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!

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!  

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

September update #2

Besides taking a trip to NYC with my sister and staying on budget for the first vacation in my life, I also finally had my wisdom tooth removed.  The surgery and recovery was a horrendous experience with the pain and swelling, and 12 days later I am still sore but there is a silver lining to the experience!  The biggest is that the whole shebang only cost me $68 ($50 for the surgery plus the pain meds)!  I was thrilled when I got the insurance estimate since it meant I would not have to dip into my precious emergency fund!

The other silver lining is that I decided to do a juice/ veggie fast during my recovery to try and kick my soda/ caffeine/ junk food addiction.  I figured since I couldn’t eat or drink anything the day of the surgery anyways I might as well keep it going and get rid of some bad habits in the process.   For the first 5 days I stuck with fresh juices and veggie purees/ soups.  Since then I’ve gone back to my more normal diet sans the caffeine, soda and junk food.  I plan to stay caffeine free for at least 30 days since most of my caffeine intake was coming from soda and I want to make sure I’m well past temptation before going back to tea. 

Since I started tackling my debt a year ago I knew that one of the biggest money sinks for me are my bad diet habits including junk food and soda.  Bit by bit I’ve cut back on the amount I was spending on the junk but it’s time to kiss that expense goodbye forever (and hopefully my waistline will be thankful that I’m giving up the junk too!).  

September update #1

September has been an unusually jam-packed month so far which has kept me very busy in life but turned me into a complete slacker as far as this blog is concerned.  It's a shame too because so many of the things I've experienced this month have been financially related or perhaps it's just that I can now see the financial impact of every little thing I do!  Either way I wish I had written more as the month progressed, now all I can do is give some updates on how the month has been going so far...

I started September off in New York City (this is where I was when my landlord freaked out about the rent).  My middle sister and I had been planning the trip for a few months, she had found a cheap flight option and we decided Labor Day weekend would be perfect to meet up since we both already had a day off of work. Plus, it was the weekend before my birthday so we would get to see each other near my birthday for the first time in a while.  I know some folks would advise that going on trips when so far in debt is a bad idea and I agree if you're just looking at numbers.  But for me it's not just a numbers thing, spending time with my family and friends is extremely important especially since I live so far away from them.  Traveling and experiencing the world outside of my little day-to-day life is also something I place a high value on.

Since both of us are in the midst of personal finance overhauls and debt pay-off plans we set a very small budget to work with.  We were able to find a pretty inexpensive hostel outside of Manhattan that had a full kitchen so we made breakfast there and also packed snacks to take with us each day.  We also pre-paid for a few meals through Groupon so we could cut our meal budget down even further.  We decided to buy the CityPass, which is bundle of six major tourist attractions at a deeply reduced price, so that we could go to the Statue of Liberty, Ellis Island, some of the major museums, and the Empire State Building.

The trip was fantastic, it was great to be able to spend some one on one time with my sister and to see one of the most amazing cities in the US.  But the truly amazing part is that we (both of whom have been struggling to change our financial habits) were able to set a reduced budget, actually stick to it, have the cash set aside to pay for it, all while having a fantastic time.  We could have easily spent triple what we had budgeted and probably would have if we had taken this very same trip a few years ago!  I am so proud of my little sister and of myself for finally making real changes in the way we handle money!  

So that's how I started the month, I'll post some more September updates soon!

Rent woes AKA My landlord makes paying the rent as difficult as possible

Let me preface what is going to become a rant by saying that I am NOT a deadbeat renter.  I have been renting since I was 18 and have lived in at least 10 different rental properties owned by at least 10 different landlords before the place I am renting now.  Each landlord has had their own rent paying policies and I have ALWAYS paid rent, on time, according to those policies.  OK preface over…

My current landlord has the most ridiculous rent paying policy ever: the rent must be in our mailbox at 9 a.m. on the 1^st for him to personally pick up.  We can’t mail it in advance or drop it off to him.  There is no grace period.  We can’t use e-pay, paypal, or any other 21^st century form of payment.  We must write out a check and, on the morning of the first day of every month, put our check into our mailbox by 9 am. Period.  No exceptions.  

