7697
BoA CC-7.24%-Paid off in June 2014$2220
License Fees-2.5%-Paid off in April 2015$5808
PenFed Car Loan-2.49%$3189Paid off in January 2016$24040
Navient$82,2716.55%-8.25%$279January$80761
ACS Student Loans$85966.55%$20January$8215
Balance Transfer student loan (Former Navient 1-01)$21120% (through April 2016)$500January$5937
Medical Bills$59110%$25January$9000
Totals$98,890 (Dec balance = 102,502)$4013Starting Debt = $145,472

It was tough to swing this monstrous sized debt payment (just over $4,000!!!!!) and, as you’ll see in an upcoming budget update post, in order to balance the budget we had to forego a couple of savings items I’d really wanted to squeeze in this month. But February is a new month and we’ll be full-steam ahead on our next course of action, which includes building back up a healthy emergency fund, saving money toward a down payment of a home, and getting into a bit more comfortable position before we really start slugging those student loan payments. It pains me to see that, for instance, we paid $279 toward Navient this month and yet, our balance actually grew a little compared to last month because that payment still didn’t even cover the interest accruing on the loans (though this is, indeed, over our minimum payment, which is only $206/month). We’ve got to stop the bleeding and so, even though I’m considering it a “minimum” payment while we beef up our savings a bit, I’ll be increasing our student loan payments to at least cover the interest (I’m considering it “minimum” because it will still be a very minimal amount at first as our focus will be on trying to build an EF. But I will increase it from the official minimum so that we aren’t seeing a growing balance every month).

It’s so exciting to get to celebrate these recent wins after such a long period of what has felt like stagnancy. Even though we’ve been whittling away at our debt all along (so we’ve never really been stagnant), the “wins” have felt few and far between in the past year or so. Paying off the car/becoming consumer debt-free, and now dipping below the 6-digit-debt threshold both feel like huge breaths of fresh air. Like we’ve just been given a giant pat-on-the-back for all of our hard work. It really gives us the momentum to keep on rolling.

As I look at the year ahead, of course no one can really be certain what to expect, but I see good things ahead. Last year was a tough one. Nothing terrible happened, but there were lots of changes/re-adjustments as I started a new job, dealt with a lot of father health issues, and just tried to find my place in life a bit. This semester is starting off great (I really am so lucky to truly love what I do!), the financial year is starting on a high note, we have an all-cash paid vacation in a couple months, we have plans to buy a house this year(!!!), and I just hope this is setting the tone for what will be a fabulous 2016. I couldn’t be more excited! So much to be thankful for!

I hope we can all pause today and reflect on something that makes us happy or something we are thankful for. Even in the most trying times, I find it to be a helpful exercise. : )


What’s Next

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If you missed my post earlier this week, I announced the exciting news that we are officially consumer debt-free! YAAAAAAAAAAAY!!!! (insert happy dance emoticon)

What’s funny is almost immediately after making the final payment on the car….it broke. Ha!

A bit of euphemism. It didn’t break down. Just a piece of it broke off. Check this out.

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Nothing even happened to cause it to break! I was just driving down the road to get to work, minding my own business, when out of the corner of my eye I saw a piece of our car just flapping in the wind! I immediately exited the highway but on the exit ramp the piece fully fell off and broke into several pieces.

Hubs looked it up and thinks he can get the part for relatively cheap ($100ish) and do the install himself. So all is well, just kind of funny that the second it becomes OURS….it breaks. Ha!

At any rate, I’ve had a couple people comment and ask what’s next now that the car is finally paid in full.

It’s tough because #1) I’d love to start punching Navient in the face, taking out loans left and right, and #2) I have a relatively small balance transfer loan (just over $2100) from what was originally a student loan that I’d love to pay off next month.

BUT…

I’m trying to use my head and not just my heart (which says to start stomping the student loans NOW), and make our first priority re-building our emergency fund.

If you don’t remember, our EF was slowly whittled away the second part of 2015. As was our “living on last month’s income” fund. Hubs’ business wasn’t doing so hot in 2015, so whenever I needed that extra little boost for paying debts, I’d “borrow” here and there. First from the “last month’s income” fund, and then when hubs had a no income month I used our EF and, well, now we’re down to basically nada in either of those accounts (note:  not entirely true…we still have a few hundred in the EF, but not nearly what we’d like to have).

We have 3 big goals for 2016:

  1. Save up $10,000 for a house down payment.
  2. Save $5,000 for an emergency fund.
  3. Put $30,000 toward debt.

Starting in February, we’ll begin chipping away at items #1 and #2. We’ll still be paying toward debt, too, of course. But we’ll be doing so at a much less aggressive rate as we, instead, try to restock some money in the bank.

