The scariest thing I have ever seen is looking at my online banking and noticing the total amount under loans: $44k. *shock* I recently consolidated my student loans, one from an outside company and the other from my bank. That made up a good chunk of the total. The rest was from a small loan ($10k) I took out to start paying off my credit cards. Yes, I know you cannot borrow to pay off debt. But I had to do something. The interest rate on the loan is at least 2% less than the interest rate on the things I paid off. The amount of money required for payment on the loan is exactly the amount I had been previously spending on monthly payments. With the added bonus that I will have it paid off in four years, something I couldn't guarentee with just paying off cards.
Of the four cards I paid off completely, I have canceled one of them, one the account was already closed. The third I want to close I haven't been able to find (it's in a purse that I don't use anymore so I know where it is, I just don't know where exactly it is), but once I either find the card or find an old statement I will be canceling that as well. The fourth I am keeping open. Why? Because of the cards I paid off it has the lowest interest rate and I intended to keep the card open to begin with.
I will admit it has been a little hard to not use my paid off credit card. And I will admit I have used it once or twice, but only because I needed (and yes, I mean need not want) things that couldn't wait til my next paycheck and as soon as my paycheck arrived a week later I paid off the balance.
It is very easy to fall into the trap of using it again. I am doing my best not to fall into it. I did buy some concert tickets with it and I don't know that I'll be able to cover the expense with my next paycheck. That should have been a warning sign not to use the card but it wasn't. I know this road will be tough but I have confidence that I can do it. I also know I won't be perfect.
I have a dentist appointment tomorrow for a root canal. They will be wanting $260. Between my savings (currently at $115) and my next paycheck I should have the bulk of it. I will be charging it though because it needs to be taken care of before my paycheck arrives. And I'm anticipating having to pay some interest on it but only for one month.
I am a salaried employee but once check a month has extra money on it for extra work that varies month to month so I never budget for it. Usually it just bails me out of whatever situation I've gotten myself into.
My consolidation of my student loans allowed me to re-allocate money to actually budget for the payment of a medical bill that I've been pulling out of my extra money for the past three months. Hopefully this will make things easier.
The plan as it stands right now. Any extra money goes to my larger credit card balance (currently sitting pretty at $15,281.23). We'll see how that goes. At least my budgeted payment for that card is more than the minimum.
Every time I think I have a handle on things something comes up to throw a monkey wrench into the mix. Six months ago I was diagnosed with a health issue and the tests they ran to try and figure out what is the cause are what I'm currently paying off. I have another test scheduled in July, I expect to see the bill for that in September at least. Now that it's actually part of my budget, I'm hoping that I can just stash the money I don't spend after I pay off the current bill in my savings so when the next big bill comes I can pay it off directly instead of waiting. I also now have prescriptions to fill and while I realize that Costco might be cheaper, it's not exactly nearby. I don't know that they take my insurance and to just save $5 and to drive 30-40 minutes round trip twice a month just doesn't seem worth while to me.
Everyone tells me I just need to find a better paying job. I'm looking, sort of. It's a hard call for me to make now that I've got a health issue that requires me to find a job where the health coverage starts relatively imediately and has no pre-existing condition clause. We'll see.
I have done things though to create more take home pay. I get the same amount back in taxes every year so I changed my withholdings from 1 to 2, figured out what the increase was, and found that the amount of money I get extra in 8 months is roughly what I get back standard every year. There's a little more actually because of student loans, but student loans aside, going off of known figures, that's what it works out to. Fortunately I started that in April so for the rest of the year I have a little extra. When January rolls around I'll change it back to 1 and then after I do my taxes I'll see what the damage really is. I also changed my 401k to only take out 3% instead of 8%. My company does absolutely no matching so it's not like I'm loosing out but I just can't justify not putting anything away. Even though I've got money already in the account that will continue to work for me even if I don't put anything more in.
I also did one really stupid stupid stupid thing a couple years ago. I bought into a timeshare. I'm making payments on it every month, and maintenance fees every quarter. I have never used it. And I can't get rid of it because no one wants to take it over at 'full price'. *sigh* But every year I post on craigslist to see if someone will take it off my hands.
I really want to do some volunteer work overseas. I can't do that with this load of debt hanging over my head. That is my biggest motivation to become debt free. We'll see how things go.
I need to get a better job. Or at least somehow increase my income.
June 26th, 2006 at 09:41 pm
June 26th, 2006 at 09:59 pm 1151359148
If I were you, I might want to pay the minimum on the cc's and take the extra each month to create the Ever Popular Emergency Fund. At least $1000. Then, once that is socked away, start paying more on the cc.
That way, when LIFE happens, and it will.........you can handle it with your ER fund and not add more to the cc's.
Just my 2 cents
June 26th, 2006 at 10:06 pm 1151359575
June 27th, 2006 at 03:12 am 1151377921
I was reading another blog that mentioned rebates on merchanise if you get yoru drugs at costco. If you just had to go onece amonth an the rebate is good maybe that will be more than the cost savings. Based on your cars MPH how much does it cost to drive there. If the rebate is bigger than that you may come out ahead.
June 27th, 2006 at 04:30 am 1151382602
June 27th, 2006 at 12:06 pm 1151409979
July 5th, 2006 at 03:49 pm 1152114592
I agree with Ima on the concert tickets.