As you can see above, I have received my credit card statements, assessed the damage, and updated my Ticker.
I have also added 3 new tickers to demonstrate where I am actually making progress considering I almost threw up at the sight of only $56 being paid on my debt principal this month.
As you can see the trouble lies with Credit Card #2, which actually went up. I forgot about this, but I had a major bill ($1430) that I had to pay for work. This will be reimbursed, but has not been done as of this point. Phew!!! I thought I rambled on for a month for nothing!!!
As you can see, however, this is going to be a large number of baby steps before I get anywhere. Interest will kill you!
Tuesday, September 30, 2008
Monday, September 29, 2008
Gold Star for the Hubby...
So it has been a good weekend. My husband has now managed to get a new job. However, when I say new, I mean additional. Yep that's right, another income stream into our household! Unfortunately, he doesn't start until the new year, but the good news is the job should pay for his business credit card debt (which if we remember is over half of the total debt) based on the three year pay 0ff plan. This means a little lighter on the cash flow, and if I can still allocate all or least the majority of the existing payments, it will be paid off even sooner. I know, I know, it should all be going to debt, but considering we will still be on track for "the plan" I don't see any reason why I can't take a couple hundred every month to pad the emergency fund and ease the strict grocery budget.
I am so excited for him. Plus, if we can dig ourselves out of this hole a little sooner, I will be ecstatic.
I am so excited for him. Plus, if we can dig ourselves out of this hole a little sooner, I will be ecstatic.
Friday, September 26, 2008
Christmas in September...
My budget got a nice little reprieve this week My husband's family has decided to draw names for the kids for Christmas, which now means that instead of the regular eight children (not including my own) that I have to buy for, I now only have to shop for two! Plus, they decided to put a cap on the present cost to make it "fair." WooooooHooooo!
Don't get me wrong I LOVE Christmas! And this is actually a little bit upsetting, as Christmas shopping, especially for children, is probably the best part. Every year my husband and I go to Toys R Us and spend hours trying out all the toys and deciding what to buy. It really makes you never want to grow up (if you ever really do).
However, this is a nice break on my tight budget. Plus, the money I save can go on my debt, or to the unexpected Christmas expenses that always seem to creep up, no matter how prepared you think you are!!
Beware - Month 1 credit card bills are coming!!
Don't get me wrong I LOVE Christmas! And this is actually a little bit upsetting, as Christmas shopping, especially for children, is probably the best part. Every year my husband and I go to Toys R Us and spend hours trying out all the toys and deciding what to buy. It really makes you never want to grow up (if you ever really do).
However, this is a nice break on my tight budget. Plus, the money I save can go on my debt, or to the unexpected Christmas expenses that always seem to creep up, no matter how prepared you think you are!!
Beware - Month 1 credit card bills are coming!!
Thursday, September 25, 2008
A Few Depressing Thoughts...
So I had a bit of a sobering experience yesterday. I actually sat down and thought about what I can't have because of my debts. It was really aggravating!! Due to the debt we have accumulated we have essentially locked up over $3000 a month (that is $36000 per year) that we are not allowed to touch for our past indiscretions. Talk about not moving forward!!
My husband and I want to a get a newer, more fuel efficient car. Without our debts this would be a piece of cake. But no dice.
I would like to cut back my working hours in exchange for more mommy hours. Not going to happen at this rate.
Trips? Nope. Basement renovations? Nada. New bedroom furniture? Not a chance. New pair of shoes? No - but maybe if I do a good job with this debt it could be worked out ;)
I know that it is always said to look at the positive side of things to motivate you to action, but apparently looking at the downside can also give you the swift kick that you need.
My husband and I want to a get a newer, more fuel efficient car. Without our debts this would be a piece of cake. But no dice.
I would like to cut back my working hours in exchange for more mommy hours. Not going to happen at this rate.
Trips? Nope. Basement renovations? Nada. New bedroom furniture? Not a chance. New pair of shoes? No - but maybe if I do a good job with this debt it could be worked out ;)
I know that it is always said to look at the positive side of things to motivate you to action, but apparently looking at the downside can also give you the swift kick that you need.
Wednesday, September 24, 2008
Beware "miser mode"...
So sometimes after you have scaled back as far as you can go, you can get used to not spending money, and actually "forget" how to spend money wisely. My friend refers to this phenomenon as "miser mode."
Let's use an example:
You need a pair of dress pants for work. You think to yourself "I don't want to be spending my money on pants I have debt to pay!!" But you know you need them. You go to the store, and buy the cheapest pair you can find, and you think that you've done a pretty good job because you have spent as little as possible. Problem is, they don't wash well, they don't wear well, and the hems fall about 5 seconds after you put them on. So in about 2 months you not only look unprofessional, but you need another pair of pants. So you start the cycle over again. In retrospect, however, you should have bit the bullet the first time, spent a little extra and bought a good quality pair. After all of the replacement pairs you would need to buy (not including any tailoring you did along the way), you likely spent more in the long run going the "cheap" route.
Moral of the story: Being money saavy is not always about spending the least, it's about making wise decisions with your money. For items that you expect to need for an extended period of time, or use on a fairly regular basis (staple clothing items, everyday electronics, appliances, etc.) remember that cheaper is not always better. Take the timet o research your purchases, buy good quality items and you will likely be happier (and in some cases spend less) in the long run.
