Debt Update

Our last debt update was really good! (This one won’t be as good, but our overall debt did decrease.) Last month we paid off over $1300 in debt and 5% of our total debt! It was a great month for debt payoff and we did keep our debt going in the right direction. Due to Christmas, I know we didn’t pay off nearly as much debt, and in fact had to borrow from our savings to make progress this month; but our debt total didn’t increase and we even funded some of our cash envelopes.

The debt we owe our children has continued to (ever so slowly) decrease. We borrowed almost $1500 from each child and have paid back $1250 to each of them, which means we are over 80% of the way through paying them back! Although once we have fully paid them back, we will continue to deposit $50 into their bank accounts, I will be so happy when I can no longer consider them a debt! Our car loan has continued to decrease as well. We have a 0% loan so it’s nice to see the payment actually affect the bottom line; to that end, I don’t really focus on paying extra towards our car payment because it’s at 0% interest. I know that goes against what Dave Ramsey teaches, but I can’t see paying more interest on my credit card balance just to get an interest free loan paid off quicker.

Although we are not paying off our debt as fast as I would like, I am happy to say that for the fifth month in a row, our overall debt decreased! (I am so happy to get to be writing that instead of having to say again that our debt went up!) We are not making giant leaps and bounds in our debt repayment, but slow and steady wins the race. This month, due to Christmas, we had to use some money from our savings account to put towards our credit card so that we didn’t increase our debt. Now, in addition to paying off debt, I need to work on replenishing our savings account to over $10000.

Here are our current debt totals:

            $18,958.93        Credit Card at 16.24% interest

            $250                 The Girl

            $250                 The Boy

            $4785.00           Car Loan at 0% interest

          

Our total debt stands at: $24243.93. YIKES! I can hardly wrap my head around that number. I absolutely HATED seeing a 2 as the first number on our credit card and I’m so happy that our credit card debt is back under $20,000 and at least our credit card debt only has a 1 in the front! In the grand scheme of things, the actual amount of debt is not that much less but psychologically there is a huge difference! I’m hoping for a much bigger decrease next month!

Plus side: our debt decreased! We paid off over $400 of debt in actual dollars, which amounted to about 1.8% of our total debt. I haven’t charged on my credit card since before New Year’s. When I didn’t have enough cash to buy something, I used my debit card instead of my credit card (for the win!). Our car loan fell another thousands place, from the 5s to the 4s (through no extra effort of our own, it was just through normal payments).We continue to make progress on both our car loan and the loan to The Kids and the fact that we haven’t borrowed any more money from The Kids is a plus.

Down side: we didn’t pay off as much as I would have liked because Christmas is expensive. We had to transfer money from our savings account to cover our credit card (Christmas) spending. I didn’t make our goal of under $18,000 by the end of the year. L Of course I also hate that several hundreds of dollars went towards interest on our credit instead of towards the principal, but at least our credit card spending was basically a wash.

Looking forward to: getting our credit card debt below $18000 and finally hitting my goal of under $18000 if a month late. Making continued progress on our car loan and decreasing our overall debt from 24K-something to 23K-something. I’m also looking forward to fully funding our envelopes and using a cash only budget!

If we have a really good month (which is mildly possible due to some overtime The Husband worked) we might be able to go from owing 24K-something to owing 22K-something. I’m not counting on it, but it would sure be nice!

I finally recently posted my 2019 financial goals. They are all doable if I work at them. And if I am successful with each one, I will definitely improve my financial situation.

Clearly, I’m not in an ideal situation. But if I have to get out of debt one baby step at a time, I can do that.

WOW! My debt update posts are consistently my longest posts. This was another one.  If you stayed around until the end, thank you! If you got bored and moved on, I totally understand.