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Weekly Debt Update #1

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Hey everybody!

I’ve been doing some thinking and since I update my personal debt numbers on a weekly basis and tally my budget numbers, I’dd the same here. I give the run down of my week of week from what I paid on debt to what I spent.

So on Wednesday I got paid $924 (my normal $847.50 plus milage reimbursement for driving). I pay my electric bill on the 2nd week of each month which was $99.70. After I paid myself $70 for whatever gas and groceries (I tend to buy dog food and chicken to help out my girlfriend). This week I was able to make a payment of $752.93 on my Sallie Mae loans.

Rant alert- I really hate how Sallie Mae allocates how you can pay off loans. I’m in the automatic withdrawal program to get .25% off my interest rate on each of my loans. The automatic withdrawal gets made the 21st of every month. My due amount on the 21st is currently $467.91, which they lower as I pay off the loans (my initial payment after college was somewhere around $900!). At the beginning of the month, if I want to make a payment, they don’t allow me to choose which loan the payment goes towards until I’ve paid the full $467.91, even though I make this same payment on the 21st. I guess it’s not terrible in the sense that I’m paying off each of my loans with 2 payments a month plus what ever extra, but I could pay off the lowest ones so much quicker!

So here’s my debt numbers for the 2nd week of January:

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

And here’s how my budget stands:

Matt's Blogging Stuff

My sister is currently 8-1/2 months pregnant. I bought her a bunch of gifts and had them sent out of state to where she lives. That’s the $116.53 showing up in the misc. category. My $70 didn’t last too long this paycheck. I ended up spending it on a couple of restaurant dinners (totaling $20, but could have been avoided) that I could have avoided, $20 on gas and the remaining cash on groceries. As I type this on Monday night, I’m penniless until Wednesday.

For the coming week, I don’t see too many expenses. I owe my student loans on Wednesday and my folks are coming to visit, which I should be able to use my normal $70 to pay for any expenses with this, but normally we just hang out around the house. Barring anything that comes up between now and tomorrow, I should be able to make a nice loan payment.


18 Comments

  • Reply Walnut |

    Are you able to structure your payments in a way that you make an initial payment of the minimum that will distribute across all loans and then make all subsequent payments to a specific loan? Would it otherwise be an option to call Sallie Mae and ask them to move your payment date? If you can schedule the minimum payment for the first week of the month, then you’ll be able to direct all subsequent payments for the month.

    On the budget front, have you sat down and analyzed your ‘misc’ category for the past year? I wonder if it would make sense for you to budget based on a twelve month rolling average? Or does it make sense to budget nothing and then just report actuals? The $40 seems arbitrary.

    • Reply Matt |

      To your first question- that’s actually what they do, until the automatic withdrawal is made from my bank account on the 21st. So if I made a $467 payment (which is the monthly minimum) on the 1st of the month, that amount gets distributed across all my loans. Any amount after this I can choose which loan it gets applied to. However, the minimum amount gets withdrawn from my account on the 21st and distributed across all my loans, regardless of previous payments. I think I’m just going to have to call, like you said, to see if anything else can be done.

      On the budget note- I have looked at 2014’s misc category and I spent $6,304.00 in that category. I had some major expenses in 2014 that make up most of that. I put on gutters over the summer that were $600. I had a car repair billed that was $900 in November and I bought a $800 guitar before that when I thought things were OK. These are just off the top of my head. The more and more I look at it, the more I’m feeling the need to set up budget categories like everyone suggested last week. I can’t stop thinking that that $6,304 could have went to paying off debt; I don’t want to sit here and say life happens, either. I definitely think there’s better ways around it now.

  • Reply Brooke |

    My student loans are also like this. I have to make the initial payment, then I can call or email so that the balance above the minimum is applied like I want. Right now we are concentrating on a loan that is in an account by itself, whoo hoo! Don’t have to worry about correcting how the payments are applied right now. We already paid off the higher interest loan in the account.

  • Reply Joanna |

    I’m just curious- and you may have mentioned the reasoning before- but why does your GF only pay for food, and you pay for everything else? And then, for instance, you pay for additional food items to help her out. Is she low income and this is the fairest percentage of living expenses? Is she unemployed? I just have a natural aversion to situations that seem like one person is taking advantage of their partner. Or perhaps it’s from having experienced it myself (and having witnessed it in other relationships). Anyway, just wondering the reasoning behind that…

    • Reply Matt |

      Well…initially when we started living together, I was making about %50 more than she was, which was a really good balance. If you add up the numbers on my budget, I spend roughly $850 on the house, before calculating money for extra groceries, because that’s not how it started. She would spend about $400 a month on groceries. All the bills were in my name, so it made it easier just to split it that way and I hate shopping, anyways. I didn’t even want to think about the tax repercussions of “charging” rent or something of that sort since then it would be taxable income (right? That’s how I always thought about it.)

      Since we started that plan, I’ve essentially kept the same job with the same pay, while the GF took a layoff back in April and went back to grad school in September. Since she works part time and goes to school now, I’ve had to gradually increase how much I financially support the grocery category (hence the $120 per month I budget). She’s looking for a full time position, nothing has come around though lately. So what do you think? I’m thinking about making this a post towards the end of the week, since I’d like to know how other (non-married) couples handle this. Please share if you have any comments or stories of your own!

