My 100th post couldn't come at a better time.
I received a $4000 scholarship today from NAWIC-National Association of Women in Construction, El Paso Chapter, 248.
I was floored by their generosity and their dedication and commitment to my education and my career goals.
What a year...
After this week’s payments, my remaining debt balances will be:
Asset Retrieval- $2498.80
Dentist- $1235—will verify with my folks.
GECU- $525.89
Not a lot of debt payoff this month, but I’m thinking I beefed up my savings enough to where I can focus primarily on paying off debt the last couple months we have left.
Total debt payoff for August: $399
$200 to Asset
$130 to Dentist
$69 to GECU
I was just looking through my savings folder I have on my computer, taking a look at where I started.
Unique/Library- $111.95? paid off
CMI/Time Warner- $154? Paid off
JSZ/Sutters Wood- $212.42? paid off
RJM ACQ/WAMU- $412.47 paid off
Target card-$ 570.51? paid off
Midland/Chase-$707.50? paid off
Capstone- $2500.15? paid off-ish
Mysterious time warner? Knocked off
Total Debt payoff-ish: $6636 (inclusive for everything)
My cell phone bill is gone, my GECU loan is shrinking, Asset retrieval will be a one shot payoff for the remaining balance at the end of the challenge at which it should be around $1000 and they’ll work with me then, my dentist bill will be knocked out in 19 weeks at $65 a week or the first week of January…
I’ve received $5000 in scholarships not to mention the $7300 in financial aid each year for the next three years…
What a year. Regardless how the challenge ends, I feel like a winner. Especially with the team I’ve been blessed with.
Thank you guys for your support, your advice, and your friendship.
Showing posts with label Debt. Show all posts
Showing posts with label Debt. Show all posts
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Debt,
money,
Payoff,
savings
I know that many financial experts recommend paying of debts - especially high interest credit card debt first, before saving. Conventional wisdom suggests that paying off high interest debt garners an immediate 13%, 18%, 21% (or whatever) rate of return on your money. Makes sense. I guess.
Here's the problem. If you take all of your available cash and pay down debt, then what will you do in case of an emergency? (eyes on your own paper) Right! You'll go into debt - whether it's putting the charge on the same credit card which now has more room, or borrow it from your next door neighbor, along with a cup of sugar. Kinda defeats the whole purpose, no? On top of that, the emergency will actually cost you more in the long run, because of the interest you'll pay, and the fee that it may cost you to use your credit card. For instance, some utility companies and insurance companies charge a transaction fee for paying with a credit card.
Sometimes the emergency is a mini emergency where you can't pay with credit. Your transmission goes costing more than the available credit you have on your Visa. Not to mention that your goal in life is to dig yourself out of debt, and continuing to charge feels like running up the down escalator. What's a debt-buster in training to do?
I say: Split the difference. I find it a bit more psychologically comforting to save some money for emergencies, even if you are paying off debt. To my mind, it works the same way as the debt snowball. The debt snowball, class, is a method of repayment where you pay off the smallest debt first, regardless of interest rate. Once you have success in eliminating the first debt, you get a psychological boost and roll the former debt payments into paying off the next debt on the list. Psychologically, a good idea. Financially, not so much. But sometimes the process is not as crucial as the end result.
I have come up with a highly complex and intricate formula: 75/12.5/12.5. I take roughly 75% of my income and put it towards debt. I divide the remaining in half - thus the 12.5% - and put it towards savings. For me, that means 12.5% goes to my emergency fund -towards the requisite 6-months, minimum, that we all should have, and the other 12.5% goes towards regular weekly budgeting.
For me, even though the savings may come in more of a drip than a gusher, it is comforting to see the balances limp along. Little by little, they will begin to pick up steam and break into a fast walk, a trot, a sprint....
Here's the problem. If you take all of your available cash and pay down debt, then what will you do in case of an emergency? (eyes on your own paper) Right! You'll go into debt - whether it's putting the charge on the same credit card which now has more room, or borrow it from your next door neighbor, along with a cup of sugar. Kinda defeats the whole purpose, no? On top of that, the emergency will actually cost you more in the long run, because of the interest you'll pay, and the fee that it may cost you to use your credit card. For instance, some utility companies and insurance companies charge a transaction fee for paying with a credit card.
Sometimes the emergency is a mini emergency where you can't pay with credit. Your transmission goes costing more than the available credit you have on your Visa. Not to mention that your goal in life is to dig yourself out of debt, and continuing to charge feels like running up the down escalator. What's a debt-buster in training to do?
I say: Split the difference. I find it a bit more psychologically comforting to save some money for emergencies, even if you are paying off debt. To my mind, it works the same way as the debt snowball. The debt snowball, class, is a method of repayment where you pay off the smallest debt first, regardless of interest rate. Once you have success in eliminating the first debt, you get a psychological boost and roll the former debt payments into paying off the next debt on the list. Psychologically, a good idea. Financially, not so much. But sometimes the process is not as crucial as the end result.
I have come up with a highly complex and intricate formula: 75/12.5/12.5. I take roughly 75% of my income and put it towards debt. I divide the remaining in half - thus the 12.5% - and put it towards savings. For me, that means 12.5% goes to my emergency fund -towards the requisite 6-months, minimum, that we all should have, and the other 12.5% goes towards regular weekly budgeting.
For me, even though the savings may come in more of a drip than a gusher, it is comforting to see the balances limp along. Little by little, they will begin to pick up steam and break into a fast walk, a trot, a sprint....
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Debt,
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Driving to New Mexico, I looked over at my friend and said those miraculous words, "So... How are your finances?"
Had somebody asked me that today I would have started rambling about my savings account, what I'm paying for school, my recent scholarship, my debt I've paid off. Finances to me means, accordingly, everything money.
Finances to my friend meant what she has available and what she owes on her credit card.
Which is true, those are finances. Her response allowed me to take a glimpse into her world on a monetary level. My finances are definitely a positive thing. I'm enthusiastic when I tell people what I've achieved this year. I don't just pay off debt, I knock out debt *punch punch*. I don't just save money, I boost my savings. I didn't just get a scholarship, I was truly blessed!
Is it that much different from saying what you owe and how much you have left in your checking account?
I'm going to give a boisterous, HELL YEAH to that question.
