Reflections on 2014

I started this blog in January 2014.

I did it for the following reasons:

  • I love tracking our money.
  • I enjoy reading other personal finance blogs.
  • I liked the idea of there being some accountability in the Debt Eradication process.

I did not do it for these reasons:

  • I want to monetize the blog. (Still am not interested in undertaking all of the work that would involve.)
  • I want to change how other people deal with their money.
  • I want to be a part of a community of other bloggers.

No, WAIT! Don’t go! 🙂

Though I didn’t sent out to get lots of readers or start dialogues with others, I have really and truly enjoyed my conversations with other PF bloggers and I want to say thank you to those who comment and have been so supportive! It’s really wonderful to have this outlet (as so many others have stated, personal finance isn’t something that is often brought up in polite company), because I find money so very interesting to talk about. Where else can I lay it all out there (to be judged) and be able to read others’ financial woes and successes?

I have no real desire to help others with their money – I find that I feel most secure when I’m mulling over my specific money issues. Considering how I would deal with someone else’s personal finances might be interesting in the abstract, but I would hate for someone else to depend on me for financial advice!

I’m going to continue with my experiment with this blog, because I am enjoying this hobby (everyone needs one, right?).

So, now the 2014 Mintly Blog Roundup:

The Good:

1. We have paid off over $20,000 in debt this year! I think it deserves a bit of a cheer, eh? WHEEEEE!

The debt eradication (which is obviously still in progress) breaks down like this:

  • Mortgage Payments (though we sold the house in September)
  • Car Payments (paid off in May 2014)
  • Credit Card Bills (now we pay down our credit card bills each month, as we just use them to generate points)
  • Citibank Card Student Loan Transfer #1 (paid off in April 2014)
  • Citibank Card Student Loan Transfer #2 (generated in May 2014 , now standing at $2564)

2. We have saved over $5500 this year! No, not a huge amount, but it’s still something! It breaks down like this:

  • $5100 in our Travel Fund for our July trip to France
  • $500 in our Emergency Fund (no, it’s not even $1000, but it’s something)

3. We snowflaked a total of $3,860.27 this year to Debt Eradication and the Travel Fund! This was money that had previously just disappeared into our checking account or spending!

4. We managed to set aside $500 each month to our Sinking Fund to keep us from going into credit card debt every time we had an expense.

5. We had a positive net income for ALL 12 MONTHS of the year. And often it was by a pretty wide (well, wide to us) margin of over $500! This is a huge change to how we had lived our lives previously (though we had already made positive strides in this area before I started the blog).

6. By setting some (admittedly vague) goals for 2014 and striving to achieve them, we have learned what seems to work and what clearly doesn’t, which has helped inform how we will approach 2015’s Goals and Debt Eradication Plan!

The Bad:

1. We only stayed within my ideal budget one month out of the year. Guess which month? January 2014. WHAT. (Again, on the upside, we did stay in positive net income range for the entire year. Whew.)

2. Once we spend that $5000 in our Travel Fund, it will be GONE. Net worth will go down….

3. I only managed to meal-plan for maybe two to three months (not consecutive – not even consecutive WEEKS, y’all) out of the whole year. I, uh, need to work on this area.

The Ugly:

I mentioned to my mom that H wanted wool socks for Christmas. She said, “Doesn’t he have those slippers we got him last Christmas?” I said, “Yes, but I keep the house cold, so he wants wool socks for inside the slippers.” My mom said, “Don’t be like your grandpa. He was a miser for so long and made the rest of us all miserable.”

This conversation (and some general thoughts I’ve had swirling around in my head) have made me wonder if I’m a bit TOO obsessed? It makes me feel good to be organized and track my money (and try to cut corners when possible), but is it possible I’m going down an ugly road?

