by Ashley
I pre-wrote and scheduled a couple of posts for today because I’ll be doing my campus interview all day (my itinerary is from 9am-7pm)!!! I probably won’t have a chance to respond to any comments until tonight or tomorrow so I just wanted to give you a heads up on that. Please send me some good vibes, positive thoughts/energy, prayers, good juju, whatever works for you! I am trying to come off as confident (but not cocky), enthusiastic and likable (but not desperate), professional, and articulate. Remember – I’ve kinda got all my eggs in one basket on this one, so it feels like a BIG day for me! Wish me luck!!!
The numbers are in and here’s how my debt has been shaping up this month…
| Place | Current Balance | APR | Last Payment Made | Last Payment Date (original debt, March 2014) |
|---|---|---|---|---|
| Capital One CC | - | 17.9% | - | Paid off in March ($413) |
| Mattress Firm | - | 0% | - | Paid off in May ($1381) |
| Wells Fargo CC | - | 13.65% | - | Paid off in May ($7697) |
| BoA CC | - | 7.24% | - | Paid off in June ($2220) |
| License Fees | $2208 | 2.5% | 250 | January ($5808) |
| PenFed Car Loan | $15978 | 2.49% | 1000 | January ($24040) |
| Navient - Federal Student Loans | $4444 | 8.25% | 16 | January ($4687) |
| Navient - Dept of Ed | $72231 | 8.25-6.55% | 260 | January ($69191) |
| ACS Student Loans | $21040 | 7.24% | 77 | December ($21035) |
| Medical Bills | $6411 | 0% | 75 | January ($9000) |
| Totals | $122,312 (Last month = 123,667) | Total: $1,678 | Starting Debt = $145,472 | |
Maybe it’s just because we’ve reached the 10-month mark so some of the newness and excitement has started to rub off a bit, but I’m just not as enthusiastic about my progress as I was early on in the debt-repayment process.
On one hand, we put over $1,600 toward debt this month! That’s great, right?!
On the other hand, my student loan balances went up. Again. (my minimum payments don’t cover the interest, so the balance keeps slooooowly growing).
And my total debt ($122,000+) is still so out-of-control. I cannot WAIT for the day that I break the $100,000 barrier and dip into the $99,999s.
Hubs ended up making an extra debt payment toward his license fees at the end of last month. So if you were to compare the balance this month to the one from last month, that’s why there’s a discrepancy (the table says $250 was applied this month, which is true, but hubs had made a payment of just over $250 at the end of last month, too, so it’s gone down by $500 compared to last month’s beginning balance).
Can I make a little confession that will become pretty apparent anyway real soon (when we talk about how the budget went this month)???
I ended up going a bit over on a couple categories this month. I think some of the holiday-spending spilled over into January and I was just a little too loosey-goosey on my spending. Nothing crazy or extravagant. Mostly just up to my old tricks again….spending too much on groceries and crap that we don’t really need because its oh-so-easy for me to justify grocery purchases as a necessity, even if they aren’t.
Anyway, my plan at the beginning of the month was to pay extra toward my student loans (above the minimums) so I could pay the interest in full and not have a growing balance. *Sigh* Having gone over on my grocery budget (by a lot, I should add), I re-allocated those funds to cover my frivolous food expenses and, alas, the student loan balances continue to grow. Very discouraging.
I will do better next month!
Another confession, since we’re on that train now…
Hubs and I have fallen off the wagon with our monthly finance talks, too.
For long time readers, you’ll know that hubs and I have a unique financial relationship (I talked about it here when I first started blogging). Some of it is changing (e.g., we’re adding each other to all of our accounts this month), but one of the big things is that I’ve always been the one to sit down and actually pay the bills. When I first started blogging we started loosely following a Dave Ramsey-esque type program where hubs and I would have a monthly budget discussion to decide exactly how to allocate that months’ funds.
Over the holidays we’ve sort of slipped back into our old patterns where hubs has simply given me money and I’ve put it where I think it should go. To be clear, I really am doing what I believe to be best with the money (in terms of debt allocations, etc.), but I do think it’s important for hubs to actually be in on these decisions rather than simply letting me handle the funds how I see fit. Things seemed to be moving faster and progress seemed to be better when we were working together. So that’s coming back at the end of this month as we discuss our plans for February.