If you spend your entire day being positive about everything you've accomplished and keeping an open mind to any troubles that come your way, you'll fare much better.
If you spend your entire day fretting over negativity and retract when things become challenging, you'll wish you never climbed out of bed.
So why should talking about your finances be any different? My friend didn't give me details, but from her viewpoint I could tell that she wasn't financially where she wanted to be. And instead of reminding me that she just recently paid off her Tempur-Pedic mattress or that she's begun saving for her summer vacation abroad after she graduates, she focused on what she hasn't accomplished yet.
Changing how you look at your finances, understanding that you've made some progress along with any setbacks and just being nice to yourself could help you boost yourself in the right direction.
One bite at a time...
Had somebody asked me that today I would have started rambling about my savings account, what I'm paying for school, my recent scholarship, my debt I've paid off. Finances to me means, accordingly, everything money.
Finances to my friend meant what she has available and what she owes on her credit card.
Which is true, those are finances. Her response allowed me to take a glimpse into her world on a monetary level. My finances are definitely a positive thing. I'm enthusiastic when I tell people what I've achieved this year. I don't just pay off debt, I knock out debt *punch punch*. I don't just save money, I boost my savings. I didn't just get a scholarship, I was truly blessed!
Is it that much different from saying what you owe and how much you have left in your checking account?
I'm going to give a boisterous, HELL YEAH to that question.
If you spend your entire day being positive about everything you've accomplished and keeping an open mind to any troubles that come your way, you'll fare much better.
If you spend your entire day fretting over negativity and retract when things become challenging, you'll wish you never climbed out of bed.
So why should talking about your finances be any different? My friend didn't give me details, but from her viewpoint I could tell that she wasn't financially where she wanted to be. And instead of reminding me that she just recently paid off her Tempur-Pedic mattress or that she's begun saving for her summer vacation abroad after she graduates, she focused on what she hasn't accomplished yet.
Changing how you look at your finances, understanding that you've made some progress along with any setbacks and just being nice to yourself could help you boost yourself in the right direction.
One bite at a time...
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Labels:
Debt,
Personal
Confessions of a Debtaholic:
This time last year I didn't want to think about my credit score, who I owed, HOW MUCH I owed. All I wanted to do was push it all away, make it disappear. The "letters" I'd get in the mail would miraculously get lost in my bedroom and then I'd find them weeks afterward and give a quick farewell/ohwell shrug and into the trashcan they'd go. They were already late anyways, might as well wait for the next one to come in the mail...
But I couldn't throw it all away. I couldn't go a day without thinking about them. I couldn't see them, but they were still there. I was still terrifyingly in debt. It was terrifying because I didn't know my credit score, because I didn't know who I owed anymore. But mainly because I didn't know how much I owed. I would fret that the figure had grown astronomically over the two year hiatus I took. I envisioned never being able to buy a car, a house. If an emergency were to ever arise, I'd imagine the ambulance drivers refusing to transport me to the emergency room without putting money down. I didn't know my credit score, but I felt that everyone else did.
I suffered from a severe case of finance paranoia.
"There she is!"
"Who?"
"What do you mean 'who'? The girl who owes $480,000,000!"
"Oh my goodness! She's such a horrible person! Quick! Let's walk on the other side of the street, lest we catch her bad money bug!"
Talk about my finances?! Are you kidding? Who would I talk to? My parents, so they could know that I intentionally ruined my life and let them down? My friends, so they would feel sympathetic to my situation but would cease to want to hang around me? My boyfriend, so he could know that I didn't feel good enough for him and I suffered from such a severe case of dis-financia that I'd probably drag him down with me?
No thank you.
I was content to sit there, terrified of the mail, and do nothing and accept no emotional support from anyone. If no one knew there was a problem, then there was no problem. It was private and personal and it was killing me.
Then the lawyer called, demanding payment or I'd be sued. Who took the call? My dad. My dad who instructed me on the day I moved out to take care of my credit first and foremost before I spent any money on anything else. My mom quickly whispered something about never going hungry once my dad was out of earshot. Yes, that dad took the call from a lawyer saying I owed $650 to be paid before months end or I'd potentially face jailtime.
JAIL?!
Whoa whoa whoa... what? Jail? Seriously? It wasn't that far off the mark from how i felt. I felt like I was a bad person. I felt like I deserved to be punished. Paying back what I owed was the least form of punishment they could dish out. After that call, I had to sit down with my mom and explain my situation... most of it. Even when I was finally confiding in some one, I couldn't give the whole story. I couldn't tell her everything, then she'd know and she'd feel as bad as I did. I told her about the two credit cards and the issue the lawyer was calling about... I didn't tell her about the other two credit cards or the broken leases or the other debts that I'd pushed so far off my mind I'd forgotten about; money-nesia.
She was disappointed, but anxious to help. But how could I bring my mom into this mess? How could I put so much financial mental stress on my family, when it wasn't their fault nor their problem? A polite decline and an assurance I'd have it taken care of and I went back to my world of solitary confinement, with only my scarlet lettered credit to keep me company.
In the meantime, I spent money like it was going out of style. Food, beer, parties, movies, gas, cellphone, anything! Everything! I was like a stock broker (BUY BUY BUY!) except not very good at it. Soon I was paying more to my bank on overdraft fees than I was on anything else. Packs of cigarettes went from costing me a little over $5.00 to costing over $40.00. Gas was a little over $3.00 a gallon, but after averaging in an overdraft fee, was easily over $6.00. Some paychecks lasted as long as it took to drive to the bank to deposit them and instantly it was all gone to pay for last weeks siesta, fiesta, or what have you.
I'd have 30 minute conversations with my bank about my account over the phone:
"There is absolutely no way I could have spent that much money. I think I'm a victim of identity theft!"
"Well lets take a look at your account... Did you buy groceries last week?"
"Yes."
"Did you get gas?"
"Yes."
"Food at subway? Burger king? Pizza? Liquor store?"
"errr. Ya."
"Clothes at Ross, Marshalls, Hot Topic, Forever 21?"
"...um"
"Oh well here's something.. Do you have an online subscription?"
"No! Finally, you see, identity theft!!!"
"Okay well, we'll take a look at this Neopets.com subscription."
"Oh wait... no that's me too."
