I’ve Paid For This Twice Already…

Archive for the ‘NCN Charts’ Category

June seems, looking at my budget sheet, like it is the month of being in the red.  We actually didn’t end up in the red for the month - we still spent less than we earned - but we have slightly less left at the end for debt reduction than I forecasted based on my snowflake earnings.   Two columns in my budget are significantly in the red - the groceries and gasoline.  The price of gasoline just keeps going up so I know why that is, but I was surprised by the groceries.  it always seemed like I was coming in very close to budget every week so how could I have spent $124 more this month than I budgeted?  When digging into the numbers, I figured it out - I did go spend $30 on a huge chicken sale, which was part of it, but the other culprits were my medical procedures, and in the case of my wisdom teeth, not planning well in advance.  First I had my wisdom teeth out, and instead of planning ahead and buying myself soft foods for after, I sent my spouse out to get me things, and he spent a lot more than I bargained for.  I’m not at all irritated by his doing so - I should have bought in advance and planned better.  Then, for my colonoscopy, I had to buy several medications beforehand and I bought them out of my grocery budget because they were over the counter medicines (over the counter meds come out of my grocery budget usually).  I also bought a number of clear fluids to entertain myself with since that was all I was going to be able to eat for a whole day.  Usually I would just drink water for liquid, so that added some cost.  I didn’t eat any solid food, but I bought a lot of white grape juice and popsicles and vegetable broth.

This doesn’t completely explain being so far over budget but it does explain a good portion of it.  My son’s birthday was also in June and the ice cream and other party supplies for his little celebration also came from the grocery budget, so that’s another factor.  Regardless, July is going to be the month I spend less than my budget on groceries.   Or, failing that, I am going to keep a much tighter reign on the groceries and keep myself as close to budget as possible.  I know the cost of groceries has gone up in general, but I haven’t really sat down and crunched all the numbers to see how much of that is the cause of my overspending last month versus just poor planning.

All in all - taking our June income and subtracting from it everything we spent or moved into savings, we have $533.37 left over as our initial surplus.  Subtract from that $132.50 budgeted for irregular expenses that carries over into next month, and we have $400.87 left as our actual surplus.  I forecasted we should have $439.93 left for snowflaking to the student loan, so I came close but I am disappointed we didn’t hit that mark.   Even with going significantly over budget in groceries and gasoline, we did manage to come close to breaking even, and that is due to both some performance bonuses for me at work as well as our utilities bill being almost $100 under budget.   I am going to take the extra $39 from our July utilities budget, which I also anticipate to be under budget this month, and still apply the full $439.93 to my spouse’s student loan along with our $437.59 budgeted minimum payment in a few weeks.  Hopefully I will have some blog income and survey payouts to add to that and hit my $1000/month goal.

Our emergency savings account now stands at $1753.24.  I have paid for the wisdom teeth removal but not yet for the colonoscopy.  Hopefully our portion (which will be 30% of the negotiated cost from the insurance company) will be less than $750.  Because everything medically checked out fine, I haven’t decided what we’re going to do about the emergency fund.  $1000 will definitely stay put there, but whatever over that remains, I may put towards debt elimination, or I may just keep it in the emergency fund as an extra buffer.  I’m not sure.  For July’s snowflakes, I am shifting back to debt elimination mode, and all my snowflake earnings will go directly to debt versus split 50/50 with savings.  This should help knock down the student loan significantly this month - it would be nice to get it to under $5000.  And get our percentage of debt paid off to 50% would be amazing.  We’d have to pay about $1800-$2000 to debt this month to do those things, which I think is not completely likely but definitely possible.  Next week I’ll have gotten some earnings and maybe made some payments so we’ll see where things stand then.

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I started writing this blog on June 19th, 2007, exactly one year ago today.  At the time, I started it rather impulsively to help me organize my thoughts about debt reduction and keep me motivated to continue even after the newness of all the ideas I was trying to implement wore off.

I honestly could never have imagined what a labor of love and support this has turned into.  I truly get excited every day about writing posts, reading comments, thinking about new ideas, participating in the personal finance community, and keeping my focus and drive about reducing my debt.

My spouse and I were talking a few days ago about how my blog’s first anniversary was coming up, and he said to me that when I first told him I had a plan for us to be completely out of all non-mortgage debt by December 2010, he thought I was crazy.  Which, looking back, I realize now is why he basically focused on our credit card debt for the first few months when he was talking about our debt at all, and never really mentioned the car or the student loans.  The credit card debt, I think he was reasonably sure we could eliminate by 2010.  :)  But he doesn’t think I am crazy any more, not by a long shot.

