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Weekly Debt Update #7- About Me and Other Stuff

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Hey everyone,

Ok, so on Thursday I posted about my latest accomplishment- I paid off debt Sallie Mae 03! But what I didn’t post was… everything else. A couple of you asked if I could post more about me- a valid point which I’m more than happy to share, knowing that people want to hear more than just “blogging away debt”.

So here’s what lead me to…well… here:

I’m currently 28, having just turned 28 last month.  I was born and raised in the beautiful (not really, but still awesome) Buffalo, NY with my 2 parents, a younger sister (2 years) and brother (5 years). We lived a very comfortable (for us kids) middle-class life in the suburbs (translation: we looked like we had more money than we did). I grew up with Buffalo Bills, Buffalo Sabres and chicken wings- 3 of my favorite things to this day. Sometime around the age of 10, I decided I wanted to be an engineer, not just any engineer, an Imagineer- a Disney cast member who designs everything in the theme parks. This was my dream and to some extent, still is. After a long road through high school, in which I was quite the trouble maker, I got accepted to a few schools for Mechanical Engineering, two of being University of Miami (FL) and University at Buffalo. Going to U of M was also one of my dreams and I made an early decision to go the summer before my senior year. Sometime during that year, I got the bill for the 1st years tuition- $40,000 FOR. ONE. YEAR. Like I said earlier- I was a screw off and didn’t do any favors for myself in terms of scholarships and grants. After a long talk with my parents we decided that going to University at Buffalo (UB) for $4,000 a semester and living at home made way more sense than going to an out of state, private school.

My freshman year of college I really turned things around- I had relatively high GPA for the program (3.8), worked nearly full time and helped coach my high school wrestling team. This coaching gig gave me the itch to go back and wrestle myself- in college. In high school, I was good but definitely not great. UB was/is a NCAA Division 1 school, meaning you have to be pretty awesome to excel there. So, I transferred. To a private Catholic University in Erie, PA. Why? Because it was the only Division II school that had both a wrestling program AND mechanical engineering. Well, private Catholic University means BIG $$$ (and even more $$$ since I had to take summer classes to catch up due to “nontransferable credits”) and somehow in the course of me deciding the transfer, I lost sight of why I didn’t go to my “dream school” in the first place. Was it a great experience? Most definitely. I met my lifelong friends, gained a tremendous amount of skills wrestling in college and graduated with a degree, a pretty sought after degree, or so I thought…

At the time I graduated in 2009, the economy was already deep in recession (something I think we all remember). It’s hard to find someone who WASN’T affected by all of it. Anyways…getting a job was tough, really tough. I remember sending out 15-20 resumes a day and not getting any calls, let alone interviews. I wasn’t the only one. Of 13 of us in the program, only a couple (2-3) had jobs lined up after graduation, and it was for firms they had internships with. The fear of not being able to pay bills and having to move back in with my parents kept me motivated. Thankfully, I was lucky enough to get an internship in my last semester with the Federal government to work in construction and equally thankfully they had a position open that I could have when I graduated. Problem was, an intern had to work 600 hours before they could be hired full time, so I worked 70 hours a week, while going to school full time (I had to give up wrestling to achieve this). The day after graduation I had a full time job (but not great in the pay department) and was in full time student loan debt.

As you’ve all seen from my initial posts, I graduated with $110,000 in student loan debt (now matter how many times I write, it’s still crazy). For 2 years after gradation, I lived in a basement apartment (which had windows, albeit, not good ones) and paid interest only on my largest batch of student loans- the private ones with Sallie Mae. As terrible as it was for a while ( I was only making $50K at the most while I was with the government) this set me up to be disciplined to pay off my debt. Even paying interest ONLY on half I loans my payments still added up to $700 a month. It truly scared me with what could happen if I lost my job and couldn’t pay (reading student loan horror stories on the internet didn’t help any). So I worked form the ground up, putting whatever I could to pay off my debt, even taking a 2nd job for a year busing tables. This also lead to me taking up a whole bunch of hobbies that really don’t cost that much- playing guitar, here’s my current guitar:

IMG_2372

,surfing (yes, you can surf Lake Erie- look up YouTube videos), and here’s proof (that’s me, over the summer):

IMG_2146

longboarding (the skateboard kind) working out, running and reading. From my intro post, here, and here,  you can read my journey form the last five years. I currently “own” a house, which I share with my GF and our 2 dogs: Harlow (the white one, a whippet mix) and Bubba (an Australian Sheppard mix), both rescue dogs:

IMG_7259

IMG_5744

Ok, so that’s pretty much the run-down of my bio. I think a good reason why I don’t post too much info about myself, is because paying off debt is boring, like REALLY boring. I can count on my one hand the amount of times we’ve “gone out” since last summer. I’ve paid off over $48,000 since September of ’09 and in order to do that I’ve cut a lot of money absorbing things out of my life, which gives me little to discuss other that what I’ve posted in the past. What I do love posting about is what’s come up in the past week and what I’m expecting in the week to come that lead to me being able to put a good chuck onto my loans.

I guess here is where I’m looking for some input- what do you guys want to see? I could post weekly updates like I was doing with more insights into my financial plans, or I could most more personal items about my life, like this post…or some mixture in between. Just let me know in the comments!

Since this post is already long enough- here’s a quick look into my monthly budget thus far. Big ticket item- had to pay $397.50 at the dentist’s for a crown which came out of my slush fund.

Weekly Update #7

And here’s where my debt balances are:

Loan NameInterest RateOriginal Balance- May '09Current BalanceTotal Paid Off
Sallie Mae 015.25$27,837.24$24,462.48$3,374.76
Sallie Mae 024.75$22,197.02$19,189.15$3,007.87
Sallie Mae 037.75$20,692.10$0.00
$20,692.10
Sallie Mae 045.75$10,350.18$7,723.61$2,626.57
Sallie Mae 055.25$6,096.03$4,969.48$1,126.55
Sallie Mae 06 and 074.75$6,415.09$0.00$6,415.09
Sallie Mae- DOE 015.25$5,000.00$0.00$5,000.00
Sallie Mae- DOE 025.25$3,000.00$0.00$3,000.00
AES6.8$9,000.00$0.00$9,000.00
TOTALS$110,587.66$56,344.72$54,242.94

Note to all: I will be now focusing on paying Sallie Mae 05 (the next lowest balance). Interest rate does not concern me at this point since I should have these paid off quick enough that it won’t have a large effect.

Thanks for continuing to allow me to post on this blog and thank you to all the comments on my last posts!


Another One Bites the Dust…

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First, before I go into any announcements, I want to thank those who wished me well on my post on Tuesday. After a couple more rest days, and besides the lingering congestion, I’m finally feeling back to normal.

To my announcement- I did it! As of this morning I have paid of my Sallie Mae 03. See my table below.

Loan NameInterest RateOriginal Balance- May '09Current BalanceTotal Paid Off
Sallie Mae 015.25$27,837.24$24,462.48$3,374.76
Sallie Mae 024.75$22,197.02$19,189.15$3,007.87
Sallie Mae 037.75$20,692.10$655.99$20,036.11
Sallie Mae 045.75$10,350.18$7,723.61$2,226.57
Sallie Mae 055.25$6,096.03$5,356.99$739.04
Sallie Mae 06 & 074.75$6,415.09$0.00$6,415.09
Sallie Mae- DOE 015.25$5,000.00$0.00$5,000.00
Sallie Mae- DOE 025.25$3,000.00$0.00$3,000.00
AES6.8$9,000.00$0.00$9,000.00
TOTALS$110,587.66$57,338.22$53,249.44

Although I haven’t updated the table, the balance is now $0! This will give me an extra $34 per month to throw at the next debt in line- Sallie Mae 05. AND, not only did I knock out #3 but I started to pay down #5 bringing the balance to just over $4,900.

With it being so late in the week already (my apologies…)and the fact I didn’t do ANYTHING last week except take Nyquil and watch Netflix, I figured I wouldn’t do a full blown debt update, I’ll just save it for Tuesday, unless I get enough comments to warrant one.