I'd beg I'd plead and I'd give myself a cheesy grin and a pat on the back when they'd drop one or two of the handful of overdraft fees I incurred. Wonderful news! Of course the bank knew all along, giving me back the overdraft fee enabled me to spend outside my means again and owe them more in the end. I didn't know this. I was just pleased that I had my $35.00 and that I'd "stuck it to the man". *grrrrr*Serious face*grrrr*
And then I decided to take a peak, just one peak, appease my curiousity. Not lose anymore sleep over trying to sort it all out. Time to check out my credit score. Logged on to the free site, entered in more information than I was comfortable with and there I was. Staring face to with my worst nightmare.
One, two, three, four,..... ten, eleven... twelve! I owed twelve different companies, most of whom I'd never heard of! Reading down the list $112, $254, $713, $3600... WAIT!? What? $2500!? What are those... A brief spat of hyperventilating and my eyes regained focus. Like flashes of lightning I worked the total out on a calculator.
Needless to say it added up to a significant sum.
But I knew. I wanted to know then and then I knew. I'd done my part. Continue pushing it all around in my mind, sorting and categorizing and trying to decide which gets paid first.. who gets what? How I could afford it all and how long it would take me.
And if possible I felt worse about myself. How was I to get a loan for school with credit like that? What if I had to stop going to classes because I was a major screwup and one year of fun and reckless abandon was going to haunt me for the rest of my life?
Questions, questions, questions! Nonstop. Worry, panic, fear... what makes me feel better? SPEND SPEND SPEND. More overdrafts, more begging, more hiding...
On the outside, I was physically the same person. I laughed, I played, I worked hard... On the inside, I hated myself for getting myself so in over my head.
What changed between then and now?
Priorities, responsibilities, and the determination to love myself again.
Amazing how much can change in one year. Sitting comfortably atop two debts that seemed astronomical before; while, they're still pretty big I'm biting off managable chunks and I feel good. I've changed financial institutions, politely flipping the bird from one bank to embracing a credit union that genuinely wanted to help me. Everything is manageable and nothing is critical anymore. All of my payments are on my schedule and on my terms.
While I'm not perfect and I don't have the miracle cure for your bad money bug, I can tell you that I was in a place that no person should put themselves in. And I'm surviving and in some ways thriving. And I believe in myself. I can do this.
This time last year I didn't want to think about my credit score, who I owed, HOW MUCH I owed. All I wanted to do was push it all away, make it disappear. The "letters" I'd get in the mail would miraculously get lost in my bedroom and then I'd find them weeks afterward and give a quick farewell/ohwell shrug and into the trashcan they'd go. They were already late anyways, might as well wait for the next one to come in the mail...
But I couldn't throw it all away. I couldn't go a day without thinking about them. I couldn't see them, but they were still there. I was still terrifyingly in debt. It was terrifying because I didn't know my credit score, because I didn't know who I owed anymore. But mainly because I didn't know how much I owed. I would fret that the figure had grown astronomically over the two year hiatus I took. I envisioned never being able to buy a car, a house. If an emergency were to ever arise, I'd imagine the ambulance drivers refusing to transport me to the emergency room without putting money down. I didn't know my credit score, but I felt that everyone else did.
I suffered from a severe case of finance paranoia.
"There she is!"
"Who?"
"What do you mean 'who'? The girl who owes $480,000,000!"
"Oh my goodness! She's such a horrible person! Quick! Let's walk on the other side of the street, lest we catch her bad money bug!"
Talk about my finances?! Are you kidding? Who would I talk to? My parents, so they could know that I intentionally ruined my life and let them down? My friends, so they would feel sympathetic to my situation but would cease to want to hang around me? My boyfriend, so he could know that I didn't feel good enough for him and I suffered from such a severe case of dis-financia that I'd probably drag him down with me?
No thank you.
I was content to sit there, terrified of the mail, and do nothing and accept no emotional support from anyone. If no one knew there was a problem, then there was no problem. It was private and personal and it was killing me.
Then the lawyer called, demanding payment or I'd be sued. Who took the call? My dad. My dad who instructed me on the day I moved out to take care of my credit first and foremost before I spent any money on anything else. My mom quickly whispered something about never going hungry once my dad was out of earshot. Yes, that dad took the call from a lawyer saying I owed $650 to be paid before months end or I'd potentially face jailtime.
JAIL?!
Whoa whoa whoa... what? Jail? Seriously? It wasn't that far off the mark from how i felt. I felt like I was a bad person. I felt like I deserved to be punished. Paying back what I owed was the least form of punishment they could dish out. After that call, I had to sit down with my mom and explain my situation... most of it. Even when I was finally confiding in some one, I couldn't give the whole story. I couldn't tell her everything, then she'd know and she'd feel as bad as I did. I told her about the two credit cards and the issue the lawyer was calling about... I didn't tell her about the other two credit cards or the broken leases or the other debts that I'd pushed so far off my mind I'd forgotten about; money-nesia.
She was disappointed, but anxious to help. But how could I bring my mom into this mess? How could I put so much financial mental stress on my family, when it wasn't their fault nor their problem? A polite decline and an assurance I'd have it taken care of and I went back to my world of solitary confinement, with only my scarlet lettered credit to keep me company.
In the meantime, I spent money like it was going out of style. Food, beer, parties, movies, gas, cellphone, anything! Everything! I was like a stock broker (BUY BUY BUY!) except not very good at it. Soon I was paying more to my bank on overdraft fees than I was on anything else. Packs of cigarettes went from costing me a little over $5.00 to costing over $40.00. Gas was a little over $3.00 a gallon, but after averaging in an overdraft fee, was easily over $6.00. Some paychecks lasted as long as it took to drive to the bank to deposit them and instantly it was all gone to pay for last weeks siesta, fiesta, or what have you.
I'd have 30 minute conversations with my bank about my account over the phone:
"There is absolutely no way I could have spent that much money. I think I'm a victim of identity theft!"
"Well lets take a look at your account... Did you buy groceries last week?"
"Yes."
"Did you get gas?"
"Yes."
"Food at subway? Burger king? Pizza? Liquor store?"
"errr. Ya."
"Clothes at Ross, Marshalls, Hot Topic, Forever 21?"
"...um"
"Oh well here's something.. Do you have an online subscription?"
"No! Finally, you see, identity theft!!!"
