Back From Vacation, Unexpected Surprises, and Moving Forward!

Wow! I’m finally back from Germany and settling back in. I would go into all the lovely, wonderful details of the vacation, but that isn’t the focus of this blog. The focus of this blog is to get the Hell out of debt! However, one lovely and wonderful detail was a very unexpected surprise that relates to that goal:

For 10 years, I had a bank account opened by my grandmother that was never touched by me nor my parents. She passed away, and somehow this account was overlooked. I went with my mother to the bank to figure out her finances and suddenly the associate turned to me and started discussing my account. I found out I had just over 1,000 euro (1,300 US) just sitting there. I took it out, didn’t spend a dime of it, and when I came back I exchanged it over.

I am most happy to report that I have cleared out my debt to my boyfriend and completely paid off one credit card!

This means my rough $10,000 amount is now down to $7,400! So much happy, so much excite, and it’d be easy to celebrate and go wild! But, that brings us to the next step: the future!

I’m still considering a second, part-time job. I also now am supplementing my income with Fiverr. I have a couple large and/or reoccurring orders through this, but it’s not realistically enough to say it’s a second job. I’m waiting to hear back from the MFA program at the university I work for to begin classes this Fall and, until I do, I can’t make any movement towards a second job (schooling > job). What I can continue to do is snowball my payments on my other debts, and this is what it looks like now:

Debt Amount as of August 11, 2014 Interest Minimum Snowball Total Payment Very Next Step
Paypal – BillMeLater 959.72 19.99% 35 60 95 Under 900
American Eagle – Credit Card 1602.23 48 95 143 Under 1600
Bank of America – Credit Card 4863.52 49 192 241 Under 4850
Total Current Debt 7425.47 132 347
Total Beginning Debt 10,000
Total Current Debt 7425.47
Percentage Debt Free 25.75%

Still working on my budget, as well. It’s a little haphazard because of the trip so, I will be working on that this week and updating here. But, essentially, the lessons learned:

Surprises are nice, but they also make it easy to lose focus. Use that forward momentum to remain charged and motivated to getting out of debt. Don’t lose sight of what’s important or your priorities.

Mid-Month Update!

It’s been a couple days now and I think it’s time for a mid-month update!

Exciting (and not so exciting) things have been popping up all over the place and I’ve been a busy-bee while trying to stay within my budget. On one end, no, I haven’t managed to stay within my budget due to pop-up expenses. On the other end, I did start my Fiverr account and have gotten some good, honest work out of it. In fact, I’ve made enough so far to pay off one monthly bill! That’s HUGE! So, I guess this means I can call myself a freelancer now, too. I’m also learning where my weak points are when it comes to spending (impulse buys for things like video games…).

Fiverr, pop-up expenses, and applying to grad school.. All within 15 days! There may also be plans to start a Twitch.tv account and broadcast my gaming skills (or lack thereof) and I forgot to mention another exciting life event happening this month: I will be leaving for Germany on July 25th and coming back August 8th! Expect a lot of reflective posts during that time period and, of course, photos.

If there’s one thing July has taught me so far, it’s that I can’t sit still for long and I’m not comfortable being immobile. But, this opens opportunity for me to reflect on how much I really do value being still and if I can implement stillness into my life while gaining momentum. Worth thinking about, at the very least.

Aside from celebrating all the good that’s been happening lately, below is my mid-month budget update. As you can see, things are getting a little hectic, but hopefully we’ll see at the end of the month a budget that comes out in the black! Please note, July is a 3 pay-period month. In this way, I almost feel like I’m cheating my budget, but because of travel, I’m so thankful I get paid three times this month!

Projected Actual Notes
Income 1 939 1163.54 Sold lightning outfit, sold books, mom owed me $50
Income 2 908 989.19 With overtime. 80.19 difference
Fiverr 0 20
Total 1847 2152.73
Gas (Fuel) 80 46.81
Groceries 80 115.24
Home Supplies 35 44.82 Included travel items
Laundry 10 10
Pet Supplies 35 64.95
Therapy 100 75
Renter’s Insurance 25 23.24 Paid 6-27
Rent 795 818 Transferred 6-27 & 7-11
Student Loans 50 50 Paid 6-30
Bank of America 49 49 Paid 6-27
Bill Me Later 35 35 Paid 6-27
American Eagle 48 48 Paid 7-11
Util: Gas 70 49.88 Scheduled 7-14
Util: Internet 50 49.9 Paid 7-11
Util: Electric 50 11.78 Scheduled 7-14
Capital One 25 75 Paid 6-27
Auto Insurance 80 79.52 Paid 7-11
Fun 40 40 CASH from previous check mailed from mom – not taken out of check
POP-UP Expense: License Plate Stickers 102 0
POP-UP Expense: College Transcripts 10 10
POP-UP Expense: Ebay Fees 8.7 8.7
POP-UP Expense: Kickstarter 5 5
POP-UP Expense: WildStar 15 14.99 Impulse buy
POP-UP Expense: Parking 1.5 1.5
POP-UP Expense: Demo’s Birthday 10.91 10.91
POP-UP Expense: Lunch at work 5.75 5.75
POP-UP Expense: Grad School Application 75 75
POP-UP Expense: Earbuds with mic 22.92 22.92
Total 1913.78 1840.91
Difference -66.78 311.82
**$300.00 ontop of whatever is leftover goes towards germany

Unwanted Help – Dealing with Parents

It’s confession time: I’ve lied about my situation to someone. That someone is my mom.