      • Reply Joanna |

        Before we were married my hubby and I lived together for three years and split everything down the middle. However, we also made similar salaries at the time. That being said, if one of us had been hit with a job loss, I know we would’ve done the same thing that you’ve done- one person taking on more of the household responsibility.
        I’ve also seen it where one person works their butts off and the other person can’t be bothered to find a job, or contribute to the household at all, but expects to be taken care of! Those relationships never end well.
        It sounds like you and GF have a good system worked out. I might just be cognizant of how things will (and should) change when she finds a better paying job, or settles into her new career, and you all communicate about that.

      • Reply first step |

        When we were in college, dating and living separately, my husband & I often shared grocery expenses because we both worked at a grocery store, and whoever worked later brought dinner supplies home. We lived together for about a year before we got married. I had a permanent job and rented the apt based on my salary. While he was temping, he helped with groceries and utilities. Once he had a permanent job and we were engaged, we combined finances and haven’t looked back. Fortunately we both brought minimal loans to the relationship, (around $10K, and I had more debt than he did), and we’ve managed to stay out of credit card debt the whole marriage (21+ years). We’ve paid cash for our last two cars, and now we’re working on paying off the mortgage early and paying for college for the kids. We hope to be finished with both of those bills in 2020. Good luck with figuring out what works for you!

      • Reply Walnut |

        Prior to my husband and I getting married, we handled things similarly to you guys. I owned the house, so I paid the mortgage, insurance and taxes. He covered the utilities and most of the restaurant and entertainment type budgets. We took turns paying for groceries. We did not generally tally what each of our individual spend was, but just tried to keep a pulse on whether or not it felt fair.

        We dated for quite awhile prior to getting married, but after dating for three or so years, we both more or less knew we were going the marriage route. That distinction meant we spent less time on the yours versus mine, because it would all eventually be ours.

        One important thing we did prior to getting married was track our combined net worth. We then pushed each other to make sure we were saving for retirement and set goals for the year. We also were transparent about debt. The balances were logged on a spreadsheet and we’d push each other to the next payoff goal.

        • Reply Jackie |

          My husband and I lived together before getting married. His name was on the lease and I paid all utilities–at least they were in my name. Honestly after a month we just deposited his check into my bank account since I paid all the bills. He didn’t have a checking account just a savings. He lived on a total cash basis. Our money has always been all in one pot so to speak. We married after dating and living together for 6 months. We now use a credit union and everything is directly deposited. For me it was just a pain in the butt to divide his share of everything and then have to go to the bank to deposit it or withdraw my portion. We live in Maine and things are spread out up here so I’d have to drive a 1/2 hour one way to the bank. Having it just directly deposited in our account just made it easier so I could pay online. I did add him to my account at the time. Now our credit union is maybe 10 minutes away and right next to his work.

      • Reply Maureen |

        Suze Orman is a big advocate of splitting everything based on the percentage of your incomes and splitting all the bills evenly that way. E.g. Partner A’s take home is $4000 a month and Partner B’s take home is $2500. Then split the bills on the % that you make in relationship with each other. I think this is the most equitable way to do it.

      • Reply Brooke |

        We had a few systems throughout our 3.5 years of dating. First, we just covered designated bill and split other purchases. Then we went to a system with two separate accounts and a joint account for monthly bills such as rent, electricity, etc. We then moved to a new area where we couldn’t use our previous credit union. That’s where we set up the system we have today as a married couple: one joint account and both of us have access to all log ins. We didn’t get around to closing our other separate checking accounts until after we were married.

  • Reply Angie |

    I love the simplicity of your budget. I wish I could reduce my life to be that simple. I’ve got 10 years of lifestyle creep behind me though and its way harder to give things up than to just not add on!

    What worked for me with Sallie Mae was writing checks. Each individual breakout should have an account number that is xxxxxxxxxxx-xx. I have CapitalOne360 where you can write “paper” checks.

    If you have the account number correct with the dashes on the paper check they will go to the proper loan. This is the major factor lacking on their payment website. But yes, it does make it dramatically easier if you pay your minimum first. That really is what screws it up most of the time. But I found the paper checks definitely helped getting the extra payments allocated correctly. It does seem counterintuitive to send the payment through your bank versus the Sallie Mae website directly.

    • Reply Matt |

      I think it’s only simple because that’s what works for me, lol. I’ll try that with Sallie Mae next week, but there’s something about sending paper checks that make me uneasy. This has to be a generation thing since this was how payments we’re always made, but the internet has made things so much easier to schedule, make, and track payments.

      • Reply Angie |

        To be clear you still do it all online. The bank just sends a physical check instead of electronic payment. I don’t do anything different and there is no postage. Just go online, choose an old payment, and resend. Its still tracked fully in the pending payments.

  • Reply cristina williams |

    Hey matt, if time warner is your internet provider you can call every few months and ask for a discount. Tell them that you have been a customer for a while and that you can only afford to pay 45 dollars because you are on a budget. Currently i pay 38.11 i just have to call every six months. I have been doing this for 2 years and i will be debt free this december.

    • Reply Matt |

      Great idea! I’ve been with them for close to 4 years now so I should definitely see what they’re able to do!

  • Reply Candice |

    I could definitely see how that could be frustrating about the student loans with Sallie Mae. My service providers allow me to allocate money as I see fit. If I don’t (didn’t) pay the minimums on the loans each month I would just be heavily fined.

    Have you considered consolidating the loans with similar interest rates with a different lender? This might not make sense for you since you plan to have them all paid off in 23 months but it’s a thought.

So, what do you think ?