"Okay well, we'll take a look at this Neopets.com subscription."
"Oh wait... no that's me too."
I'd beg I'd plead and I'd give myself a cheesy grin and a pat on the back when they'd drop one or two of the handful of overdraft fees I incurred. Wonderful news! Of course the bank knew all along, giving me back the overdraft fee enabled me to spend outside my means again and owe them more in the end. I didn't know this. I was just pleased that I had my $35.00 and that I'd "stuck it to the man". *grrrrr*Serious face*grrrr*
And then I decided to take a peak, just one peak, appease my curiousity. Not lose anymore sleep over trying to sort it all out. Time to check out my credit score. Logged on to the free site, entered in more information than I was comfortable with and there I was. Staring face to with my worst nightmare.
One, two, three, four,..... ten, eleven... twelve! I owed twelve different companies, most of whom I'd never heard of! Reading down the list $112, $254, $713, $3600... WAIT!? What? $2500!? What are those... A brief spat of hyperventilating and my eyes regained focus. Like flashes of lightning I worked the total out on a calculator.
Needless to say it added up to a significant sum.
But I knew. I wanted to know then and then I knew. I'd done my part. Continue pushing it all around in my mind, sorting and categorizing and trying to decide which gets paid first.. who gets what? How I could afford it all and how long it would take me.
And if possible I felt worse about myself. How was I to get a loan for school with credit like that? What if I had to stop going to classes because I was a major screwup and one year of fun and reckless abandon was going to haunt me for the rest of my life?
Questions, questions, questions! Nonstop. Worry, panic, fear... what makes me feel better? SPEND SPEND SPEND. More overdrafts, more begging, more hiding...
On the outside, I was physically the same person. I laughed, I played, I worked hard... On the inside, I hated myself for getting myself so in over my head.
What changed between then and now?
Priorities, responsibilities, and the determination to love myself again.
Amazing how much can change in one year. Sitting comfortably atop two debts that seemed astronomical before; while, they're still pretty big I'm biting off managable chunks and I feel good. I've changed financial institutions, politely flipping the bird from one bank to embracing a credit union that genuinely wanted to help me. Everything is manageable and nothing is critical anymore. All of my payments are on my schedule and on my terms.
While I'm not perfect and I don't have the miracle cure for your bad money bug, I can tell you that I was in a place that no person should put themselves in. And I'm surviving and in some ways thriving. And I believe in myself. I can do this.
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Labels:
budget,
Budget Planning,
Debt,
money,
savings
I practice what I preach. For the most part. I have got my planning skills fine-tuned and honed in on the most efficient way to handle the financial challenges that are thrown my way. But like a vast majority of things I plan for, I'm not following through with as much energetic enthusiasm on the "doing" compared to the "planning".
How does this happen?
Well take the vast majority of Americans retirement savings. Half the paid workers ages 25 to 64 don't own retirement savings accounts of any kind. People plan to live as long as possible. People don't plan on working for the rest of their lives. So whats the holdup? Why aren't more people planning for their own retirement? We've all heard the recent news that Social Security is running out on a timeline that is falling short of previous estimates.
So what do most of us do?
We plop down in a chair, pencil and paper in front of us, start writing down what we make, what we hope to make in the future, how much we can afford to put away. Move to another chair, plop down in front of the computer find a savings calculator or 401k calculator online plug in our numbers and sit in awe at the results of compounded interest. The more ambitious will take it a few steps further, comparing funds and different risk options, but for the most part we see the results and we know the "what if".
The "what if" is enough for us. If we start saving now, if we save this much, if we invest here, we'll have this much in the end. The "what if" is a mentality we could all do without. The "what if" needs to change to simply "when and will".
When I retire I will need x amount of money to live.
When I get paid, I will need to deposit x amount into my retirement savings.
Transforming your retirement savings goals from the theoretical to the actual is as simple as changing your expectations of yourself and the realization that you are ultimately responsible for yourself.
So how does this example apply to me? I have plans up to my eyeballs. They're not going to accomplish themselves, no matter how many times I tweak and retweak them. When I get done with this email, I will start the "doing".
How does this happen?
Well take the vast majority of Americans retirement savings. Half the paid workers ages 25 to 64 don't own retirement savings accounts of any kind. People plan to live as long as possible. People don't plan on working for the rest of their lives. So whats the holdup? Why aren't more people planning for their own retirement? We've all heard the recent news that Social Security is running out on a timeline that is falling short of previous estimates.
So what do most of us do?
We plop down in a chair, pencil and paper in front of us, start writing down what we make, what we hope to make in the future, how much we can afford to put away. Move to another chair, plop down in front of the computer find a savings calculator or 401k calculator online plug in our numbers and sit in awe at the results of compounded interest. The more ambitious will take it a few steps further, comparing funds and different risk options, but for the most part we see the results and we know the "what if".
The "what if" is enough for us. If we start saving now, if we save this much, if we invest here, we'll have this much in the end. The "what if" is a mentality we could all do without. The "what if" needs to change to simply "when and will".
When I retire I will need x amount of money to live.
When I get paid, I will need to deposit x amount into my retirement savings.
Transforming your retirement savings goals from the theoretical to the actual is as simple as changing your expectations of yourself and the realization that you are ultimately responsible for yourself.
So how does this example apply to me? I have plans up to my eyeballs. They're not going to accomplish themselves, no matter how many times I tweak and retweak them. When I get done with this email, I will start the "doing".
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Labels:
Budget Planning,
Debt,
Personal
Over the course of the savings challenge, I have undergone multiple changes in perspective. The first one came within the first two months of the competition when I came to the conclusion that this is not a normal competition. I don't have to worry about somebody being able to run faster, throw farther or swim further in this competition. I just have to worry about what I'm doing and how I can play better. So in those terms its a competition against myself and part of me is destined to succeed and the other part is demanding failure. To say I'm not in this 100% would be absurd. I breathe, sweat, cry and dream of the challenge. But it seems that every speedbump that gets thrown my way is something I have created. Past mistakes, bad decisions are all coming back. Had I paid closer attention to my teeth and visited the dentist the recommended times per year, I wouldn't have had to shell out the money for a root canal and crown. Had I not broken two leases in Dallas, I would be able to put more money towards savings and be able to be out on my own once more.
