I have to be honest. I’m totally nervous about this post.
When I first started blogging here back in early 2014, I experienced a lot of backlash. It’s tough to put your entire financial world out there on the internet for a bunch of strangers. And tougher, still, to take in the comments and criticism of very personal financial decisions.
But then the tides changed once I started experiencing some success.
Within 3 months of beginning to blog, I paid off over $10,000 in credit card debt. In total, I paid off just over $25,000 of debt in 2014, just over $26,000 of debt in 2015, and over $30,000 of debt in 2016!!!
Once I was winning with money, the criticisms mostly melted away. I felt more support and encouragement. Not as much judgement or negativity.
Then the summer of 2017 occurred. Poor spending decisions have been made. Income has been reduced. Outflow has increased. I’ve been struggling with some personal mental health issues which have prevented me from spending as much time and attention with our family budget as I should have. Things have just spiraled.
There’s no one single “thing.” It’s more like an avalanche of smaller stuff. Death by a thousand cuts. And all the sudden I look up and realize that our minimum monthly debt payments are so out-of-hand that I don’t know what to do. We’re nickel and diming ourselves to death. To the point that we have no money for food. We have to rely on credit to buy our groceries.
I tried to start over from scratch. I’ve been using YNAB, but I haven’t been able to make the money work for several months now. Our expenses exceed our income, no matter what I do or how I try to shuffle things around, there’s just not enough. So I opened a simple Excel spreadsheet. I wrote my monthly take-home pay at the top and started listing expenses in order of importance. Here’s what I got:
We’re down to $1264 to spend on all of our monthly needs in terms of food and clothing, savings, and/or additional debt payments. It doesn’t feel like enough….especially since the debt figure ($1098) does NOT include any student loan payments, given that they’re in deferment currently.
On my post about increasing student loan payments, many people tried to give me encouragement that we COULD put $1,000/month toward student loans. That it was totally possible.
Well…..not with only $1264 at the end of the month. Not when we don’t have enough money to buy food or gasoline for our cars. Not when there’s zero wiggle-room because we literally don’t have a single penny in any emergency fund. Not when Christmas is coming up and we have no way to buy gifts for friends or families. Not when our property taxes are coming due!
Can we decrease our fixed bills? The “utilities” line item ($650) includes water, electric, HOA, cable, internet and phone. We can try little things to save on energy, but we’re in a contract with the cable/internet company and same with our phones. HOA is also “set.” So not a lot of wiggle room there.
We do have some debt payments that have lower balances – once we knock them out we can reduce the monthly minimum. But we can’t just be paying minimum payments – we have got to be paying as much over minimum as possible in order to make any headway.
I’m preparing a full debt update so you can see a larger financial picture (give me a couple days to get it posted). But it seems pretty clear to me – we have to find ways to increase our income. $4880/month is not enough for us to achieve our financial goals.
My sister recently added me to a Dave Ramsey Facebook group. It’s been a huge motivational boost to see so many stories of sacrifice and determination. So many debt-free success stories, pictures of fully paid homes, etc. I know we will get there. Our path hasn’t been linear and I think that’s okay. Sometimes “life happens.” Sometimes you have to take a step back and focus on yourself or your family. But we don’t want to live in a state of debt like this forever. The only way out is to put our heads down and plow forward. And that’s just what we intend to do.
As always, I welcome and appreciate your constructive criticism. I’m back to square one here. Googling sample budget plans and just trying to figure out how to survive without taking on additional debt. I’m a little nervous and scared of the path ahead. Our first 2 years of debt-reduction were totally bare-bones. I remember the days well. That was back when I was working part-time from home so it was easier to cook from scratch, meticulously research and shop sales, etc. We’re in a totally different situation now.
It wasn’t easy then. It won’t be easy now. But nothing worth having ever is, now is it?
Give me all your tips! Link to web resources, give me book recommendations. Even just a word of encouragement is appreciated. Thank you all, especially those of you who have been around and seen my story evolve over the past nearly 4 years! It’s been quite a journey and we’re only half-way through it!