Thankfulness and the November 2012 Total Money Makeover Update

Many people have been posting something they’re thankful for each day of November on Facebook. I’ve decided to do the same on a weekly basis, but here in the (relative) quietness of my blog. Here are my first seven, in no particular order.

  1. I’m thankful for my husband Dexter. He is my best friend, and he knows when it’s time to bake a batch of brownies and brew a pot of tea. He’s so creative and has so many big dreams. I’m so proud that he’s started a business called Iron Swallow, which offers ready-made and custom comic book wallets, greeting card, and journals.
  2. I’m thankful for the health insurance and sick leave my job provides. I used both today and was reminded that I received amazing services, information, and medication with incredible flexibility and affordability that many people don’t have.
  3. I’m thankful to have a job I love. Real talk: sometimes I get really tired of my job. However, my students–with a smile, a question, or an enthusiastic “Miss Kelsey!”–always remind me that I love what I do.
  4. I’m thankful for parents who taught me about Jesus, always made sure I knew that I was loved, warned me to NOT EVER mess around with credit card debt, and have been a great example of what it looks like for two imperfect people work together to make a marriage survive and thrive.
  5. I’m thankful that we got through our fire safely, and that a year later we are back home with our puppies and a mostly unpacked house.
  6. I’m thankful for our roommate. She has introduced us to some amazing Honduran foods, she made my birthday celebration extra special, and she’s just a good friend.
  7. I’m thankful that for the first time since our fire, we are able to make extra payments on our debt each month! Since September, we paid off 1.3% of our debt and we have 63.6% to go!

What are you thankful for this month?

Total Money Makeover Update: June 2012

Life has been a tad chaotic since I last posted about our Total Money Makeover progress.

After our fire, we lived in a Comfort Inn for 6 weeks. We ate out every night–which is not in our normal budget–and were begrudgingly given an advance of $500 (after we’d spent about $1000) by an insurance lady who said they didn’t usually give advances for food. (Which begs the question, What must one need in order to get an advance?)

Then, we moved to a condo and were given a rather random and unhelpful assortment of our stuff to live with. Salad spinner – yes. Bed sheets – no. We also were blessed with the companionship of a family of adorable, but filthy and disgusting brown mice who were much too smart to crawl into our humane mousetrap, even when it was full of cheese and peanut butter. About a week before we moved out, our property manager finally returned our call about taking care of the mice, but we decided to live with the mice and let maintenance deal with mouse-killing after we were gone.

About a week and a half after we moved back into our newly remodeled home, I took one of my students to the hospital and spent most of my evenings for the next three weeks with her. When she was discharged, she moved in with us and became our unofficial foster daughter for a few weeks. Then, she decided to get married.

During all of this, Dexter spent about two months out of work, though God blessed him with a few fantastic freelance jobs. He now has a nice, predictable job at a bank and I get to see him dressed up, tie and all, every morning. We also took an amazing class called Perspectives which added plenty of homework to our schedule. Dexter, always creative and always entrepreneurial, started a handmade product business which I’ll tell you more about soon.

How has all of this life affected our financial situation?

For the last eight months, we haven’t budgeted well at all. We started using a credit card and paying it off every month, but then using it again because paying it off used up our cash flow. After depleting our emergency fund, our car stopped working, so we opened a new, interest-free credit card for that bill.

For me, this summer is about getting back on track financially. We’re paying off the credit cards, getting back on the cash envelope system, and trying to live simply.

I remembered getting to the 75% mark in our debt repayment process, but I didn’t remember how close we came to 70% last time I calculated our debt. I was happily surprised that after months of paying only minimums, we had still made visible progress. Over the past seven months, we paid off 2.8% of our debt and have 67.9% to go.

We haven’t received the check for what we lost from the insurance company. This is mostly our fault, because we haven’t finished our paperwork. I like to blame this on the people who cleaned our house, because we keep unpacking damaged items mixed in with undamaged items, and having to record them in our paperwork. We have a few pieces of furniture to get repair estimates for, and then we should be done. Once the check comes in, things will look a lot more cheery in the financial department. With the check, we’ll do things like:

  • Save money
  • Replace our bed (We are currently floor-camping, and have been since February 6. It’s surprisingly comfortable, but we’re thankful for the new carpet underneath the sleeping bag.)
  • Replace our couch, window treatments, and set money aside for things we discover we need in the future
  • Fix our air conditioner
  • Look into refinancing our house
  • Finish paying off Debt #3

In my imagination, we’ll take the rest of our thousands of dollars and go on a vacation and buy a new car, but it’s unlikely we’ll be able to do all the things on the list above. A girl can dream.