Any regrets? Well, ya. Any regrets in how I'm doing in the challenge? No. Flatout. Resounding. NO. I enjoy being able to run ideas past my coaches and getting sound advice.
And that led to another revelation. I have a plan! A plan of plans for how I'm going to pay off my debt this year and how I'm going to make it happen for myself. And I'm sticking to it and its working and I couldn't be happier! But is there more that I could do?
I have a plan.... I don't have a budget. I have allocated venues for where my money goes each WEEK. Not month, WEEEK. And it successfully goes there. But after that whatever is left over, sits in my checking account until next payday. Until the next step of my plan. And it shouldn't be that way. If I had a real budget, something I took into consideration with every purchase, that money would also be allocated and the leftover dumped into savings. Its what I've been preaching, what I thought I was following. And it took me until the third month in the challenge to realize that I wasn't following what I preached.
I think I'll use spring break as an opportunity to really look at my budget. Luckily, I have kept my receipts (yes all of them) from the past three months and what better tool to gauge my spending trends to adjust my budget?!
So expect more thoughtful, insightful, and just downright helpful posts from me in the future. I will be able to post better blogs when I have proven, tried and true methods that have worked for me.
:)
Any regrets? Well, ya. Any regrets in how I'm doing in the challenge? No. Flatout. Resounding. NO. I enjoy being able to run ideas past my coaches and getting sound advice.
And that led to another revelation. I have a plan! A plan of plans for how I'm going to pay off my debt this year and how I'm going to make it happen for myself. And I'm sticking to it and its working and I couldn't be happier! But is there more that I could do?
I have a plan.... I don't have a budget. I have allocated venues for where my money goes each WEEK. Not month, WEEEK. And it successfully goes there. But after that whatever is left over, sits in my checking account until next payday. Until the next step of my plan. And it shouldn't be that way. If I had a real budget, something I took into consideration with every purchase, that money would also be allocated and the leftover dumped into savings. Its what I've been preaching, what I thought I was following. And it took me until the third month in the challenge to realize that I wasn't following what I preached.
I think I'll use spring break as an opportunity to really look at my budget. Luckily, I have kept my receipts (yes all of them) from the past three months and what better tool to gauge my spending trends to adjust my budget?!
So expect more thoughtful, insightful, and just downright helpful posts from me in the future. I will be able to post better blogs when I have proven, tried and true methods that have worked for me.
:)
HomeWord's Family Financial Survival Guide
Unemployment is up . . . home prices are down . . . and no one is really quite sure where the Stock Market is going to land from one day to the next. In these challenging economic times, it’s easy to be worried about your family’s financial health. “HomeWord’s Family Financial Survival Guide” gives you practical tools that are biblical, practical and recession-proof.
For this special audio presentation, Dr. Jim Burns welcomes noted financial experts Dave Ramsey (author of the book, The Total Money Makeover), Ron Blue (author of Master Your Money), Howard Dayton (Founder of Crown Financial Ministries), Wall Street Journal business reporter Francine Huff, and Ellie Kay –“America’s Family Financial Expert.”
Free MP3 Download:
HomeWord's Family Financial Survival Guide
Instructions:
Internet Explorer Users: Right-Click above link and select"Save Target As..."
Firefox Users: Right-Click above link and select "Save Link As..."
Unemployment is up . . . home prices are down . . . and no one is really quite sure where the Stock Market is going to land from one day to the next. In these challenging economic times, it’s easy to be worried about your family’s financial health. “HomeWord’s Family Financial Survival Guide” gives you practical tools that are biblical, practical and recession-proof.
For this special audio presentation, Dr. Jim Burns welcomes noted financial experts Dave Ramsey (author of the book, The Total Money Makeover), Ron Blue (author of Master Your Money), Howard Dayton (Founder of Crown Financial Ministries), Wall Street Journal business reporter Francine Huff, and Ellie Kay –“America’s Family Financial Expert.”
Free MP3 Download:
HomeWord's Family Financial Survival Guide
Instructions:
Internet Explorer Users: Right-Click above link and select"Save Target As..."
Firefox Users: Right-Click above link and select "Save Link As..."
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Hopefully I will never have to say that out of fear. I've devised the coolest system known to man. I wanted to wait and test out my system before I blogged about it and I've got to admit its worked out better than I can even begin to tell you about.
First step, visit Powerpay.org and get your Debt Snowball going. Questions about this, see my second or third post to learn about how to use this helpful website.
Second step is to set a calendar for repayment on each snowball step to each debtor. This is going to be your financial plan until you are debt free.
Third step is to get a box of envelopes. One envelope for each debt you plan on repaying until all your debt is paid back. An optional step is to include a letter inside your envelope explaining your anticipated payment plan with dates and amounts, the final envelope should request a receipt of full and complete payoff.
Fourth step is to neatly organize the envelopes by date in a shoebox or other box.
Do you know what you have now? A box. Full of your debt. Its something you can see, feel, smell and once you throw your payment (in the form of check, cashier's check or moneyorder) something you can lick and mail. Its your debt and you are now responsible for mailing out each and every single envelope until you are debt-free. What does this mean? Well your debt is now in physical form. You can see the envelopes disappearing over time and it means significantly more to you. You can't avoid something that you are physically responsible. Having your debt scattered over little bits of paper, in your mind or in a filing cabinet keeps it out of sight and out of mind. A box full of your debt strategically placed on your dresser, kitchen counter or next to the front door is something you'll have to interact with.
My debt is in an old fedex box. I put christmas paper lining the bottom and my debt repayment calendar taped to the front. Its on my dresser in my bedroom. I know where it is, I have a better understanding of what my debt situation is like and I couldn't be more happier! Sending the first envelope out was terrifying, but you know I'm getting better. And the envelopes are disappearing! AND I CAN SEE IT HAPPEN!!!
So, I ask you... Where's your debt?
First step, visit Powerpay.org and get your Debt Snowball going. Questions about this, see my second or third post to learn about how to use this helpful website.
Second step is to set a calendar for repayment on each snowball step to each debtor. This is going to be your financial plan until you are debt free.
Third step is to get a box of envelopes. One envelope for each debt you plan on repaying until all your debt is paid back. An optional step is to include a letter inside your envelope explaining your anticipated payment plan with dates and amounts, the final envelope should request a receipt of full and complete payoff.
