I’m so excited to have been chosen as one of the new BAD bloggers and I think this new format is going to be great! I figure I will start building on my introduction to my debt with some debt details and noticed many of comments liked to have an image of the blogger so I thought I would start out with that….
|Creditors||Amt Owed||Total Interest||Pymts Left||Payoff Date||Interest Rate|
|Retail Card #1||413.00||–||1||Apr-14||0%|
|Loan from Dad||3,830.00||–||6||Sep-14||0%|
|Retail Card #2||2,264.80||499.76||12||Mar-15||25.99%|
|Line of Credit||1,248.00||58.25||6||Sep-14||15.95%|
Total Debt: $78,518
I have already made March payments (including paying off my highest interest debt – YEAH!) so these numbers will be the same going into April minus interest accrual.
You can see from you my chart that I am not paying off higher interest debts first, but rather focusing on the personal and smallest amounts. After those 3 are done, I will target my highest interest one and move forward from there. I am very open to hearing suggestions on changing strategies.
So where did the debt come from you ask?
- Retail Card #1 – is a store card (gives me a 5% discount) linked to my checking account which I used so I wouldn’t incur any debt. Lack of record keeping forced an overdraw of my account and they graciously turned it into a credit situation and I have til next month to pay it off with no penalty.
- Property Tax – the car tax bill due every 6 months. This bill kills me every time, but now I’ve put it in my monthly budget and will be prepared the next time around.
- Loan from Dad – this was an inadvertent loan when I lost a large client last fall (good testimony for the need of an emergency fund,) that I am very anxious to pay in full due to the personal nature.
- Retail Card #2 – for the most part this was unavoidable spending as it is for equipment used in my business. I’m in a really good place right now and anticipate my current tools will last for several years, so getting this paid off will allow me to put some aside for when I do need to replace or upgrade something.
- Credit Card – I was in a great place with this card two years ago. Had it mostly paid off and felt good having it for an “emergency.” Unfortunately, I let my desire for experience for my kids out weigh good money sense and used it to take a trip to Floriday – Disney, Universal, etc. It’s a decision I will not repeat. I go back and forth over regretting it as I do believe it probably will be the last time we go since my kids are growing up so fast, but we probably could have lived without it too.
- Car Loan – I know I am going to get the most comments for that one. My car has a story all of it’s own that will come another time. But I’ll put this perspective out there now. I drive a 2013 commercial passenger van (the Beast.) I chose a newer car because I am a single mom with no “car support” around (did not want to say male, but that’s what it is in my mind,) and am scared to death of car trouble. I chose this huge, gas guzzling beast because I have 4 children of my own, another 1 whom is with us all the time, and my twins have a biological brother and sister who are with us 1 or 2 weekends a month…that’s 8 people on a pretty normal basis. And oftentimes, I watch other people’s kids, carpool with others and we are certified to foster two more if the need arises. As much as I would like to sell it and go small and old and cheap, I have not been able to wrap my head around that.
- Line of Credit – I hope you will agree that this, my newest debt was good choice. When the adoption of the boys started last summer, I knew I was going to have to have a bigger car (I will tell the whole car debacle another time.) At the time, I had a 2012 Honda Crosstour. So I found my Beast but when it came down to trading in the old, well, I just couldn’t take what they were offering so I held on to it and put it up for sale privately. Fast forward, 5 months and I got my best offer, $2K less than what I owed. This line of credit paid the difference for me to get rid of that additional car payment, insurance payment, property tax payment.
- Student Loan – this loan is from grad school only. My parents got me through my bachelors degree with new debt. I was SO naive as to what was happening, and now I am so grateful. It was still a horrible decision to take it out in the first place. I was single, working full time and making decent money. I could have paid for it without the loan. But I was not educated, I lived paycheck to paycheck and while I didn’t run up debts, I did spend all my income, thus the student loans.