Total Money Makeover Update: September 2011

Hello, internet. It’s been several weeks since I’ve blogged. School started, we got a second renter, Dexter and I have been talking and praying about future dreams, and I just plain didn’t want to.

This blog and I have become frenemies. I love the chance to write, to interact with the nice people online, and to urge myself to be creative. However, I think I’ve been taking it all too seriously in light of my other priorities. I also struggle with what to write about–freedom is a blessing and a curse for the no-niche blogger.

I did, however, commit myself to updating the blog monthly with our debt repayment. I knew what to write about. I didn’t feel like I was contriving something to write just so I could talk to you. I thought some math symbols would break the ice or anesthetize the awkwardness. Whether or not it’s working, here I am.

close up picture of keys on a calculator

In August, we paid o.5% of our debt and we have 71.5% remaining.

It’s far enough into September that I know what our extra loan payment situation looks like. Last month, I naively wished that for my birthday in October, I could pay off Debt #3 or at least get down into the 60%s rather than the 70%s. Then, we paid for six months of auto insurance, a year of life insurance, three new tires, and new front breaks and rotors. So, not only do we not have any extra payments, we’re dipping into our baby emergency fund.

I was really frustrated when I prepped the budget for this month. I really want to be out of debt. I’m tired of the bondage and having an eerie voice whisper in my ear in the checkout lane.

You shouldn’t be buying this. Underpants without holes aren’t a need, they’re a want. Who cares about animal welfare; you need money.

While I successfully smother these voices long enough to buy what is good and practical to buy, the feeling they leave is uncomfortable.

What’s wrong with you? Why did you let yourself get into so much debt in the first place? Was a college education really worth it? Why is it taking you so long to pay off? You must not be smart enough to take care of your finances. Other people are done paying off their debt after 18 months. You’re not even 30% of the way there.

My inner-monologue is not always very friendly.

I had to remind myself that we made the choice to make less money at the beginning of summer. I didn’t tell you why, but I’ll tell you now.

My extremely talented (and handsome) husband cut down his paid hours at the coffee shop and was accepted as an intern at an innovative, well-respected web development company, Cramer Dev.

It was a gutsy move on Dexter’s part. He took the cut at work without knowing he’d get the internship. He worked really hard crafting a layered print resume that combined an 80s color scheme with professional quality. (Yeah, he’s that good.)

Since June, I went from understanding 99% of what he told me about his coffee shop job to giggling in the middle of his how-was-your-day report because he sounded like the trumpet-voiced teacher from Charlie Brown to me. I listened really hard, though, and figured out what the words meant.

He has learned so much in the past three months, and he has been so happy learning it. When he used to get on facebook or Tumblr to kill time, now I catch him writing CSS on the sly. My new question for him, whenever I see what he’s created, is, “So, did you make that by just typing some words?”

So, when I remind myself that, aside from slowing down our debt, this summer has allowed Dexter to pursue a passion and develop skills for his vocation (which may end up helping us to pay off our debt faster down the road!), the sacrifice of staying in debt just a little longer is a no brainer.

Total Money Makeover Update: August 2011

Since I’m switching to budgeting a calendar month at a time (rather than starting at the 15th of each month), I knew I would have to do a teeny-tiny, half the payments update sooner or later. So here it is.

In the past two weeks we’ve paid off 0.2% of our debt and we have 72% left to go.

I’m not expecting a huge drop in percent next month since we made a bigger payment last month with my multiple paychecks from school. My first paycheck of the school year is in September, so I’m hoping to be able to celebrate my birthday in October by moving down into the 60s.

Total Money Makeover Update: July 2011 – Shaking Up My Easy Budgeting System

Since we’ve become an all-Mac family, I’ve had to change the way I track our budget. I was so frustrated since I had spent years perfecting my system. The upkeep was quick and painless each month, and it was easy to check on my progress throughout the month.