Stats-
Credit cards to pay - 3
"Extra" earned -$100
Let's use an example:
You need a pair of dress pants for work. You think to yourself "I don't want to be spending my money on pants I have debt to pay!!" But you know you need them. You go to the store, and buy the cheapest pair you can find, and you think that you've done a pretty good job because you have spent as little as possible. Problem is, they don't wash well, they don't wear well, and the hems fall about 5 seconds after you put them on. So in about 2 months you not only look unprofessional, but you need another pair of pants. So you start the cycle over again. In retrospect, however, you should have bit the bullet the first time, spent a little extra and bought a good quality pair. After all of the replacement pairs you would need to buy (not including any tailoring you did along the way), you likely spent more in the long run going the "cheap" route.
Moral of the story: Being money saavy is not always about spending the least, it's about making wise decisions with your money. For items that you expect to need for an extended period of time, or use on a fairly regular basis (staple clothing items, everyday electronics, appliances, etc.) remember that cheaper is not always better. Take the timet o research your purchases, buy good quality items and you will likely be happier (and in some cases spend less) in the long run.
Stats-
Credit cards to pay - 3
"Extra" earned -$100
Tuesday, September 23, 2008
That one was easy…
So, I have already accumulated my $100 for October (Yeah me!!). Turns out I was not maximizing my usage on my cell phone plan (which provides me with unlimited minutes anytime, anywhere in the city). So, I scaled down and managed to transfer/sell my plan to a friend whose family owns a business for $300. Plus, since I was also changing providers I received a $25 credit on my bill, a new phone, car charger, and activation fee for FREE! On top of all that my phone bill should be about $30 less per month. $360 in annual savings!
Yes, I know the value was $300, but as I indicated in other posts, I would consider this a windfall as it was not really planned. I took $100 for my debts, $100 for my meager emergency fund, and the final $100 is currently in limbo until my final bill with provider #1 and my first bill with provider #2 is settled. Everyone knows they always try to get you until the very end, so I have money sitting there to cover those expenses. If I don't use the $100 I'll reassess again.
At least it gives me a headstart to be thinking about November's scheme.
Stats -
Credit Cards to pay - 3
Money earned this month - $100
Yes, I know the value was $300, but as I indicated in other posts, I would consider this a windfall as it was not really planned. I took $100 for my debts, $100 for my meager emergency fund, and the final $100 is currently in limbo until my final bill with provider #1 and my first bill with provider #2 is settled. Everyone knows they always try to get you until the very end, so I have money sitting there to cover those expenses. If I don't use the $100 I'll reassess again.
At least it gives me a headstart to be thinking about November's scheme.
Stats -
Credit Cards to pay - 3
Money earned this month - $100
Monday, September 22, 2008
Taking the Home out of Home Business…
So I received a comment relating to the “My Husband, My “Client”” concept. One of my good friends was indicating that one of the biggest debt problems was my husband disconnection between his expenses and income. My hubby works from home earning commission income and has a great deal of associated expenses (and over half of our combined debt on his “business” credit card, I might add). He does his job how he sees fit, and I handle all of the bills and finances.
My friend then indicated that I need to segregate his business from our household finances. She suggested doing this by providing a “salary” to the household from his commission income and the residual income would go to pay his operating expenses. His salary would be dependent on how much of his income is actually required to cover these expenses (ie. 45%) Based on this method she said it would help with the following:
a.) Determining if we are overspending on our household expenses. By removing his business debt and related operating payments to a separate accounting system (read: budget) I can determine if our household is actually balanced and operating properly. If not, cuts will need to be made here.
b.) Determining if the business is overspending by determining if the allotted % is actually covering his expenses and whether we have an overage or shortfall here. Budget may also need to be made.
c.) Requiring my husband to take more responsibility for the expenditures in his business. For this system to work he will need to know if he can make purchases, instead of just doing it and having me deal with the consequences by shuffling around his income and our household spending.
A huge lightbulb went on at this point. Why didn’t I think of this before!! It’s really a simple concept, but for some reason I just never got it.
Considering both the household and business are starting out in a negative position, I think it will logically take 6 months to a year to have each completely self-sustaining, but I am going to give it a go. Unfortunately, I will not be able to implement until October as I have already missed September.
I asked my friend how she got so smart. She responded, “It’s what Gail would have told you to do!” She’s probably right.
Stats -
Credit Cards to Pay off - 3
"Extra" this month (October) - $0 - I will think of something though.
My friend then indicated that I need to segregate his business from our household finances. She suggested doing this by providing a “salary” to the household from his commission income and the residual income would go to pay his operating expenses. His salary would be dependent on how much of his income is actually required to cover these expenses (ie. 45%) Based on this method she said it would help with the following:
a.) Determining if we are overspending on our household expenses. By removing his business debt and related operating payments to a separate accounting system (read: budget) I can determine if our household is actually balanced and operating properly. If not, cuts will need to be made here.
b.) Determining if the business is overspending by determining if the allotted % is actually covering his expenses and whether we have an overage or shortfall here. Budget may also need to be made.
c.) Requiring my husband to take more responsibility for the expenditures in his business. For this system to work he will need to know if he can make purchases, instead of just doing it and having me deal with the consequences by shuffling around his income and our household spending.
A huge lightbulb went on at this point. Why didn’t I think of this before!! It’s really a simple concept, but for some reason I just never got it.
Considering both the household and business are starting out in a negative position, I think it will logically take 6 months to a year to have each completely self-sustaining, but I am going to give it a go. Unfortunately, I will not be able to implement until October as I have already missed September.