I do have one question for those paying off debt- do you guys do anything to reward yourselves when you reach a milestone, or do you figure the ability to put more money on the next debt is enough of a reward in itself? Let me know in the comments!


Formal Event – eeekk!!!

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Houston, we have a problem!  A BIG problem!

Ok, maybe it’s not a problem, just a challenge, a big one!  My Sea Cadet’s division is throwing their annual awards ball.  Last year, his first year in, I let him go, but we didn’t really make a big deal out of it.  This year, he’s been in a year and has been selected to be part of the Honor Guard (a special unit that does a ceremony honoring the MIA/POW of each military branch is how he explained it to me.)  I want to support him, I am super proud of him BUT….

Two things really…social situations make me all sorts of uncomfortable.  I have NEVER been good with people, small talk, happy hour…none of that.  NEVER.  I get nervous and self conscious and in this situation where I understand pretty much nothing about military stuff, well, I’m WAY out of my depth and comfort zone and pretty much, know no one who would be there.

And second, dress up?! Me?!  I mean if it’s not jeans and a t-shirt, then you most likely will not see me in it.  Seriously, I even wear them to church…okay, I throw a scarf on to dress it up a bit.  But this is a FORMAL event.  I mean, I saw the pictures from last year, the parents were in FORMAL, like prom dresses.  Who does that?  Who likes that?  Ok, I know it’s part of the military culture, I see enough Facebook posts of friends whose husbands are in the military, but really…me?

So I asked him…”do you want me to go?”  Hey, I remember this age, it was a really big toss up on whether I loved or hated my parents at any given time.  And the bottom line is, he wants me there.  He wants someone to witness his achievements, to smile proudly at him and to belong too.  (Yes, I threw all those words in, he just stumbled around on the yes.)  So I’m going… and it’s in a week!

What in the world do I wear?  I can promise you that there is NOTHING in my closet that will pass muster, not even close.  And unfortunately, I am a big girl so it’s not like I can just go borrow something from someone’s closet (ooh, I miss those days!)  So help me!  What does a mom wear to a son’s formal even that won’t a) break the bank, b) not be a complete waste of money since I hate the thought of buying something never to be worn again and c) doesn’t make me look like I’m trying to relive my high school prom days???

Help, I’m DESPERATE!

Just for fun, this is my prom picture from my junior year...I love reliving memories from pictures, but do not want to go there in real life!

Just for fun, this is my prom picture from my junior year…I love reliving memories from pictures, but do not want to go there in real life!


Weekly Debt Update #5- V-Day and B-Day

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Good afternoon everybody!

Thanks to everybody for commenting on how they spend their typical Valentine’s Day on last week’s post.

For this V-day I budgeted $52 for a pair of concert tickets to go see a band (Milky Chance) that both me and the GF really like. The concert itself isn’t until April, so my plan was to get a hotel room and dinner for us that night- I would have paid for this as her birthday gift, which happens to be around the time of the concert.

Well…it turns out the night of the concert is her last final exam and group presentation for one of her graduate classes.  So unfortunately, it didn’t work out as I had planned. I’m going to sell the tickets (the concert is already sold out, so I should get face value for them) and plan on using that money to do a small weekend trip in April to a B&B we both really like (which has been less than $150 for the room and dinner when we stayed there before). Not the idea I originally planned, but still something she seems really excited for.

For my gifts (v-day and b-day combined), I got some very sweet (and inexpensive) items that I love but never buy for self- a bag of beef jerky, sour patch kids, gold fish crackers and ‘coupons’ (20 minute massage, 3 hours of uninterrupted guitar playing, etc…) which really made my day. And Sunday I got to spend all day doing whatever I wanted (played guitar, played with the dogs, nap) while she did all the chores normally assigned to me. It was wonderful. Despite what she paid for the gifts (couldn’t have been more than $20) I couldn’t have asked for more.

Edit- Here’s my card that she made (I wanted to show everyone):

Homemade Card

Edit- Here’s the homemade bag she made:

Homemade Bag

Ok, so on to my financials! I finally took the juicer back and received store credit! (Edit- I asked for store credit but the amount showed back up in my checking account!)