Fourth step is to neatly organize the envelopes by date in a shoebox or other box.
Do you know what you have now? A box. Full of your debt. Its something you can see, feel, smell and once you throw your payment (in the form of check, cashier's check or moneyorder) something you can lick and mail. Its your debt and you are now responsible for mailing out each and every single envelope until you are debt-free. What does this mean? Well your debt is now in physical form. You can see the envelopes disappearing over time and it means significantly more to you. You can't avoid something that you are physically responsible. Having your debt scattered over little bits of paper, in your mind or in a filing cabinet keeps it out of sight and out of mind. A box full of your debt strategically placed on your dresser, kitchen counter or next to the front door is something you'll have to interact with.
My debt is in an old fedex box. I put christmas paper lining the bottom and my debt repayment calendar taped to the front. Its on my dresser in my bedroom. I know where it is, I have a better understanding of what my debt situation is like and I couldn't be more happier! Sending the first envelope out was terrifying, but you know I'm getting better. And the envelopes are disappearing! AND I CAN SEE IT HAPPEN!!!
So, I ask you... Where's your debt?
1. Stop increasing your debt. If you have any credit cards that are maxed out, cut them in half. If you have more than one remaining credit card, cut them up. When you finish, you should have no more than one credit card. Also cut up any "convenience" cards, such as gas cards, department store cards, etc. You will use your one credit card ONLY to buy "must haves" (see below) until you can get your spending fully under control.
2. Record your spending. The idea of writing down what you spend is a concept most people find annoying at best and useless at worst. However, this is actually your key to getting out of debt. You're in debt because you spent money you didn't have. If you're like many people, your debt didn't come from one single huge purchase; it was trickles of spending amassed over time. Avoiding more debt starts with knowing what you are spending your money on. Each day for one month (at least), write down every penny you spend, no matter how small.
3. Categorize your spending. Categorize your monthly expenses into logical groups of "Must have," "Should have," and "Like to have." "Must haves" are things that will cause harm if you don't buy them, such as food, rent, medicine, pet food, etc. "Should haves" are things that you need, but can do without for a little while, e.g., new clothes for work, gym membership, etc. "Like to haves" are things that you don't need, but enhance your life, e.g., magazine subscriptions, newspaper, cable tv, weekly coffee with friends, IM on your phone, etc. By doing this, you'll have a good idea of what you spend your money on, and you'll be able to figure out where you might need to cut back on spending. You don't want to eliminate all of the "should haves" and the "like to haves," but take a look at those first. One of your expenses will be paying off your debt. You will want to always pay more than the minimum required, otherwise it will take a really long time to eliminate your debt. For example, a single credit card with just a $1,000 balance and 19% interest will take about FIVE YEARS to pay off by making only the minimum payment of $26. Paying the minimum, you will spend $1556.40, with the Total Interest Paid: $556.40! Paying only the minimum payment will equate to giving them 55% more than you actually borrowed.
4. Make a budget based on your spending record. Write down the amount you spent in each category of spending last month as you budget for spending for the next month. Don't sweat if you feel like the amount is too much. For now, just write it down. If you spent $250 on clothes last month, write it down. If you spent $200 on gas for your car last month, write it down.
5. Figure out your debt paydown fund amount. Looking at your new budget, you're going to be able to see areas where you might be able to cut back. You might also see categories where you need to increase spending. In doing this step, no one is suggesting that you come up with budget amounts that are unlivable. Think about going on a diet--if you try to restrict your calories excessively, what's the first thing you want to do? Krispy Kreme here you come, right? The key here is to be realistic. Are you paying money for a gym membership you never use, despite your best intentions? What about the $4 a day, every day, morning coffee you get before work, or your 5-cans-of-Diet-Coke-a-day habit? Chances are, your budget has some fat that can be trimmed. At the end of this exercise, you should have come up with a figure, a number of dollars that can be put toward debt paydown.Make a note of this figure. Day-to-day, if you don't want to keep taking note of all your expenditures, just write down what you spend in the categories you are trying to cut back. This will give you a very clear idea of how well you are doing, and, if you know you're going to go over your budgeted amount, it may help you decide to hold back on a purchase, . If your still unable to find money in your budget, you may be able to find it in your paycheck. Statistics show that the average employee pays over 30% in taxes. Meaning that if your salary is $50k per year, your take home pay is only $35k. There are millions of employees who have filed their w4 forms incorrectly which means that their job is taking out more money than they should. If you are interested in determining your witholdings visit this website http://www.kiplinger.com/tools/withholding/. You should review your filings with an CPA to determine your exemptions. Chances are, you can refile your w4 form and increase your paycheck almost instantly. However if all else fails, and you still can't qualify for a more exemptions than start a home base business to take advantage of the write offs. You must work them to make a potential profit but the tax write offs alone are worth it. There are a lot of businesses out there that you can plug into, but there is one that may be more helpful because their services revolve around getting you out of debt as quickly as possible using your same money, credit restoration, unlimited access to CPAs and Financial Planners, and building wealth, because while you are getting out of debt you should be building wealth.
6. Figure out how much you owe, to whom, and on what terms. Debt can often feel overwhelming because you really don't have a clear idea of how much in debt you really are. Gather your bills, and make a simple list or spreadsheet of all the debts you have. Write down all the pertinent facts, including name of the creditor, your total balance, your minimum monthly payment, and your interest rate.
7. Start paying it off. Take the debt paydown figure of money you trimmed from your budget in step 4, and apply it to debt repayment. It's a good idea to prioritize the debts to which you are going to apply this extra money. Do you have debts that are past due and the creditors are hanging out on your door step demanding your first-born? Do you have debts with exceedingly high interest rates? Consider these top priorities. Let's say you determined in Step 4 that you could comfortably trim an extra $250 from your monthly budget to go toward paying debts, and that from your list of debts in Step 5, you owe $2,000 on a store credit card that has an interest rate of 19.5%, $1,000 on a Visa with an interest rate of 11.5%, and $25,000 in student loans with an interest rate of 5%. You would want to pay the minimum on your low interest rate debts, and apply the bulk of your $250 to the highest interest rate, in this case, your 19.5% store credit card, despite the fact that the actual cost of the student loan interest is highest. Also, consider that if you are already paying a minimum payment of $50 on that high interest card, if you start sending $300 per month (the minimum you are already paying plus your debt paydown figure), once it is paid off, then you will have increased your debt paydown figure. The next creditor can get the amount they are already getting plus the $300. Each debt gets easier to pay off than the last.