I asked my friend how she got so smart. She responded, “It’s what Gail would have told you to do!” She’s probably right.
Stats -
Credit Cards to Pay off - 3
"Extra" this month (October) - $0 - I will think of something though.
Friday, September 19, 2008
The windfall trifecta...
So have you ever been fortunate enough to go to your mailbox and have an unannounced cheque show up! Cha-ching - you may be thinking, but what do you do with money that you were not expecting? It could be a rebate from your insurance company, a gift from Auntie Erna, or whatever, but sometimes luck changes and you get a little break (or a big break). How to deal with the money is what I call "The Windfall Trifecta." This is a way to keep you happy without just blowing the money. Basically allocate all windfalls (no matter the size) into 3 components.
a.) Debt - If you have debt you should put some money on there. Unless you are in dire straits putting the whole windfall is likely unsatisfying as you will feel like it never really happened. Especially for gift money. However, we must remember to give our debt monkey a little extra and loosen up our debt load a bit.
b.) Savings - Debt or no debt, save some of that money. Even if only $5 put that little gold nugget into a high interest savings account for a rainy day. It may not seem like much, but a few $5 allocations with a decent interest rate could amount to an emergency car repair very quickly. Plus, think how nice it will feel not to charge something unexpected.
If you have no debt, you can either double up the savings component or split between savings accounts (ie. emergency fund and your vacation fund)
c.) Spend it!! - Yeah, you heard me. Even a cup of Starbucks can really make your day if you have been diligent with your debt repayment plan. Besides, you only live once and if you put every cent away you'll never enjoy yourself. Grant yourself a little pleasure and it will take you much further and recharge your batteries for the uphill debt fight.
Note: Just because there are three categories does not mean that you need to split the money 3 ways. If you are drowning in your debt, it may be worth it put 75% or more on your debt, with a much lower amount allocated to savings and spending. A good key concept for windfall success - the spending amount should never be higher than any of the other two categories.
If your windfall is particularly big, remember to take the time to assess what you really need/want in the spending category. When you are dealing with bigger bucks, making wiser decisions will relieve some future cash strain while still feeling satisfying.
Cards to pay off - 3
Extra earned this month - $100 - Yep I did it, and with hardly a day to spare!!! The remaining $31 dollars came from a combination of my change jar, money in purses/wallets I hadn't used for a while (a whopping $17.43), and I returned an item that I had charged on my credit card (item was actually $21, but I figured that one was a stretch so I will only take credit for the remaining amount needed for September).
Note: Getting my mitts on $100 was really hard. I will definitely have to get creative in the next few months.
a.) Debt - If you have debt you should put some money on there. Unless you are in dire straits putting the whole windfall is likely unsatisfying as you will feel like it never really happened. Especially for gift money. However, we must remember to give our debt monkey a little extra and loosen up our debt load a bit.
b.) Savings - Debt or no debt, save some of that money. Even if only $5 put that little gold nugget into a high interest savings account for a rainy day. It may not seem like much, but a few $5 allocations with a decent interest rate could amount to an emergency car repair very quickly. Plus, think how nice it will feel not to charge something unexpected.
If you have no debt, you can either double up the savings component or split between savings accounts (ie. emergency fund and your vacation fund)
c.) Spend it!! - Yeah, you heard me. Even a cup of Starbucks can really make your day if you have been diligent with your debt repayment plan. Besides, you only live once and if you put every cent away you'll never enjoy yourself. Grant yourself a little pleasure and it will take you much further and recharge your batteries for the uphill debt fight.
Note: Just because there are three categories does not mean that you need to split the money 3 ways. If you are drowning in your debt, it may be worth it put 75% or more on your debt, with a much lower amount allocated to savings and spending. A good key concept for windfall success - the spending amount should never be higher than any of the other two categories.
If your windfall is particularly big, remember to take the time to assess what you really need/want in the spending category. When you are dealing with bigger bucks, making wiser decisions will relieve some future cash strain while still feeling satisfying.
Cards to pay off - 3
Extra earned this month - $100 - Yep I did it, and with hardly a day to spare!!! The remaining $31 dollars came from a combination of my change jar, money in purses/wallets I hadn't used for a while (a whopping $17.43), and I returned an item that I had charged on my credit card (item was actually $21, but I figured that one was a stretch so I will only take credit for the remaining amount needed for September).
Note: Getting my mitts on $100 was really hard. I will definitely have to get creative in the next few months.
Thursday, September 18, 2008
Be true to yourself...
So as you can see I have added a "Debt Destruction Chart" above my posts. This chart will detail how well, (or how pathetically), I am paying off my debt. It's one thing to see it as a number, it is another to see how ridiculously far you are from reaching your goals. I kinda like it. I might actually diversify it into all my different credit cards.
I love widgets!
I plan to update at the end of every month after statements are in, unless of course of a windfall.
On that note, see "The Windfall Trifecta" post tomorrow.
Stats-
Total Debt - Look at the chart!
Credit cards to pay off - 3
Earned this month - same as before
I love widgets!
I plan to update at the end of every month after statements are in, unless of course of a windfall.
On that note, see "The Windfall Trifecta" post tomorrow.
Stats-
Total Debt - Look at the chart!
Credit cards to pay off - 3
Earned this month - same as before
Wednesday, September 17, 2008
They like me, they really like me...
