Last blog entry was in July 2007... Holy moly, 4 years.
So, where are we at? First, let's take a look at where I left thing at...
Hhmm... Not all that inspiring. Our total credit card debt was a bit above $12,500.
And in September 2011? $10,500. We actually reached an all-time-high of $21,800 in August 2009 (Did I mention I keep record of everything? )
The numbers are not aw inspiring, but there are a few things that have changed since 2007:
1. I changed jobs in early 2010 and am making a bit more money
2. We have a plan to pay off the debt - which started in February 2010
3. We have the motivation!! - laugh all you want, but this is making a huge difference.
So the plan:
I love spreadsheets! So I've come up with a card-by-card and month-by-month pay off schedule.
If we stick to the schedule (and WE WILL!), we're on our way to pay all of our credit cards by April 2012. The monthly payment on credit cards is along the line of $1200-1400 depending on the month. This is a big chunk of our budget, but it's just necessary at this point. I'm simply tired of dragging this debt around. It's ridiculous and preventing us from enjoying ourselves.
So here we go... April 2012! Let's do it
Viewing the 'Budget' Category
Last blog entry was in July 2007... Holy moly, 4 years.
My Roth IRA at Vanguard is now worth $ 2,456.51. Up 5.66% since January 19. Not bad.
I've decided to increase the contribution from $50 to $75.
It's not going to make a HUGE difference, but it's still 50% more.
2007 GOAL UPDATE
My goal of putting 10% of our income in a savings account is not going to happen. I am able to put between $100 and $200 every month, but $7,000 is too much at that point.
I have come up with a
The car loan will be gone by February, just like my goal was set to.
Right now, we cannot make the $1,550 and $300 payment on the mortgage as I wanted to, so I am sticking with the regular payments of $1,477.32 and $252.45 respectively.
One thing that was very overdue since we got the house was to get both me and hubby covered with life insurance.
And because Suze says that no insurance is useful except term life, I requested quotes just for that: Term Life.
Wow! I didn't expect such high premiums.
I asked for coverage at $250k and $500k, for 20 and 30 year term.
For me? $452 to $1,225.
For hubby? $1,600 to $4,615.
Well, we might look at a lower coverage.
I've computed all the debts we have which includes:
- 4 credits cards
- 1 credit card at 0%
- 1 medical bill
- 1 car loan
The plan is to have all of it, except one credit card paid off on February 2008.
The debt totals $11,447.28. Hmm... not great, but we'll get to it.
The plan: snowball the payments until one remains and gets paid off.
The order it will be paid off:
- Chase $25 owed
- Home Depot $35 owed
- Target $311.98 owed
- Citi $1,138.24 owed (all at 0%)
- Medical bill $241.78
- Car $4,603.89
- MBNA $4,918.39
We can allocate $1,180 every months towards that debt, increasing it by $10 every months.
We're actually already 2 months into the plan. The goal is to see all 0.00 in that first column.
------- Edit -------
D's comment about putting the payment from the 0% card into a high yield savings account and only making minimum payments got me thinking: how much would we make in interest if I did that?
The minimum payment on the card is $20. Since we make between $160 and $165 payments, it would leave us $140-145 to put in the savings.
We have an E-Loan account at 5.12%. Let's see...
So we're talking $22 in interest. What should I do? Not as much as I thought it would be.
Is it worth it??
I wrote a few days ago that hubby sat me down, asked me about our bills and debts. I was happy. I thought he got it. Yay!
Today, all of this came down. He got a will kit a few days ago from his work. He couldn't pay for it then, so agreed with his boss that he would when he gets paid next week. He calls me today saying that his boss told him he had to pay for it before next Monday. He's broke (what else is new?) and wants to charge it on my credit card (balance is $5,100 right now and I keep telling him that it's WAY TOO HIGH and I want it GONE!!). I say "No!".
Then I thought: he has a credit card. The limit is only $1,000, but why isn't he using that?
Well, guess why he's not using it? Yes, it's maxed out!!
We've had a gazillion talks about credit cards. He's bad with money, he knows it, I know it. I hate the fact that he has a card because I know he can't manage it properly. He was so happy when he got approved for this one. This meant his credit score and report were almost back to normal. He told me it was his responsibility and he was going to prove to me that he could do it. yaddi... yaddi... yadda... I should have known better.
One of his argument was that it wasn't fair that I have a card and he doesn't. He can't picture himself without a card. I can't make him understand that "you don't have to have a credit card" and that "if you can't afford it, don't buy it".
I want him to give me both cards (mine and his). We're going to have a huge fight over this. I am not looking forward to it tonight.
This is so frustrating...
I haven't been keeping my blog up to date lately. Spring has come and hubby and I have been spending time outside cleaning out the yard, planting a few vegetables. I think we got started a little late, but we'll see. I will post a few pics.