The plan is to put nearly $2,000 a month into savings. This will be $1250/month toward the house down payment fund (our goal is to buy by the end of summer, so we need to save heavily the first half of the year), and another $500/month into our dedicated Emergency Fund.

In addition to that, we’ll still be making debt payments in the range of $1500-$2000 per month.

It’s going to be tough. That’s a pretty aggressive rate of savings and debt payment. We’re talking about $3500/month between the two, which is more than what our average monthly debt payments were last year (see here for a quick-view breakdown of the majority of last year).

But when you have something so meaningful that you’re working toward, it definitely helps put the fire under your pants. That, plus this will be our first full year both working full-time (and I still have the part-time job, too). It’s just going to be astronomical earnings compared to 2 years ago. Even compared to the first half of last year. So I think we can do it.

The first half of the year will, admittedly, be a little heavy on the savings side of things. Then the second half of the year we’ll make up some ground and really start making some good headway with the student loan debt.

But it won’t be all savings and no debt until then! It wouldn’t make sense to blog for a getting out of debt blog if I wasn’t actively working on the debt!

I’ve got a few tricks up my sleeve to try to make some good progress even while in savings mode! I’ve GOT to have the balance transfer student loan paid in fully by April (that’s when the interest sky rockets from 0% to 13%!!!) But right now my projections show it being paid in full by March. Then I plan to initiate a second balance transfer to do it all over again (they still have the deal with 0% APR for a year, and only a 2% initiation fee; this is half the initiation fee of other offers I’ve received).

I also may consider some type of consolidation program a little bit down the road. I like having my loans separated currently because it gives me a big psychological boost every time I pay off one of the loans (and I target them one-by-one, paying minimums on all others). However, I hate Navient with such a fiery passion that it may be worth it to consolidate with an outside company just to get them out of my life. We’ll see. I’m not jumping on anything now, but keeping my mind open to the possibility down the road.

Anyway, that’s it for now. I just wanted to dedicate a post to the question I’ve been seeing, “What’s next?”

Also…counting down the days until the all-cash paid Cruise 2016 vacation in April! We’ve been planning and saving for it since February 2015 (over a year!!!), so we’re beyond ready! I can’t wait! Whoever said you can’t have a little bit of fun while in debt-repayment mode certainly never read here! It may be a controversial stance, but I’m a believer in balance in life. We’ve worked HARD the past two years to dig ourselves out of the giant debt hole we were stuck in. Yes, we have a long way to go. But it’s precisely because this is a MARATHON (and not a sprint) that I think it makes sense to build some fun into the budget. Otherwise it’d just be impossible to stick to for so long! That’s my view on the matter.

What are your plans once you get out of consumer debt? Tackle student loans? Your mortgage? Get your savings up to snuff? Or are you going to go beyond? Perhaps save enough to retire early? Do some traveling, etc? I’d love to hear YOUR plans!

 


Saving Money in the New Year

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Since starting my full-time job this past summer, I’ve had a really tough time keeping on top of some household tasks. The biggest of which was meal planning and food prepping. It’s lead to a large increase in our overall grocery spending as I’ve been buying more prepared foods, not buying items on sale, and making more last minute trips to the store for “one item for dinner” (which inevitably leads to over-spending on additional items). Just not a great situation overall.

So one of the things I’m trying to be more mindful about this year is to do some better planning and try to save more on groceries.

Toward that end, I recently came across this article in Cooking Light titled 18 Foods You Can Scrimp On At The Grocery Store.

I hate when articles force you to click through screen by screen, so let me summarize the main points for you (content from Cooking Light)

Buy these foods generic:

  • Sugar
  • Whole and Ground Spices
  • Block Cheese
  • Tomato paste
  • Milk
  • Canned beans
  • Bagged lettuce
  • Table salt
  • Panko
  • Neutral cooking oils (e.g., canola, vegetable, safflower)
  • Cooking spray
  • White vinegar

Save money on:

  • Buying whole produce (as opposed to pre-washed/pre-cut)
  • Nuts, by buying in bulk
  • Brown rice & whole grains, by buying in bulk
  • Dried beans and lentils, by buying bulk
  • Popcorn, by buying in bulk
  • Herbs. Instead of buying lots of individual kinds of herbs, buy blends that can be used more frequently to reduce waste.

Your thoughts? Any items you disagree with? Any other items you’d add that you’ve saved on?

I don’t agree with the idea of buying generic/cheap cooking spray. I used to do that, but noticed that the thing always clogged up or broke before the spray was actually gone. I switched to a name brand and have never had an issue since (update:  I actually started using Kirkland brand from Costco so it’s technically a generic/store brand, but it’s awesome! Costco for the win again!)

