As you can see I updated my debt amounts the other day on my sidebar. I'd be interested to know the noise you all made when you actually read the total. Six digits worth of debt, makes my skin crawl.
You must keep in mind that some of this is from fees and such to get the equity loan, but my mistakes nonetheless.
A few little things to note:
Things are going to get worse!: Credit cards B-D have all had partial payments from the equity loan, so for 3/4 of the month they had a balance in the 10's of thousands at a disgusting rate over 19%. So therefore, the when the interest charge hits at the end of the month it will be big and ugly, coming close to doubling some of the balances. It's okay, I know this is coming.
Charging the Opportunity Cost: The equity portion is not just current mortgage less balance before the loan (well it is right now, but it will not be in the future). To make sure that the balance is the most accurate, I have maintained an amortization chart of my old mortgage, so the amount owing will be the current mortgage value less what my old mortgage value WOULD HAVE been on that date. I figured that if I didn't take into account where I should have been under normal mortgage payments had my financial life not gone to hell, then I would be attributing money I pay on my mortgage to debt reprayment and basically over accounting my actual progress. This is a process, I will not get thorough it quickly or easily, I have come to terms with that.
But there it is; the writing on my blog wall. Things are going to go better this time around. They have to.
Showing posts with label debt repayment plan. Show all posts
Showing posts with label debt repayment plan. Show all posts
Sunday, May 17, 2009
Tuesday, January 20, 2009
What Was I Thinking...
Okay, so I read over my last post and realized that everything I said on Friday was BS, and frankly, a little whiny. How the heck am I supposed to get out of debt, or remain debt free for that matter, if I can't even muster up enough willpower to pay off the bloody credit cards in the first place.
Yes, I have had issues in the past, but they will never get better if I put my head in the sand and waste hundreds playing the safe, although stupid, debt repayment game.
I deeply apologize for wasting your time reading that post.
New Game Plan:
1.) Suck it up - I'm in debt and never getting out if I don't shape up.
2.) Transfer as much debt as I can from high interest card #2 to low interest card #1. I know this is just displacing my debt, but it will reduce the amount of interest I am paying. Plus, as I will be closer to zero on my higher interest card I will pay that balance off quicker, and I will be a lot more reluctant to add charges when the balance is nil.
3.) Annhilate my high interest credit card #2 will everything I possibly can. (I think I might even undertake the mythical debt snowball.)
4.) Once paid off, revisit plan and see what my next step/strategy will be.
There, now that is a post I can be a lot more proud of!
Yes, I have had issues in the past, but they will never get better if I put my head in the sand and waste hundreds playing the safe, although stupid, debt repayment game.
I deeply apologize for wasting your time reading that post.
New Game Plan:
1.) Suck it up - I'm in debt and never getting out if I don't shape up.
2.) Transfer as much debt as I can from high interest card #2 to low interest card #1. I know this is just displacing my debt, but it will reduce the amount of interest I am paying. Plus, as I will be closer to zero on my higher interest card I will pay that balance off quicker, and I will be a lot more reluctant to add charges when the balance is nil.
3.) Annhilate my high interest credit card #2 will everything I possibly can. (I think I might even undertake the mythical debt snowball.)
4.) Once paid off, revisit plan and see what my next step/strategy will be.
There, now that is a post I can be a lot more proud of!
Friday, January 16, 2009
Smart vs. Stupid with a Purpose...
Okay, so I have an interesting dilemma. Since, I have managed to lower the interest rate on one of my credit cards it would be assumed that my repayment plan would take a bit of twist to account for the lower interest and reduced amount required to pay that balance off. Also, it would be reasonably assumed that this credit card would be shuffled to the bottom of the debt repayment deck. But due to emotional reasons, I'm really not sure....
First let recap my debt:
Credit Card #1 - My first priority. Balance started at about $20,000, and it is a card that is not normally used and has not had a charge since June of last year. A good place to start as nothing is being added, only paid off.
Credit Card #2 - Next in line. Balance started at about $20,000. Unfortunately, this is my "operating" card. I try not to charge anything, but if there are any slips or shortages in our home life this is where they end up.
Credit Card #3 - The business card. Balance started at about $40,000. This was made the last priority as any slips or shortages on the business side are charged here, and I actually don't have access to this card. As much as the hubby is reining in the spending, he's a little more prone to charging than me. (He is really trying, believe me.)
This payoff scheme was reasonable in the past as all interest rates were similar so where I started was really irrelevant. However, Credit Card #1 has just dropped rates by almost half. Obviously, the smart thing to do would be bump Credit Card #1 to the back of the line and focus on Card #2 and #3, let #1 sit charging much lower interest. I repeat this would be the SMART thing to do.
