Posts tagged with: debt payoff

Spring Break (+ Feb. Debt Update)

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Hi All!

Last year, my first year back to full-time work, my Spring Break happened to align with my kids’ Spring Break. I remember at the time colleagues mentioning how lucky that was and to appreciate it. So it was no real surprise when this year rolled around and, looking at our academic calendars, I realized our Spring Breaks did not align. Bugger!

But, I think we’re also making the best out of having separate Spring Breaks! This week is my school’s Spring Break (and hubs’ Spring Break as well). I’ll be back in Texas for a couple days to deal with some dad-related issues. But otherwise, hubs and I are looking forward to doing some serious manual labor out in our backyard. When we bought the house, it had nothing but chest-high weeds all through the back. We mowed them all down, but have done very little since then. Hubs has a friend who owns a landscape company and came over to take a look at our yard and offer some practical suggestions in terms of plants, placement, etc. So for the cost of some plants + weed killer + some hard work and elbow-grease, we’re hoping to get our backyard into a more presentable condition. We’ve allotted $200 to the project. It would be a project the girls could help us with…but will probably be easier without the interference, er, “help.” And I like that the couple days I’ll be gone are on days that they’re already in school. Makes it a bit easier for the hubs and makes me feel less guilt about being away (quick Dad update for those who have been following along and are interested – skip this part if you’re only here for the financial -my Dad, who has frontotemporal dementia, continues to decline. His speech is almost gone at this point and he lives in a constant state of agitation, presumably from the confusion and frustration associated with what’s happening to him. He’s been living in an independent living facility but we’ve been touring several assisted living and dedicated memory-care places. It’s a tough move to make but it’s coming up probably sooner rather than later so we’re trying to research and prepare accordingly. Being that the purpose of my trip is for things related to his care, my sister and I decided he would cover the cost of my airfare – something he would have done in the past if he had the mental capacity. I’ll be staying with my mom so I’ll have free lodging, and will only be paying my meals out of pocket which should be minimal. I’ll be there not quite 3 days.)

Next week is our girls’ Spring Break. In the future, I hope that we can plan family vacations (or even staycations) during Spring Break week, but with our looming tax debt ahead, that’s certainly not in the cards this year. Instead, we’re lucky to be able to hodgepodge together some childcare without having to pay extra to a babysitter. Hubs has class Mon/Wed (but is available other days) and I teach on Tues/Thurs (but am available other days), so between us, we’ll be able to always have one parent home with the kiddos.

I’m still on operation minimal-spending, too. It’s not a complete spending freeze because we still have to purchase essentials like food, fuel, etc. But I have been extra mindful about every dollar being spent. As an example, one of my daughters lost her water bottle for the second time this school year. Last time, I just jumped on Amazon and bought her a new one. This time around, I’m making her take my water bottle as a back-up. I explained that we can’t just get something new every time we lose our old item. It’s been a nice lesson in natural consequences and how its important to keep track of our things. It’s a bit of a punishment because my water bottle isn’t a nice or “cool” as the kid version, but at least it’s an adequate replacement so she’s not going without one. I’m really trying to scrimp and save and see if we can pay our full tax debt ourselves rather than relying on borrowing. I really want it PAID IN FULL by the deadline. I did talk to my sister, however, and if I need to borrow money from my dad it would be an option available to us. I really want to avoid this. It’s such “messy” terrain and I just don’t like the feeling. But I would be able to save the interest + penalties associated with an IRS payment plan. Something to think about, should it come to that (I still don’t have exact figures from our accountant).

In the meantime, I want to share my February 2017 Debt Update. As mentioned in a previous post, the debt payment was less than my originally intended $3,000 payment because I decided to just pay debt minimums toward my student loans so I can try to save up the extra money to put toward our IRS debt. Here you go:

PlaceCurrent BalanceAPRLast Payment MadeLast Payment Date Original debt, March 2014
Navient - Federal 2 (unsubsidized)$11,1055.8034February82433 (all school loans, combined)
Navient - Federal 3 (subsidized)$86085.8025February
Navient - 2 (subsidized)$84966.5533February
Navient - 7 (subsidized)$71976.5529February
Navient - 8 (subsidized)$63726.5525February
Navient - 9 (subsidized)$84976.5534February
Navient - 10 (unsubsidized)$98056.5519February
Balance Transfer Student Loan #2$14000% (through Sept 2017)$800February$7650
Balance Transfer Student Loan #3$45940% (through October 2018)$0N/A
Medical Bills$43700% (must be paid by April)$1216February$9000
Balance Transfer student loan #1$00% -Paid off in March 2016$5937
PenFed Car Loan$02.49%-Paid off in January 2016$24040
License Fees$02.5%-Paid off in April 2015$5808
BoA CC$07.24%-Paid off in June 2014$2220
Mattress Firm$00%-Paid off in May 2014$1381
Wells Fargo CC$013.65%-Paid off in May 2014$7697
Capital One CC$017.9%-Paid off in March 2014$413
Totals$70,444 (Jan balance = 72,560)$2215Starting Debt = $145,472

This month (March), I’m putting less toward the balance transfer card – only $400 instead of the $800 I gave in February. I do NOT want to add “IRS” to the debt spreadsheet, so I’m just stockpiling money in hopes we can pay them their money and not move backward in our debt progression. That will mean lower debt payments for the next couple months (March & April). Even small progress is moving in the right direction.

Have you had any financial set-backs lately?

 

 


Insane or Crazy Like a Fox?

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Have you ever heard that the definition of insanity is doing the same thing over and over and expecting a different result?

Welllll, does it count as being insane if you are doing the same thing over again and expecting a different result, but you’ve learned something new throughout the process that hopefully changes the outcome you’re anticipating?

Does this even make sense at all?

I think so. I’ll just think of myself as crazy like a fox.

So here’s the deal (and, please, refrain from the exasperated sighs until I finish)…..

I’m changing up my debt-repayment game plan.

Again?

Yes. Again.

I’ve been calling my car loan repayment my race to 20K (because the loan balance was approximately $20,000 when I began). This was back when I was making $3,500 monthly debt payments (last summer) and thought I could reasonably expect to pay off the car within 6 or 7 months. I soooo had my eye on the prize for a March 2015 payoff.

But, alas, things have changed.

Our income went down. Our debt payments went down. We’re only a few weeks from March and nowhere near paying off the car.

That’s not to mean we haven’t made good progress. When I started the race to 20K back in July the full balance was actually $22,742. As of last month I had just dipped below $16,000 owed (averaging over $1,000/month toward the payment).

BUT….

I need some quick wins. And with a balance that high, there’s not going to be anything “quick” about paying off the car.

That, plus comments many of you have left, have made me reconsider our game plan a bit. So here’s the new debt plan of action:

We’re re-adopting a modified snowball approach (aka: attacking lowest debt first) so we can re-gain some traction and feel a good boost when a debt is conquered. Here’s what’s up on the chopping block:

  1. License Fees. I made a massive payment on the license fees this month, bringing the total owed to $1344. The goal date to have it eradicated is April 2015.
  2. Medical Debt #1. Note that I’ve always grouped our medical debts together for ease, but we are actually making 2 separate monthly payments (one for $25/month and one for $50/month). The $50/month payment will be done in 3 more payments, by May 2015. Although this isn’t a huge deal from a goal perspective (this will be gone simply from making our regular $50/month payments, no extra), it will be nice to free up that extra $50/month to apply toward other debts. Plus I still consider it a win to have the debt behind us!

Aaaaaand, that’s as far as I know now. My next smallest loan is for a federal student loan (balance = $4347), which also happens to have one of my largest interest rates (8.25%), but I just can’t let go of my desires to pay off the car. My rationale is that I can increase my student loan payments to keep the balances from growing (since my minimum payments don’t even cover the interest), but by May I could refocus back on the car as my #1 priority. If I do that, I’d have a solid 8 months to work on chipping away at the loan, with a tentative goal of having it paid in full by the end of December 2015. Remember that we bought the car (original balance $30,000) in March of 2013, so I would LOVE LOVE LOVE to have it paid in full in under 3 years from purchase date. It would be so lovely to begin 2016 consumer-debt free, with only student loans (and that one low-payment interest-free medical debt) remaining.

We’ll see. I can’t commit yet to what will be #3 on the chopping block. But I do know that it will feel oh-so-good to get those license fees and the one larger-payment medical bill behind us. Especially with the license fees, having them paid off will feel like the closing of a terrible, long-ago chapter of our lives that has been hanging around for entirely too long (over a decade, but whose counting?).

Only one other teeeeeeeny thing I need to mention that may serve as a competing interest for our debt payment funds. But that will have to wait for another post. (CLIFF HANGER!) Check back on Thursday for the juicy details.  ; )

What debt are you currently focused on? What debt(s) motivate you the most?