Making excuses or explaining why really does matter. But, a story about how to deal with unwanted help (especially from people like our parents who are so vehemently protective and loving that all they want to do is dig us out of the holes we have dug ourselves into) does matter.

In a conversation about going to graduate school (something my mother does not support), she wanted to know how much debt I had. I didn’t want to lie and tell her I had 0 debt, and I didn’t want to lie and tell her the full amount (partially because I didn’t know the full amount at the time and partially because she would have a stroke at the number). I told her I had $4,000 worth of credit card debt.

Immediately, she is demanding, not asking, that she gives me the money to pay it off. I’m kindly refusing, stating that this is my battle and it is my problem; that I love her and understand why she wants to help, but I don’t need that sort of help from her right now; that she should trust that if I need help, I would come to you. And she is getting angry, very angry, at my refusal to accept her help.

Now, how easy would it be to just say, “Ok, I’ll take the 4 grand!”? Very damn easy. Painfully easy. Too easy. It also opens the door for chastising and negativity in the future when/if I do go to graduate school: “After I dug you out of debt, you’re going to accumulate more!?” and I refuse to put both of us in a situation where she is saying that sentence to me.

A month later, she is still not dropping it. She’s is on Facebook, messaging me about interests rates and numbers and “doing the math”; about how she isn’t mad at me, but mad at the numbers. I spend an hour on Facebook messenger kindly and lovingly declining her offer for help and she will not drop it. Eventually, I had to set a boundary:

Jenn: I love you. I love that you want, so desperately and passionately to help me. It’s part of why everyone loves you, but we can not continue to have this conversation. If I need help, you are the first person I will go to, but I do not need help in this right now. If you continue to talk about it, I will have to stop talking until you talk about something else.

This was the first time I had ever set a mature boundary with either of my parents. And, I had to follow through as she did not let up. It was a small achievement and a good lesson, although heartbreaking.

LESSON LEARNED:

You’re an adult. It is completely in your right and realm to establish boundaries that are loving, honest, and that protect yourself, regardless of who that boundary is established with.

Rookie Mistake #1: FORGOTTEN DEBT

A bit into my private life: I do have a boyfriend. When I moved into my current place, I had mix of odd furniture that didn’t include a bed or mattress! I also had only $2000 from my tax return and income to pay first month’s rent and deposit ($795 + $795 = $1590). This left me with $410 to rent a uhaul, go to Ikea, and buy a bed and mattress at the very minimum (although, I did have an air mattress I could have used while saving up).

My boyfriend stepped in and demanded I be able to get myself enough furniture to make myself a nice home that I feel comfortable in. I ended up with a new loveseat, end table, coffee table, living room lamp, storage/book shelf, dresser, bed frame, mattress, two rugs, and another side-table lamp with a couple kitchen mats for the floor. My boyfriend lent just over $1800 to make sure I was comfortable. A coworker-turned-friend gave me her old La-Z-boy recliner for free and another coworker-turned-friend supplied me with a patio set for free as well!

However, as one of my values is making mistakes and one of the blog ground rules is being honest… I have to tell you all that I forgot to include this debt in my initial totals of consumer debt. To date, this debt has been paid down to now owing $524. This bumps my current consumer debt to roughly $9,630 total.

I suppose it’s good I rounded up to paying off $10,000 worth of debt.

LESSONS LEARNED
Estimate high when it comes to debt, estimate low when it comes to income.

Don’t be ashamed or become frustrated when you find debt you forgot about. Roll with it, baby. Part of this journey is to become adaptable. Forgive yourself and take action to adjust.

A Rough Sketch

So, I had a few ideas on how to accumulate $10,000 in a year to pay off my consumer debt. 4 to be exact, but they need some fleshing out. Some REAL (or real enough numbers) tagged to them. So, I developed a rough sketch as follows. It didn’t need to be perfect down to the decimal, but it needed to be something to give me an idea

WORK
I have a merit raise, based on performance review, and a possible title promotion (read: more hourly income) to take effect by September. While this may only bump me from $17.20/hour to somewhere closer to $19.00/hour (I’m personally hoping for $20.00), every extra bit helps. I have also been approved to work a full 40 hours/week, instead of the allotted 37.5 hours/week associated with my job description. This is an extra 2.5 hours of time and a half (currently $25.80).

Roughly considering taxes (estimated math, not exact), this gets me an extra $150-$180 per month or $1800-$2160 per year.

