Tuesday, January 10, 2017

Time to start anew

It’s the beginning of the year which is when I would normally set some goals for the year. This year in particular is in need of some focus on goal setting after stepping away from the blog for the past year and because of the loss of focus and hope we’ve been feeling. It’s time for us to start anew on our journey, learn what we can from the past and find a way to move forward to the ultimate goal of being debt free.

One of the nice things about having documented my journey on this blog is that I can go back and retrace where I’ve been. With the goal of rebooting my blog and reinvigorating my hope that we can and will get out of debt, one of my first goals of 2017 is to re-read all of my own posts. I don’t want to spend a huge amount of time dwelling on what we could have done differently but I do think it’s important to revisit what worked and what didn’t. I also need to start actively reading other debt reduction blogs again, the lapse in my own writing was coupled by a lapse in reading/ being inspired by other peoples’ debt reduction journeys.

Another immediate goal is to re-work our budget. We ended the year with a balanced budget by moving to a much cheaper housing option and cutting full-time daycare to offset the increases we faced by adding S to my health insurance and by taking on debt for S’ business. However, I just received the estimate for 2017 health insurance and it’s going up again plus our balanced budget only included minimum payments to debt. We need to figure out how to free up some money and bring in more money to get back on debt reduction track and cover the increased health insurance. To that end, I’ve already cut my IRA contributions to get us back to balanced. Over the next month I will be looking at alternative health insurance plans for S and the boys to see if we can get something more affordable, S is looking into part-time jobs particularly ones that may offer health benefits, and I’m applying for Income Based Repayment on my student loan, which may or may not lower my loan payment.

I have not given much thought to the year at large yet, mostly trying to focus on what I can accomplish immediately to get us moving in the right direction again. Once we get through the above mentioned goals in the next week or so and can get a better understanding of what we’ll have to work with in the coming year, I’ll look at what I think we can accomplish in 2017.

Sunday, January 1, 2017

End of 2016 Report

Starting point (Oct 2011):

Student Loan 1 (My fed loan): $38,339
Student Loan 2 (S' state loan): $21,719
Student Loan 3 (S' fed loan): $5,454
Car Loan: $11,684
Credit Card 1: $10,577
Credit Card 2: $3,635
Credit Card 3: $0
Misc. small debts (S' small debts in collections): $5,443
Medical expenses: $3,672
Parents: $600

Total: $101,123

Here's where we are at the end of 2016:

Student Loan 1: $33,579
Student Loan 2: $18,186
Student Loan 3: $0
Car Loan: $0
Credit Card 1: $1,698
Credit Card 2: $5,856
Credit Card 3: $6,930
Misc. small debts: $4,284
Medical expenses: $0
Parents: $1,856
Consolidation Loan: $5,354

Total: $77,740

Paid off to date: $23,381 paid off + $3,543 in savings

Friday, December 30, 2016

What?! A year has passed?

I'm struggling to believe that it's been a year since my last post! This has been an incredibly challenging year, in a lot of great ways but also some not-so-great ways. At the end of last year/ early this year I decided I needed to take a break from some of my various "extra" responsibilities such as this blog and some of my sewing/ Etsy stuff. I really needed to focus on my own career plus helping S' business make the final big push into reality (more on that later). And I needed to focus more of my energies on home life. 

Still, I hadn't intended on taking a whole year off of blogging and I feel, in some ways, that not blogging, not having the record of our financial decisions to "keep us honest" did some damage to my resolve to pay off debt. I am reflecting on the year now, wondering what financial decisions we would have made differently if we'd known how things would turn out. Financially speaking, I am feeling pretty low and am hoping that rebooting this blog may help me find some hope that we will ever get out of debt.

So with that on with a mini re-cap of some of the highs and lows of 2016, starting with some things that were really fantastic:

1. The boys "caught up" with peers from their development delays and are doing wonderful! We worked very hard with speech and occupational therapists and they both tested out of, ie were within normal range, by their 3rd birthday! We also enrolled them part time in preschool during the first part of the year and then went to full time during the summer, both to give S the chance to focus on his business full time and to give the boys a huge leap in development and socialization. 