You heard it here first folks, I have actually been "crawled" by Google. WOOOOOHOOOOOO!! Do you know what this means?
a.) I will not actually be talking to myself anymore. Don't get me wrong this is very therapeutic and helps keep my "eye on the ball" so to speak, but it is nice to know someone may actually be listening. Plus, if I manage to help out one person, even just to make them feel better about themselves in comparison to me, life is good.
b.) Comments!!! I can handle brutal truth, but no meanies please. Besides if I have to earn/find $3,500 more dollars over the next 35 months I am going to need all of the creative genius I can find. I am pretty good at thinking on my feet, but 35 months will be excruciating.
Stats - same as yesterday - but I am really cutting it close to my $100 goal. Guess I will be checking the couch cushions tonight.
a.) I will not actually be talking to myself anymore. Don't get me wrong this is very therapeutic and helps keep my "eye on the ball" so to speak, but it is nice to know someone may actually be listening. Plus, if I manage to help out one person, even just to make them feel better about themselves in comparison to me, life is good.
b.) Comments!!! I can handle brutal truth, but no meanies please. Besides if I have to earn/find $3,500 more dollars over the next 35 months I am going to need all of the creative genius I can find. I am pretty good at thinking on my feet, but 35 months will be excruciating.
Stats - same as yesterday - but I am really cutting it close to my $100 goal. Guess I will be checking the couch cushions tonight.
Tuesday, September 16, 2008
The eBay way...
So it’s judgment day for eBay and I’ve earned a whopping $59.47. Not exactly as much as I had planned.
There are, however, a few things I have learned from my eBay experiment:
Shipping Charges – Make sure you get your shipping charges right. Nothing cuts into your profits more than charging $5 for shipping and actually having to pay $15 for an item you sold for $2. GRRRRRRRR!!!!
Wait for a Sale – eBay offers sales from time to time so if you are not in a hurry, get your photos ready and write out your descriptions in word, then when 5 cent listing day arrives you can go nuts for a whole lot cheaper.
Second Chance Offers – If you happen to have duplicate items to sell, take advantage of the second chance offer. You might be able to sell two for the effort it took to sell one. This enables a lower bidder to buy the item from you for the price they bid, even if they didn’t win the original auction.
Beware the Lowball – If you lowball your prices to start a bidding frenzy, BEWARE. Too many times I have put a lowball price on an item that wasn’t being bid on, then BOOM!!! seconds before the auction closes someone swoops in and makes the minimum bid, which is less than I really wanted for the item. Now I’m stuck for the low price. I don’t like reserve bids as it makes bidders upset, but make sure you are willing to take what you have listed.
Not Everything is Saleable – Whoever said one person’s junk is another person’s treasure forgot to mention that sometimes one person’s junk is just junk. I put a lot of time and effort this month (not to mention insertion fees) into items that just will not sell.
Overall, I thought the eBay experiment went alright. I made some money and I learned some lessons, but all in all it was relatively easy to do once I got the hang of it. I think I will keep my eye out for other items to unload, but I don’t think this will be a significant source of income for the rest of this project. However, a dollar is a dollar – especially when that dollar has a 19.5% interest rate attached to it.
Debt balance – same as last time
Credit cards to pay off – 3
“Extra Money” this month - $69.47
There are, however, a few things I have learned from my eBay experiment:
Shipping Charges – Make sure you get your shipping charges right. Nothing cuts into your profits more than charging $5 for shipping and actually having to pay $15 for an item you sold for $2. GRRRRRRRR!!!!
Wait for a Sale – eBay offers sales from time to time so if you are not in a hurry, get your photos ready and write out your descriptions in word, then when 5 cent listing day arrives you can go nuts for a whole lot cheaper.
Second Chance Offers – If you happen to have duplicate items to sell, take advantage of the second chance offer. You might be able to sell two for the effort it took to sell one. This enables a lower bidder to buy the item from you for the price they bid, even if they didn’t win the original auction.
Beware the Lowball – If you lowball your prices to start a bidding frenzy, BEWARE. Too many times I have put a lowball price on an item that wasn’t being bid on, then BOOM!!! seconds before the auction closes someone swoops in and makes the minimum bid, which is less than I really wanted for the item. Now I’m stuck for the low price. I don’t like reserve bids as it makes bidders upset, but make sure you are willing to take what you have listed.
Not Everything is Saleable – Whoever said one person’s junk is another person’s treasure forgot to mention that sometimes one person’s junk is just junk. I put a lot of time and effort this month (not to mention insertion fees) into items that just will not sell.
Overall, I thought the eBay experiment went alright. I made some money and I learned some lessons, but all in all it was relatively easy to do once I got the hang of it. I think I will keep my eye out for other items to unload, but I don’t think this will be a significant source of income for the rest of this project. However, a dollar is a dollar – especially when that dollar has a 19.5% interest rate attached to it.
Debt balance – same as last time
Credit cards to pay off – 3
“Extra Money” this month - $69.47
Monday, September 15, 2008
My Husband, My "Client"...
After doing some research on debt and relationships I have come the conclusion that I need to treat my husband like a “client.” As I mentioned in a previous post, the reality of our debt never quite sank in for my darling hubby until he saw the results on paper (not unlike many others out there). However, I know if I want this to pay off to work, he needs to be working with me and be fully disclosed as to the entire extent of the damage. So here is the plan:
At the end of every month I will provide my husband with a package. Kinda like a Board of Director’s treasury report. It will detail the following:
a.) What our debt picture looks like. This includes interest rates and balances.
b.) What our debt is costing us. This is the details on the interest we have been charged in the month, and the payments we have made.
c.) A variance analysis on our budget. Where we were over and under for the month.
