Saturday, October 20, 2012

One year of debt reduction

Today marks the one year anniversary of my decision to finally tackle my finances and mountain of debt.  Many of the changes I’ve made over the past year seemed pretty insignificant against the mountain… how much does remembering to use a coupon really save, is a couple degrees on the thermostat actually worth freezing/ heatstroke?  Some of the changes I needed to make seemed impossible… could I really give up my junk food addiction, could I learn to want less stuff in a commercial world? 

I stuck with it for a whole year and now I get to look back and see how far I’ve actually come!  I haven’t perfected my lifestyle by any means; I still struggle with eating out, I still give in to “wants” more than I should,  I still forget to bring my coupons and I still debate the thermostat setting.   But now for all the times I fall back to bad habits there are at least ten times as many occasions that I do the right thing without pause.  I’ve also learned how to keep and stick to a budget, started saving for emergencies, and increased how much cash I bring in by focusing on side jobs.

In the past year, I’ve paid off $12,435 of my debt which is 19% of the total debt and roughly on track to the 5 year debt pay-off goal I originally set.  I’ve also already met my goal to set aside $1000 in an emergency fund by the end of the year. 

The next year of debt pay-off will be pretty interesting since I’ll also be saving towards the wedding with S.  I’m still determined to have all of my “bad” debt (car and credit cards) paid off by the end of 2013 so that’s going to mean a small wedding budget coupled with hard work and diligence on keeping spending in check.  I’m thrilled with what I’ve accomplished in the past year and motivated to keep the momentum going in the next year!

Friday, October 12, 2012

Proposal accepted

I thought September was full to the brim but October has already blown it out of the water!

S and I took a little romantic weekend getaway last weekend to celebrate his birthday (keeping within a small set budget of course).  It was also the first time he and I had ever taken a vacation together which makes it extra special.  We drove up the coast from Boston to Deer Isle, Maine which was absolutely wonderful... the sun was out, the leaves were all shades of red, yellow, and orange, the coastal towns were charming, and we were having a grand time just driving!  We stayed at a historic B&B, which by visiting during off-season and staying in the smallest room available were able to pay a rate similar to what I've paid for crappy hotels!  

After enjoying one of the best meals I've ever had we were just relaxing in our room when he surprised me by popping the question!  I was absolutely thrilled (and still am) and now that I've had a week to process the excitement I can start focusing on some of the realities of becoming engaged as it relates to my financial life...

Some of the big questions I'll need to face in the following months:
  • So far in our relationship we've chosen to stay financially out of each others business, how are we going to work together on financial issues? 
  • How much financial merging needs to happen pre-marriage?
  • How much financial merging do we want post-marriage?  
  • Weddings can be ridiculously expensive, what kind of wedding do we want and how much are we willing to spend to get it?
  • How long will it take to save for the wedding?  
  • And lastly, how does all this effect my plan to pay off my debt?  
I'm sure I've just skimmed the surface of questions that will crop up as S and I move towards a union but for now I'm just very happy that S and I have decided to take this big step together!  

Monday, October 1, 2012

End o' the quarter report

Well folks it’s been almost one full year since I started this debt reducing journey and being that it's the beginning of a new quarter it's time to take a look at where I stand:

Student Loan: $36,731
Car Loan: $9,277
Credit Card 1: $612
Credit Card 2: $4,543
Credit Card 3: $1,357
Parents: $0

Total: $52,520

Here’s my starting point back in October 2011:
Student Loan: $38,339
Car Loan: $11,684
Credit Card 1: $10,577
Credit Card 2: $3,635
Credit Card 3: $0
Parents: $600

Total: $64,835

Paid off to date:
4th Q 2011: $5,051 + $0 in savings
1st Q 2012: $1,298 + $150 in savings
2nd Q 2012: $2,771 + $506 in savings
3rd Q 2012: $3,195 + $344 in savings to hit my goal of $1,000 in emergency fund!

Total: $12,315 + $1,000 in savings