I am happy to report that at this point, not only have we eliminated our credit card debt, but we’ve, in total, eliminated $16,401.39 of our debt in the past year.  And in total, we’ve paid $19,338.48 towards debt (including interest) since June 2007.  Of that, $10,535.33 was the budgeted minimum payments of $810.41 per month and $8803.15 was snowflaked from a myriad of sources, as humble as taking online surveys for some additional pocket change and as big as adding another part time job. We’ve revamped our goal of December 2010 to December 2009 to have eliminated all of our non-mortgage debt, and so far are well within target to meet it.  As of June 19th, 2008, we have paid off 45% of the debt we had as of June 19th, 2007.

On January 1st, 2008, I set a stretch goal of paying $18,000 to debt in 2008.  So far we have, in 6 months, paid $8833.94 to debt.  That is almost exactly on pace to meet the $18,000 stretch goal, with 49% of that goal met in 6 months, and that was with both a car engine replacement and furnace replacement.  I think our stretch goal is well within our reach - only time will tell if we can meet it but I feel very optimistic.  And, as a bonus, meeting that would also mean my spouse’s entire student loan would be paid off.  Being down to only two debts…  I can barely imagine it.  But I want to!

All in all, it has been a great year.  Thank you all for joining me in this journey so far and sharing yourselves with me as well.  On to the next year, and the next chapter of our journey.  Who knows, I might have to start thinking about how to eliminate mortgage debt much sooner than I ever thought I would. 

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Welcome to my weekly update of what’s been going on with our finances and what we’ve paid to debt this week, as well as what decisions we’ve been making as far as debt reduction, savings, and life in general as it relates to money! Some weeks are more exciting than others, and I think this one qualifies as a pretty exciting week. Which is usually true when it’s the week I pay bills.

After a lot of thought about what our priorities are for the future, and also factoring in the logistics of everything, we made the decision not to go to World Championships this year. This isn’t completely because of our debt, although it is a factor, but also because the competition this year is in the middle of the week vs the end of the week as it has been in years past. My spouse would have to take more time off from work and his vacation days are stretched thin as it is with having to take time off for my varied medical tests. And, logistically, I would be driving 12 hours in the car a day after I had a colonoscopy instead of three days after. Which seems a recipe for disaster in and of itself. I could reschedule the procedure, but it would be several months from now and I really would like to make sure nothing is seriously amiss in my colon sooner rather than later. So, basically, the stars are not aligned for it to happen this year.

And, honestly, I feel good about the decision. Yes, I want to be world champion, and yes, I want to just compete even if I don’t win. But I realized that even if I am never in the top ten again and I never have this chance again, I won’t regret the decision to not go this year, because it feels like the right choice for my entire family, not just me. And it feels like the right choice for me too. It wasn’t an easy decision, and I actually used a few list-making pros and cons programs to help me think more clearly about it (more on that later this week).

So, with that decision made, I took the snowflaking money I had been sitting on this past month, as well as the blog and taekwondo income that had come in this month, and put it towards my spouse’s student loan. It ended up being $883.31 on top of the regular payment we make of $437.59 each month, for a total of $1320.90 towards the student loan this month. I also made the minimum payments to our other two debts:

Current total as of 06/17/08: $20,050.32 (original $36,451.71)

Principal paid to date $16,401.39

Broken down into:

• Student loan (at 7%): $11,328.05 (paid min $144.50)

• Spouse student loan (at 9%): $6682.48 (paid $1320.90)

• Car loan (at 4%): $2039.79 (paid min $228.32)

NCN Network Chart: Paid 45% total since start of blog (last month 40%)

If we can pay off another 5% next month, we would hit the 50% mark just 13 months after I started this blog, which would be amazing. But I am not confident that we’ll have that much in income to pay. We also are hovering right on the edge of having paid our debt down to less than $20,000 - and will definitely hit that milestone next month. Hurrah! I had put $728 into our savings account (the matching $883.31 from our snowflakes minus the wisdom tooth copay), because we are still splitting our snowflakes 50:50 between debt and savings until our savings account is at $2000. And then yesterday, because every time I decide to make a large student loan payment, it seems something happens, we had to make an unexpected car repair that ended up being about $350. This came back out of our savings account, which now is still hovering around $1400 instead of approaching $2000. So we will still be splitting the snowflakes 50:50 and since tutoring is slowing down, part of the taekwondo income next month will probably be diverted into our budget versus saved for snowflakes. And there is the possible electrical panel upgrade (which has been behaving so far but we’ll see). I do have high hopes that we may get to 50% paid off by the end of summer.

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Apparently the radiology department is faster at sending out their bills than the labor and delivery department was, because last night I got the bill from the hospital for my CT scan. I then submitted it last night via the web for reimbursement from our Flexible Spending Account, which will completely wipe that account out. Which is okay, that is what it is there for, to reimburse medical expenses. Once I get that check for about $250 (I usually receive it a few days after I request it), I will be paying the $1014 hospital bill. I just paid the $49 radiologist bill as well, and that should be it for this chapter of my health adventure. On to the colonoscopy… at least I’ve already met my yearly deductible.