2. L has been seizure free since early this year! He had one more seizure in February followed by a series of tests which all came back negative... and hasn't had a seizure since! There is still the possibility that he may have another but it's a very good sign that he's had fevers with no seizure activity for so long. 

3. We are expecting baby #3 in spring of 2017! This was a huge decision, I strongly felt that our family was needing one more member but the financial impact of another child is obviously pretty significant. In the end, we decided that this was the right decision and are happily awaiting his/her arrival in early April.

4. We got hitched (finally)! Somewhere right after confirming we were expecting, S and I started thinking perhaps we should go ahead and get married. We had been waiting for our lives to settle down a bit and for us to have extra cash to have the wedding and reception. It was kind of funny how obvious it was that the "right" moment, the moment we had been thinking would happen, was NEVER going to happen. And so we just went for it! We had a small beach ceremony and reception in a rental house when we traveled down to Florida to visit S' family for Thanksgiving. 

5. S' business is really off the ground! We put the boys in preschool full time in late spring through most of the rest of the year so he could put full focus on his work. And we finally put some serious cash into the business to get him fully operational. He worked incredibly hard this year, won some awards for his work, made some great contacts, participated in several large art shows, and got his work in some private collections and galleries! 

And now the not-so-great things:

Each of the above items came with a significant price tag, one that we couldn't pay on just one salary so we had to make some difficult decisions to take on more debt. Getting the boys in preschool was so beneficial to them (and to S' business) but it came at a high cost. The testing for L was also very pricey but obviously necessary. The wedding was modest and we had some generous gifts that helped cover some of it but it still was not free. Another aspect of getting married that will have a great financial impact is that S is now eligible for my health insurance. We added him but it will cost us a significant amount each month but it is critical that he have better coverage than what he had. And although baby #3 isn't yet here, we've been shifting our income towards the end of the year to savings instead of paying down debt to cover my income during the maternity leave. 

We also had very high hopes that S' business would be more profitable this year and the summer started off  with a bang but despite the hard work he put into it, the sales were not what we had been expecting. This has been damaging in so many ways: obviously financially we took a big hit but it also damaged our morale and has us questioning this path we chose to go down. I could discuss in length S' work and probably will in a future post but for now I'll continue on with the short and sweet summary of 2016...

With all the financial burdens we took on in 2016 we had to make some difficult decision during the last quarter. We decided to move again and we took the boys out of preschool. My parents generously offered to let us move into one of their properties at an extremely low monthly rent. The house is not in great shape and we had to put a lot of work into it to be able to move in. But we have a roof over our head and a balanced monthly budget as we head into 2017.

As we wrap up 2016 and start looking to the New Year, we are feeling a bit uncertain and it's my hope that starting up this blog again will give me the boost in focus that we really need to get back on track.

Monday, January 4, 2016

End of 2015 Report

Starting point (Oct 2011):

Student Loan 1 (My fed loan): $38,339
Student Loan 2 (S' state loan): $21,719
Student Loan 3 (S' fed loan): $5,454
Car Loan: $11,684
Credit Card 1: $10,577
Credit Card 2: $3,635
Credit Card 3: $0
Misc. small debts (S' small debts in collections): $5,443
Medical expenses: $3,672
Parents: $600

Total: $101,123

And here's where we are today:

Student Loan 1: $34,040
Student Loan 2: $18,369
Student Loan 3: $0
Car Loan: $0
Credit Card 1: $4,362
Credit Card 2: $0
Credit Card 3: $0
Misc. small debts: $4,284
Medical expenses: $0
Parents: $3,185
Consolidation Loan: $7,273

Total: $71,513

Paid off to date: $29,610 paid off + $1,199 in savings

The final quarter of the year killed us. We were plagued with car troubles, an expensive move, and just plain lack of dedication to paying off debt. As a result, we have slightly more debt at the end of the year than we did at the end of last year. I really hope we can get moving back in the right direction in 2016.