Those days are over. I’ve spent the last month or two downloading the wrong version of Quicken, downloading the right version of Quicken, realizing that my bank’s files aren’t compatible with Quicken for Mac. (From what I’ve read online, this is because Quicken wants extra money from my bank to give them permission to let me have a file with the EXACT SAME NAME. I found a way to hack the system, but I didn’t want to get in trouble. Plus, on principle, it should just work if I’m paying that much for their product.) It hasn’t been fun.

I’ve decided to give Mint.com a go, since it’s free and *should* look up all my financial information for me each time I log in. This will save me time logging into each of my loan accounts to track our balance each month. However, it seems like every time I log in there’s at least one financial institution that’s not updating properly. So, I may not be saving any time at all. But did I mention it’s free?

By using Mint, I’m also giving up my ability to track my spending starting on the 15th of this month. I’ve gotten around that problem by using part of my triple-beginning-of-summer-paycheck to give us a cushion at the beginning of each month up until the latest day our first paycheck might come. So, after this month, I’ll plan to do my Total Money Makeover Updates during the first week of the month.

Unfortunately, my way of coping with changing our budget system has been avoidance. In fact, my task tonight is to catch up on July and see how big a hole we’ve dug for ourselves where we’re at on this month’s budget. We’re thankful that my summer job brought in a few hundred dollars more than we’d planned so we could pay the $130 ticket we got for forgetting to register our car have a little bit of cushion on our summer budget.

Let’s cut to the chase.

This month, we paid off 2.1% of our debt and we have 72.2% to go.

And remember…register your vehicle.

Total Money Makeover Update: June 2011

Goals are a blessing and a curse.

They say that statistically there is correlation between writing down goals and achieving success. I don’t know who they are or what sort of study they did, but there is obviously some wisdom to formalizing plans for what you’d like to accomplish. Dexter and I planned to pay off our debt pretty quickly after college. However, until we set our goal to have them paid off by March of 2014, we paid our minimums each month and made no progress. Since setting the goal 16 months ago, we’ve paid off a quarter of our non-mortgage debt.

The curse manifests when you’re not making the progress you think you should be. To be out of debt by March of 2014, Dexter and I would have to pay off 2.4% of our debt each month. That has not been happening. I really like to look good in front of other people, and reporting that we’ve paid off less than 1% of our debt month after month doesn’t qualify as “looking good” in my book.

Speaking of what we’ve paid this month, since May 15, we’ve paid off 0.7% of our debt and we have 74.3% remaining.

Photo Credit: foxumon

Last week, I couldn’t fall asleep one night, so I got up and did what any normal person would do: I averaged interest rates, used debt snowball calculators, and created Excel worksheets. The information I found told me that on a fairly (but not incredibly) strict budget, getting out of debt should take about seven years. Not from when we started, but from now. I’m pretty good at math, so I realized that seven years is more than the three that we had been hoping for.

Needless to say, I was upset. It was a busy week, so I didn’t have time to sit down and talk to Dexter about what I’d learned. On Wednesday night, I was working on our summer budget, hoping (while doubting) that we’d be able to pay off Debt #3 this summer. I had been hoping and planning to do this for so long, that even though I knew we probably wouldn’t have enough, I almost wrote the check and took it to the bank, thinking that if I just did it I could escape the consequences. (This is the kind of risk that people like me who have never experimented with drugs and other risky behaviors do for a rush–we think about paying off debt irresponsibly fast.)

Thankfully my logic defeated my impulse, because we only had enough to pay off a quarter of what remains on the loan. If I had paid it, we would have been living off emergency savings, car replacement savings, Chrismas savings, and spare change from the top of the dryer all during August.

All this begs the question: Why did we think we could pay off the loan by March 2014 in the first place? Easy. We thought we’d make more money, spend less money, and let God help (but just a little bit).

Why are we making less money? Although it sounds terrible, we actually made a decision last month to start bringing in less money for a short period of time with the hope of increasing our income even more in the future. I’ll share more about that decision next week.

Why are we spending more money? That’s a harder question. We’re doing good things with our money, like giving to Compassion and Campus Crusade, buying local food, and using dairy from happy cows. We’re also doing a bad job keeping up with our cash system, which means more “I’m sure we have enough” purchases on the debit card. We’re eating out more. We’re getting comfortable, knowing that we make enough to pay the bills each month.