I’ll also mention that some of these suggestions are tough with busy schedules. I used to buy bulk pinto beans that I’d soak overnight and then cook all day. We’d use them whole (as pinto beans, duh!) or mashed up (as refried beans). Yes, it cost literal pennies compared to canned stuff in the grocery store. But ain’t nobody got time for cooking foods that take all day when you’re not home to make it! Yes, crock pots can work, but not being present just adds an element of difficulty that wasn’t there when I worked from home.

I’d love to hear other ideas of areas where you save on your food budget!


Ashley’s Year In Review (2015)

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I know we’re now a full week into the new year, but I always like to look back and reflect on the previous year around this time. So indulge me in a week-late review of some of the big highlights of 2015.

Personal and Financial Goals

The year began (or really was preceded by) setting some big goals. We had one list of financial goals, and a second list of goals related to “growing up” (in my mind this meant doing things like getting wills, life insurance, etc.). By the end of the year we hadn’t quite met all of our financial goals, but we’d made incredible progress. In all, we paid off over $26,000 in debt!!! We did even better on our “year of becoming an adult” goals. We fully accomplished 3 of our 4 goals and are well underway on the 4th goal (see update here). We’ve set some pretty lofty financial goals for 2016, too!

Budgeting

In early January, we made some pretty big changes to the way we did our budget. This eventually lead us to using YNAB for budgeting (we’d previously used an Excel file). I still can’t say enough great things about YNAB. I really think it’s made a huge impact on how well we’ve been able to stick to our budget and, therefore, how well we’ve done with paying off debt (see my full review here).

One of the categories in our budget that we really struggled with this year was our grocery budget. I talked several times about our efforts to make cheap meals, saving money by making homemade yogurt (super easy and so tasty!), DIY-ing pumpkin spice coffee (a personal fave), and trying my hardest to meal plan (which was much easier when I worked from home compared to an office-setting, and I’m still learning to balance competing needs).

I also saved a lot of money on self-maintenance this year. With the exception of 2 professional cut/colors (which I did prior to big job interviews), I’ve saved money in our budget by cutting and coloring my own hair for the past 21 months (but who’s counting? hehe). I’ve even received compliments on my self-maintained hair and really like my new darker color. To be transparent, I did just barely receive a professional cut/color from my Mom as a birthday gift, so this totals 3 professional jobs (only 2 that I personally paid for) in nearly 2 years.

Employment

I interviewed for 3 separate jobs in 2015:  one in January (recap), one in March, and one in June. I was offered the third job (third times a charm!) and accepted the position soon thereafter. I started the position in July and have been very happy in the job ever since (though I have plans to try to negotiate for a title change and more money).

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Gift-Giving

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Before I started our debt reduction mission we really spent a ton of money on gift-giving. Since starting to blog here, I’ve drastically reduced the amount spent on gifts. I now try to spend an average of about $15-20 per gift (though hubs and I set a $50 limit on gifts to each other). I talked about a cheap classroom gift here and waxed poetic about the impact of a hand-written thank you note (as opposed to an expensive flower delivery). I also talked about a cheap going away gift basket, a cheap Mother-in-Law (or grandparent) gift, an inexpensive alternative wedding gift, and relatively inexpensive ($50 limit) anniversary gifts.

Kids Crafts

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The kids did lots of fun and cheap crafts this year. A sampling of crafts include: a  Valentine’s craft, a Mother’s Day craft, and an Easter craft. All of these doubled as cheap cards/gifts for family, too!

Entertainment

Our entertainment budget was really bare bones this year as we tried to funnel all our extra money toward debt. But that doesn’t mean we didn’t have fun! I talked about a free family activity here and a free painting class (courtesy of Yelp Elite) here. I also shared how we got cheap Halloween costumes for the kids and had fun with a cheap-ish birthday day date for hubs’ 33rd birthday.

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Successes

In April we celebrated kicking hubs’ license fee debt to the curb! That left us with only the car loan, some medical debt, and the monstrous student loans to contend with. That same month I did a balance transfer of a higher-interest student loan (8.5%) to a 0% APR credit card to pay off one of my Navient student loans at a lower rate (just paid a 2% initiation fee). I also celebrated when we paid off another of my Navient student loans back in October. It’s no secret that I freaking hate Navient, so I can’t wait to rid them from my life!