I think the action of actually putting these things on paper will be very useful. It will help me get a better handle on our debt. Plus, it will let him know that this is serious business, with the details on paper to back it up.
Furthermore, I know that it is partially my fault that I probably do not communicate as effectively as I could about our debt issues. This could be a step in the right direction.
Stats – same as before, but my auctions close tonight.
At the end of every month I will provide my husband with a package. Kinda like a Board of Director’s treasury report. It will detail the following:
a.) What our debt picture looks like. This includes interest rates and balances.
b.) What our debt is costing us. This is the details on the interest we have been charged in the month, and the payments we have made.
c.) A variance analysis on our budget. Where we were over and under for the month.
I think the action of actually putting these things on paper will be very useful. It will help me get a better handle on our debt. Plus, it will let him know that this is serious business, with the details on paper to back it up.
Furthermore, I know that it is partially my fault that I probably do not communicate as effectively as I could about our debt issues. This could be a step in the right direction.
Stats – same as before, but my auctions close tonight.
Sunday, September 14, 2008
"Budget Wins"...
As I mentioned yesterday there are a few ways I know to increase your "Budget Wins" in your gift budget:
Shop off season: Since you will have an influx of "gift money" year round you can start buying before your events and holidays come up. For instance a great end of season sale in March could have some great discounts on sweaters, outerwear, sports equipment (hockey, snowboarding), or other fun gifts such as sleds. These items will likely cost you more in November/December, but your dollar will go much further when they are on sale earlier in the year. Note: Watch out for buying items that are too "trendy." They may be out of style by the time they are given thus making them undesirable.
Buy in bulk: Many stores (especially for children's clothing) offer discounts if you buy 2 or more of the same/similar items. When buying a gift, think ahead to who else you may need to shop for in the future. Could you pick up a great hoodie for a discount now, instead of overspending later on in the year and receive a discount.
Be creative: If you know events are coming up you can use your own talents to reduce the cost of gifts and increase your "wins." Knowing that a friend would be having a baby in 6 months I used some of the yarn I had lying around (from other discarded projects) and made a beautiful baby blanket. Coupled with a $7 plush toy, the gift was well received and I was $23 underbudget. Use whatever talents you have to come up with great gifts (services are always welcome) and save money.
Get to the point(s): Remember all of those points cards/frequent shopper cards you have filling up your wallet, check those balances. Many point programs can be used to buy merchandise or gift certificates that you can use to buy your gifts, without costing you a dime!! Don't worry if you don't have enough for the full amount, many programs will let you pay the difference in cash which can reduce what you would pay for an item, or get a much better gift for a much cheaper price.
These ideas should help to reduce your expenses on gifts within the year and avoid untimely events from ruining your cash flow. Take the extra money and put it on your debts or buy something you need. Plus, actively keeping tabs on your gift spending will make it easier to be more organized. Afterall, I am 75% done my Christmas shopping already.
Stats - no change - but my eBay auctions are up tomorrow -wish me luck!!!
Coming up tomorrow: My Husband, My "Client"
Shop off season: Since you will have an influx of "gift money" year round you can start buying before your events and holidays come up. For instance a great end of season sale in March could have some great discounts on sweaters, outerwear, sports equipment (hockey, snowboarding), or other fun gifts such as sleds. These items will likely cost you more in November/December, but your dollar will go much further when they are on sale earlier in the year. Note: Watch out for buying items that are too "trendy." They may be out of style by the time they are given thus making them undesirable.
Buy in bulk: Many stores (especially for children's clothing) offer discounts if you buy 2 or more of the same/similar items. When buying a gift, think ahead to who else you may need to shop for in the future. Could you pick up a great hoodie for a discount now, instead of overspending later on in the year and receive a discount.
Be creative: If you know events are coming up you can use your own talents to reduce the cost of gifts and increase your "wins." Knowing that a friend would be having a baby in 6 months I used some of the yarn I had lying around (from other discarded projects) and made a beautiful baby blanket. Coupled with a $7 plush toy, the gift was well received and I was $23 underbudget. Use whatever talents you have to come up with great gifts (services are always welcome) and save money.
Get to the point(s): Remember all of those points cards/frequent shopper cards you have filling up your wallet, check those balances. Many point programs can be used to buy merchandise or gift certificates that you can use to buy your gifts, without costing you a dime!! Don't worry if you don't have enough for the full amount, many programs will let you pay the difference in cash which can reduce what you would pay for an item, or get a much better gift for a much cheaper price.
These ideas should help to reduce your expenses on gifts within the year and avoid untimely events from ruining your cash flow. Take the extra money and put it on your debts or buy something you need. Plus, actively keeping tabs on your gift spending will make it easier to be more organized. Afterall, I am 75% done my Christmas shopping already.
Stats - no change - but my eBay auctions are up tomorrow -wish me luck!!!
Coming up tomorrow: My Husband, My "Client"
Saturday, September 13, 2008
The gift budget...
I love to give presents, thus no surprise I LOVE Christmas!!! My big problem with Christmas is that I spend far too much money, charge it because I don't have the cash, and am always in a huge rush to get my shopping done so sometimes gifts are not as thoughtful as they could be.