Wednesday, December 23, 2015

Been a busy 6 months

I knew it had been awhile since I posted anything but was pretty shocked when I looked at the date of my last post! Soooo much has happened since July 31st and it's high time I get some record of the changes on here!

Let's start with the biggie: I got a promotion at work and we moved again! Probably right around the time that I last posted, my company advertised a position in the Louisville office (about an hour and half from where we were living). I immediately put my name in the ring even though it would have been a lateral move professionally. Moving to Louisville would get us in the same city as my family, a larger and more active market for S' work, and a more metropolitan lifestyle that we were used to having. Over the course of the conversations with my bosses about possibly moving, the manager of the Louisville office turned in her notice. So the conversations turned into a promotion opportunity rather than a lateral move! 

The negotiations took the month of August and we spent the month of September moving. Meanwhile, my workload increased quite a bit and I have been really overwhelmed by the new job... hence the lack of posts here even though there are a TON of things going on in our financial and debt world.  I would love to report that the majority of these financial things have been positive but that's just not the case. I'll do my best to summarize what's been happening the last three months but the truth is, I've been so busy and overwhelmed at work and with the move that the finances are a bit out of control right now. Now that we're settled in it's time to get our financial house back in order.

The big positive financial impact is the promotion which puts an extra $360 in the budget each month plus a phone reimbursement and some moving expenses. There is also the expectation (built into the offer) that there will be an additional increase after 6 months on the job. On the flip side of the move, we decided to overlap our rental houses by a month to give us some breathing room on making the move. I received some moving expenses but only enough to cover the actual move so the cost of having two places plus utilities for both for a month was on us. And since we still haven't replenished our emergency fund the cost for the overlap (around $1,300) was financed.

Another factor of the promotion is that I was immediately in front of clients on a daily basis and the atmosphere with the Louisville clients is more business attire than my past office. In the past I could get away with a couple dressier outfits and just dress nicer on days that I would be meeting with a client. Now I need to dress nice everyday so my wardrobe needed some immediate upgrading. I went ahead and purchased a few essentials, spending around $200, to stretch the more casual wear I have and will be adding a piece or two to my professional wear each month for the next few months.

Another big financial item we have been dealing with for the past few months is vehicle repairs. One of our cars started shifting very poorly and we were concerned the transmission was going out. Thankfully it is not the transmission but instead a number of smaller repairs plus some general maintenance that needed to get done. The price tag on all these repairs is approaching $1,500, all of which has been on the credit card. Additionally, I was rear-ended on the way to work right before the move by a hit and run driver. Since we don't have comprehensive the repairs to the bumpers (back where I got hit and also front where I was pushed into the car ahead of me) will be out of pocket if we decide to get the car fixed. 

I was fortunate to get a nice bonus this past week so we were able to replenish the emergency fund, put a bit aside for some upcoming one time expenses, and pay off some debt. But it wasn't enough to pay off everything so we're ending the year slightly more in debt than we were last year. I'm trying not to be too disappointed, the past 6 months have been pretty crazy and I think we are in a very good place to make some serious progress in 2016. 

I'll post again soon with our year-end finance report and our new budget going into 2016.

Friday, July 31, 2015

Spare change challenge update

Last July I started a “Spare Change Challenge”. Basically, for the last year, any money that I’ve found (outside of my house, car, and laundry), I’ve put in a jar. This experiment could also be aptly named “I am looking for ways to break up the monotony of slowly paying off the debt.”

