Japan is Expensive!

Last year The Boy and I were afforded the opportunity to travel to Japan as part of our city’s Sister City organization. It was a wonderful experience, truly once in a lifetime, and even though we are in debt, I’m so glad we went. This year, The Daughter is going on the same trip.

The program is actually a home exchange program, 10 Japanese students travel to America for 9 days in March, and then our 10 kids travel to Japan in June. This past weekend we hosted a student from Japan. She was wonderful! I loved having her and it we made so many wonderful memories. But, they weren’t frugal memories.

Although they spend 5 nights at our house, we really only “get” them from Friday night to Monday morning. The Sister City Association calendars the rest of their time.

On Friday night we took her bowling and to In’n’Out. Cha-ching!

On Saturday, we took her to the Santa Cruz Beach Boardwalk and Blaze Pizza. Cha-ching!

Sunday was more frugal and we spent the day at The Daughter’s dance competition and we only had to buy food that day. Food for 5 people… cha-ching!

We also bought her many souvenirs: several tee shirts, many different candies, a small-stuffed animal, and a couple gifts for her to bring home to her parents. Cha-ching!

She was beyond appreciative and gracious but it was a spendy weekend to say the least!

I don’t know how much debt we are going to pay off this month! I think we are going to come very close to breaking even on our credit card, which, in a way, is a win. We should be able to pay off everything we charged on the card, but we won’t make much headway on our debt.

In addition to treating our foreign exchange student, we are sending our daughter to Japan in a few months. We are fundraising for the trip but we pay all the fees upfront and then get reimbursed if we fundraise over our need. We also pay for airfare, spending money, and gifts for The Daughter to take when she goes to stay with her host family.

Her airfare was $1500 and we will send her with (at least) $250 of spending money. Since we found out she was accepted into the program to go to Japan, we have been buying gifts for her host family, so we are mostly done with that aspect of it.

It has been a wonderful experience for my children and I’m so grateful they have this opportunity, but it is expensive; both the hosting and the sending!

Plugging Away

As far as our debt and debt payoff goes, we are just kind of plugging away. We haven’t made any significant strides, but neither have we made any huge goofs.

We did have a very expensive weekend but paid for that using our savings. To that end, we do need to work on replenishing our savings a little bit now. Some of our expensive weekend will also be paid for using our Christmas money as we bought some gifts over the weekend.

Last month was our best debt payoff month ever, which will be followed by one of our worst! Right now, we are just plodding along. Our anniversary is next month, as is my birthday, and Mother’s Day. My poor husband, right?

The Husband bought all my gifts this past weekend. He bought me gifts for my 40^th and everything else. It ended up being an expensive weekend. Because of these expenses, our credit card debt is barely going to go down. We no longer owe our kids any money (YAY!!!) so that is $100 of debt that we aren’t paying off. We will make our normal progress on our car payment, however. I think we are only going to decrease our debt by 1-2%, however, I’m thankful that there will be a decrease.

With our May debt report, I’m hoping it will be better and I’m hoping we will be able to get our credit card debt into the $15,000. (Honestly, that’s such a crazy thing to say, “I’m hoping we can get our credit card debt into the $15,000?”

Net Worth vs. Debt Worth (updated 4/11/19)

I was writing a blog post the other day and as I was writing about my debt, the idea of a “debt worth” came to me. Now I imagine somewhere in the blogoshere and the internet somebody has coined and copyrighted that phrase, but it was the first time it occurred to me. And it got me thinking, what is my net worth compared to my debt worth.

Let’s start with a simple definition.

To me, a net worth is everything you have, all your assets: house, car, bank accounts, jewelry, cash on hand, etc.

Debt worth is everything you owe, and some of those things could be repeats: house, car, credit card debt, solar loans, 401K loans, personal loans, etc., any money that you owe anybody else.

Sometimes in our society, I think people confuse net worth and debt worth with their personal worth. People who have a huge net worth are not better people than people who have a lot of debt. Financial wealth does not equate to “good people”.

Lately, I have been comparing my worth, net worth and my debt worth.

Worth:

4 cars                             $20,000

1 house                        $591,000

1 401K                          $210,000         

1 403B                            $60,000

Bank accounts                $12,000

                                    ________

                                    $893,000

On the surface, it looks like we have a very healthy financial worth, but I only showed you one side of the picture. This only takes into account our assets, and assets are only half of what determines a net worth.

Now let’s take a look at the other side and see a more accurate picture.

Debt worth:

1 car loan                         $3700

1 house loan                 $455,000

1 401K loan                      $8500

1 Solar loan                    $26,000

Credit Card debt              $16,600

                                    ________

                                    $509,800

We have a lot of liabilities so our “worth” isn’t nearly as good as it looks.

Taking away our liabilities, or our debt worth, brings our total net worth down to around $383,200

These are all new, updated numbers for this post. Periodically, I think it’s important to look back at where we were just so we can see how far we’ve come. And we have come far.

Our net worth has increased by over $33,000 since I originally posted this in February of this year. That means we are going in the right direction. A lot of this is market fluctuations: especially for our retirement accounts, but some of it is progress. We are making progress. We are going to decrease our “debt worth” and continue to increase our net worth.

Debt worth is a bigger story than just numbers. Debt, and finances in general, bring so much emotion to the table that it becomes difficult to determine our true “debt worth”.

Debt makes me feel inadequate, ashamed, irresponsible. These feelings factor into my debt worth just as much as the actual numbers do.

Having debt doesn’t make you a bad person, but it often makes you feel like one.

Taking control of our finances and making progress towards our debt makes me feel like I’m getting it right. Making a plan for my money, and sticking to it, makes me feel like I am on the right track and makes the weight of my debt worth more manageable.

I am one of the lucky ones, even taking into account the huge amount of debt that we have, we have a positive net worth, that’s mostly in part to our retirement accounts. Our retirement accounts are nowhere near where we wish they were. In fact, we changed our contributions to help us get out of debt. I can’t wait until we are credit card debt free and can max out our contributions to our 401K again. Then we will really see our net worth grow!

Remember, you are not your debt, even if feels that way sometimes. Your debt worth does not determine your worth as a person, child, parent, friend. You are more than your debt.