Hopefully in the coming months we’ll see some stronger progress!
How’ve you been doing with your debt payments? How do you and your significant other handle finances/bills/etc?
Hi, I’m Ashley! Arizonan on paper, Texan at heart. Lover of running, blogging, and all things cheeeeese. Freshly 40, married mother of two, working in academia. Trying to finally (finally!) pay off that ridiculous 6-digit student loan debt!
I know you all are concentrating on that car loan, but you guys are *so close* to paying off the license fees. Wouldn’t it be great to have a goal for February/early March to knock that loan out and close another account entirely!!! I’m sure your husband would love to put that part of the past behind him.
For me it is harder to control spending in January than in December! It is hard to go back to the frugal grind after the holidays. We also blew our budget for groceries, which meant we had to pull a little bit from savings to still get the debt payments we wanted. So progress — yay big debt payments — but not as solid progress as I had hoped — lots of overspending on groceries and eating out.
I definitely agree that it seems harder to go back to the frugal grind after the holidays! 100%!! I do think I may end up changing up our order of debt payments. I’ve been fighting to pay off the car first, but with a dwindling inspiration and desperate need for a boost of excitement, I think it may be time to move my attention to the snowball form of payment (lowest debt amount first), so I can get a couple quick wins on the license fees and lowest student loan. If I make any changes (which is probably pretty likely at this point), I’ll write a post about it.
Have you considered doing a ‘pantry cleanout’ month for February or something like that? I feel whenever my grocery spending gets out of control, I need to spend some time deliberately focusing on it again.
Yes! I was going to try to institute a no spend week for the last week of the month, but I had a couple of unavoidable expenses (e.g., parking on campus for my interview….though I was told I could be reimbursed for that expense). I need to take careful stock of our inventory and see what kind of creative meals I can come up with to avoid a bunch of additional grocery spending. It sucks that Super Bowl is this weekend because I want to run out and buy ingredients for some fun super bowl foods. I’m really going to try to avoid any more grocery spending!
Have you thought about paying the minimum + interests so that you do not add to your overall debt? It seems to met that it would be better than paying down another debt, just to gain it back on another. Not much traction there.
Yes! I was actually hoping to do so this month, but with my overspending in other areas I had to reallocate the money. But I do think this is a great idea. I hate seeing those balances continue to go up. It’s such a crappy feeling!!
I think it’s hard to get back into frugal mode in January so cut yourself a little slack, but definitely get some strategies in place to stop the budget bleeding! I like Walnut’s suggestion of a pantry clean out, although don’t clean it out too much or you will need lots of extra stock up groceries in February! I just think it’s good to focus on what you currently have hiding in the back of the pantry and freezer and use them up before they go bad.
I know you are focused on the car debt, but you may be able to knock off those license fees in February – and then send even more money to your car loan in March – set a target and go for it. I’m sure math nerds will cringe, but I still think that focusing on your non-student loan debt is best – clear those out of the way and then you can laser focus on the student loans.
Best of luck today!
Thanks for the “good luck” comment!!! I’ll update with how I think it went and little strategies I learned later this week or weekend.
I do think that it’s likely we will end up changing up our order of debt repayment. We need some quick wins right now and the only way to do that is to focus on our lower debts. Hubs and I still need to do a budget meeting, but I imagine I’ll likely be writing a post about what we decide sometime soon!
We all get down and bit loosey-goosey at times. You have acknowleged it and are ready to move forward. Good job. Fake it until you have at and sending prayers for the job search.
Thanks for the prayers! I think the interview went pretty well (its so hard to judge for sure). I’m planning to write a post about it and little things I learned about the process later this week or weekend.
My husband is the same way – he wants absolutely nothing to do with the bills – when I did put him in charge years ago we were consistently hit with late fees & I’m pretty sure had our power turned off a couple of times so I have taken on that chore on a permanent basis 🙂
While he is content to live in denial (aren’t we all), I ask that he reconcile our account each month (I do everything on-line with the credit union and he reconciles on-line so it takes him 10 minutes at the most) and at least that way I feel like he has an inkling of what is going on, what is being paid, etc. Is that something he would consider doing once a month?
We tried the “sit down” financial chats too and all I ever heard was “whatever you thing, that is your area of expertise” (UH, SINCE WHEN…..but I digress). That has worked for us – keeps him somewhat in the loop and only takes 10 minutes of his time a month.
