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Feb 28, 2014    |       7 comments

Juju’s Debt Introduction

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Note: Juju wrote this post as an introduction of herself for the blogger position for BAD. Please take the time to read, then ask questions or leave comments on what she has written. You can find information about the BAD blogger position here

I have been reading this blog for about a year now. I have always been interested in personal finance (the savings part, not the debt reduction part). I started really evaluating my own debt when I married my husband in 2012. Prior to our marriage I was a single working mother going to school in the evenings to attain my MBA. I went into labor with our son (my second, his third) a few hours after my final presentation for my Master’s degree. Talk about timing! Soon my family of two became our family of six. We have a 10 year old boy, 6 year old twin boys and our now 2 year old son.

We decided back in 2012 that what my husband lacked in education was made up for by his determination to become the best father to our sons. We decided that I would go back to work while he stayed home with the kids. This solution was perfect; however, this meant we needed to really look at our spending also known as the dreaded B-U-D-G-E-T. Previously, I was living the high lifestyle of supporting only two people but now I am supporting four on one income plus child support for the twins.

First I had to do research, which is how I stumbled on this blog. Though I am used to saving I had never really focused on debt reduction. I set things off in motion by paying off the $14,000 left on my car loan within 5 months. This freed up $388/a month in my budget! This allowed me to invest money in our next purchase.

We bought a 1950’s rambler in a good neighborhood within walking distance to an award winning school. I never thought I would ever be able to buy a home, especially in the Puget Sound market so this was another major accomplishment. Unfortunately, because we used up most of our savings to pay off the car, I had to get a 401k loan to pay for the down payment. Fortunately, around this same time my manager decided to retire and I was promoted which increased my income.

With my increased income I decided to bump up my 401k to 12% and my H.S.A. to $100 a paycheck. $225 a paycheck goes to my savings leaving my take home after taxes and employee benefit deductions to $3000 a month. I also receive child support for my oldest son. Of course higher income and assets means higher debt and liability. We are far from being debt free.

Debt:

  • ACS Student loan (undergraduate): $6,026.64
  • Nelnet student loan (graduate): $49,544.76
  • Mortgage: $143,674.69
  • 401k loan: $7,233.44

Yep, that is $206,479.53 in debt. No sweat, I am up for the challenge. My first course of action is to pay off my 401k debt. That would allow me to eliminate debt and increase my savings at the same time-a win-win. I should be able to do this by summer. I have a goal and a plan to be debt free but I will also need the help and advice from others to guide me along my journey.

Feb 27, 2014    |       18 comments

Nicole’s Debt Introduction

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Note: Nicole recently emailed me the following and no longer wants to be considered for the position:

“I had submitted a post to audition for Blogging Away Debt, which was posted a few weeks ago. That post alone and the comments that I received was a blessing! After reading the comments, my fiance and I changed our financial priorities and decided to take a large chunk of the savings we had for a house down payment and apply it to my student loan debt. With that, I should be debt free within a few months. There were so many great submissions it’s unlikely I would have been selected but I wanted to let you know that I should no longer be in the running, just in case 🙂 Thank you for the opportunity to audition and good luck selecting the next contributor(s)!

Hello everyone! My name is Nicole and I am in debt. Not as badly in debt as I once was, but still, a good, healthy – or rather unhealthy – amount in debt.

Currently, my debt stands as the following:

  • US Bank credit card (0% interest until April 2015): $3,108
  • CARE credit card (financed my LASIK eye surgery) (0% interest until October 2015): $1,398
  • Student loan (9.2% interest) (yes, seriously): $21,349

Two years ago, I owed an additional $17,000 in credit card debt and had an auto loan with a $450/month payment. What can I say, I was reckless in my 20s. There is no other excuse for the debt situation I got myself into. The last two years, I have been throwing as much money as possible at my debt and have managed to reduce it dramatically. Blogs like this one helped to keep me motivated and I always thought that writing about my own finances would help to not only keep me motivated and accountable, but inspire me to try new things that would allow me to do better.

In the last year, some amazing, wonderful things have happened. First, my then-boyfriend and I decided we want to buy a house. Second, my then-boyfriend proposed to me and we became engaged. These are such blessings but they are blessings that cost MONEY. I want to own a home (preferably with a reasonable mortgage payment and before home prices climb much further) and I want to have a wedding (nothing fancy, but an occasion to spend with our friends and family). But, the priority remains, I want to be OUT OF DEBT. My fiancé and I are ready to start having kids ANY SECOND NOW and I know I will want to be a stay-at-home mom when that happens. That absolutely is not possible until I get rid of my debt payments. Oh, and also, bringing a truckload of debt into a marriage is not the healthiest thing I could do for my relationship.

My fiancé does have one remaining credit card balance of about $1,200. He will have that paid off in full in a matter of the next few weeks because he is applying his entire tax refund to the balance.

So, here I am, trying to save for a house (I live in California where home prices are NOT cheap), save for a (very DIY, as cheap as possible) wedding and PAY OFF MY DEBT once and for all. I am in a challenging – and sometimes overwhelming-feeling – situation of wanting to do all of these things in the next year to 18 months. A large part of me believes this is possible, but I’m just not quite sure how.

I know usually bloggers come to this blog with a laser focus of paying off debt, but sometimes life brings in other areas to focus on. Previous blogger Beks had a baby during her debt paydown journey and Claire went through a divorce. That is life. I’m looking for you guys to keep me accountable on making progress for all of these things, which means I need accountability on not paying for things that aren’t necessary: clothes, trips, and wine…precious, precious wine…

I look forward to getting to interact with all of you and having you help me develop a plan!

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