In the back of my head, however, is the problem that I always encounter, Cards #2 and #3 are never really frozen. It's kind of like that "I'll never drink again" thing that people always say, only weeks, days, or hours before they are double fisting pints of pilsner. Although we have actually come incredibly far in terms of not being dependent on credit, there is still the looming feeling that I will be trying to pay off Card #2 and #3 forever as when I finally get somewhere it'll get racked up again. At least I know that when Card #1 is annihilated, it'll stay that way as it is never really used much to begin with.
So what's a girl to do? Play it smart, with the risk that my debt repayment plans will be foiled when history repeats itself again? (I know it's pathetic, I think I'm stronger now, but I'm nervous - I think I need a 12 step plan) Or do I continue on the same journey, guaranteeing that at least $20,000 will be out the door for good, at the cost of hundreds in interest from my other cards?
I've been in this place before, and as much as I know it needs to stop, I can't help but think that I will never really see the end of my debt. So do I play it SMART or play it SAFE?
First let recap my debt:
Credit Card #1 - My first priority. Balance started at about $20,000, and it is a card that is not normally used and has not had a charge since June of last year. A good place to start as nothing is being added, only paid off.
Credit Card #2 - Next in line. Balance started at about $20,000. Unfortunately, this is my "operating" card. I try not to charge anything, but if there are any slips or shortages in our home life this is where they end up.
Credit Card #3 - The business card. Balance started at about $40,000. This was made the last priority as any slips or shortages on the business side are charged here, and I actually don't have access to this card. As much as the hubby is reining in the spending, he's a little more prone to charging than me. (He is really trying, believe me.)
This payoff scheme was reasonable in the past as all interest rates were similar so where I started was really irrelevant. However, Credit Card #1 has just dropped rates by almost half. Obviously, the smart thing to do would be bump Credit Card #1 to the back of the line and focus on Card #2 and #3, let #1 sit charging much lower interest. I repeat this would be the SMART thing to do.
In the back of my head, however, is the problem that I always encounter, Cards #2 and #3 are never really frozen. It's kind of like that "I'll never drink again" thing that people always say, only weeks, days, or hours before they are double fisting pints of pilsner. Although we have actually come incredibly far in terms of not being dependent on credit, there is still the looming feeling that I will be trying to pay off Card #2 and #3 forever as when I finally get somewhere it'll get racked up again. At least I know that when Card #1 is annihilated, it'll stay that way as it is never really used much to begin with.
So what's a girl to do? Play it smart, with the risk that my debt repayment plans will be foiled when history repeats itself again? (I know it's pathetic, I think I'm stronger now, but I'm nervous - I think I need a 12 step plan) Or do I continue on the same journey, guaranteeing that at least $20,000 will be out the door for good, at the cost of hundreds in interest from my other cards?
I've been in this place before, and as much as I know it needs to stop, I can't help but think that I will never really see the end of my debt. So do I play it SMART or play it SAFE?
Monday, December 15, 2008
Bad Blogger...
So I know I haven't been around lately, and I have some good excuses but frankly I don't think anyone really cares why I haven't been posting just that I haven't. I've been a bad blogger I know...(slap on hand)...bad.
Well now with that taken care of, last month went a little better than I would have thought. I haven't updated my ticker yet, but the net change from beginning to end of the month was negative. Yep that's right my debt actually went down last month (enter WOOOOHOOOO here).
As we had already discussed I met my $100 goal, and for the first time I get as little hope that things might turn a corner.
It's good to be back!
Well now with that taken care of, last month went a little better than I would have thought. I haven't updated my ticker yet, but the net change from beginning to end of the month was negative. Yep that's right my debt actually went down last month (enter WOOOOHOOOO here).
As we had already discussed I met my $100 goal, and for the first time I get as little hope that things might turn a corner.
It's good to be back!
Monday, November 3, 2008
Making Sense of My Mess...
So as I posted on Friday I was blindsighted by the movement (increase) of my debt. So I created a reconciliation that groups all entries into categories and makes more sense of where the money is bleeding. What I found was suprising.
Sure enough there was interest charges and vehicle repairs, but there were two big shocks from the breakdown. First off was gas. I thought we were spending a couple hundred bucks a month, but it turns out we were spending just shy of $900. Can you believe it? $900 in just 30 days!!!! Gas is a necessity in my world as it is an 8km drive to the end of the line for public transit, but I never thought it was that bad.