Doing something like this (a quick reconciliation) sounds like a great compromise! Thanks for the idea!
I think making the car a priority made sense when you were making $4000 a month debt payments. Now that the snowball is $1,000 (which is still incredible btw,) and your motivation is slipping a bit I think you should mix it up and pay off the license fees and then the $4444 student loan. You will have 2 more debts behind you and the emotional boost that comes with that. You will be able to focus on your car loan then at a busier time in your husbands business and your snowball will be bigger then. I also think you should adjust your loan payments to cover your interest.
It’s so true! When debt payments are $4000/month its a totally different ball game than when they’re only $1500ish/month!!! And we could certainly use some quick wins for the emotional boost aspect! It’s pretty likely at this point that we’re going to reorder our debt payments a bit. I’d imagine I’ll be writing a post about tis pretty soon.
If I were in your shoes, I would focus on paying off the license fees by March 31st. Get creative and see what happens! Then I would switch back to focusing the snowball on car loan. You’re only a few good business months away from dropping that one down to a four digit balance. In fact, I bet it’s going to be four digits by the end of June.
There is a certain security in eliminating debts that have a heavy cash flow impact. Should there be an economic downturn or an illness, it would be pretty easy to pay the more paltry minimums on your student loans. Being committed to a much higher car loan, however, is more of a challenge.
CANNOT WAIT until the car has only a 4 digit balance (and then a zero balance, after that)!!! I do think it’s likely that we’re going to be re-ordering our debt payments a bit. I’m sure I’ll be writing a post about it soon!
When I was reading your numbers, I kept thinking to myself…why is she letting the balance on the student loans increase?? I looked back at your payoff plan (and the comments) and see that you’re stuck on paying off the car first (though it’s actually your least interest other than medical). I know no one is going to change your mind about that, but have you considered at least paying enough so that the balance doesn’t increase?! Maybe figure it out so the balance goes down even just $25 per month on those. I know they aren’t probably increasing greatly, but that’s all the more reason to pay just a little bit more. Otherwise, you’re just taking a step backwards (for each increasing balance). You are essentially choosing to purchase interest to add to your debt just so you can pay off your car loan. While the car loan in decreasing – which is what motivates you – doesn’t the increasing debt counteract that? I personally don’t think the minimum should be paid on any loan unless zero interest – loan companies love it when people do that. When I was paying off debt, I paid at least $10 per month over the minimum of each, and snowballed the remaining. I know debt is personal and it’s probably frustrating to receive opinions when they differ from yours, we are just trying to help. 🙂
No, no, not frustrating at all! I always appreciate different points of view (especially dissenting opinions) because they force me to take a different perspective of the situation and to open my mind about the choices we’ve made! I do want to pay extra on the student loans to keep the balances from growing (I’d actually intended to do so this month, but then overspent and needed the money to cover out monthly expenses). This was a mistake on my part and I definitely intend for things to be different next month!!
Ashley,
Why are you not knocking out the least amount owed first?
Here’s my shopping tip, if you’d like it – I look over everything in my cart before checking out. This gives me a 2nd chance to “justify” what I’m buying. Often times things get taken out of the cart and I save $. When we do a big shop at Costco I tell the kids they can choose one item for fun (what I consider junk food and would never normally buy!) – they are allowed to put everything that catches their eye into the cart but must choose only one before check out. Really stops the whining for “can I have this?” and teaches them a little self-control management; after many years of shopping this way, it’s all now 2nd nature to them.
Just my two cents. I would check the value of your car on KBB. Then shoot for a loan balance of about 1-2k below whatever the trade in value is. This way you accomplished your goal of uncertainty of the car because you will be assured that you are not underwater. If crap hits the fan you know that you will be able to sell the car to cover the amount owed on the loan. In the case of an accident where it is totaled you know you will be fully compensated by the insurance company.
That should give you enough peace of mind to start tackling some high interest student loans. You could still pick the small one if you are looking for quick wins. I would say leave the medical debt alone but get rid of the license fees ASAP. I would have got rid of them yesterday. All it is doing is putting a bad taste in your mouth and reminding you of stupid stuff you did in a past life. With your intensity, one good month of earnings you could pay them off instantly and never be reminded of them again.