To combat my Christmas issue (and other gift giving times of year) I implemented the "gift budget" this year. To make the gift budget, I used Excel but you could take any sheet of paper (old napkin, whatever). Write down who you need to buy for this year including birthdays, christmas gifts etc. Don't forget your own kids, spouse or parents. Put an amount that you think is reasonable to spend for each person. Add a buffer for weddings, housewarmings, babies, and bridal showers that just spring up (I budget 3 of each) or ones you already know about in the year. Add up the amount you intend to spend in the year, divide by 12 and include this amount in your household budget for the year. If it doesn't fit in your budget you need to pare down on your gift buying intentions.
How the system works:
Having the money when you need it: You will actually be saving for the holidays and other events before they happen. No charging.
Being cognizant of your spending and on what: Having the budget has helped with not only decreasing what I spend on gifts, but I have actually had more thoughtful gifts because I know I have the money to buy them whenever I see something I like (and I think about it every month), as opposed to rushing out the day of and buying the first thing I can find (regardless of cost).
"Budget Wins": In some cases (more and more frequently as you get into the idea), you will be able to come in under budget for items on your gift list. I call them "Budget Wins." You have a few choices in this matter. a.) Do nothing and keep the extra money in the account for overages (see below); b.) reduce your payment next month by the amount of the win freeing up some cash flow; c.) reduce your payment in December. This one is really nice, since if you keep "winning" in your little budget game you may not have to make a payment at all in December making the holidays much easier. See tomorrows post for easy ways to make "wins" in your gift budget.
Overages: Sometimes $20 is just not enough to get that china cat you know that Grandma will love, this is where your decision making comes in. You can either a.) use up your existing "budget wins" if you have decided to not adjust your payments or pay the difference from your own spending money. This may make you think twice about the gift.
Getting Better: Make sure you note on your budget what you actually spent on a gift to identify wins and overages. In the following year you can tweak your gift budget to be more accurate.
Miscellaneous Items: I mentioned slotting in money for random (or planned) weddings, babies, etc. If some of these events don't seem to be occurring, (ie. it's mid October with no pending babies on the horizon, reduce your payments in upcoming months (or December) to offset the lack of need.
Stats - no change
To combat my Christmas issue (and other gift giving times of year) I implemented the "gift budget" this year. To make the gift budget, I used Excel but you could take any sheet of paper (old napkin, whatever). Write down who you need to buy for this year including birthdays, christmas gifts etc. Don't forget your own kids, spouse or parents. Put an amount that you think is reasonable to spend for each person. Add a buffer for weddings, housewarmings, babies, and bridal showers that just spring up (I budget 3 of each) or ones you already know about in the year. Add up the amount you intend to spend in the year, divide by 12 and include this amount in your household budget for the year. If it doesn't fit in your budget you need to pare down on your gift buying intentions.
How the system works:
Having the money when you need it: You will actually be saving for the holidays and other events before they happen. No charging.
Being cognizant of your spending and on what: Having the budget has helped with not only decreasing what I spend on gifts, but I have actually had more thoughtful gifts because I know I have the money to buy them whenever I see something I like (and I think about it every month), as opposed to rushing out the day of and buying the first thing I can find (regardless of cost).
"Budget Wins": In some cases (more and more frequently as you get into the idea), you will be able to come in under budget for items on your gift list. I call them "Budget Wins." You have a few choices in this matter. a.) Do nothing and keep the extra money in the account for overages (see below); b.) reduce your payment next month by the amount of the win freeing up some cash flow; c.) reduce your payment in December. This one is really nice, since if you keep "winning" in your little budget game you may not have to make a payment at all in December making the holidays much easier. See tomorrows post for easy ways to make "wins" in your gift budget.
Overages: Sometimes $20 is just not enough to get that china cat you know that Grandma will love, this is where your decision making comes in. You can either a.) use up your existing "budget wins" if you have decided to not adjust your payments or pay the difference from your own spending money. This may make you think twice about the gift.
Getting Better: Make sure you note on your budget what you actually spent on a gift to identify wins and overages. In the following year you can tweak your gift budget to be more accurate.
Miscellaneous Items: I mentioned slotting in money for random (or planned) weddings, babies, etc. If some of these events don't seem to be occurring, (ie. it's mid October with no pending babies on the horizon, reduce your payments in upcoming months (or December) to offset the lack of need.
Stats - no change
Friday, September 12, 2008
My first mistake....
So this whole debt repayment plan was not just come up with in August, I've actually been trying to make positive changes since the beginning of the year. August was really just my day of reckoning with the full extent of the damage.
Although I have been in and out debt over the years, I finally figured out one of main reasons for this- I'm working TOO HARD to pay off my debt. That's right, I've been too diligent! My major issue is that I have been putting every penny onto my debt, but forgetting that by paying off my debt with all of my extra funds I didn't have any left over for those extras and suprises.
So therefore I have now started a planned payment plan. I make sure that I put enough away for the major expenses every month so that by the time the actual payment comes around I will have the cash to pay for it. I think I might actually be able to pay for my house and car insurance without charging it.
Therefore, my new plan is to increase my debt (to be paid off in 3 years as indicated before) and try to make extra money instead of diverting the every dollar into debt payment. It may take a little longer, but hopefully it'll break the cycle once and for all.
Stats - No changes from last time.
Although I have been in and out debt over the years, I finally figured out one of main reasons for this- I'm working TOO HARD to pay off my debt. That's right, I've been too diligent! My major issue is that I have been putting every penny onto my debt, but forgetting that by paying off my debt with all of my extra funds I didn't have any left over for those extras and suprises.
