Left Over Money

I’ve talked a lot about how we budget, like here, here, and here. What I really haven’t talked about, other than peripherally, is what we do with any “left over” money. I know that’s a funny term to use, “left over” money, because when you are in debt, there’s really no such thing; when you are in debt, there is a need or a purpose for every dollar that goes through your hands. What I really mean by “left over” money, is the money still sitting in a particular budget envelope at the end of a pay period or budgeting cycle.

The Husband gets paid every other Friday, so our budget runs for two weeks. Every two weeks our budgets for gas and food start over. Sometimes we have nothing left in those envelopes and sometimes we have a few hundred dollars left. It just depends on how hectic of a month it was or how planned and prepared we were or how many places we went during that time. Many different factors play into our budget.

Generally, we take that extra money and collect it until the end of the month when our credit card 1 bill is due; the one we are trying to pay off, and we add that money to however much we budgeted for our payment that month. Usually we budget $300 for our payment.  So, in a normal month, we would pay $300 plus any “left over” money from our gas and food envelopes.

Gas and food are our only two envelopes that don’t carry over a balance. We start those two over every two weeks and use the left over to help fund our debt pay-off.

Prior to having to pay for our kitchen, we were paying between $600 - $700 a month trying to pay off that credit card. Now, we are barely able to scrape together an additional $100 per month.  As our remodel drags on, our debt repayment lags. We still have “left over” money each budget period, but we are having to divert the money towards paying off the credit card that we pay off monthly.  The balances on that credit card have been astronomical since we started paying for the kitchen, always over $4000, and sometimes higher.

Our goal, once we get the kitchen finished and paid for, is to get back to paying more towards our credit card debt. Our hope is to once again be able to send all our “left over” money at the end of each month to our credit card debt.

Thankful

Happy Thanksgiving.!

I am thankful for so much in my life: my family, our home, our jobs, our reliable vehicles, the experiences we get to have. The list could go on and on.

I'm even thankful for our debt. I'm not happy we have debt; but our debt has helped to shape our choices and our opportunities. Our debt is a big part of why we are becoming fiscally responsible.

If we didn't have debt, we wouldn't have learned to budget.

If we didn't have debt, we wouldn't have learned to prioritize.

Essentially, if we didn't have debt, we wouldn't have the life we have.

Although we are working very hard to get out of debt, it is part of our family's past. A big part. A part of our history that helped to shape the life we live today.

So today, instead of whining and complaining about our debt, instead of thinking about what we could do with all the money we send to debt payment each month, I'm going to be thankful for my debt and remember that, in part, it led me to the life I have today.

I'm still going to work as hard as I can to get out of debt, but I'm going to take the lessons I've learned from it with me for the rest of my life and be thankful that I learned them early enough to make a change!

Be thankful!

November Debt Update

I still haven’t decided exactly how I want to share my debt totals every month, so for now, I’m going to stick with a middle of the month recap. 

As of last month, we owed $19439.77. Holy cow that’s a lot of money to owe to other nameless, faceless people!

Over the course of the last 4 and ½ weeks, we have made a payment to our credit card and towards our car loan.  For now, any extra money we have (which isn’t much because of the kitchen remodel) goes towards our credit card that carries a balance. Last month, I was able to make a payment that was about 2 times the minimum payment.  

Okay, here goes. The numbers for this month:

Credit Card 1: $4994.38 at 9.24% interest ~ the current minimum payment is $150

Car Loan 1: $13780.25 at 0% interest ~ payment is $345

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If you’re keeping track, (I know I am!) that’s a grand total of $18774.63

This month's debt payment saw a lot of psychological milestones. We changed the first digit on credit card 1. We now owe less on that card than we have available! To me, that in and of itself is exciting! Not to mention that our debt keeps going down! We also went from $14000+ on our car loan to $13000+. I noticed on the statement this month that we have made 20 payments and have 40 more to go. We are 1/3 of the way done paying off this debt! Lastly, we went from over $19000 in debt to under $19000 in total debt.

Next month's numbers aren't going to be anywhere near as impressive, but I'll take the win while I've got it. 

Last month we paid $705 towards debt, or 3.4% of our total debt. Stupid tax, (more commonly referred to as interest) ate up some of that; only $665.14 went towards paying off the principle. As always, I wish it was more, but the takeaway here is that our total debt decreased.  We did not add any more debt and we were able to pay more than the minimum payment.

The kitchen has really complicated our debt payoff. Any extra money at the end of the month is being diverted to pay for the kitchen. (The current balance on the card that we pay off monthly is $5600!!!) 

(This is copied and pasted directly from my last debt totals update from October 18, 2016.) I’m trying to keep my head up and remember that our total debt load decreases every month, if only by a little. I try to remember that we haven’t added to our debt total in 10 months and that we are better off now than when we started 2016. I try to remember that we choose to not let debt dictate our life or to punish our kids for our poor financial habits/choices.  That’s it in a nutshell, I’m trying.

We aren’t debt free, but we have a plan and are working it.  If we keep at it, we will be debt free.

