by Hope
I feel REALLY good about the amount of debt I’ve paid off. Although I’m not where I want to be, I am headed in the right direction for sure!
| Debt Description | Original Total (January, 2022) | Current Month Total | Goal to Payoff |
|---|---|---|---|
| Medical - COVID Hospital Stay | 5,129 | 2,197 | |
| Medical - Hearing Aids | 4,500 | 0 | Aug, 2022 |
| Medical - Testing #1 | 7,506 | 0 | Oct, 2022 |
| Medical - Testing #2 | 5,900 | 0 | Feb, 2022 |
| Mortgage | 97,850 | 94,416 | |
| Student Loan | 19,116 | 18,495 | |
| Total | $140,001 | $115,108 |
For the rest of the year, I am focused on 3 things for my money.
- Saving for a winter trip (it is the family Christmas present)
- Rebuilding my savings
- Continuing to pay down debt but not pushing it for this final half of the year
Here’s what I’m currently paying toward debt monthly:
- $306 = Student loans
- $658 = Mortgage payment
- $250 = Medical debt
After Christmas, I plan to ramp up my debt repayment plan again. In the meantime, I’ve also got to source a new medical insurance policy. Currently, I’m paying for COBRA from my old corporate job. I’m now eligible for my contract job’s policy but it doesn’t look like coverage is worth the $$ so I’m going to try the healthcare marketplace.
Why Slow Down
In preparation for the “why are you slowing down” question, here is my reasoning…
#1
This is Princess first time taking all this on herself. While I’m still paying for her car insurance, gas, and cell phone bill, she is covering everything else including her rent. I want to make sure I stay plenty liquid to help if I’m needed. Along that same line, I have no idea what Gymnast is going to choose to do after high school. And I want to have plenty to support his first year like I did Princess should he choose that route.
#2
It’s getting more and more difficult to get all the kids together. The family picture I posted on my last post was the first time we’ve all been together since, well, I don’t know when. I don’t think it was last Christmas, but it might have been. We aren’t going to Texas for Thanksgiving because 3 of the 5 kids couldn’t go due to work obligations. So for Christmas, I have planned a family trip and everyone has gotten the time off. (It’s not over Christmas, but it is their Christmas present.)
P.s. I know I need to be making some extra money, so I’d been thinking about selling some stuff on Facebook Marketplace. Sometimes I’m in and out, so porch pickup is often a good idea for me.
Hope is a creative, solutions-focused business manager helping clients grow their business and work more efficiently by leveraging expertise in project management, digital marketing, & tech solutions. She’s recently become an empty nester as her 5 foster/adoptive kids have spread their wings. She lives with her 3 dogs in a small town in NE Georgia and prefers the mountains to the beaches any day. She struggles with the travel bug and is doing her best to help each of her kids as their finish schooling and become independent (but it’s hard!) She has run her own consulting company for almost twenty years! Hope began sharing her journey with the BAD community in the Spring of 2015 and feels like she has finally in a place to really focus on making wise financial decisions.
On the upside at least this post does not declare your intention to be debt free of unsecured debt by ” fall of this year” and recognizes that in this season of your life that debt is not your priority. I would ask what came between you and paying off the medical debt that you intended to pay by April 2022 but you actually admit hot tub and car. Your post mentions your priority is a vacation and savings. Do you have an amount you intend to commit to that since that is your priority? Do you still have the original $10,000 in emergency savings or did that get depleted? If that got depleted I would prioritize bulking up savings before committing any large sums to vacation. As you can see corporate America is fickle and the R word has been mentioned on more than one occasion recently( during recessions you are more likely to get laid off). As far as debt goes your mortgage is secured debt that is fairly low interest. Even a pit would likely get $94,000 in my neck of the woods. So steady on. Just make payments and it will go down. Hopefully you are taking into consideration the improvements impact on the valuation of your home and dealing with it accordingly. Your medical debt should be halved by year end if you are interest free and paying $250 a month. And sadly you still will owe 18,000 + on your student loan by year end( you’ve paid $455 between February and now) barring forgiveness. If you are okay with that then the rest of us will have to be. Good luck!
I actually re-prioritized my medical debt payments for a couple of reasons…
1. If I didn’t get the hearing aids paid off within the year, I would have had to pay the accrued interest.
2. Once I saw that I could pay some of the debts off, I figured which ones I could pay off most quickly.
3. The remaining medical debt has no interest accruing.
So I did payoff the medical debt I had planned to pay off by this fall. Just in a different order.
The $10K EF is still in tact. I’ve been saving regularly for the last couple of years. And will continue to do so.
Yes, my house has about doubled in value according to all the different sites you can use to evaluate that. The house across the street which has not been updated in 40+ years just sold for $189K. Insane! But I’m not sure I follow what you mean by “deal with it accordingly.”
I did de-prioritize my student loans. The interest rate is so low. They will die with me. (Not that I’m dying, but just keep it in consideration.) So it just makes sense to keep them lower on my priority list.
If you are paying $250 a month on your medical debt it will NOT be paid off by fall, not even close. It won’t even be paid off by winter. You will be heading into the new year with debt. It is what it is. I am thrilled to hear you still have the $10,000. I will have to admit when I saw the shiny car with the bow and heard hot tub I expected the worst. This is a horrible time to not have that cushion particularly since you only started recently which makes you low man on the totem pole. There is a reason for the saying “last hired, first fired.” As far as deal with it accordingly, I mean that DIY can sometimes mean taking a hit on value. I do remember you hiring a professional to deal with the bath but deciding to DIY open shelving in the kitchen. You already know my feelings on your student loan. I do give you credit though for at least and at last acknowledging the fact that it is not something you really and truly care about paying back.
Student Loans – It’s not that I don’t care about paying it back. It’s just not a priority in comparison to my other debt.
Honestly, all you debts are at such low interest rates and the student loan debt still has a small chance to be forgiven. Your monthly payments are low and easy to cash flow even if your work slowed down. I would advocate for you to pay minimum only on (current) debts forever. And instead start maxing out your retirement savings. You’ve put yourself in pretty good shape on monthly expenses. Now it’s time to ramp up for “old person” Hope.
Thanks for continuing to share. Impressed with your progress through what sounds like a rough 2022.
I have thought of that. And I am really starting to contemplate my “latter” years and how I need to prepare for that. It’s something my fiance and I are in discussions about now.
Right now, and we all know I’m prone to change direction, but for right now, at least the first 6 months of 2023 will be very heavily focused on debt payoff again. I have an idea for something else come next summer…but we will see.
I’m curious if you are currently actively looking for another job (not contract)? I know you are averse to what you call the corporate world, but there are a lot of companies hiring remotely that would offer the benefits you need. It seems that you are in the position you are now (ahead financially) because of the job you had over the last year or two. Why not continue down that path?
I am. Although I certainly waver in my conviction after the final 6 months at that job.
Most likely this 6 month contract will end in a job offer as well. So I’m grateful for the opportunity to “try before you buy”.
But I’m always gearing up my own consulting business again as well.