On the financial front. NTD (Nothing To Declare) Bills are getting paid. Although I think I finally got through to DH. He understands now that we have to get our credit cards balances paid. Don't ask me how that happened! When I did a big sigh on Friday when he told me he needed to go to the store and was going to have to charge it on the credit card, he ended up sitting down with me. Asked me where and how much we owed. What are regular bills were, and so on. We have a breakthrough!! Woohoo
The water bill came in this week: $124.09. More than last quarter.
The car is getting paid at a good rate. Balance is $5,135.21. 9 more months and we should be done. When this is over with, next step is to tackle the credit cards.
We had to take $1,000 out of our savings to pay for taxes! Damn... That hurt. But I'd rather pay taxes then get money back. I just wish we had planed that a little better and adjusted our deductions better so we didn't have to pay as much. Anyway, I'm trying to replace it. We're still far from the $18k we need as an EF and I'm not comfortable with that.
I closed my BofA checking account and transfered the money to the MBNA card. That helped a bit.
The balance I transfered from Chase to Citi (at 0%) is also getting paid. This one needs $150/month in order to get paid without paying any interests. We're on track there. Nothing gets charged to that card. I don't even know where it is! (ok, yes, I know where it is, but it's hidden somewhere and I never think about it)
I talked about how we got a new credit card a few weeks ago with a 0% APR on balance transfer for 12 months. We had managed to charge on it already, but the balance transfer wasn't done. We consider it done. I'm waiting for the money to be moved around (ie: Chase cards paid, Citi cards charged), but the request was sent on Thursday.
And on a lighter note, here are two pictures of a new dog, Beaux:
I am late posting our end of month status. I have had to adjust it because I had forgotten accounts. This thing is getting larger every month.
Anyway, here it is.
What has changed?
- I added my Scottrade account info. As you can see, not very brilliant.
- I got a new Citi card. I only got it for the 0% APR on balance transfer, and was going to transfer the whole Chase card balance on it. I have not done that. However,I successfully charged stuff to it already!! Damn me...
Our net worth is up a bit, but our debt has subsequently gone up, which isn't good. I blame it all on Christmas!
I have been completely obsessed with our budget lately, counting to the penny what comes in and goes out every month and trying to figure out what will come in a go out in the next few months. Well you dummy! What about the car insurance?!?!
Last year in March, our insurance comes up. Because I didn't have my US license and we were switching companies, it took a few months for the premium to actually shows as it should. We went from $1,600 to $2,100 back to the "normal" premium of $900. But while it was very high, our monthly payment due was also way up there, and whether I liked it or not, I had to make the $2,100/12 payment for a few months. Long story short, our premium ended up being paid way early in July I think and I sort of forgot we ever had to pay for car insurance. Now our policy is going to come up in 2 months and I didn't factor that into the budget.
Ok, we'll have to readjust he number a little bit. What really makes me angry? This article from Boston.com:
A state law passed in 2004 changed the effective date of the 2007 auto insurance rates from Jan. 1 until April 1, which means anyone renewing their policy during the first three months of the coming year will continue to be billed at the 2006 rate for all of 2007.
And when is my policy being renewed??? Huh huh... in March! Damn you people making laws
I tried to figure out our taxes last night and surprise! We might be owing taxes. I've never owed taxes, I've always gotten a refund. Here's what has changed:
- We both do make more money
- DH's son was living with us so we could claim him as a dependent... not no more!
Since we bought a house only 2 months ago, we have not paid enough interest or real estate taxes to itemize, so we have to take the standard deduction. I have a small capital loss on my Scottrade account, but not enough. This is a really a big bummer!
------- EDIT -------
After a little bit a digging around, I found out that there are 2 things that can be done to lower taxes:
• Earned income tax credit
• Child-related tax credits
• Education tax credits
• Retirement saver's credit
We qualify for... well, none
- Deductions, which consist of
• Standard Deduction/Itemization
• Above-the-line Deductions - I was hoping to find something in the latter, but no such luck
• Exemptions - nothing surprising there, we are 2, so 2 * $3,300 = $6,600 deductions.
Well, haven't found anything for us to use, but I hope I helped someone else with their taxes!
Anyway, whatever you do, don't forgot the Telephone excise tax refund
Loan amortization schedule template on the Microsoft template website.
I have mentioned this a few times in various comments I've left, but I wanted to share with everyone this little spreadsheet that has come very handy to me while figuring a lot of loan-related things: car loan and mortgage mainly.
I found the
Once you've entered all the information in the gray cells, it automatically displays your whole payment schedule, with how much you're paying for towards interest and capital. You can see the impact that making extra payment has on your total interest payment, as well as on the actual number of payments you will end up making. I think it's a fantastic little tool.