Personal

In June I let you know something I’d been keeping a bit of a secret. I have a very close family member experiencing a debilitating illness for which there is no cure. I later told you all that the “close family member” is my father and divulged that his diagnosis is frontotemporal degeneration (a type of dementia). I had a rough time in regard to processing this information. I was painfully honest about the scary feelings and emotions experienced knowing that his health is quickly declining and my siblings and I will be tasked with becoming his caretaker and all of the other financial implications of the situation. I also discussed prioritizing the costs of therapy so I could take care of myself. I never updated, but I did in fact search for therapists but there was only one person who really stood out to me as a good fit. Of course, that person was not accepting new clients at the time and, feeling overwhelmed by life, the new job, etc., I never pursued any other options. To be honest, I do think I’ll try again to find someone to talk to in the New Year. I feel like I am in a much better place mentally than I was when I first wrote this post (or this one, too), but I know my Dad’s health issues will continue to be a HUGE deal in my life and I would like to see someone at least occasionally to help me process everything as his disease progresses.

Summary

2015 was a wild year! Lots of great successes – Can I get a high five for that $26,000+ of debt that was paid off!?! and some tough times, too. In 2016 we plan to split our priorities a bit between saving for a house and continuing to pay off debt, but I know that we’ll continue to make great progress along the way. I’ve admitted before that I may loosen up the purse strings slightly. I think it’s important to have more regular date nights and such. But I also can’t wait to make some big dents to our debt this year. This will be the first full year of me having a full-time job and income (in addition to my part-time job & hubs’ job). With the additional money we really hope to do some crazy things in 2016. A house, a car (not a new one, but our current one being paid off), punching Navient in the nose, and so on. Great things ahead, friends! Thank you for joining me on life’s wild ride!


Ashley’s November 2015 Budget Update

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November seemed to fly by in the blink of an eye. I was proud of how well I did in trying to tighten our belt, especially with the Thanksgiving holiday/travel. I’ve been struggling with our food expenses (both eating out and regular grocery budgets have been out of control lately), so I made a concerted effort this month to try to get those categories down a bit and was pleased with the result. We could still do better (we’re not perfect), but this was a big decrease compared to the past few months, so overall I’m happy.

Place Amount Spent
Rent 1200
Electricity 193
Water 60
Natural gas 65
Cell Phones (2 lines) 92
Cable/Internet 100
Car Insurance 117
Trash 35
Preschool 1006
Gift-Giving 119
Entertainment 38
Restaurants 135
Groceries 605
Gasoline 64
Household Goods 70
Clothing 53
Toddler purchases 107
Rainy Day Savings 150
Savings Goals 500
Debt Payments 2751
Total Budgeted $7460

Comments:

Preschool:  Preschool was a little more this month because we had to utilize the after-care program a bit more than usual. The preschool we chose ends their normal day at 3pm. Rarely are we able to pick them up at 3. Generally we aim for a 4pm pick-up time (which is what they’re used to since that’s when their old preschool had pick-up), but there have been a handful of times that we’ve both been tied up with work until 4:30 or 5:00pm. Our preschool charges by the hour (so we don’t get a discount if we pick up at 4:30 rather than 5), but we still prefer to have our children if we can, so we just pay the whole hour and get them as soon as we can.

Gift-Giving:  Gift-giving was high this month because it includes several items. We bought gifts for our Utah relatives (Grandma, Dad, and Uncle) so we could take them up with us over Thanksgiving rather than mailing at Christmas. I also bought a gift for the girls (hidden in the closet until Christmas) and this figure includes the belt I bought for hubs for our anniversary at the beginning of November.  For five-six gifts total (depending on whether you lump the girls’ gift as one or view it as two), I think we did pretty good.

Entertainment:  This month we rented a couple Netflix movies, I bought a few iTunes songs, and hubs watched the girls one night so I could go to a movie with a friend. We saw the last movie in the Hunger Games series. I think this was the first time I’ve been to a movie since the last Hunger Games movie….it’s been awhile. : )  Fun month!

Gasoline:  This is actually low for the month, and its because I didn’t include the gas costs for our travel to Utah. My dad paid our gasoline costs.

Household Goods: This is from a Sonicare toothbrush (I lost our old one, leaving it at my Dad’s house on a previous Utah trip. I’d been using a manual one and hoping to retrieve my Sonicare one at this trip but when I went and couldn’t find it anywhere I gave up and bought a new one). The extra cost is from a few Halloween decorations purchased on clearance after Halloween was over (to save for next year).

Savings:  Savings were low this month in favor of trying to put more money toward debt. Our rainy day savings were $100 for Christmas spending (to be spent in December) and $50 for the girls’ 529 accounts. The $500 savings goal was for our cruise 2016 fund.