I realize this sounds like the easiest thing to do but for a multitude of reasons it is not working for us.  In the year that we have lived at the apartment, S and I have forgotten to get the rent in the box at least 4 or 5 times.  Why, you ask.  Because the morning of the 1^st is an extremely small window of time when you’ve got two people who are rushing to feed and walk all the pets, prepare lunches and be out the door, half asleep, by 7:30.  Or, for instance, the 1^st falls on New Year’s Day and you are still SLEEPING when your landlord comes banging on the door for the rent at 9 am.  And, yes, sometimes we put it in the mailbox the night before but if it rains or snows we can’t because whatever is in the mailbox gets soaked (which is something that Mr. Landlord really needs to fix).  

After the last missed pick-up I was able to convince Mr. Landlord that we should be permitted to mail him the check in advance.  So this past month I wrote out the check and popped it in the mail several days in advance so it would have plenty of time to get from one side of our small town to the other.  So easy.  Except the check didn’t get delivered on the 1^st which means I got an urgent text, e-mail , AND phone message from him stating that I need to bring him a replacement check right away.  I was in New York visiting with my middle sister so I couldn’t get him a new check and the rent money was in my account so S couldn’t write him a check either to cover the missing $1700 either. 

I called him and was able to talk him off the ledge (he’s really high strung) and I haven’t heard from him today so I’m assuming the check finally arrived.  The whole situation is absurd and is really getting under my skin.  I’ve never had trouble paying my bills before and am really frustrated with my landlord for his policy and with myself and S for not getting this bill paid the correct way every month.  Unfortunately, we signed another year’s lease agreement a few months ago so we’re stuck dealing with it.  For now I’ll be adding alarms to my smartphone calendar and sticky notes around my house.  Hope that takes care of the problem because I really can’t deal with another freak out from Mr. Landlord.

Oral surgery update

Had my consultation for my wisdom tooth extraction this morning.  Not a fun morning.  In typical doctor's office fashion I spent over half an hour just sitting in the waiting room.  I had the first appointment of the day so I'm really not sure why I had to wait so long and I have a suspicion that doctors are now purposefully scheduling their appointments early to make sure none of their precious time is wasted.  By the time I get into the exam room I'm already annoyed.

The assistant tells me that I have to watch a standard video about wisdom teeth and the surgery that is involved to extract them.  The video is specifically catering towards teenagers and their parents and is full of doom and gloom warnings against waiting till past the age of 25 to extract wisdom teeth.  If you keep your teeth you are at risk for all sorts of HUGE health problems... even if they don't emerge, even if they don't hurt, even if they don't come in sideways.  If you wait till you are an adult to have them removed your surgery will be more complicated, risky, painful... the entire seven minute video was basically telling me that I am an idiot with a death wish for keeping my wisdom tooth till the ripe age of 32.  Now I'm really annoyed, shouldn't they have a different video for those of us who did not know we should have undergone a major surgery on a non-problem when we were 18?!

Anyways, part of the consultation was talking about the insurance and payment.  They are going to run an estimate with my insurance company and I have to pay in full my portion on the day of the surgery.  They asked if I would be using anesthesia since some insurance companies don't cover it... um, heck yes I am!  There is not a chance that I would let someone near my mouth to cut out a part of my bone if I was awake, would anyone?  I'm hopeful that my insurance (which is pretty good) will be covering the majority of the surgery including anesthesia but we'll see in a week when I receive the quote.  

The only good thing about this situation is that I actually have the money set aside in my emergency fund to cover whatever costs come up.  I'm so thankful that I've really started getting a handle on my finances and I don't have to worry about pushing off a needed procedure or going further into debt to get it taken care of!