What I find interesting about all these bills is that the hospital originally billed my insurance company about $4500. Of which, my insurance company basically told them no, we’ll pay $1250. Interesting how insurance works. It is mind-boggling to me that my insurance can get that much of a discount and the hospital just accepts it.

So, this week was pretty light on the snowflakes. Any snowflakes that came in were diverted to paying for the hospital bill, and I will be bringing my emergency fund back down to $1000 to pay for the rest of it. Which is fine, that was what I was saving the extra money for. I have no idea what a colonoscopy might cost, I only hope it will be less expensive for me out of pocket because I’ve already paid my deductible. Be that as it may, I am going to keep the half debt-repayment/half savings snowflakes going and build my emergency fund back up to $2000. Healthcare is one of the only things I can think of where you do things without having any idea what they’ll cost you. Once we’re past the colonoscopy, depending on the results of that, we’ll make a decision as to where we’ll keep the emergency fund at right now.

I did make the monthly minimum payments to the car loan and my student loan this past week, so there was a little downward movement of the total debt. Compared to the progress on my spouse’s student loan, they feel like they are shrinking at a snail’s pace, especially my student loan where half my payment each month goes to interest, but I know that will change in the future. Patience, patience… not my strongest virtue. Here are those new debt numbers:

Current total as of 05/19/08: $21,612.70

Principal paid to date $14,839.01

Broken down into:

• Credit Card: PAID OFF 2/7/08

• Student loan (at 7%): $11,411.24 (made $144.50 minimum payment)

• Spouse student loan (at 9%): $7940.54

• Car loan (at 4%): $2260.92 (made $228.32 minimum payment)

% of debt paid off from NCN Network Chart: 40.71% (last week 39.95)

Yay for over 40% of the original debt (as of last June) paid off! At this rate the idea of being out of debt by the end of 2009 may actually come to pass. I am hoping that next month we can knock the spouse student loan down to about $7000. The car loan is 2 months away from being under $2000 as well. My student loan… well, I think by the time it goes down to 4 digits, we’ll have the spouse’s student loan completely paid off. But then we’ll be able to knock it down pretty quick. Getting the entire debt under $20000 feels right around the corner (although it is probably another 2-3 months away at least).

Here’s to colonoscopies being cheap…

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A few weeks ago, I made the decision to, for a short time, change our financial focus from primarily debt reduction to a mix of debt reduction and saving. Until our emergency fund is at $2000, all my snowflakes will be split evenly between our emergency fund account and our student loan payoff fund.  This was the first month I have put that into action (since everything last month went towards the purchase and installation of the new furnace), so yesterday I snowflaked $446.33 to my spouse’s student loan, and put the same amount in our emergency fund.  The emergency fund now stands at $1446.41.  Gotta love the $0.08 in interest I earned last month.  :)  Added to the debt snowball minimum of $437.59 I pay to that student loan every month, my total payment was $883.92.

When I went to redo my numbers, and recalculate the percentage of debt we have paid off, I saw that we are now at 39.95% of the original debt (as of June 2007) paid off.  It made me wish a little that we were more flexible in our payment ability for these loans, because I wanted to go pay another $19 and throw us over the 40% mark.  But I found when I did the payment from my Revolution Money Exchange bonuses last month, that for the Sallie Mae loan online, my payment has to be assigned to a “payment group” which is a minimum monthly payment - so if I make more than one payment in a month, I advance my payment due date by a month each time I make at least a full monthly payment.  I don’t want to do that, so I will only be making payments to the student loan once a month.

With that, here are the numbers:

Debt at start of blog (6/19/07) : $36,451.71

Current total as of 05/12/08: $21,888.57

Principal paid to date $14,563.14

Broken down into:

• Credit Card: PAID OFF 2/7/08

• Student loan (at 7%): $11,467.76

• Spouse student loan (at 9%): $7940.54 (made payment of $883.92)

• Car loan (at 4%): $2480.27

NCN Network Chart %:  39.95% (last week 37.65%)

When I think about the fact that we have paid over $14,000 to the principal amount of our debt in the past 11 months…  well, that is great but it is also depressing.  That is a LOT of money we could have done a lot with.  Yikes.  But hey, the spouse’s student loan is now under $8000!  And only about $22,000 let to pay before we are free of non-mortgage debt…

Someone asked me earlier if I thought we’d get to the debt halfway point by the blog’s first anniversary.  Then I was slightly hopeful, but now after the furnace, I think it will be a bit later than that.  We’d have to pay about $3700 to debt in the next month… hey - just about exactly what the furnace cost… heh.  But soon!  I have some survey income I just received that will go towards debt for the next month, and I’ll have some blog-related income and another check from taekwondo before next week.  We will definitely be over 40% paid off next week - just by paying the minimum payments on the car and my student loan!

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