Here’s what my monthly budget looks like so far this month:

Weekly Update #5 (1)

My electric bill for this month ended being $11.04 less than expected, which was nice. The misc costs is a total of the concert tickets ($52.00) and my EZ-Pass bill ($25.00, I don’t have a line for this since it’s so irregular. I only get charged when my balance drops to below $10.oo and it automatically refills to $35.00 from my checking account, maybe once every 3-4 months).

My slush fund total increased by $9.00, to 0 out my checking account, to a balance of:

Slush Fund: $2,587.78

Here’s my debt totals to date:

Loan NameInterest RateOriginal Balance- May '09Current BalanceTotal Paid Off
Sallie Mae 015.25$27,837.24$24,462.48$3,374.76
Sallie Mae 024.75$22,197.02$19,189.15$3,007.87
Sallie Mae 037.75$20,692.10$655.99$20,036.11
Sallie Mae 045.75$10,350.18$7,723.61$2,226.57
Sallie Mae 055.25$6,096.03$5,356.99$739.04
Sallie Mae 06 & 074.75$6,415.09$0.00$6,415.09
Sallie Mae- DOE 015.25$5,000.00$0.00$5,000.00
Sallie Mae- DOE 025.25$3,000.00$0.00$3,000.00
AES6.8$9,000.00$0.00$9,000.00
TOTALS$110,587.66$57,338.22$53,249.44

I was able to pay $653.46 onto the balance of my smallest student loan, bringing that to a balance of $1,153.01. I should have this paid off in only 2 more weeks! To think, this was the loan that scared me the most (balance plus interest rate) not 1 year ago.


Weekly Update #4- Orlando Trip

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Hey everybody!

I’m back from my visit with my sister and my nephew. I couldn’t be more stoked that I went. An amazing trip. I got to Orlando on Wednesday night/ Thursday morning at 12:30AM (just barely, though. I made my connecting flight by the skin of my teeth. 2 minutes later and they would have taken off without me.) Since my sis and her fiance are both Cast Members at Walt Disney World, we spent all of Thursday at Magic Kingdom with the baby. Friday was spent hanging out with my sister and other family that was visiting, while her fiance worked. Saturday was spent at Epcot and Animal Kingdom and I left very early Sunday morning.

Here’s a picture of me and baby on my favorite ride, Living with the Land, in Epcot:

Disney Pic

 

He was so amazing and seemed to love the rides we took him on (if sleeping on them means loving them, lol). The only ride he didn’t like was Haunted Mansion, which he just screamed and screamed and screamed on.

OK, so for the financial aspect of my journey, I had budgeted $200.00 (above the $70 I normally carry in cash) for the trip, but it ended up tallying $280.00, give or take. I took it all in cash and had too much change left over to count, I just threw it all in my change jar. I would have been pretty close if I had accounted for the $25 in baggage fees each way for my checked bag. Oh well, I’ll know better next time. The remaining $230.00 was spent mainly on food. I bought dinner on Wednesday (McDonald’s) when I arrived, snacks throughout Magic Kingdom on Thursday, dinner at Sweet Tomatoes Thursday night, dinner at Downtown Disney on Friday night and snacks throughout the day on Saturday. Given the fact we ate so much in Disney, the damage could have been much worse, but my sis gets a pretty nice Cast Member discount that could be used at each stop.

So, here’s what my budget looks like for February:

Weekly Update #4

I have yet to return the juicer (ugh), but I’ve vowed to do that sometime this week, hopefully as early as tonight. But thankfully, even though I spent a majority of week in Florida, I was still able to pay $497.85 on my student loans, which brings the tallies to:

Loan NameInterest RateOriginal Balance- May '09Current BalanceTotal Paid Off
Sallie Mae 015.25$27,837.24$24,462.48$3,374.76
Sallie Mae 024.75$22,197.02$19,189.15$3,007.87
Sallie Mae 037.75$20,692.10$655.99$20,036.11
Sallie Mae 045.75$10,350.18$7,723.61$2,226.57
Sallie Mae 055.25$6,096.03$5,356.99$739.04
Sallie Mae 06 & 074.75$6,415.09$0.00$6,415.09
Sallie Mae- DOE 015.25$5,000.00$0.00$5,000.00
Sallie Mae- DOE 025.25$3,000.00$0.00$3,000.00
AES6.8$9,000.00$0.00$9,000.00
TOTALS$110,587.66$57,338.22$53,249.44

My current slush fund balance didn’t change from the previous post:

Slush Fund= $2,577.57

For the following week, with V-day (Saturday) and my birthday (Sunday) coming up we have some plans for the weekend, but nothing that will cost a significant amount. I have some money budgeted and a pretty good plan for my V-day gift, but I can’t reveal how much and what I’m buying until next week (my GF reads this too, lol). How is everyone else going to spend their Valentine’s Day? Do you treat it like a holiday to celebrate your spouse, or do you see it as a “Hallmark Holiday”? Let me know in the comments! I know couples that do both. Some see it as a nice day to enjoy time together, and others just see it as another day.


Paying Down Principal

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Can I admit something that may make me sound like a real dummy? (It’s okay, I’m secure enough with my own intelligence in other domains that I’m okay with admitting when I’m totally out of my depth in something.) Plus, it’s something that I’m hoping many of the readers here will be able to educate me on and help me with. Here goes…..

You know how I’ve been making larger-than-minimum payments on my car for several months now (since last August to be precise)? Well, I logged in to check on the status of my balance for my last debt update and realized that it said my next due date isn’t until January of 2016!!!

In other words, instead of applying any additional money toward the principal balance, they were simply pre-paying future payments. I had thought (and was wrong), that they only pre-paid for up to 3 payments, and then extra money went straight to principal. So after discovering this error I called customer service and explained the situation, asking for my extra payments to go toward the principal instead of future payments.

I was assured this would be done, but it would take a few days (so my online account hasn’t been updated yet), and I was told that it wouldn’t actually change my balance at all.

I started thinking about it after we hung up and have thoroughly confused myself.

Aren’t most loans (cars, mortgage, etc.) arranged so you pay mostly interest up front? Toward the end of the loan terms you end up paying more principal, but initially almost the entire payment goes to interest, right? So basically I’d just be pre-paying mostly interest. Sooo, if that money gets reallocated toward the principal, then there’s a lower balance for the interest to be compounded on (or capitalized on? I’m so confused!). Right? Soooo, shouldn’t my balance go down then??? No?? Why not? I don’t understand!

Also, I was thinking about it more and trying to figure out what the actual benefit is of paying more toward principal versus simply pre-paying payments (particularly if there’s no difference in the balance). I’ve always heard that if I make extra payments (for car loan or student loans) that I should request for the extra to go toward the principal. But why? I was so off-put by the fact that I don’t know the answer to this that I started googling…..without much luck. When I googled “why should I put extra money toward principal instead of prepaying a loan?” I received a ton of results related to mortgages and student loans. I’m specifically interested in my car loan, but figured the numbers would be the same so I read some of the articles. From what I could gather, it seems like if you pay the principal first, it basically just shortens your loan term (so if you had a 60 month term, like my car, it may end up getting shortened down to a 48 month term). But wouldn’t this also inherently decrease the amount interest being paid? I mean, you’re paying it off sooner, so you have a lower balance for the interest to be compounded/capitalized on (again – no idea the difference between capitalized vs. compound interest), and then eventually you pay it off and it all just goes away. Right? And it’d be the same thing with pre-paying a loan too, right? You pay it off sooner, meaning less interest gets paid in the end because there are fewer months for which to have interest accumulate. Am I totally off on this?

I almost shudder, knowing that so many of you are probably bonking your heads against the computer screen, shouting at my ignorance.

But, yeah. I really don’t know. And I don’t get it, either.

Please enlighten me! I really want and need to understand this difference, particularly with my huge amount of debt!!

