Tell All Tuesday: Four Figure Debt Edition
Our total non-mortgage debt is now in the four figure range.
When I said that last night to my spouse, he added “For now”, because he is more pessimistic about the future life span of the Saturn than I am. But I am trying hard to be optimistic about the Saturn surviving another year, and honestly, if it survives 6 months without any more major issues, we may be able to escape any debt in purchasing a new to us car. If there isn’t anything else major going on. It could happen.
As an aside, I complained to Saturn corporate about the lousy vehicle that is my primary car, as I did last year when the engine died. This time they felt slightly more sorry for me (or wanted more to get rid of me) so they gave me a year’s membership in GM Motor Club to placate me. Since I wasn’t expecting a single thing, it did somewhat placate me. And for the next year, if the car breaks down I can call them to tow it, so there’s that.
Back to the debt demolition! Yesterday I made my “new” $300 payment to my student loan. We are still building up our emergency fund, so I probably should have just paid my $145 minimum payment, but I am stubborn like that. I like to feel like I am making progress. This knocked the balance of my student loan down into the four figure range, and since it is our last remaining non-mortgage debt, that makes our debt total in the four figure range as well. Here are the numbers:
- Debt at start of blog (6/19/07) : $36,451.71
- Current total as of 01/13/09: $9798.95
- Principal paid to date: $26,652.76
- Broken down into:
- Student loan (at 7%): $9798.95
- Credit Card: PAID OFF 2/7/08
- Spouse student loan(at 9%): PAID OFF 10/7/08
- Car loan(at 4%): PAID OFF 11/14/08
- NCN Network Chart % debt paid off: 73.12 (last update, 72.48)
This month, the priority is to get our emergency fund to $2500. Then, everything beyond that $300 monthly student loan payment will go to my newly established ING subaccount, the “new car fund”. I am aiming for at least $1500 per month (starting in February) deposited in that account. That has a strong possibility of not being met every month, but that is the goal. With the economic slowdown, I’ve had less tutoring hours available to me, and my internet properties are not earning as much money as they had been. Couple that with the blasted snow here that has canceled taekwondo classes a few times already in this new year, and my earnings aren’t quite as high as they used to be. But we will do our best to save every penny that comes to us that we can and put it away for a new to us car. Once we get that fund to about $9000, we’ll shift gears to paying off the student loan at a much faster rate and save $300 a month towards the car.
Our emergency fund is currently at $1000. We should be able to get it to at least $2000 by the end of the month, but I am not sure about $2500. We’ll see. On to next month and another month of four figure debt!
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January 13th, 2009 at 12:28 pm
PT, I think you’ve got the wrong date showing on your current total. Shouldn’t it be 1/something/09?
Current total as of 11/18/08: $9798.95
January 13th, 2009 at 12:42 pm
Oops, I always forget to update the date! I shall fix.
Thanks!
January 13th, 2009 at 1:16 pm
You are doing great and keeping me motivated to stay out of credit card debt. Now if I could just pay off that student loan
January 13th, 2009 at 1:18 pm
Your persistence towards getting rid of your debts is so inspiring. I feel that with all the energy you’re channeling towards becoming debt free, things will definitely fall into place and you’ll see the 3 digit debt remaining pretty soon.
All the best!
January 13th, 2009 at 1:36 pm
I’m glad to hear that you’ve decided to increase your emergency fund. We are mostly out of non-mortgage debt (a bit on my credit card from groceries and Christmas that should be paid off at the end of the month is all we have), and we had an emergency fund of $2500. A few broken windows on my husband’s truck, him having problems with his tooth that require a couple of dental visits, and me having problems with my back that require a yet-to-be-known number of physiotherapist visits, and our emergency fund has taken a big beating.
January 13th, 2009 at 1:37 pm
^^^But as of yet, none of it has had to go on the credit card.
January 13th, 2009 at 2:38 pm
Congrats on getting down to 4 figures. We hit that goal, too, right before the new year. It’s really just so inspiring to get to something like that.
Sorry to hear about your Saturn being no good. It must be awfully frustrating.
January 13th, 2009 at 3:21 pm
Wow, that is impressive. Imagine how great it will feel when the mortgage debt is in the 4 digits. I still have my wife’s student loan, my student loan, and a car to pay for, but if I can hold on to my job through this economy I think I can have those all taken care of by the end of 2010.
January 13th, 2009 at 3:21 pm
You GO Girl!!! Just remember, life happens, and if you incur more debt, that’s OK. You have the process and tools down pat, so you will always climb back out.
BTW, if you decide on a specific car model for your next vehicle, think about giving your ING account that name. That would be inspiring
January 13th, 2009 at 5:45 pm
Hey, Paid Twice, had a thought: have you considered using your “new car” ING account to double as your Saturn repair account? Not sure, but maybe that’d make it crystal clear the tipping point for chucking the “old” in favor of the “new”; e.g., if you had an estimate for a repair you’d have to choose putting off buying the new car vs biting the bullet, and choosing a bit of debt [maybe] to complete purchase of a “new” car. May be too discouraging, weird …. I don’t know….. just a thought from my highly compartmentalized brain
January 13th, 2009 at 6:24 pm
That is so awesome. Congratulations on dropping into the 4 figures. Do you see the light at the end of the tunnel yet? Hopefully, the Saturn will hang on until you are able to pay cash for another car!
January 14th, 2009 at 9:09 pm
As a follow-up to Jay’s comment, here’s what I do regarding cars and car maintenance.
I set aside an amount, per mile driven, in my budget that goes against either car maintenance or car savings. If I spend it on repairs or changing the oil, it’s maintenance. If I don’t spend it, it goes into my “car replacement fund.” And I pull from that car replacement fund to repair my car, if needed.
If I don’t see the amount in my car replacement fund going up every month, I know that maintenance costs are getting too high. I’ve used 20, 25, and 30 cents per mile, depending on what I’m driving. (Been doing it for a lot of years, and now even have two cars.)
I don’t add the amount I earn on the car fund to it, but I considered that. I just decided it was too much of a bookkeeping problem, and decided to not keep it as a separate bank account.
January 15th, 2009 at 8:24 pm
keep doing a good job on paying off the debt! I paid off my car a few years ago and I never felt better. Then I was able to put that money into a savings account and did other things with it (like put bamboo flooring in the house, painting and fixing up some things). I’m down to about $2700 in my savings account because I bought a used car (for $3300) a few months ago so that my girlfriend has something to get around in (the car is titled in my name though because we agreed that since I paid for it, it should be in my name). i’m building up the fund again though. having that coushin of money feels good incase of emergencies
January 16th, 2009 at 3:47 pm
Well done, that’s a staggering amount of debt to have paid off! I love this website, it’s keeping me inspired to sort out my finances.
I’m in the opposite situation - I’ve gone from in a fair amount of debt to having a lot of savings due to an inheritance and I’m getting ready to buy a house. But I’m saving and snowflaking as hard as I can to pay for all the moving costs and make sure we are secure through the recession.