--------- EDIT ---------
This is not brand new, but I just found out that MIT offers free online courses from Aeronautics and Astronautics to Writing and Humanistic Studies. I have actually already used it to get a refreshing course in Java.
I said I would do it yesterday, so I'm doing it.
This is still a draft, and I will have to refine it a bit, but here's the list for our goals for the New Year:
:: Savings ::
1. Save 10% of income into E-Loan account (+ ~$7,000)
2. Get my Scottrade account at $3,000 (+ ~50%)
3. Fund DH's 401(k) by $3,000
4. Pay off DH's 401(k) loan
:: Credit cards ::
5. Amazon, Target card paid off by March (3 payments)
6. Chase transfered to 0% APR by January and paid of by December
7. MBNA: send regular payment + raise every month - Have it paid off by December
:: Mortgage ::
8. Make at least $300 payment on mortgage #2 every month
9. Make at least $1,550 payment on mortgage #1 every month
:: Car ::
10. Payment of at least $450/month
-------- Update --------
Here are a few notes on the items above:
1. 10% is not much compared to what I've seen people in the personal finance community do, but it is realistic for us. Anything over this would be great and will go in savings.
2. I was lucky to be able to have $2,500 to "play" with for the past year trading stocks. Well, let's face it, I'm not too good at it. Although I did go as high as $4,200 in a few months only to lose it and come back down to $2,000. My goal is to get more conservative stocks, mutual funds and REITs and with the help of a few deposits along the year get back up there.
3. The max contribution for a 401(k) is $14,000 but that would be about 50% of DH's income. So not gonna happen. Again, I'm trying to be realistic.
4. Oh yeah! That one is a stupid one, and believe me he understands now why you never take loans out of your 401(k):
- He paid a 15% early withdraw fee plus 10% income tax = 25% lost for a lousy $400 loan, that's $100 gone for no good reason!
7. I will get a raise and in the spirit of living one raise behind, I will send every penny of that raise to pay off that credit card and pretend I never got it!
8 and 9. Regular payment on both mortgages are respectively $1,477.32 and $252.45. A few dollar more every money will save thousands in interest over time!
For argument sake, let's say we keep both loan for the whole 30 years - well actually the smaller one has a balloon payment in 15 years.
Loan Amount: $236,800.00
Monthly payment: $1,477.32
Over 30 years that's $295,036.61 in interest.
Payment at $1,550 cuts 54 months (4.5 years) of payments and we'll "only pay" $251,915.36 in interest. $43,121.25 saved.
Loan Amount: $34,000.00
Monthly payment: $252.45
Balloon payment due on month 180: $26,218.06
Payment at $300 cuts the final balloon payment to $9,739.28
See how amazing only a few extra dollars can make??
10. Regular monthly car payment are $263.59. I have been making more than regular monthly payment starting at month #2. I already shaved off 6 months off our scheduled 5 years loan. I'm expecting this to be paid somewhere in May/June 2008. It should have been paid in March 2010.
That was then (October 13):
CC#1 22.9%, 66.5% balance to limit
CC#2 21.0%, 84.7% balance to limit
CC#3 24.0%, 71.6% balance to limit
CC#4 27.75%, 57.4% balance to limit
This is now (December 13):
CC#1 22.9%, 53.1% balance to limit
CC#2 21.0%, 39.0% balance to limit
CC#3 24.0%, 0.0% balance to limit
CC#4 27.75%, 0.0% balance to limit
Woohoo... 2 cards are completely paid off. The other 2 are used for christmas shopping.
Made another transfer to our new e-loan account, which brings our balance to $5,800.
Below is the state of our affairs... A lot of the entries under liabilities have to go. Namely Amazon, Target, Orchard and Aspire for the credit cards.
Our dental and medical bills will also be paid starting Jan 2007.
I put together our budget for when we will be in the house and have to pay mortgage vs. rent
Tel. (Cell & Fixed) $ 92.00
Cable (Internet & TV) $ 109.57
Oil/Gas $ 145.83
Electricity $ 60.00
Food $ 300.00
Insurance - car $ 80.75
Insurance - home $ 42.83
Property Taxes $ 225.67
Mortgage 1 $ 1,477.32
Mortgage 2 $ 287.64
CC#1 $ 100.00
CC#2 $ 100.00
CC#3 $ 100.00
CC#4 $ 100.00
CC#5 $ 250.00
CC#6 $ 125.00
Car $ 375.00
Total $ 2,914.96
The 4 CCs @ $100 will be gone by Feb 1st so that will be a nice weight off our shoulders.
The regular car payment are $267, but I want to get rid of that loan sooo bad!
The Oil/Gas is just an approximation. We've been heating our appartment with gas so far and the house is heated with oil. It's also larger than our appartment... I guess we'll see how that works, but any input on this