And, relatedly, I’m going to start paying extra on my student loans. My plan is still to focus on other debts first, but I need to at least pay the interest on my student loans so the balances don’t keep growing (remember, my minimum payments are so low that they don’t even cover the interest). In reference to this….when I make an extra payment, my intention is really just for it to cover the interest. So I can just make the payment online and leave it alone, right? Or do I need to call and ask that the extra payment be applied to principal? This whole issue with prinicipal balance, interest payment, and loan pre-payment has really thrown me for a loop! Help me sort it out!!!

Seriously, sorry for my ignorance on this matter! Clearly I do not have a background in finance! But to really take charge of my debt I feel like I need to get my mind wrapped around this better. Do you suggest any good personal finance books? Or any good websites or other resources that have been informative for you?


Weekly Debt Update #2- Back Online

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After 3 nights and many cable swaps later, I’ve finally got my computer working. The cost? $17.99 for a new video cable. Thankfully, it could have been worse.

Firstly, I want to thank everybody for their kind words and for sharing their stories on my previous post. There were some questions as to why me and my girlfriend split the costs like we do (so if you haven’t read why, go to the comments section on this post) and after a lengthy discussion between me and her, we decided to stay the course (paying bills based on a ratio of our pay) as she looks for a full time/higher paying job. Thanks again, it was extremely helpful to us.

After the past week, I have a lot to go over, so I just want to dive into it.

Here’s my new debt numbers (as of Tuesday):

Loan NameInterest RateOriginal Balance- May '09Current BalanceTotal Paid Off
Sallie Mae 015.25$27,837.24$24,462.48$3,374.76
Sallie Mae 024.75$22,197.02$19,189.15$3,007.87
Sallie Mae 037.75$20,692.10$655.99$20,036.11
Sallie Mae 045.75$10,350.18$7,723.61$2,226.57
Sallie Mae 055.25$6,096.03$5,356.99$739.04
Sallie Mae 06 & 074.75$6,415.09$0.00$6,415.09
Sallie Mae- DOE 015.25$5,000.00$0.00$5,000.00
Sallie Mae- DOE 025.25$3,000.00$0.00$3,000.00
AES6.8$9,000.00$0.00$9,000.00
TOTALS$110,587.66$57,338.22$53,249.44

I made some pretty good progress on the pay down. I made my normal payment (on the 21st) then put some extra on to the lowest one. I’m currently tracking having this one paid off by March.

Here’s what my January ’15 budget looks like (as of Wednesday)

January '15 Budget

Even though I made progress with my debt payoff, I also did a couple of things that are out of character of me since I started my debt free push- I made a couple of big ticket purchases that I otherwise wouldn’t have. First- I got sucked in the juicing craze after watching Fat, Sick and Nearly Dead (1 & 2) on Netflix during the weekend. Although the juicer makes some delicious juice, I definitely wasn’t worth the +$200 price tag. Not only that, but in order to juice, we need fresh veggies, and since I don’t do the grocery shopping, I (understandably) got a run down of why she (my GF) doesn’t have that in her own budget. I mean, you really need ALOT of veggies to make even a small cup of juice. Certainly not the wisest decision I ever made.

Secondly, I bought a plane ticket to Florida. My little sis, who lives in Orlando, just gave birth to my nephew (the first in our family). For the past 9 months, my feelings were I was going to wait to see my sis and her son once they came up to see us, whenever that happened to be. Well…we got the news Saturday night, first pictures starting rolling in and my feelings changed pretty quickly. The plane ticket ending up costing $262 and I leave this coming Wednesday. I’m going to be staying at their place, so I’ve budgeted $200 for the trip just in case.

Since I didn’t budget for either of these 2 items, I took the money out of my slush fund (I’m not calling it an emergency fund anymore since I hardly use it for emergencies). In order to hold myself accountable I’m going to my slush fund total every week along with Weekly Debt Update. After these 2 costs, I’m currently at:

Slush Fund= $2,570.55

Other than these costs, everything else has been normal. My parents did stay with us on Friday as planned, but they ended leaving early Saturday morning when they found out my sister was in labor. So, all in all, a pretty crazy week.