8. Wash, rinse, repeat. Just kidding, but you get the idea. This process gets easier. Once you've figured out your spending and what debts you owe, keeping it up gets easier and easier. You'll refine your budget over time, increase the amount of money you can pay yourself (see tip below) and the amount you can put toward debt. Continue to pay off each debt in your priority list. As you pay off convenience cards and high interest credit cards, call those credit card companies and cancel those accounts.
9. Don't give up. Chances are you didn't get into debt in a day, and you won't get out of debt in a day. Quick fixes don't last, but learning how to manage your money can bring great peace into your life, and you can spend your mental energies on more fun things.Also checkout this company had some great feed back about them,
2. Record your spending. The idea of writing down what you spend is a concept most people find annoying at best and useless at worst. However, this is actually your key to getting out of debt. You're in debt because you spent money you didn't have. If you're like many people, your debt didn't come from one single huge purchase; it was trickles of spending amassed over time. Avoiding more debt starts with knowing what you are spending your money on. Each day for one month (at least), write down every penny you spend, no matter how small.
3. Categorize your spending. Categorize your monthly expenses into logical groups of "Must have," "Should have," and "Like to have." "Must haves" are things that will cause harm if you don't buy them, such as food, rent, medicine, pet food, etc. "Should haves" are things that you need, but can do without for a little while, e.g., new clothes for work, gym membership, etc. "Like to haves" are things that you don't need, but enhance your life, e.g., magazine subscriptions, newspaper, cable tv, weekly coffee with friends, IM on your phone, etc. By doing this, you'll have a good idea of what you spend your money on, and you'll be able to figure out where you might need to cut back on spending. You don't want to eliminate all of the "should haves" and the "like to haves," but take a look at those first. One of your expenses will be paying off your debt. You will want to always pay more than the minimum required, otherwise it will take a really long time to eliminate your debt. For example, a single credit card with just a $1,000 balance and 19% interest will take about FIVE YEARS to pay off by making only the minimum payment of $26. Paying the minimum, you will spend $1556.40, with the Total Interest Paid: $556.40! Paying only the minimum payment will equate to giving them 55% more than you actually borrowed.
4. Make a budget based on your spending record. Write down the amount you spent in each category of spending last month as you budget for spending for the next month. Don't sweat if you feel like the amount is too much. For now, just write it down. If you spent $250 on clothes last month, write it down. If you spent $200 on gas for your car last month, write it down.
5. Figure out your debt paydown fund amount. Looking at your new budget, you're going to be able to see areas where you might be able to cut back. You might also see categories where you need to increase spending. In doing this step, no one is suggesting that you come up with budget amounts that are unlivable. Think about going on a diet--if you try to restrict your calories excessively, what's the first thing you want to do? Krispy Kreme here you come, right? The key here is to be realistic. Are you paying money for a gym membership you never use, despite your best intentions? What about the $4 a day, every day, morning coffee you get before work, or your 5-cans-of-Diet-Coke-a-day habit? Chances are, your budget has some fat that can be trimmed. At the end of this exercise, you should have come up with a figure, a number of dollars that can be put toward debt paydown.Make a note of this figure. Day-to-day, if you don't want to keep taking note of all your expenditures, just write down what you spend in the categories you are trying to cut back. This will give you a very clear idea of how well you are doing, and, if you know you're going to go over your budgeted amount, it may help you decide to hold back on a purchase, . If your still unable to find money in your budget, you may be able to find it in your paycheck. Statistics show that the average employee pays over 30% in taxes. Meaning that if your salary is $50k per year, your take home pay is only $35k. There are millions of employees who have filed their w4 forms incorrectly which means that their job is taking out more money than they should. If you are interested in determining your witholdings visit this website http://www.kiplinger.com/tools/withholding/. You should review your filings with an CPA to determine your exemptions. Chances are, you can refile your w4 form and increase your paycheck almost instantly. However if all else fails, and you still can't qualify for a more exemptions than start a home base business to take advantage of the write offs. You must work them to make a potential profit but the tax write offs alone are worth it. There are a lot of businesses out there that you can plug into, but there is one that may be more helpful because their services revolve around getting you out of debt as quickly as possible using your same money, credit restoration, unlimited access to CPAs and Financial Planners, and building wealth, because while you are getting out of debt you should be building wealth.
6. Figure out how much you owe, to whom, and on what terms. Debt can often feel overwhelming because you really don't have a clear idea of how much in debt you really are. Gather your bills, and make a simple list or spreadsheet of all the debts you have. Write down all the pertinent facts, including name of the creditor, your total balance, your minimum monthly payment, and your interest rate.
7. Start paying it off. Take the debt paydown figure of money you trimmed from your budget in step 4, and apply it to debt repayment. It's a good idea to prioritize the debts to which you are going to apply this extra money. Do you have debts that are past due and the creditors are hanging out on your door step demanding your first-born? Do you have debts with exceedingly high interest rates? Consider these top priorities. Let's say you determined in Step 4 that you could comfortably trim an extra $250 from your monthly budget to go toward paying debts, and that from your list of debts in Step 5, you owe $2,000 on a store credit card that has an interest rate of 19.5%, $1,000 on a Visa with an interest rate of 11.5%, and $25,000 in student loans with an interest rate of 5%. You would want to pay the minimum on your low interest rate debts, and apply the bulk of your $250 to the highest interest rate, in this case, your 19.5% store credit card, despite the fact that the actual cost of the student loan interest is highest. Also, consider that if you are already paying a minimum payment of $50 on that high interest card, if you start sending $300 per month (the minimum you are already paying plus your debt paydown figure), once it is paid off, then you will have increased your debt paydown figure. The next creditor can get the amount they are already getting plus the $300. Each debt gets easier to pay off than the last.
8. Wash, rinse, repeat. Just kidding, but you get the idea. This process gets easier. Once you've figured out your spending and what debts you owe, keeping it up gets easier and easier. You'll refine your budget over time, increase the amount of money you can pay yourself (see tip below) and the amount you can put toward debt. Continue to pay off each debt in your priority list. As you pay off convenience cards and high interest credit cards, call those credit card companies and cancel those accounts.