The second shocker was the $700 that was spent on Miscellaneous stuff. Between 2 credit cards we managed to charge just over $700 on items that were not necessary (ie. going out for lunch) or that I didn't even realize I had charged. How pathetic is that! There were actually a few charges that I swore I had paid cash for. Ouch!
Being more cognizant will hopefully put an end to this one. If the misc. stuff wasn't charged and gas was more in line with what I thought it was we would have actually could out ahead, although meagerly.
Well we can only learn from our mistakes, and hopefully I will not be repeating this post in early December.
Sure enough there was interest charges and vehicle repairs, but there were two big shocks from the breakdown. First off was gas. I thought we were spending a couple hundred bucks a month, but it turns out we were spending just shy of $900. Can you believe it? $900 in just 30 days!!!! Gas is a necessity in my world as it is an 8km drive to the end of the line for public transit, but I never thought it was that bad.
The second shocker was the $700 that was spent on Miscellaneous stuff. Between 2 credit cards we managed to charge just over $700 on items that were not necessary (ie. going out for lunch) or that I didn't even realize I had charged. How pathetic is that! There were actually a few charges that I swore I had paid cash for. Ouch!
Being more cognizant will hopefully put an end to this one. If the misc. stuff wasn't charged and gas was more in line with what I thought it was we would have actually could out ahead, although meagerly.
Well we can only learn from our mistakes, and hopefully I will not be repeating this post in early December.
Friday, October 31, 2008
Un-Happy Halloween...
So here it is - Halloween. I received my last credit card statement and went to update my ticker. To my unfortunate suprise, not only did my debt balance go up - but it was $713 dollars more then when I started this whole crusade.
I was completely dumbfounded. From further investigation it appears that the majority of the problem is that my interest charges are eating too much of a chunk into my monthly payments, the aforementioned car repairs, and my husband's continuous spending on his business card.
Something has got to give here as I am really discouraged right now! I know I just have to keep plugging away, but I am not even sure how. I guess I'm just a whole lotta talk!
I was completely dumbfounded. From further investigation it appears that the majority of the problem is that my interest charges are eating too much of a chunk into my monthly payments, the aforementioned car repairs, and my husband's continuous spending on his business card.
Something has got to give here as I am really discouraged right now! I know I just have to keep plugging away, but I am not even sure how. I guess I'm just a whole lotta talk!
Thursday, October 23, 2008
Abort mission...
So after a long talk with the hubby last night we have decided to put off our quest for a consol loan for about 6 months or so. Some of you are probably confused as to why we would choose to do this, but there are three very good reasons why.
1.) The economy. Yes, I am sure everyone is sick of hearing about it, but while banks are on the defensive we are likely to get less than we desire, if anything at all. Plus, unless they simply give us a straight up "No," we are looking at a senseless credit check on our credit report (which we don't need if it will not be fruitful), and we might send up some flares about our mortgage (which we are fine with, but hey why call attention to ourselves). In this respect, we have decided to wait until some of the panic has subsided and the bank may be more likely to "play ball," so to speak.
2.) We will have a little less debt to come to the table with. Yeah, I know 6 months is not going to be a huge difference, but if we are already waiting, it is a benefit.
3.) My hubby's new job does not start until the new year, and with no way to substantiate the potential income until he starts making some, it will not be a good bargaining tool. If we can have a track record of his income (even for just the first quarter of the year), it will be a stronger argument as to why we should be granted the loan. Based on projections, this could be a major factor in how much we get.
1.) The economy. Yes, I am sure everyone is sick of hearing about it, but while banks are on the defensive we are likely to get less than we desire, if anything at all. Plus, unless they simply give us a straight up "No," we are looking at a senseless credit check on our credit report (which we don't need if it will not be fruitful), and we might send up some flares about our mortgage (which we are fine with, but hey why call attention to ourselves). In this respect, we have decided to wait until some of the panic has subsided and the bank may be more likely to "play ball," so to speak.
2.) We will have a little less debt to come to the table with. Yeah, I know 6 months is not going to be a huge difference, but if we are already waiting, it is a benefit.
3.) My hubby's new job does not start until the new year, and with no way to substantiate the potential income until he starts making some, it will not be a good bargaining tool. If we can have a track record of his income (even for just the first quarter of the year), it will be a stronger argument as to why we should be granted the loan. Based on projections, this could be a major factor in how much we get.
Thursday, October 16, 2008
The Perils of Being "Too Good"...
I have learned a thing or two over the years about debt repayment, and one of the key lessons, which is sometimes hard to fathom, is the concept of being too aggressive with debt repayment.