Anyhoo, besides just setting aside any spare change, I also challenged myself to increase my chances of finding spare change. I started walking more, taking a short walk before work, on lunch if I could get away from my desk, and in the evenings with my boys. I also started paying more attention to my surroundings when I was walking. I quickly realized that I spend a LOT of time daydreaming, texting, looking at social media updates, and generally NOT paying attention to my surroundings when I’m walking about. It has been really refreshing to walk around and observe my surroundings. AND it has paid off….

In the past year, I’ve found $21.63 worth of dropped money including a $5 in a storm drain inlet, another $5 in a wad along a sidewalk, and a soggy $1 bill at the playground. My little experiment added more to my wallet than the interest on my emergency fund with the added benefit of getting me walking regularly. Aside from the cash I also found some cool and expensive sunglasses, a couple small car toys, a fitbit/ bracelet (the actual fitbit was broken but I kept the bracelet so I can have a spare), and a gas gift card with $2.96 left on it.

Here are a few tips I can give after my year of finding spare change:
·         Walk more!!
·         Increase path of travel such as parking farther away from building entries and creating walking loops instead of walking back and forth along the same route.
·         Walk along the edge of the sidewalk and pay attention to the edge of the road at the curb line especially at paid parking spots
·         Walk where people partied the night before… I feel pretty confident in saying that the $5s I found were dropped after an evening of excess as they were found around known nightlife spots.
·         Also, pay attention in places where people frequently have cash out like shops, festivals, parking meters, etc.

·         Keep your eyes open and mind on the surroundings, I was surprised at how easily I space out when I’m walking about and had to make a concerted effort to stay alert to my surroundings.  

Monday, July 27, 2015

Budget Assessment 5: Debt and revised budget

To rehash the previous assessment points, we were trying to come up with enough to cover the following:

$260 for pre-school
$140 additional for medical expenses/ savings
$150 for IRA plan

So far we’ve cut $45 from utilities budget by enrolling in balanced billing, getting water leaks fixed, and other energy saving techniques. We are working on cutting at least $30 in the diaper funding by starting potty training DS B (who proudly made his first pee pee in the potty this past weekend). We’ll be tracking our grocery and fun money expenditures closely over the next two months and seeing how we can reign in our spending or possibly even make cuts. And, for now, the $8 Netflix stays…. Got major pushback on proposing that cut!

The last budget area to assess is our minimum debt payments. Our minimum payments are as follows:
$205 consolidation loan
$183 to my parents
$225 my student loan
$210 S’ student loan
We’ve received all of the new medical bills from DS L’s seizures and owe $1,909 to many different organizations so there are many different minimum payments.

We’ve decided to put the two student loans in deferment and use my anticipated end of year bonus to cover the accumulated interest. This frees up $435 in our budget to cover the pre-school and medical savings. We’ve negotiated with two of the smaller medical bills organizations to get payment plans set up and will owe $114 for the next five months to pay those two off. There are four additional accounts that are all under the same parent company but since they are different departments, they cannot be combined and the minimum payments are unaffordable. We have been advised to let these four accounts go into default at which time they will be sent to the parent companies central billing department. Once the central billing department has all four, they can combine and offer more flexibility in repayment length. I’m anticipating this process will take several more months and hopefully our first payment will be due after we pay off the first two bills.

The adjusted budget we’re working towards is as follows:

$1,170  29%      Rent & Utilities: gas, electric, sewer, water
   $580  15%      Insurance: Health, life, disability
   $270    7%     Cars: insurance and fuel
   $135    3%     Tech: phones, internet, Netflix
   $620  15%      Household: Groceries, diapers, toiletries, pets, etc
   $180    5%     Extraneous/ Fun: haircuts, clothing, dining out, projects, gifts
   $200    5%     Medical/ Savings
   $260    7%     Pre-school
   $585  14%      Debt: minimum payments
$4,000              Total after tax income

The goal is to have fully implemented all of the cuts and re-organization from our assessment by the end of this quarter, September 30. We will need to re-assess at the end of the year when our loans are close to coming out of deferment. For now, retirement savings is still off the table but is a high priority once we get a handle on this medical debt.