2014 Wrap Up – Hope

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Wow, there is no way I could have predicted what this year would bring, but I do have to say that I am super excited about what I hope 2015 will bring. I thought I would close out the day with a kind of summary of where I started and where I am today…

Back in March, 2014 I introduced you to my debt load…you can see that post here. Two things were quickly pointed out…I spent a great deal of money on my kids (activities, music and allowance, etc.) And the most obvious way to speed up my debt repayment was to add to my income.

While I took a couple of months to come around, I finally acquiesced and came around on both points… we cut music lessons, I switched up how the kids earned money and I got a part time job outside the home. Then summer began…and we traveled, and the kids attended camp, and we continued school, and then…chaos began!

I introduced you to our housing situation in early April, and frankly one of my primary goals in paying off debt was to be able to purchase my home from my dad. But after lots of review, I decided that staying in our home was not the best financial decision for both financial and space reasons. That began the biggest of our transitions…a move to an apartment. You can read the beginning of that saga here.

As I struggled with this unexpected move, we worked diligently to downsize our belongings, get ready for a move and get the house ready to go on the market. And then we moved, all 9 of us (1 adults, 4 kids, 3 dogs and 1 cat) from a 1800 sq foot home with a large yard to a 900 square foot apartment with a dog park. And we learned to give up convenience for space. Meanwhile, my painting contractor quit, running off with more than 1/2 of the monies I had to pay towards getting the house ready to sell.

Boy that had to be the hardest three months of my life…but we have gotten settled, resumed our regular crazy schedule and best of all, despite the setbacks, the house sold 4 days after we put it on the market. That was a huge stressor off my shoulders. And here we are moving forward…

So I began Thanksgiving week with a list of long term, unprioritized priority list that would be the base of my life plan or long term planning. After reviewing your input and giving it more thought, I did break things down a bit more and put them in a priority order. My new plan is ready! I can’t wait to start sharing it with you as we get into the new year.

I’ve ended the year with a bang…

  • Selling the house paid off my debt to my dad including the twin’s car.  I now have a lien free title to the Honda Accord.
  • I was able to refinance my highest interest debt to a 4% interest rate for 6 months.
  • And most importantly, I have a buyer for my van….my second highest debt, second only to my student loan debt.  We are still figuring out of the details since it’s a interstate sale, but I have received the personal loan needed to pay off the difference in the loan amount and sale amount that brought me a tremendous amount of stress when I got the offer.

Overall, when the dust settles, in the past year (counting the sale of the van) I have paid off/sold off almost 50% of my original debt!  Just typing that feels great…and as I mentioned at the beginning of this post, I cannot wait to see what 2015 brings!

I hope you are enjoying a wonderful, safe New Year’s Eve surrounded by your loved ones.  The kids and I are about to find a live stream of the ball dropping via the internet before I head to bed.

Happy New Year and Welcome 2015!


Debt Specifics

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For the new readers, I’d like to give a quick recap on my debt specifics. As you can see from the info on the side bar, I started this journey with a lot of debt.  I still have a lot of debt but I was able to pay off the little ones and then obtain a consolidation through a credit union signature loan.  Then my husband moved out on Labor Day weekend and my debt was further reduced by a car loan going with him and the selling of my newer vehicle got rid of my car loan. We divorced on Dec 14, 2012 and I was left with what you see in the debt column.  That was my pre-marital debt.

 

The three debts break down like this:

$13,210 USAA @ 11.9%

$18,110 Bank of America @ 12.9%

$9,844 credit union @ 11%

 

I have an excellent income that I’m working hard to use more responsibly than I have in the past.

So if you’re new here…welcome!  I have a long way to go but the new year has motivated me to get even more focused on being debt free!

 

 


Side Business

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During the summer I kept getting contacted by friends and family with questions about our real food plan.  After awhile I started brainstorming about how I might be able to turn this into some sort of exta income opportunity.  So, in late August I organized a “real food workshop” idea and had a great turn out.  I hadn’t shared about it on the blog because I wanted to see how it all went before I committed to it beyond this first try.