Any other time I have been in debt I have thrown every last cent at my debt. Problem becomes, if you put all of your cash on your debt, where do you get cash for other things/emergencies. Granted you should have an emergency fund, but sometimes that just doesn't cut it. Answer: you put the charge on your credit card. Then you aggressively try to pay that off and something else comes up, and then begins the cycle.
So unless you have the priviledge of having a completely uncomplicated, unpenetrable life you end up in the same boat you are trying to get out of. Using the boat analogy, you are bailing out a boat with a hole in it; you may stay afloat, but you will never be completely free of the water.
This time I am trying to take a more balanced approach by budgeting what is going to be spent on debt in a month, and if I can manage extra I will. It may take a little longer, but hopefully I can keep the debt monkey down for good.
Any other time I have been in debt I have thrown every last cent at my debt. Problem becomes, if you put all of your cash on your debt, where do you get cash for other things/emergencies. Granted you should have an emergency fund, but sometimes that just doesn't cut it. Answer: you put the charge on your credit card. Then you aggressively try to pay that off and something else comes up, and then begins the cycle.
So unless you have the priviledge of having a completely uncomplicated, unpenetrable life you end up in the same boat you are trying to get out of. Using the boat analogy, you are bailing out a boat with a hole in it; you may stay afloat, but you will never be completely free of the water.
This time I am trying to take a more balanced approach by budgeting what is going to be spent on debt in a month, and if I can manage extra I will. It may take a little longer, but hopefully I can keep the debt monkey down for good.
Wednesday, October 15, 2008
Not time for snow...
So I have received a few questions about why I have not decided to use the tried and true debt repayment scheme of the "The Debt Snowball."
For those of you who do not know this concept, you set aside how much you can put on your debts in a month, pay the minimum on all but one card (either with the highest interest rate, or lowest balance - depending on who you talk to) and you put all of the extra money and any other pennies that you can on that debt until it is paid down. Repeat with next debt in the series until - Voila! no more debt.
Basically, there is one main reason why I have not done the snowball - FEAR! As you can see the balances are quite high, and cards #2 and #3 are close to their limits with reasonably large interest payments. To try and gain control over these cards I want to make sure I am paying more than the minimum for now until I have some wiggle room to decrease the payment and concentrate on card #1. All cards are being paid more than the minimum (as said before, based on a 3 year payoff plan) but I am worried that if I focus all of my energy on one debt too quickly the rest will fall apart because I am not properly prepared for the undertaking.
Don't get me wrong, the snowball is a good system, I just need to be in a more secure place before I go Rambo on card #1.
For those of you who do not know this concept, you set aside how much you can put on your debts in a month, pay the minimum on all but one card (either with the highest interest rate, or lowest balance - depending on who you talk to) and you put all of the extra money and any other pennies that you can on that debt until it is paid down. Repeat with next debt in the series until - Voila! no more debt.
Basically, there is one main reason why I have not done the snowball - FEAR! As you can see the balances are quite high, and cards #2 and #3 are close to their limits with reasonably large interest payments. To try and gain control over these cards I want to make sure I am paying more than the minimum for now until I have some wiggle room to decrease the payment and concentrate on card #1. All cards are being paid more than the minimum (as said before, based on a 3 year payoff plan) but I am worried that if I focus all of my energy on one debt too quickly the rest will fall apart because I am not properly prepared for the undertaking.
Don't get me wrong, the snowball is a good system, I just need to be in a more secure place before I go Rambo on card #1.
Wednesday, October 8, 2008
It's not just Halloween that's scary...
So barely into October and it's looking pretty dark and scary. Have spent time so far trying my hardest to only spend cash. Little thing I noticed - cash runs out!! It's true. For some reason ends are not meeting as well as in the past. I think I need to revamp the budget.
Significant speed bumps on my road to sanity:
- the car repairs (still seething!)
- hubby has already overspent on his business travel this month (naughty boy)
- daycare fundraisers (seriously, just send me an invoice so I don't have to buy anything else!)
- general lack of money! Hubby's paycheque was lower than expected and the rest of it just seemed to float through my fingers. Tracked some of our spending, but can't seem to wrap my head around it.
But it will be okay. Say it with me now "November will be better...November will be better...November will be better!"
Significant speed bumps on my road to sanity:
- the car repairs (still seething!)
- hubby has already overspent on his business travel this month (naughty boy)
- daycare fundraisers (seriously, just send me an invoice so I don't have to buy anything else!)
