Year End Goal

Well, it looks like I'm going to come up short on a couple of my year end goals, but that's ok. The Personal Loan goal of $1,000 was based on my previous cc debt goal. I replaced it with the PL b/c I used it to pay off the ccs. It took about 6 weeks for me to get my first statement, plus the transfer fees, so that's where the extra money went.
The Other Debt goal was created before I decided to add my 401(k) loan. I didn't adjust the goal to reflect my new balanced, but rather decided I'd try and do it anyway. So the fact that I fell short wasn't too much of a surprise/disappointment on that. In the end I came in pretty close to hitting my 2007 total debt goal, but again, that was set before I added some debts. I'm working on my 2008 goals, and am trying to be as realistic as possible while increasing my savings. I'm going start tracking that on here as well in hopes that having some accountability will keep me from raiding it to pay extra on my debts.
Happy Holidays to all and we'll see you in 2008!

Stupid Interest

I had some extra money left over this paycheck, so I decided to send a $25 payment to my Student Loans...I waited 24 hrs for the payment to post, only to find out that 100% of it went to interest. My balance didn't change one iota. Hopefully that means more of my regularly scheduled payment will go towards principle, but for now it's frustrating. GRRRRR

Extra

I managed to squeeze out another payment to my PL...it's looking like I'm not going to hit all of my year end goals for 2007, but I will be close. And that's actually a good thing considering I set my goals before I decided to add in some "other" debts I hadn't been racing. That's life...at least the numbers are going down! :)

Moving it around some more

In looking at my debts I have decided to use some of the "leftover" PL money sitting at ING to pay off my 401(k) loan (one of my "other" debts). I originally thought the interest on the 401(k) loan was lower, but it's actually 2% higher than the PL...plus I'm losing out on the compounded interest gained over time in my 401(k). And, it will give me another zero and free up $120/mo after taxes.

Financial Restructuring

My personal loan came through and I have made payments to my credit cards. One of them has posted already (YEY), but I'm still waiting on the others. My CC debt will now officially be $0, but I will be adding my personal loan. The amount of the loan was more than my CC's, and I've put the difference in savings until I have to make my first payment. I'm going to start off with the full total here of $2375 and track downwards from there. My goal is to have this loan paid of by March 2008, which was my original goal for the CC debt.

A Solution

Well, after my frustration yesterday I had an appointment with a loan officer at the bank. We looked at my situation and what my financial goals were and they came up with something for me! I'm getting a personal loan that will allow me to pay off my CC debt completely. It's actually more than I need, so the extra amount I am paying back on the loan immediately. There are no fees and no pre-payment penalties. I was also awarded a Credit Card that will help me start rebuilding my CC history. I plan on using it for about $30-50 a month worth of gas/food and then paying it off in full monthly. That way I can start to re-establish a solid re-payment history. Based on my credit report 'what if' scenarios, paying of the CCs and opening these new accounts should increase my score by 25-30 points!!! :)

GRRRRR..................

So I decided to give the old "hey can you lower my interest rate?" tactic a try and it led to one frustrating phone call after another. Here's the backstory...in my last post I referred to one of my cc's as "KILLER". This account went delinquent almost a year ago and was closed & placed with a collection agency in March 2007. Of course, b/c of the delinquency my interest rate shot up to a whopping 30.45%. In the last 7 months I have been on time with all payments, always paid more than the mins, enough so to have brought the account current. So first I call the CC company...they tell me to call the Collection agency. So I call the collection agency and talk to some moron who could hardly understand what he was seeing on the computer in front of him. I ask him about the interest and he says the CC company handles it and I need to call them. NICE, cause they just told me to call you! :) Anyways, while I have him on the phone I ask if there is anything he can do on his end to help me pay things down faster without settling the balance. He said, well if you pay the balance in full you won't get any late fees/over limit fees. So I say, but I'm not late or over the limit...then he backpeddles and says, oh your right b/c your limit is $X and I say, no my limit is $Y. Then I hear a bunch of garbled gibberish as he tries to say something profound, but no actual sentences come out. So I thank him for his time and call the CC company again. this time I get someone on the phone (CS is definitely outsourced overseas) and ask for interest rate options. She says, well we do have a debt management program with a fixed rate of 9%, and yada yada yada. I'm like, sign me up! So she gives me the phone number (which I'm thinking is another department) and I give them a ring. It's a Credit Counciling Service...I talk to the lady there and tell her my situation (Card with a balance around $650 and 30%+ interest) and she flat out tells me that I'm better of not to use the program b/c of how it would affect my credit. Then she says why don't you call the CC company back and ask again. So I do and they say that the only thing they can offer is that debt management program and there's nothing they can do to the interest rate. So I'm going to try and get rid of this thing ASAP, but I'm not sure how other than what I've been doing thus far...just one paycheck at a time.