So therefore I have now started a planned payment plan. I make sure that I put enough away for the major expenses every month so that by the time the actual payment comes around I will have the cash to pay for it. I think I might actually be able to pay for my house and car insurance without charging it.
Therefore, my new plan is to increase my debt (to be paid off in 3 years as indicated before) and try to make extra money instead of diverting the every dollar into debt payment. It may take a little longer, but hopefully it'll break the cycle once and for all.
Stats - No changes from last time.
Thursday, September 11, 2008
Pieces of the "just desserts" pie...
I thought a good exercise would be to determine what exactly I have spent my money on the past while, and what exactly is still outstanding on my debts. So I took each of my credit cards and downloaded all the transactions posted to my accounts since the balance was last at zero (for 2 out of 3 cards – one didn’t go back that far L)
Next I put all of interest charges at the top of the list (cause you aren’t really paying for items unless you have already paid for the convenience of buying them. I then worked my way down the list marking off any charges that have already been “paid” based on my payment history on the account.
Good News: In all cases I had “paid off” all of the interest on my accounts. This means I am actually making a dent in the principal of my purchases.
Bad News: I am still paying off purchases from last year on one card, two years ago on another and 3.5 years ago on the third!!! Ouch.
This is a pretty good slap in the face. I recommend it to anyone, but make sure you are alone when you do this (might not want your co-workers to see you cry!)
If anyone else wants to own up to their spending history demons, please leave a comment below. Afterall, misery loves company.
Debt balance – same as last time
Credit cards to pay off – 3
“Extra Money” this month - $10 – eBay sales will be up shortly – looking “okay” right now
Next I put all of interest charges at the top of the list (cause you aren’t really paying for items unless you have already paid for the convenience of buying them. I then worked my way down the list marking off any charges that have already been “paid” based on my payment history on the account.
Good News: In all cases I had “paid off” all of the interest on my accounts. This means I am actually making a dent in the principal of my purchases.
Bad News: I am still paying off purchases from last year on one card, two years ago on another and 3.5 years ago on the third!!! Ouch.
This is a pretty good slap in the face. I recommend it to anyone, but make sure you are alone when you do this (might not want your co-workers to see you cry!)
If anyone else wants to own up to their spending history demons, please leave a comment below. Afterall, misery loves company.
Debt balance – same as last time
Credit cards to pay off – 3
“Extra Money” this month - $10 – eBay sales will be up shortly – looking “okay” right now
Wednesday, September 10, 2008
No man is an island...
So apparently I will have one more obstacle on the way to Debt Freedom. Task #4 – Educate the Husband
I was greeted the other day with a bellowed “What the HELL is this?” coming from our home office. Apparently, my beloved hubby had found the “Own Up to Your Debt” worksheet and was even more oblivious than I concerning our current situation. I had thought I had been communicating our situation to him, but things have gotten a little lost in the translation.
His first suggestion – Consolidation Loan. No way! I know this will likely bring down our interest rate, but this will bring the lifetime total to 3 loans. We have always paid the loans off, but we always end up back in the same situation as before. We need to learn our lesson this time. Plus combined with being too chicken to confront our banker with yet another pile of debts, I’ve ruled it out (until the pile is a little more manageable at least!)
The hubby is always about the quick fix. My new goal is therefore to keep him apprised of our current position and making sure that he is working in the same direction to getting these debt monkeys gone. First, I have to fight his compulsion to sell everything we own and live in a box to pay off the balances. Moderation – my young grasshopper – moderation!
By the way, he has helped me by giving me all of the old beer bottles and cans in the garage to return. Only got $10.40 (0.40 in the change jar for another month), but hey I’ll take it.
Debt balance – same as last time
Credit cards to pay off – 3
“Extra Money” this month - $10 – still waiting on that eBay money ship (some of my auctions are looking good – some not so good)
I was greeted the other day with a bellowed “What the HELL is this?” coming from our home office. Apparently, my beloved hubby had found the “Own Up to Your Debt” worksheet and was even more oblivious than I concerning our current situation. I had thought I had been communicating our situation to him, but things have gotten a little lost in the translation.
His first suggestion – Consolidation Loan. No way! I know this will likely bring down our interest rate, but this will bring the lifetime total to 3 loans. We have always paid the loans off, but we always end up back in the same situation as before. We need to learn our lesson this time. Plus combined with being too chicken to confront our banker with yet another pile of debts, I’ve ruled it out (until the pile is a little more manageable at least!)
The hubby is always about the quick fix. My new goal is therefore to keep him apprised of our current position and making sure that he is working in the same direction to getting these debt monkeys gone. First, I have to fight his compulsion to sell everything we own and live in a box to pay off the balances. Moderation – my young grasshopper – moderation!
By the way, he has helped me by giving me all of the old beer bottles and cans in the garage to return. Only got $10.40 (0.40 in the change jar for another month), but hey I’ll take it.
Debt balance – same as last time
Credit cards to pay off – 3
“Extra Money” this month - $10 – still waiting on that eBay money ship (some of my auctions are looking good – some not so good)
Tuesday, September 9, 2008
When in doubt - eBay...
So I figured that for the first month of my EARN $100 plan I would try the tried and true method of eBay. Apparently the average household has $1,200 worth of merchandise just sitting there waiting to be sold. So I listed everything I could find. After the fees, I listed a value of $71.17 that could go towards my debt (provided everything sells at my minimum price!) A little short of the goal so I will go back to the closet and see if I can rake up another $28.83 of saleable goods. Who knew this would be so difficult!!! Obviously, this does not have any sustainable potential so while I am digging through my closet I will be trying to find a new idea for next month.