- general lack of money! Hubby's paycheque was lower than expected and the rest of it just seemed to float through my fingers. Tracked some of our spending, but can't seem to wrap my head around it.
But it will be okay. Say it with me now "November will be better...November will be better...November will be better!"
Wednesday, October 1, 2008
What Have You Done With My Husband...
I mentioned yesterday that the hubby has added a new income stream to our little home, but today I thought I was going to pass out.
In an effort to keep him "in the loop" on our finances I was in our home office preparing the monthly report as I had described in an earlier post. After finding out what I was working on he actually decided he wanted to talk about the issue. And I mean actually listen to what I had to say!
The final verdict:
a.) He agreed there was a problem that we needed to fix and agreed to cut out all unnecessary purchases until we had things under control.
b.) We talked about the consolidation loan concept and why I don't really want one right now, and especially why I DO NOT want to add it to our home equity. And he listened!!! However, he did remind me that compared to ourselves a year or so ago, we have actually been getting better with the frivolous spending. A large portion of our debt would likely be gone if we were not paying for landscaping and the final additions (ie. driveway) to our newer home. Considering that he does have a point, we compromised to get a consolidation loan, but only for the amount of the home renovation/completion costs. This will not cover all of our debt, but we can bring our receipts and records to the bank to back up the amount (as opposed to just consumer spending), it will be a more reasonable amount so we are more likely to get approved, and all the good stuff like a lower interest rate. He agreed that everything else was our own misdoings and we will need to deal with that on our own, but the loan should make the whole project just a little more manageable. Besides, if they say no we are in no worse position than we are now. Oh yeah and he agreed - NO HOME EQUITY LOAN!!!
c.) To top it all off, he is going to go to the bank to handle the loan for us! I know we are in this together, but this is a huge step for him. He will singlehandedly need to sit with our banker and own up to our debts and make a plan. Of course, I get final veto, but it means that he is being responsible for our debt and not just putting the problem on me to fix. I am really impressed about this. My little man is growing up!!!!!! Besides, if I don't have to take time off work to do this, my boss will surely be pleased.
d.) We got to talking about our goals A.D. (after debt). We had always chirped about what we want before, but never in a "I would like to put a coupld hundred away every month to do X."
I am really not sure what has gotten into him, and I know it may fade as quickly as it came, but I will take what I can get as long as I can. If he has finally decided to work with me on this, instead of just letting things happen, we may have a shot at our end of August 2011 goal afterall.
In an effort to keep him "in the loop" on our finances I was in our home office preparing the monthly report as I had described in an earlier post. After finding out what I was working on he actually decided he wanted to talk about the issue. And I mean actually listen to what I had to say!
The final verdict:
a.) He agreed there was a problem that we needed to fix and agreed to cut out all unnecessary purchases until we had things under control.
b.) We talked about the consolidation loan concept and why I don't really want one right now, and especially why I DO NOT want to add it to our home equity. And he listened!!! However, he did remind me that compared to ourselves a year or so ago, we have actually been getting better with the frivolous spending. A large portion of our debt would likely be gone if we were not paying for landscaping and the final additions (ie. driveway) to our newer home. Considering that he does have a point, we compromised to get a consolidation loan, but only for the amount of the home renovation/completion costs. This will not cover all of our debt, but we can bring our receipts and records to the bank to back up the amount (as opposed to just consumer spending), it will be a more reasonable amount so we are more likely to get approved, and all the good stuff like a lower interest rate. He agreed that everything else was our own misdoings and we will need to deal with that on our own, but the loan should make the whole project just a little more manageable. Besides, if they say no we are in no worse position than we are now. Oh yeah and he agreed - NO HOME EQUITY LOAN!!!
c.) To top it all off, he is going to go to the bank to handle the loan for us! I know we are in this together, but this is a huge step for him. He will singlehandedly need to sit with our banker and own up to our debts and make a plan. Of course, I get final veto, but it means that he is being responsible for our debt and not just putting the problem on me to fix. I am really impressed about this. My little man is growing up!!!!!! Besides, if I don't have to take time off work to do this, my boss will surely be pleased.
d.) We got to talking about our goals A.D. (after debt). We had always chirped about what we want before, but never in a "I would like to put a coupld hundred away every month to do X."
I am really not sure what has gotten into him, and I know it may fade as quickly as it came, but I will take what I can get as long as I can. If he has finally decided to work with me on this, instead of just letting things happen, we may have a shot at our end of August 2011 goal afterall.
Tuesday, September 30, 2008
Ticker Time #1...
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!
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!
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.
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
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
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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