Taking action

So I decided to move some of my savings around to pay down some CC debt. I had a card sitting just under $200 and another with a KILLER interest rate, so I paid of the small one and took a chunk out of the KILLER. Now I only have 2 CCs left and have cut my CC balance in 1/2 since May. I want it completely gone by March 1st, 2008 at the latest.

What-ifs

I have a subscription to a credit monitoring service that I use to track my credit score on it's way to recovery. Well, in my down and out situation I decided to go online and look at it...nice thing is the score is definitely going in the right direction, just taking a while to get there. However, they have this cool feature that lets me play out "what-if" scenarios on my credit report.
So here's what I found out:
- Paying off all CC debt will raise my score by about 29 points.
- Making on-time payments for 3 months with add 6 pts; 6 months will add 23 pts; 1 year will add 38 pts; and 2 years will add 69 pts.
Since I want to improve my credit situation so I can potentially buy a house in the next 2-4 years I think I'm going to scale back on the savings and pay down my cc's faster. The sooner I can get my credit score up a bit, the better chances I have of obtaining better credit options. Plus, if I can establish a decent score sooner and hold onto it for a while, that will help even more.

Down and Out

I'm having a down and out day today. One of those days where you feel like a hamster in a wheel...trying really hard and going nowhere. Work has been wierd...the day to day stuff has been slow and boring, but the behind the scenes, corporate politcal BS has been rather tumultuous. Luckily I had my review in June, b/c as of last week they put a freeze on all promotions, raises and new-hires for some unknown reason. Usually companies do this when they are hitting financial rough spots, but to my knowledge we've been doing nothing but having a great year.
On another note, I'm really hating how long it's taking to A) pay off my debts & B) raise my credit score. I don't list my interest rates on the WIRR board, b/c I see them balking at rates lower than mine. And my credit is still recovering from being so jacked up that I don't have the ability to transfer to new cards with low rates or get a consolidation loan.
So today i'm torn...do I cut back on the debt repayments and develop a nice hefty EF? Or do I cut back on the savings and get rid of more debt faster? Depending on the moment, I have the urge to do both.

Can't leave well enough alone

It's an addiction...working and re-working the numbers. There has to be a way I can scrimp more money over to my debt repayment. I look at it every day - some days I say, nope that's about right, and others I have an "AHA" moment and somehow manage to figure out something new. I've currently worked things out so that if I really keep a tight lock on my budget, I can be completely debt free by September 2010. That's only 3 years from now! :) Instead of the 18 years left on my SL note. Not too shabby...now let's see if I can make it work. (Oh, and this doesn't account for any increases in pay or other monetary windfalls like bonuses...anything like that would just be icing on the cake)! And I'm still saving while I do this...

I've given myself some incentive...no new car until the SL are paid off! Plus, I can save more $$ for the downpayment this way too, or potentially pay in cash.

Hah...take that!

Alright, so apparently this toll tag bill really got under my skin! For the first time in a while I felt like I wasn't in full control of my finances, which is a feeling it TOTALLY hate! So I took control...I had a card with a $96 balance (the one I was hoping to put the extra $$$ on) and was planning on paying it off in October. So, I transferred $$$ out of my savings and paid it off. If life wants to throw me a curve-ball, I'll throw one right back!

2 Steps forwards, 1 step back

So yesterday was a good day. Financially I felt like I was ahead of the game. I had to put new tires on my car and was able to pay cash for it. (YAY!!) Later in the day I was balancing my checking account and looking at my budget, and realized I had about $50 extra to play with this month, so I threw another $30 at one of my CCs through bill pay. Today is another story...I checked my account online and saw that I had a $10 balance, not including the $30 payment I made to the CC yesterday. So what happened to that $40? Damn Toll-tag payment...seriously those things always sneak in when you're not expecting it. And it's not like a regular bill that hits when I know it will! For those of you who have never had a toll tag, the way they work here is that $40 is charged and credited to your account. Each time you pass through a toll booth, they deduct from your account...when the balance hits $10, they charge another $40. So depending on how much I've had to rely on the toll roads, i get billed anywhere from every 4-12 weeks. Luckily I used bill pay through my checking to send the $30...since I don't have the $$ in my account, the bill pay will just get rejected (no fees, no returned checks, etc.). And luckily it was and extra payment, not my actual payment.
Good news about the toll tag is that it will be basically irrelevant in within the next 60 days...I only use the toll road to get to work, and my office is moving in Nov...I won't have to take the tolls to get to the new location. (I could get by without taking the tolls now, but the extra time sitting in traffic probably wastes more than $0.35 of toll charges in gas.) In the mean time I tracked down the website where I can track my TT balance...i'll just have to stay on top of it now.

