by Hope
It’s the last day of the month. April has been a month of enormous wins (business wise,) personal challenges (car wreck) and some fun (Gymnast visited and we went to Texas.) Time is just flying by! I can’t believe summer break officially starts for us in just a few weeks.
But through it all, I am very much laser focused on getting 100% out of debt ASAP! And I did get rid of two debts in their entirety this month…
(as of 10/14/17) | |||
|---|---|---|---|
| Student Loans | $35,019 | 2.88% | $0 (income based deferment) |
| Credit Card | $2,221 | 17.00% | $32 |
| Car | 0 | 7.00% | $0 |
| Collections 3 (Ex-husband) | 0 | 6.25% | $0 |
| Collections 2 (Apartment) | 0 | $0 | |
| Total | $37,240 | $32 |
I have begun paying at least $100 per month towards my student loan, which covers the monthly interest.
I mentioned yesterday that my Credit Card debt is what I am targeting hard now. My, maybe lofty, goal is to pay off my credit card debt before we go to Texas at the end of the June. That may mean not saving my car payment money…or maybe I’ll be able to pick up some extra work.
But that would be absolutely amazing!!
What are you personal finance goals for this last month of the school year? Before the schedule change that summer brings for so many families?
Hope is a creative, solutions-focused business manager helping clients grow their business and work more efficiently by leveraging expertise in project management, digital marketing, & tech solutions. She’s recently become an empty nester as her 5 foster/adoptive kids have spread their wings. She lives with her 5 dogs in a small town in NE Georgia and prefers the mountains to the beaches any day. She struggles with the travel bug and is doing her best to help each of her kids as their finish schooling and become independent (but it’s hard!) She has run her own consulting company for almost twenty years! Hope began sharing her journey with the BAD community in the Spring of 2015 and feels like she has finally in a place to really focus on making wise financial decisions.
The total numbers do not match up with the individual line items.
You’re right. I’m so use to Excel where I keep track of things that sums up automatically. I just forgot to change the totals. Updated now.
To pay off the credit card debt before the end of June you need to put $1110 on it in May and June. Where will this money come from? Goals are great, and I’m really glad you are making the high interest credit card a priority, but you need a plan to get to them. I think you sometimes set yourself up for failure by announcing these grand goals with no plan on how to get there. It’s like when you said you could be out of debt in 2 years if you put X amount of money toward your debt. Yes you could, but you didn’t have that kind of money to put toward your debt.
Between the car savings and the reduced car insurance, I will have the money to do that. I’m sorry if that wasn’t clear.
The other variable is my income as it fluctuates greatly based on projects in any given month in addition to regular client hours.
Hope, in the list I see, the last detail is for Collections 2, and the total of details shown doesn’t add up to $42,697.
Your total debt is not 42,697. It’s 37,240. It’s $5457 lower than your total listed. You brought the card down $279 since your last update. Good job. However, somehow your student loan total crept above $35,000. Boo!
Not saving payments for the car nets you $800 onto the $62 you had in the budget for the card. In 2 months you could potentially put $1724 on the $2221 leaving you with $497 on the card. That is not completely paid off. You’d have to add 8 days of subbing at $69 a day to completely pay off that card(once a week through May and June) Is that realistic? If it were me I’d put $400 of my $800 payment towards the card for 6 months. I’d keep $400 towards car payment and emergencies. You seem to have fairly regular emergencies unfortunately. I continue to worry you are setting yourself up for failure by not saving for future expenses\ emergencies. I don’t want to see you pay the card off just to have to use it again because you did not plan ahead.
I do still have a $1,000 in my EF. I think it was December when we had just finished a No Spend month that I decided to save the extra $1,000 instead of putting it toward debt. So I came into the new year with $2,000 in my EF.
$1,000 went towards the deductible with my first car wreck, but I do still have $1,000 and now have added back $347 more between substitute pay and random extra money I put in there. I do agree, having this EF has given me great peace of mind.
But it’s also why I feel comfortable dumping my car savings and any extra income for the next two months into finishing up paying off the credit card debt. Does that make sense?
If you add in the leftover from insurance, you’d have a $3000 ish emergency fund which seems pretty good. I would also pay off the credit card first in that situation, then start with $800/month to savings.
What a great challenge! A good income month combined with disciplined spending could definitely make the credit card payoff happen.
YES! And bring me that much closer to being completely debt free.
I’ve been working on a new “should something unexpected happen to me” plan and having no debt for the executor (one of my brothers) to worry about so he can focus on my kids feels really good.
I love the cash spending plan. That is exactly how we keep out entertainment spending in check!
I’m just in week one…but I am loving it. I also love that it’s very easy to tell the kids…how much money do we have left for the week when they ask for something? Or to do something? etc. Something about the tangible count makes a difference.
i just want to say personally to Cwaltz that i think that you always give such good advice to Hope. it is a real shame that she for the most part completely ignores it. if she listened to only half of what you have suggested over the many years she has been here then she could be totally debt free now.
……… We need to stand up and say no to any kind of system that forces our debts to increase each month.
I’m getting off of IBR this month, and I challenge you to do the same. My Navient balance was $29K when I graduated in 2013. I had it down to $18K, then went on IBR, and my total balance now is $19,337.
It’s really not going to change unless we make it change. I see going on IBR as giving in. I know people who graduated with $50K in loans and now the balances are $100-150K. Our parents didn’t have to deal with that!
That happens because the payment on IBR may not be enough to cover the interest and principle that is due, the shortfall get added to the debt so the balance grows. If you want the balance to go down, you have to pay enough each month so that it will.
Exactly, that was my point. I hate it when I see anyone unable to make full payments and watch the total balances go up. The majority of us signed up for college thinking it would mean a bright future.
I would have to tell the kids that if they want something and it is not in the budget that they will have to pick up some odd jobs around the house or do errands for folks and earn the money somehow. It has worked well for the three of my kids because they know the expectations. They are aware if something is not in the budget then they have to earn the money by doing something such as extra chores or selling stuff. It teaches them that they do not “get everything they ask for” and when they are adults they will respect that they learned how to figure out needs from “wants”.
Hope, I think you’re doing really well. I’m proud of you for accomplishing so much, and for enduring so much for you and your family. I admire that you always take the high road in the comments section. I have to admit that I find myself growing angry with some of the commenters. Just because you’re open about your situation shouldn’t mean you’re opening the floor for judgement and derision. People seem to forget that. And the most important part of personal finance is the part about it being PERSONAL. I admire your determination. Keep up the good work. 🙂