That’s it! We’re trying to have a frugal Christmas this year, too. It’s funny how every year we tend to think “next year….”  This year we had hoped to do some really fun Christmas activities that just aren’t in the budget (the Polar Express was at the top of the list). Instead, we’re digging deep and really trying our hardest to get out of debt! It’s not going to be this month, but we’re working hard to try to pass the consumer debt-free mark in January. We’re so excited! It will feel like Christmas all over again!

How are you trying to save money with all the holiday spending?


No Spend Month – Wrap Up

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So if you will remember, due to my job lay off and being on the edge financially I committed to No Spend November. I have to admit, it has been a very pleasant month.  I did ALOT of cooking and really enjoyed every morning getting up and searching through my cookbooks to find new recipes to try out.  In fact today, I have a hearty vegetable soup going in the crockpot which will be perfect for this cold winter night!

But on the spending side…

We did GREAT with no spend November.  But I did cheat…exactly twice.  Once during the weekend of Little Gymnast meet.  At the end of the meet, we were both starving and while I did have dinner at home in the crockpot, I knew I couldn’t make the 3 hour drive without something so when we stopped to get gas, we each got a little snack…$13.59.  And then last night, the last night of the month, I just couldn’t resist a celebratory meal out for the kids and I to the tune of $42.  I immediately regretted this second one especially in light of how tight this next month will be, but boy it was good!

Otherwise, I stayed right on track with absolutely NO SPENDING!  Go me, go me!

Now, on the income side…

As I previously wrote, I have gotten a decent part time job which will start in January, but thus far have found no other work. However, I have been very blessed this week by two friends.  One had surgery and the little ones and I volunteered to go help her out for a few days while she was home recovering; she has a 10 month old and 2 year old at home.  It truly was a friend helping a friend.  Then I went to clean out my purse this weekend and there was an envelope in my purse with a check from them.  I called immediately and she said she knew I wouldn’t have taken it but they wanted to help me out.  I couldn’t help but cry.

And then another friend whose son is in three of my classes, unexpectedly paid me most of next semester’s tuition a month early.  What a blessing that was!

The kids and I had a great low key Thanksgiving.  We actually cooked a full meal including a turkey our neighbor gave us!  And better yet, we set up our 6 ft plastic table in the middle of the living room and ate together as a family…the first time we’ve sat together at a table in our tiny living space…and one of the things I miss the most.

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So in a nutshell, my No Spend November went great!  And I am looking forward to Do Good December!

 


Confessions of a Grey-Haired Girl

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You know how I’ve been cutting and coloring my own hair for the past 18 months? It’s still going strong. With the exception of 2 professional hair cut/colors prior to interviews I’ve been exclusively doing my own hair (one professional cut/color was back in November 2014, the other was in January 2015…funny enough, neither of those are jobs I actually landed. Before the interview for my current job I hadn’t done anything special to prepare myself physically. Just wore my interview suit – third time was a charm – and styled my hair normally).

Anyway, I’ve mostly been blonde but about a month ago I decided I wanted a change and I went dark for Fall. Dying my own hair, as usual.

Only….I made a terrible discovery in doing so. You guys! I’m going grey! Eeek!

Yes, at the ripe “old” age of 32 technically 31, but only for one more month. Grey hairs galore! I guess I hadn’t noticed before because they blend in much better with blonde hair. In fact, I bet it actually increased the length of time I could go between hair dyes because the grey masked any darker-colored roots. But with dark brown hair the grey is painfully obvious.

And now I’m in a conundrum.

I like the dark brown. I want to stay dark brown for awhile. But….yeah. The grey is an issue.

I feel like I’m going to have to dye my hair more regularly (maybe every 4-6 weeks instead of closer to 8-10 weeks, which was my norm with blonde hair). And I’m using cheap grocery store dye, not something professional. I’m worried about the condition of my hair. Especially with our colder weather it feels very dry and brittle. I’ve always been a person who has HAD to wash my hair every single day (because otherwise it would get so greasy!) but I’ve moved to an every-other-day wash schedule because my hair is so dry it really doesn’t need to be washed more frequently than that.

So, I don’t know what to do. I’m torn between my preference (I’d like to stay brunette for now), my pocketbook (more frequent dying = more $), and my hair quality (more frequent dying = more damage).

I know back when Adam and Emily were blogging I’d once commented on a post by Emily about hair care. I’d found some type of at-home salon-quality hair dye that’s professionally matched to the person based on hair type, color, etc. It’s a bit more expensive than the cheap grocery store hair dye, but it’s still much cheaper than going to a salon and maybe it would save my hair from some of the damage???  What do you think?

What would you do? Try better quality at-home dye? Go back blonde? Some other alternative? Any suggestions for good hair dye brands are welcome, too!