Life Changes

Well, this past weekend I moved in with my BF...I'm not officially out of the old place yet. I still have a few small things to bring over and of course the cleaning to do. (bleh)...but it's nice to know that when rent is due on Oct. 1st it will be considerably less ($300) than I've been paying! :) More money for debt repayment.
I'm also thinking about cancelling my gym membership. I almost always workout outdoors (I'm a triathlete, so running and cycling are always outside - plus the weather in TX is never SUPER cold). I always hold onto the membership for the pool, but I haven't used it in 2 months. Plus, I could join a masters swimming program for about $50 less than I pay my gym (I know...I pay outrageous gym fees)....something to ponder...

Personal Accountability

So I had a "personal" debt that I've been avoiding for awhile...it was from a friend who loaned me money last year and told me to "pay it back when you can". Well, for a while my financial situation was a bit rocky, but recently things have gotten a lot more stabilized. My friend and I haven't talked about repayment since she gave me the money, but for me it's been a bit like the "elephant in the room" each time I saw her. So yesterday I got the urge to confront it. I had been estimating what I owed to this point, but yesterday I sat down and ran the true numbers. I also contacted my friend about repayment plans...and wouldn't you know that being a responsible adult would pay off?!?! I actually owe about $700 less than I expected! :) Hooray for holding myself personally accountable even though my friend was giving me no pressure...it's a good feeling.

Using the momentum of others

Prior to joining the WIRR, I had already created a spreadsheet to track my debts and predict how long it would take me to pay them back. Being a bit of a data nerd, it was full of formulas and linked cells so that I could see how paying a little extra here and there would affect everything else. I thought I was doing pretty good on my own and had figured out my own 'snowball' that would have my CC free by Dec 2009, and debt free by 2017...now keep in mind if I were to take as long as the banks want for me to repay the student loans, I'd be in debted until 2025. So I figured cutting it down by 8 years was pretty good. Once I joined the WIRR, my mentality towards debt repayment totally changed. I realized that I could and should commit more of my income to paying my bills. I was seeing plenty of other people doing it and hearing stories of people in worse financial situations than myself pay 2x what I was each month! So I became addicted to working and re-working my spreadsheet. All kidding aside, I play with the numbers at least 1x a week! I'm now currently on track to be CC free by March 2008 (20 months ahead of "schedule" and debt free by January 2011 (14 years ahead of schedule)!!! It's amazing what happens when the momentum of others inspires you to dig a little deeper and squeeze a little tighter!

And she's off...

Well, this is my first attempt at true blogging...so bear with me for a while until I get the hang of things! Let me give you a little background information about how I got into the financial predicament I'm in now...
I moved out on my own at the age of 18 after making the decision to pursue a college degree. My parents were not in a place financially to help me with school, so I took on the entire burden myself. I really was flying blind, and was pretty naive about how student loans, etc. worked. All I knew was that I applied for and was awarded loans from the gov't...it paid for school and then some! I didn't really pay attention to how much was accummulating over the years, and I definitely didn't research anything about what it would take to pay them back. During college, I also fell into the credit card trap...seriously, what poor college student is going to turn down free t-shirts, etc just for filling out an application? But then the cards arrived, and I made the fateful decision to activate and use them. I did alright for the first 2 years of school...didn't charge up more than I could handle and was able to pay them in full almost every month with the money I made waiting tables. But then I moved out of the dorms and into my first apartment...I had furniture and TVs to buy. And the balances got higher fast. On top of that, I had monthly bills - I was used to paying 1x for all room and board! I did not do well balancing my checkbook...and a budget! Are you kidding?!? What fun was that? Luckily I got scared into cutting up the cards before the collective balance hit 5 figures, but the damage to my credit was done. I wasn't able to make the minimium payments - and if I was, I'd often forget. I was overdrawing my checking account regularly too. I was 20 years old and had trashed credit...I had a stretch for almost 2 years where things got better - I was living with my BF at the time and my committed expenses were VERY reasonable...until that relationship went kaput. Again, I had trouble adjusting to living on my own and being responsible for 100% of the bills. My CCs were late again - my phone bill went to collections...and I'll I wanted to do was act like everything was ok. I'd get notices in the mail and throw them away without opening them. I'd never pick up the telephone for fears of the creditor that might be on the other line. The result of this was of course that my credit score took another nose dive. Anyways...4 months before my 24th birthday I had a BS and MS, almost $35,000 in student loan debt and a credit score that wouldn't qualify me for jack squat! :)
In May 2007 I found a group called the Women In Red...and they have been a godsend. Although I'd stabilized my finances prior to joining the WIR, I wasn't really making any major progress, nor did I have a desire too! (i.e., carried <$200 balance on a CC for 2+ years - just made the minimum payments so I could spend more on other things). Now just passing my 90 day mark with the group, I've made a lot of headways. Above mentioned CC is now paid off! :) This blog is not only to help me track my progress of climbing to a positive net worth and eventual debt freedom, but to help others in the same situation learn from my mistakes!