9. Don't give up. Chances are you didn't get into debt in a day, and you won't get out of debt in a day. Quick fixes don't last, but learning how to manage your money can bring great peace into your life, and you can spend your mental energies on more fun things.Also checkout this company had some great feed back about them,
Greetings,
I have an insane amount of debt. Nothing to show for it. I decided in the summer of 2006 that I was going to sell everything I owned, charge up a bunch of credit cards and move to another city. Another country. I went to Thailand. I'll say it once and I'll say it again: I don't regret going, I just regret how I went.
And I'm still trying to get my life back on track. But now I can officially start, and here's my plan that you can follow too.
First, if you're anything like me, you need to know exactly who you owe and how much you owe. If you stop paying on your credit cards, like I did, or if you have floating utility bills, like I do, that you didn't make the last payment on, chances are the company you had those bills with has sold them off to collections agencies. They've probably accrued some amount of late fees, interest or collections fees. The easiest way to get all of this information is to obtain a credit report for all three credit unions. I say all three because some companies report on all three, only two or just one, so you want to be sure you've got all the information you need to start your financial recovery on the right foot.
Second, take a look at all the reports and make sure you can account for each purchase. You'd be surprised how many things sneak onto your credit report. If you search google for the company's name that is handling your debt, or you do an inquiry with the various credit companies, you can find their contact information. If you feel that there has been an error on an entry or entries on your report, dispute it. Even if you're wrong in the end, better to be safe than sorry.
Thirdly, don't feel overwhelmed. You knew you were in debt, this is just giving you a number to tell you how far into it you were. You can use this as a source of motivation to empower you to turn information into action. Visit Powerpay.org to create a detailed list of your debts in an easy to read excel sheet. You can enable a payment calendar that will allow you to see what would happen if you put x amount of money towards each debt. Once one debt is paid off, the alloted money that was going towards that debt is now going towards another and so on and so forth.
Once you've selected what state you live in, created an account and arrived at the main screen, you can then enter in your debts. Include the company name, amount and interest rate. Save and the website will computer how long it would take you to pay off your debt:
This is what it should look like.
Now click on the "Payment Calendar" link above the debt information. This will take you to a second page. Select from a few options at the top, I recommend Highest Interest Rate First or Lowest Balance first.
Select calculate and scroll down to the bottom of the screen to view your projected calendar:
You will notice that when one bill is completely paid off that allotted amount is assigned to another bill until all bills are paid off. In just over a year and a half you can pay off almost $2500 in debt including interest! This website is truly a valuable resource.
And finally, take this information and roll with it. Its not going to be as easy as it was getting yourself into debt in the first place, but it will be worth it. If things get too tough, recalculate your powerpay plan. Its okay to stumble, just don't give up! Stick with it, stick with me and we'll make it together!
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
I save, you save is brought to you in part by... me! Krystal! I'm 23 years old and I'm out to save some money. I'm participating in a savings challenge here in El Paso with a great credit union, GECU. If I manage to achieve or exceed my goals for the year 2009, I will win the grand prize of 10,000 dollars! So help me out, by posting tips, links to helpful websites and ideas to help me save money! :)
Money might not by happiness, but not having to stress about money problems will make you a happier person.
Peace, love and a handful of pennies.
Krystal
I have an insane amount of debt. Nothing to show for it. I decided in the summer of 2006 that I was going to sell everything I owned, charge up a bunch of credit cards and move to another city. Another country. I went to Thailand. I'll say it once and I'll say it again: I don't regret going, I just regret how I went.
And I'm still trying to get my life back on track. But now I can officially start, and here's my plan that you can follow too.
First, if you're anything like me, you need to know exactly who you owe and how much you owe. If you stop paying on your credit cards, like I did, or if you have floating utility bills, like I do, that you didn't make the last payment on, chances are the company you had those bills with has sold them off to collections agencies. They've probably accrued some amount of late fees, interest or collections fees. The easiest way to get all of this information is to obtain a credit report for all three credit unions. I say all three because some companies report on all three, only two or just one, so you want to be sure you've got all the information you need to start your financial recovery on the right foot.
Second, take a look at all the reports and make sure you can account for each purchase. You'd be surprised how many things sneak onto your credit report. If you search google for the company's name that is handling your debt, or you do an inquiry with the various credit companies, you can find their contact information. If you feel that there has been an error on an entry or entries on your report, dispute it. Even if you're wrong in the end, better to be safe than sorry.
Thirdly, don't feel overwhelmed. You knew you were in debt, this is just giving you a number to tell you how far into it you were. You can use this as a source of motivation to empower you to turn information into action. Visit Powerpay.org to create a detailed list of your debts in an easy to read excel sheet. You can enable a payment calendar that will allow you to see what would happen if you put x amount of money towards each debt. Once one debt is paid off, the alloted money that was going towards that debt is now going towards another and so on and so forth.
Once you've selected what state you live in, created an account and arrived at the main screen, you can then enter in your debts. Include the company name, amount and interest rate. Save and the website will computer how long it would take you to pay off your debt:
This is what it should look like.
Now click on the "Payment Calendar" link above the debt information. This will take you to a second page. Select from a few options at the top, I recommend Highest Interest Rate First or Lowest Balance first.
Select calculate and scroll down to the bottom of the screen to view your projected calendar:
You will notice that when one bill is completely paid off that allotted amount is assigned to another bill until all bills are paid off. In just over a year and a half you can pay off almost $2500 in debt including interest! This website is truly a valuable resource.
And finally, take this information and roll with it. Its not going to be as easy as it was getting yourself into debt in the first place, but it will be worth it. If things get too tough, recalculate your powerpay plan. Its okay to stumble, just don't give up! Stick with it, stick with me and we'll make it together!
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
I save, you save is brought to you in part by... me! Krystal! I'm 23 years old and I'm out to save some money. I'm participating in a savings challenge here in El Paso with a great credit union, GECU. If I manage to achieve or exceed my goals for the year 2009, I will win the grand prize of 10,000 dollars! So help me out, by posting tips, links to helpful websites and ideas to help me save money! :)
Money might not by happiness, but not having to stress about money problems will make you a happier person.
Peace, love and a handful of pennies.
Krystal
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