99k by 2011

Beginning the year, we had $32,456 in credit card debt.

In January:

we paid $1,204 total on our cards*
$258 were charged to us via finance charges
for a total of $945 debt paydown.

and now our credit card debt total is $31,511.

* $450 of this total was redeeming our cc points for cash back and just having them put it as a credit on the card.

Just a note, this total amount paid is a lowish number. We are refinancing our ARM in February, and we saved $1500 in January to go toward refi closing costs (which we’re also doing again in February, for $3k to take to closing).

It does make me excited to think that we managed to sock away $1500, AND throw $754 (not counting the “free” $450 from the points) at debt last month. That’s $2254 total! After we get our savings established, as well as a buffer, (and some tires for my husband’s car, which are sucking the life out of our budget) we can probably throw a good chunk at this each month.

I am apprehensive that we miscalculated on our withholding last year and will get hit with a tax bill come April. At the very least, if we DO have a bill to pay in april, it’s good to know that we can handle it and it won’t become more debt. What it means for out debt repayment plan, I guess we’ll have to see.

And lastly — is anyone out there reading this? Just wondering…

I’m all ready to post some January totals, but a-duh.. it might be useful if I posted what the 97k in debt actually looks like. So here goes:

We have 3 credit cards, one of which I recently opened for it’s 0% percentage balance transfer qualities. Here are the January totals:

12% citi amex $7,408
11% usaa mc $17,548
0% citi mc $7500
TOTAL: $32,456
Next up:

car loan: $19,945
home eq: $47,042

total debt: $99,443

(I just realized I need to rename the blog!)

So, the first step is our credit card debt. I am going to attack each debt according to interest rate, and thanks to an annual bonus my husband gets each year, I think we can get all credit cards paid off in a little over a year, March 2009. At that point, I’ll throw all the money that was going towards credit debt to the car loan, and then when it’s paid off, we’ll hit the home equity loan.

I realize we are going to have to be very aggressive to get all this paid off by December 2010, but I think we can do it. Next up - January update.

So I’m a big fan of all the rules with YNAB. I feel like I knew many of them and was doing weird versions of them. For example, our 2 biggest outflows each month is our mortgage and our kids’ tuition (kindergarten for my son and all day care for both). Both are due at the beginning of the month, so I always put aside half of each payment with each of our paychecks the month before. I am paid twice a month, and my husband is paid every 2 weeks (which is usually 2x a month). Then, by the time the new month comes, those payments are sitting waiting to be paid.

What was really a pain in the ass though, was the semantics of it all. We had a savings account which our bank switched over to a checking, because I was making too many transfers in and out of it. I physically placed that earmarked money out of our checking into the “old savings” account in order for it to be “safe” for mortgage and school tuition.

I love that YNAB lets me earmark money for things and I don’t have to physically move that money anywhere. I was already *kind of* living on last month’s incom, with this habit. Wahoo!

This is my journey to get rid of our non-mortgage debt. I am a working wife and mother of two (3yo daughter and 5yo son) and I handle the family’s money.

Well, things have crept up! Most definitely! We knew things weren’t going well. I knew. But I stuck my head in the sand and ignored. Each month, when we ran out of money in our checking account, I would say, “Use the credit card, we’re out of money,” but never pay that balance down. Several years ago, we got a home equity loan to do some work on our basement and decided to also pay off credit card debt with it. 50 thousand dollar HEL, but only 20 of it was for the house. We didn’t change our system, and just racked up more debt on the now zeroed out card. Last year, we also bought my husband a practically new car. So we have 44k on our home equity loan, 19k on a car loan, and *clears throat* 34k in credit card debt. I’ve worked the numbers and thanks to both of us making a good living, and my husband’s yearly bonuses, I figured that we can have this (the credit cards, I mean) paid off BY THE END OF NEXT YEAR.

So here we go! Wish us luck.