SELL
I have two pieces of jewelry to sell: an old engagement ring (estimating value at $450 without appraisal) and an old promise ring (estimating value at $100 without appraisal). Other odds and ends (books, DVDs, electronics, clothes) should total to another $150-$200.

This gives me a rough extra $700-$750 (which would pay off a single credit card)!

SIDE JOB
I have editing/writing/proof reading/design skills that I can market for extra, supplemental income from home. More on this later in this post.

TRANSPORTATION/CAR
1.3 miles from my front door is a FREE shuttle that travels to and from work, dropping me off right infront of my building. There is no excuse to not take it. My city also has a very workable public transit system. There is no excuse to not take it.

The entire idea (and a scary one at that) is to eliminate the need of a car for 2 reasons.

1. Save Financially (duh):
Right now, I spend anywhere from $50-$100 per month in gas and $70-$80 per month on insurance. My city sticker to park on the street costs $100 per year and renewing your license plate stickers costs $101 per year. Oil changes range from $40-$50 every 3 months. I do not have a car payment as the car was a gift at graduation.

At best, I spend $2,000 per year on my car. That isn’t including any repairs, maintenance, tires, or extra road trips, parking, or the inevitable city-living parking tickets (“Wait, does that sign mean 12 noon or 12 midnight?”).

2. Be mindful of your carbon footprint and seek intentional, alternative transportation:
I can take the bus/train/carpool/or ask to borrow someone’s car.

The next natural question that popped into my head was:

What does successful independence from a personal car look like? What would I have to do to prove I could be independent of a vehicle in my current situation.

I decided to define it as:

  • Travel to/from work for free 90% of the time.
    There are roughly 250 working days per year, with consideration of holidays. 90% of that is 225 days of free commuting with 25 days of admitting the use of a personal car (weather, emergencies, etc…).
  • Trips to see my family or personal travel do not need to include using a personal vehicle. I can train home, or I can rent for personal travel.

But then I came to an impasse. What about emergencies? What if there was a family emergency I needed to go home for and I couldn’t rely on Amtrak or I didn’t have the funds to rent a car? This lead me to ask myself, “Do I keep a car for emergencies only?” I allowed myself to sideline this question for now and focus on immediate action: taking free and public transit. I also researched and KBB quoted my car at $7,200 selling independently.

XXXX

OK! That is a lot of numbers and planning! Including the option to sell my car, I’m resting at a nice $11,700 potential. That’s $1,700 over my goal! WHOA!

But… We’re not done yet. What if I don’t sell my car? Or, what if I keep it for emergencies only? At best, then, I’d be saving $600 per year on gas and that brings my total potential down to $3,100 and that simply isn’t good enough.

How much could I potentially earn with a supplemental income? I’m still missing $6,900 towards my goal. I would need to make an extra $575 per month to make up that difference. This is a red flag, but not necessarily impossible with proper planning and implementation.

Giving myself permission to consider selling my car IF I prove to myself, based on the above measurable goals, that I can be successfully independent of a car? A scary, but firm, “Yes!”

Giving myself permission to seek ways to make an extra $575 per month? An even scarier and quieter, “Yes.”

My Real Budget

In the name of honesty, I’ve decided to unleash what my real budget looks like. A few logistical notes, I keep the budget on Google Drive, so it can be with me anywhere I have my phone and I can update in real time to put in my actual spending. This budget goes into effect June 27th (payday!). The first step is to track my actual expenses vs my projected expenses for one month.

Projected
Income 1 – Paycheck 1 939
Income 2 – Paycheck 2 908
Total 1847
American Eagle 48
Gas (Fuel) 80
Groceries 80
Home Supplies 35
Auto Insurance 80
Rent 795
Pet Supplies 35
Bank of America 49
Bill Me Later 35
Capital One 25
Student Loans 50
Therapy 100
Util: Gas 70
Util: Internet 50
Util: Electric 50
Renter’s Insurance 25
Fun 40
Total 1647
Difference 200

And this is the spreadsheet I keep for my debt, including a “snowball system” where I pay the smallest amount off first, paying double the minimum. Once that debt is paid off, I take the total amount I was paying on it, and apply it to the minimum of the next smallest debt. Momentum! I also set “next step goals” and “percentage paid off” formula to cheer myself on and see the debt diminishing.

Debt Amount as of June 25, 2014 Interest Minimum Snowball Total Payment Very Next Step
Capital One – Credit Card 725.76 13.90% 25 50 75 Under 700
Paypal – BillMeLater 953.19 19.99% 35 75 110 Under 950
American Eagle – Credit Card 1616.27  ?? 48 110 158 Under 1600
Nelnet – Student Loans 3769.2 ?? 50 158 208 Under 3760
Bank of America – Credit Card 4961.52 0% until August 49 208 257 Under 4950
Total Current Debt 12025.94 207
Amount Paid Off 0
Percentage Debt Free 0