Seasons

Sorry I fell off the face of the earth... Work has been crazy busy, as has life, not too mention we are entering the holiday season.

Anyhoo, let's get on with it!

I read an interesting blog post from Dream Beyond Debt today. It was all about seasons to spend and seasons to save. She explained the she is currently in a season of spending. I am right there with her. As much as I wish I wasn't.

We are in a season of spending for many reasons. We are remodeling our kitchen (and I think finally in the home stretch), we have two tweens, life happens, and the holidays are fast approaching.

This season is killing me financially! No matter how hard we try, we are outspending our budget. Our kitchen has been a huge expense causing our credit card bills to be over $5000 every month for the last several month. We have a couple of big expenses left there and then, hopefully, spending will slow down.

We also have two wonderful children. However, they often bleed us dry. They each do extracurricular activities that nickle-and-dime us with a $5 purchase here and a $10 fee there. They are constantly bringing home forms for fundraisers at school. They are also getting to the age where they are doing things with their friends: movies, shopping, ice cream, etc. I understand we could tell them no, and believe me, we sometimes do, but as I've said a million times before, we also don't want to punish them for our financial mistakes. Having said that, there are times we just tell them we can't afford it; and I'm sad about that - not that we are telling them no, but that we are telling them no because we can't afford something.

Let's be real, life happens: dryer's break,, Keurig's need to be replaced, and cars need repairs.  Knowing these things happen, doesn't make them any cheaper.

The last major reason we are in a season of spending right now is, quite literally, because the season of spending is upon us. In addition to Christmas shopping for friends and family, we host a huge Christmas open-house every year. It's the one time of the year where we buy prepared (read expensive) foods and all the finger foods you see at the grocery story. And those aren't cheap. But we love having our party and we love visiting with friends and family, many of which we only see once a year at our gathering. I know I could consider not hosting it one year, but I don't want to. I enjoy it.

This has been a tough season, but so far we have been able to weather it. I'm looking forward to a season of saving and relaxing.

I Was Able to Pay that Monster Credit Card Bill

I have an update to report: I was able to pay that monster credit card bill without moving any money from savings!!!

We purchased tickets for several other people on that card and all of them paid me back. That added $800 to what I already had to pay the card and that was enough to put me over the edge! I'm so happy!

The only snafu came when I went to schedule the payment with my bank. I use bill pay through my bank and in order for a payment to post for the next day, you must schedule it by 2:00 PM the previous day. I went to schedule my payment on Wednesday evening, the 9th. The bill was due the 12th so I thought I had plenty of time. When I went to schedule  it, the earliest I could sent the bill for was the 14th. That was a problem. I haven't paid interest on this card in over 5 years and I don't want to start now.

I called the number on the back of my card and had them debit the necessary amount out of my checking account; that way I didn't have to pay interest. It was a pain, but totally worth it.

I'm very happy we were able to pay this bill off but very sad that the whole dance starts over again next month. Our bill doesn't close for a few days and it's already higher than last month's bill. Oh well, we will do our best. We have some savings and our annual spending account we can dip into if necessary.

Just keep paying. Just keep paying.

Trying to Remember the Good

I’ve talked about this a couple of times before, but as humans, we are so quick to point out all the bad things that happen to us, and all the seemingly great things that happen to other people.

Lately, I’ve made a conscious effort to try to notice all the good and “lucky” things that happen to me.

Last night is a great example.

Last December, we bought a new Keurig coffee maker from Costco.  Our old one died the week before our Christmas party (where we serve coffee, tea, and hot chocolate) and we immediately replaced it. We had had our old Keurig for 5 years and felt it was well worth the money so we didn’t think twice about buying a new one.  Well, last night, after only having it for 10 months, the touchscreen on our new Keurig died, effectively making the whole machine useless.

We were not happy. Because we currently have no kitchen, the Keurig was our only source of hot water for coffee, tea, instant mashed potatoes, etc. I was devastated. Not to mention, fewer than 10 days prior, I had to buy an unplanned for and unfunded new dryer. As my brother-in-law so succinctly put it, “you guys are burning through appliances like crazy!”.

At this point, I decided we would try to take it back to Costco. They have a fabulous return policy and we had only had it for 10 or 11 months.

At Costco, I explained the problem was that the screen went out. She asked me if we had any of the accoutrements that went with it. I was honest and told her we didn’t know where any of them were and that we were in the middle of a complete kitchen remodel. She was very understanding and allowed us to do the return without having any of them.  She gave me a store credit for the price of a new Keurig.

I immediately went and bought a new Keurig so we were never without coffee or hot water.

I’m very thankful that it was such an easy process and we had no problems with the return. I’m so glad that Costco’s return policy is so generous and that it really hadn’t been that long since our initial purchase of our Keurig. I’m sure that helped.

It’s so easy to only look at and reflect on all the negative things that happen; I really want to be thankful and remember the good things that happen to me. It’s so easy to play the victim card and think I’m so unlucky and only bad things happen for me while everybody else is just lucky. This is one of those things and it happens to be finance related, but they aren’t always. It’s nice to look on the bright side and recognize that God blesses me in so many ways every day.