As of Oct 20th, I will have been at this board for exactly one year.
I started my financial overhaul journey just a few weeks prior to finding this board.
So in a nod to my first annual checkin, I’m going to share with all of you the details of this first year journey (whether you care to hear about it or not – lol).
Here are the numbers:
I started here $31,707.94 in medical/line of credit & credit card debt
As of Oct 20th this year, I will have $1,630.31 left to pay on this debt.
This means (if all goes as planned these next few weeks, which I think it will), I will have paid off $30,077.63 toward these debts in a one year timeframe.
Of this ridiculous high amount (not braggin’ just saying), approximately $8,000 was from our tax refund (first refund in years), a small bonus, selling an extra car for $3,500 and scrapping spare metal (wherever we could find it).
So this means $22,077.63 came out of our income cash flow from the year.
Honestly, I’m amazed that we pulled this off.
Clearly we have a good income (should be approximately $93,000 this year – I don’t see any need to hide this number since it’s really all relative when we are talking about these sorts of journeys) in order to make this happen. So I’m not looking for kudos here ‘cause I know how fortunate we are . . . have been . . . and continue to be . . .
((We have also had a nice bonus that fully funded our retirement goals (which isn’t in the above calculation)).
Since I decided to share these details with you all, I thought it might also be fun to share with you more details of what we did this past year to make our progress . . .
So take or leave as you wish . . .
This is Bumblingalong’s ideas/suggestions/steps that helped her pay down debt this last year:
1) We had to educate ourselves on what our debt actually was. Seriously. It’s seems so stupid now . . . but a year ago, I thought our Line of Credit was related to our mortgage and didn’t really count as “consumer debt”. Afterall our bank kept telling me it was “as if” it were rolled into the mortgage. But . . . wait . . . I don’t get a break on interest come tax time . . . and wait . . . this isn’t making sense. So honestly, a few months AFTER I started posting here, I FINALLY came to understand that our $20,000 LOC WAS consumer debt. Again, sounds so stupid, right? But true.
2) We started educating ourselves on the value of money. Dh’s time was worth more than he had been making – I mean he was long overdue for a raise. He had been long overdue for a raise prior to the recession even. So he finally (FINALLY) got up the nerve to ask for more money. Again, so darn stupid . . . but when you aren’t holding yourself responsible for what’s going out, you likely aren’t holding yourself responsible for what’s coming in, ya know? So stupid really.
3) “Use it up, wear it out, make due or do without” – ‘nough said. We did A LOT of that this year. (A LOT of that!!)
4) We got financially organized . . . what we owed, who to, at what interest rate . . . streamlined the paperwork and took A TON of advice from SmallChange about organizing our filing system
5) Budgeting time as well as money. Dh (luckily) can do his own car repairs, house repairs, etc . . . (he’s a talented guy), but he can’t get them done unless we budget the time for him to do them. Again, duh?
6) There is tons of room to save on groceries. Now I know some will disagree regarding coupons (they have helped me, but I’ve had the luxery of time on my side – since I’m not working – to make them work. If I worked full time I probably wouldn’t have bothered), but I’ve saved a bunch of money other ways . . . like keeping track of prices, sales, etc. . . stocking up on sale items and learning when you likely to find the best sales. I planted a huge garden this year and I’m reaping the rewards now. And eating in season . . . and at times rice and beans and more rice and beans in order to make the budget balance.
I cannot emphasize this enough . . . when the budget is tight, rice and beans, rice and beans . . . and HELL NO don’t even THINK about eating out! Lol.
7) Lowering all my household expenses; cutting back on utilities, cable, switching my cell plan to join my parents plan, drying my clothes outside, raising my deductible on my car insurance . . . carefully (very carefully) reviewing every bill that comes in – each and every month - to look for more potential to save.
8) Changing my gifting style; giving my time instead of money, talking to family to change our family holiday expectations . . . I’ve learned that I often “over gifted” from what I could truly afford. And I learned, again, how valuable TIME is. So we have been budgeting “gifting time” to cut down the tree in the woods my parents want done, or detail my mother car ourselves for her bday present, Dh and I installed a door (that my sister bought for herself) as our gift for her bday. We divided mums from our yard and planted them at my mother’s house for her Mother’s Day gift.
9) Learning sales trends, when to buy what. Ie: we got a crazy good deal on suits for Dh during Macy’s Father’s Day sales. In the fall tires go on sale, so we saved up to buy new tires for my car, etc. . . Now everytime I think “I need this” I automatically think “Let me check to see when it’s likely to go on sale during the year” and wait it out and put money aside.
10) Last but NOT least, one of the key reasons I was able to stay on track is that I worked on staying motivated. OBVIOUSLY this board was a HUGE help. When I was feeling frustrated, I posted. When I was feeling proud, I posted. I posted, and posted and posted. And I listened to Dave Ramsey on the radio during the day. And I recorded the Suze Ornman show on Saturday. And I sought out and read “frugal living” articles. Days when I felt particularly frustrated, I spent most of the day simply googling “I feel so poor” or “ways to save even more money” – lol. I know . . . pathetic . . . but I think it worked
Now I’m only through one year. I know there is more budget fatigue in my future . . . no doubt.
The plan is pay off the balance of this year's goal next month, and then to give ourselves the entire month of December to celebrate . . .
Then set new goals for next year (ie: paying off/down dd’s student loans).
Likely more rice and beans . . .