At the first workshop–on September 9–we made the very simple whole wheat tortillas from www.100daysofrealfood.com.  I rented the neighborhood clubhouse so everyone could have a lot of space and figured out the numbers so that I was sure to not lose any money in the process.  I charged each person a $10 fee to attend to cover the rental fee and everyone brought their own ingredients.  I envision this becoming a sort of support group to get people and keep people on the real food wagon.  I was amazed that the first workshop had 10 attendees!  Most participants are moms that work outside the home and we discussed a very long term goal of making it a sort of “supper club” where we each make multiples of the same meal and then we swap and all leave with different meals for the week.

As a sort of afterthought to the workshop idea, I did something pretty crazy for me.  At the last minute I decided to become a Pampered Chef consultant.  Over the years, I went to many a kitchen show and have a lot of great kitchen gadgets to show for it.  But, until the real food revolution hit my family, I wasn’t using a lot of those tools.  But, now that I cook so much I am getting so much use out of them AND know the importance of having the right kitchen tool!  I was kind of scared to share this b/c it did cost me $150 to sign up.  Well, I’m happy to report that as the month draws to a close, I have earned $450 with this adventure!  That’s commission and overage on the attendance fees only.  I also earned more gadgets and dollars to spend with PC.

What perfect timing for me to stumble into this workshop/Pampered Chef idea!  Actually, I was opening the new consultant kit when Steve said we needed to talk that day before he moved out.  I laughed later picturning myself as one of those consultants you read about that say “PC changed my life!  I was opening the starter kit when my husband informed me he was moving out!”  :-)  It has been a great distraction for sure but the VERY best part of this is that the kids–especially DD–are totally on board and excited.  In fact, DD has no fear and I even got an email from her teacher asking me to send in a catalog!  LOL!  And DD sat and watched all the teaching materials PC sends to new consultants and then one day asked if I had spoken to three new people about my business that day!  Talk about accountability!   When you come home to an 8-year-0ld checking on your progress, you really don’t want to disappoint!

So, we will see where this takes me and I’ll enjoy every step of the latest adventure!  Please don’t worry that I am too busy for this—keep in mind I am kid free every other week (after helping with transportation for M, T and W activities).  It’s a fun distraction that made me a lot more money this month that I was expecting.  I hope to reinvest just a small portion of the commission into the business and use the rest to pay off debt.  :-)

On the divorce front, there’s good news on what is owed in taxes for 2011.  Instead of close to $1500 it is actually only $935.  Since I had not heard anything from Steve on it I found the return on Turbo Tax (he had been working on it) and finished up what needed to be finished and snail mailed him the forms with a note asking that he sign and send me his half of taxes.  This snail mail communication is how Steve has to do this but given my history with dealing with my ex it just feels bizarre.  In hindsight, what a huge red flag it is that someone cannot get along with an ex.  That’s so telling about anyone I’ve decided–if they cannot be a civilized adult to the person they had children with, something just isn’t right.  That’s a great life lesson to take away from this and the lessons just keep coming to light.

 


New Numbers Are Up!

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Like I already shared, the numbers aren’t great this month.  I do love the first day of a new month because it can fill you with optimism and energy.  Unfortunately, on this first day of the month I have some difficult things going on that I just can’t share right now.  I will soon.  I will have to soon but right now I am not in a place to do so.  My health and the health of my children is fine.  I want to say that because I don’t want there to be concerns about our well-being in that regard.

Life is hard.  We all know it brings twists and turns that we never expect and we can never truly be prepared for.  This is why I know to lean on my faith and my natural optimism for which I am most thankful.  Hang in there with me but I may be taking the rest of this weekend off to turn inward and get through some things that I need to push through.

As silly as it sounds, I do value the support of my readers so much.  As a rookie blogger I didn’t come here expecting to get that benefit.  But as is always the case, the Lord knows exactly what people to put in your life when things get rough even if those people are a virtual presence.  Thanks in advance for your patience.


Loving mint.com

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Wow!  I am really liking what I see at Mint.com.  What a great website!  It accesses my accounts online and inserts relevant information.  I confirmed the previous payoff estimate of December 2014 for the credit card debt of approximately $55K.  We are on track to meet that goal right now and it feels good to have a date to circle on the calendar.  There will be detours, no doubt but I can’t get discouraged by those and instead keep my eye on the prize.  With any luck (and more cutting costs…and yes, that includes passing on a housekeeper at this time…and increasing income…got a little boost in a side job today) maybe we’ll have a very Merry Christmas 2014. 

The vehicles–with the minimums–will be paid of in June 2017 but we SHOULD have a lot freed up to knock those out sooner rather than later.


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