Debt balance – same as last time
Credit cards to pay off – 3
“Extra Money” this month - $0 – but I have my fingers crossed
Debt balance – same as last time
Credit cards to pay off – 3
“Extra Money” this month - $0 – but I have my fingers crossed
Monday, September 8, 2008
The beginning of the end...
Okay, so I guess this all came about on August 20, 2008 when I decided to face up to my debt issues by using a handy dandy template on the www.gailvazoxlade.com website called "Own up to your debt." If you don't know who Gail is, she is a godsend for anyone with any financial issues. Practical, and super nice (I met her once)
Anyhow, I digress... So I punch in my numbers into the spreadsheet and my jaw almost hit the floor. I always had a good idea of where my debt was, in pieces, but never as a whole pie. In this case my "just desserts" for an obsessive shoe buying fetish.
So are you ready for this my credit card debt totalled a whopping $81,110.01. This is not including my mortage! On top of that one of my cards had changed their interest rate to 2.5% points higher then when I signed up and I never noticed. I felt sick. So I decided it's crackdown time.
As I indicated above they always say, if you are going to commit to something tell someone. I've decided to tell everyone.
So based on the worksheet I indicated above, there are calculations based on principal and interest rate to figure out what the monthly payment would be to pay off each and total debt within 12, 24 and 36 months. I am opting for the 36 month route as the 12 month route is a little steep. This still results in $3062.61 per month. I've slashed bills in my budget to make up this monthly amount, but this is not quite fast enough for me so I have instituting the following plan:
1. MAKE PAYMENTS: Make my monthly payments as per a 36 month payoff period. This will be a challenge as my hubby is a commission based earner so income is not always steady, and the payoff amount is about 2.5 times what I was already paying per month.
2. LEARN TO COOK: Pathetic as it is I know at least a 1/4 (probably more of this amount) is from my obsession with convenience food. After a hard day of work, you just don't want to make anything. Apparently this needs to stop.
3. EARN/FIND $100 MORE PER MONTH: This is the tough one. As I said 36 months is too long for me. Ideally I would like to pass a financial fitness test before my kid is in kindergarten (which only leaves me with about 2.5 years). So what other option is there. Earn more money. Unfortunately, my job is not exactly 9-5 and finding some extra scratch will be a little more difficult when a traditional part time job is out of the question. So I look at it this way, here is my chance to try out a few new things and see what I can make work for me. 36 months of opportunities to see what it takes to make just that little bit extra. I have a few tricks up my sleeve right now, but feel free to provide some insight. $100 may not seem like much, but if you have to do it every month for the next 3 years I am sure I will need some creative assistance. Payments must be in the hot little hands of VISA by the 20th of each month, as statements (and that unforgettable interest will be calculated on the 22nd. Here goes nothing...
Opening Tally:
Debt - $81,100.01
Credit Cards with Balances - 3
"Extra Money" earned this month - $
Days till next statement - 15
Wish me luck!!
Anyhow, I digress... So I punch in my numbers into the spreadsheet and my jaw almost hit the floor. I always had a good idea of where my debt was, in pieces, but never as a whole pie. In this case my "just desserts" for an obsessive shoe buying fetish.
So are you ready for this my credit card debt totalled a whopping $81,110.01. This is not including my mortage! On top of that one of my cards had changed their interest rate to 2.5% points higher then when I signed up and I never noticed. I felt sick. So I decided it's crackdown time.
As I indicated above they always say, if you are going to commit to something tell someone. I've decided to tell everyone.
So based on the worksheet I indicated above, there are calculations based on principal and interest rate to figure out what the monthly payment would be to pay off each and total debt within 12, 24 and 36 months. I am opting for the 36 month route as the 12 month route is a little steep. This still results in $3062.61 per month. I've slashed bills in my budget to make up this monthly amount, but this is not quite fast enough for me so I have instituting the following plan:
1. MAKE PAYMENTS: Make my monthly payments as per a 36 month payoff period. This will be a challenge as my hubby is a commission based earner so income is not always steady, and the payoff amount is about 2.5 times what I was already paying per month.
2. LEARN TO COOK: Pathetic as it is I know at least a 1/4 (probably more of this amount) is from my obsession with convenience food. After a hard day of work, you just don't want to make anything. Apparently this needs to stop.
3. EARN/FIND $100 MORE PER MONTH: This is the tough one. As I said 36 months is too long for me. Ideally I would like to pass a financial fitness test before my kid is in kindergarten (which only leaves me with about 2.5 years). So what other option is there. Earn more money. Unfortunately, my job is not exactly 9-5 and finding some extra scratch will be a little more difficult when a traditional part time job is out of the question. So I look at it this way, here is my chance to try out a few new things and see what I can make work for me. 36 months of opportunities to see what it takes to make just that little bit extra. I have a few tricks up my sleeve right now, but feel free to provide some insight. $100 may not seem like much, but if you have to do it every month for the next 3 years I am sure I will need some creative assistance. Payments must be in the hot little hands of VISA by the 20th of each month, as statements (and that unforgettable interest will be calculated on the 22nd. Here goes nothing...
Opening Tally:
Debt - $81,100.01
Credit Cards with Balances - 3
"Extra Money" earned this month - $
Days till next statement - 15
Wish me luck!!
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