Why are we “letting” God help? We purposely chose a goal date to be debt free that was a bit of a challenge. We wanted God to be glorified through our journey to debt freedom, and that wasn’t going to happen if we approached the goal as if we could do it all ourselves.

What are we going to do about it?

The problem I see with the answers I’ve given above are with how comfortable we are parting with money. For the past several months, I haven’t been mad about our debt. I remember looking at a tax form for one of our student loans last year. I realized that we had spent one entire month of my income on interest for that one loan. That made me sick, but it also renewed my sense of urgency about getting out of debt.

Looking at our summer budget this week and realizing that we couldn’t pay of Debt #3 made me mad. When I analyzed our summer budget, I thought, “Who needs clothes when you have debt?!” and “Restaurants are for rich people!” I did, obviously, leave some room in the budget for those things, but I have a renewed desire to spend as little as possible in those areas. Hopefully this new drive will help us stick to the budget and really analyze what is a need and what is a want.

 

Total Money Makeover Update: May 2011 – Hitting a Milestone

Remember how I keep saying that we’re going to get back on the cash envelope system wagon? This month, I really meant to. But Dexter got called into work the morning I was going to go to the bank, so I didn’t have a car, and then a trip to the bank never happened. It was another one of those haphazard-spending-amazed-we-came-out-okay months. But this month, I’m going to make it happen. 

We bought a computer this month, which should contribute to my blogging more regularly. We have only had one easy-to-use computer for about a year, so now I can blog and Dexter can write his web novel* simultaneously. Although the new computer has brought about tremendous happiness and convenience, it definitely hurt to shell out that much money once I figured out what percent of our loans it would have paid off. I try not to think about it.

I am happy to report that we have finally reached our long-awaited milestone. This month, we paid off 0.82% of our loans, and we have 74.98% to go! I had to switch to two digits after the decimal otherwise my rounding would have pushed it up to 75%, and I really want to remind myself that we are under 75%!

I’m unsure of how to predict and plan our progress for the next few months. We need to refill the (new car) savings we used to buy our computer. We’d also like to buy a new bed frame and do a few projects around the house. Obviously, we’ll attempt to accomplish those things spending as little money as possible, but it will take at least a little cash. We’re at a point where we know it’s still going to take a few years to pay down our debt, so we have to decide whether we’re going to hold out on buying conveniences (like a bed sturdy enough to withstand our four-legged, 65-pound baby jumping on and off multiple times a day) until we’re debt free, or if we’re going to slow down our repayment a bit so we can enjoy them now.

The bed I really want...only $350.99 from overstock.com!

What would you do? Buy a bed and fix up the house or wait until 2014 and end up debt free a month or two earlier?

*Warning: The comic is rated PG for violence, but if you click away from Dexter’s web novel you’ll find web comics that are rated R for language, drug references, and zombie violence. I also rate Dexter’s novel A for awesome.

Total Money Makeover Update: April 2011

Photo Credit: Billy Alexander

It’s been a busy month! Our evenings and weekends have been packed with events, friends, and responsibilities. I’m at the point where when a friend cancels, I’m thrilled. I even had to take a rain check on an invitation for dinner with this lovely lady. We’re looking forward to our next completely free weekend on May 21. (Sigh. That’s a long time.)

We’re not making extra income like we were in the fall when I worked after school three days a week. I miss the check, but as busy as we’ve been, I’m so thankful it’s no longer such a frequent commitment. It’s also been interesting to see what cooking for four has done to our budget. I also failed to get cash in my envelopes last month, which resulted in us coming in around $60 over budget. (It’s a miracle that it wasn’t more!) Since our month starts today, I plan to go to the bank tomorrow morning (or send Dexter) so I don’t make excuses later.

I was disappointed about the lack of extra payments we made this month. We paid off 0.8%  of our debt and have 75.8% to go. Next month we’ll make another small extra payment, but I’m hoping it at least gets us down to 75%. The following two months should be much more fun!

Thanks for checking in on our progress!

Total Money Makeover Update: March 2011

Photo Credit: Egahen

The past 28 days have been busy. Although in January I resolved to use cash for all of our spending, we never made it to the bank to get cash for this month. Fortunately, we didn’t have a lot of time for shopping, either, so I didn’t waste money on things we didn’t need. We bought food and toilet paper, and we paid our bills.

We had a friend move into our basement for a three-or-four-month stay and invited another friend to eat dinner with us on a regular basis, so we had to increase our grocery budget. I’m still figuring out what a grocery budget for three grown men and one woman should look like. Fortunately, I don’t think it will quite double what we currently spend. Hopefully, it will help us to use up everything we buy and will force me to plan meals better. (It’s a lot harder to “wing it” at dinner time when there are four stomachs to feed!) I may have gone a little crazy buying canned food for the nights I don’t feel up to cooking. There were some good sales on Indian food and Muir Glen organic soups the weekend our friend moved in, and I bought about 16 cans (which is really only about 8 meals). I’m hoping to get some freezer cooking done over spring break to further save money and take the stress out of making dinner. (Dish suggestions welcome!)

Last month, I shared a review of the progress we made after having done our Total Money Makeover for a whole year. It was rewarding to see how all our hard work has paid off! When I made this month’s budget, I was a little disappointed. We had lots of extra income due to our tax return, but we also had some larger-than-usual expenses, so the extra loan payment amount on my spreadsheet looked pretty boring and average. However, after totalling our remaining debt and calculating our percentage, I’m encouraged. This month, we paid off 1.1% of our debt and we have 76.6% to go.

I’m also encouraged as I look at the balances for each of our loans. I can see a difference even in the balance even for the loans we haven’t paid extra on. Debt #3, which we are working on now, is looking pretty conquerable. I’m hoping to have it gone by July 1. Debts #4 and #5 are still dauntingly huge, but Debt #5’s biggest digit will drop next month.

Currently, I’m taking Leah’s advice and praying for God to provide opportunities to earn extra money and speed up our debt repayment. For now, we’re pressing on and are hoping to be at the 75% point very soon!

Spring Break on a Budget

For a few short days in December, Dexter and I entertained the idea of visiting New York City over Spring Break. It’s on both of our 30 Before 30 lists (although I’ve been there before), and we were both a little anxious for adventure. (Sometimes I feel like since I don’t have kids–and not because I don’t like them–I am entitled to have adventures. It’s not a healthy mindset.)

I had it all planned out. We were going to stay in this swanky vintage style hotel. We were going to indulge in dessert (and maybe dinner) at this Smitten-Kitchen-mentioned* restaurant. We were going to walk, wide-eyed, around this museum.

But, alas.

Remember my post about making money decisions? Well, reluctantly, I took my own advice and looked at the price of a trip (and let me tell you, I researched some bargains!) in another light. I calculated how much extra interest we’d pay in the long run because of the money we’d spend on our trip. Then, I figured out that by spending Spring Break in New York, we’d be keeping ourselves in debt for an extra 6 months.

Yuck.

We remembered the verse in Proverbs that says, “It is the blessing of the Lord that makes rich, and he adds no sorrow to it.” And we were pretty sure we’d be sorry during the fall of 2014 as we were sending our checks to the student loan company rather than transferring money into savings. So, we decided not to go.

We realized, however, that we do need to get away. We need a weekend without dirty dishes, without picking up dog poop, and without phone calls from work. So, we followed the example my parents set and planned an “urban midwest getaway.” This summer, you might remember, we spent a weekend in Kansas City. Chicago also makes itself into our weekend getaway rotation. (For some reason, we ignore Omaha.)

So, in less than two weeks, we’ll be gazing at the Minneapolis skyline. And we’re pretty excited.

Like New York, the Twin Cities have hotels, restaurants, and museums. And they’ll be noticeably more budget-friendly than their NYC counterparts. This trip will keep us in debt less than a month longer than we would have been. Which, I think, is an excellent trade-off when you consider that our options are a) go on this trip or b) go crazy.

Here’s the thing: We don’t really know the Twin Cities area very well, so we need your tourism advice.

What would you do on a weekend away in Minneapolis?

(Can’t decide what advice to share? Consider the following. We’re not on a super tight budget–although concert tickets at $100 a pop aren’t going to happen. We like food–especially local, organic, and humane. We like coffee–especially fresh, small-batch roasted coffee. We like shopping. We like museums of all sorts. And Dexter is kind of a hipster–you know, the good kind, with hipster taste and none of the attitude.)

*Click that link. Make that gingerbread. Flour your pans well. You won’t regret it.

Photo Credit 1 & Photo Credit 2