H has been more than understanding about my attempts to cut costs, so he isn’t bitter (and I believe he would talk to me before it got to that point). I know that we are just prioritizing some things (such as ballet and piano lessons for L) at the expense of other things (like eating out and having the temperature set at higher than 65 degrees in the house [63 at night!]), but I still worry a little bit that the thrills I get from managing money might end up making me a little …. crazy? Maybe it’s just the fact that I watched The Christmas Carol recently and was struck a bit by my sympathy with Scrooge on some matters. (Sure, his clerk shouldn’t freeze to death, but paying for heat is expensive! And why turn all the lights on in your house when you only need one candle to light the way up to your bedroom?)

Anyway, I’m not sure how I can stay focused on our goals and not tip over the edge into Scrooginess, but maybe you guys can help keep me in line?

The 2015 Mintly Blog Goals:

  • To eradicate over $18,000 of Student Loan debt! (Check out more details on our Goals Page….)
  • To continue with my monthly recap posts
  • To begin posting our estimated budget at the beginning of the month

In Conclusion….

I’m really happy with the accountability that this blog is providing for me monthly. It’s another way for me to get my PF geekiness on – and I really enjoy being a part of the PF blogger community (even if I’m only on the fringe!).

Thanks for a great year, and Cheers to 2015!

 

 

2015 Goals

After much deliberation, we have determined our family Debt Eradication plan for 2015. Here are our goals!

2015 Goals: 

We are aiming to do the following by the end of December 2015:

  1. Put a scheduled $8316 extra towards our student loans (in addition to our minimum monthly payment of $506).
  • This will require putting aside $756 a month to accomplish this, starting in February.
  • This number was generated by developing our 2015 budget, and we think this is the most we can put aside a month to focus on Debt Eradication (in addition to minimum payments).
  • We can’t start in January, because we need one more month of saving for our Travel Fund.
  1. Split tax refund 60%, 30%, 10%.
  • 60% – Student Loan Debt
  • 30% – Savings (Extra into sinking fund, IRA, travel fund, house fund, wherever we decide it is most needed)
  • 10% – Fun money! (Going out to dinner to celebrate birthdays?)
  1. Pay an additional $3150 to our student loan debt, beginning in June or July 2015.
  • This refers to the $450 we pay on the Citibank card. It will be paid off in June 2015. If we can manage an extra big payment in May, then we can start paying that money to our student loans. If we can’t do the big extra payment, then we will have to wait until July to start the additional payments.
  1. Snowflake at LEAST $600 ($50/month) extra towards our Student Loan Debt Eradication fund.
  • In 2014, we snowflaked over $3000 to Debt Eradication and savings, so hopefully this goal is set low enough that we should clear it easily. (Some of the things we were able to accomplish last year in terms of snowflaking might not be in the cards for us this year, so I prefer to keep this number low.)
  • This will also include any leftover money in budgeted categories to the Student Loan Debt Eradication fund.

Of course, these are all just parts of the same goal, which is basically:

Decrease our Student Loan balance by $18,138.

It breaks down this way:

  • $6072 – minimum monthly payments
  • $8316 – extra payments of about $756 a month
  • $3150 – snowballing payments for the Citibank card (which will be paid off in the summer)
  • $600 – extra snowflaked money

Considering we decreased our debt by over $20,000 last year, I have high hopes that we can do even better. I haven’t estimated our tax return, so I didn’t even try to include that.

At this rate, according to my Debt Optimizer (from Vertex42.com), we will be on our way to having our loans paid off by January 2018. That’s about three years of serious Debt Eradication. This comes at the expense of saving for trips (after our trip to France, coming up in July 2015), retirement, or other fun things. Because of this, I am only focusing hard on the 2015 goals, as other things may come up in the future. I’d like to visit friends for long weekends (not as expensive as an overseas trip, for sure) and we may have changing goals. But it would be great to knock out that debt before January 2018… and I hope we can, with the application of our tax refunds over the next couple of years.

Notes:

  1. As I have stated before, Sallie Mae / Navient makes it extremely hard to make extra payments to your principal without advancing your due date. You have to send in a paper check along with a letter that explicitly states your intentions. Then they will often make mistakes and misapply it, and you have to email or call and nag them to fix it.

To avoid this problem, we transferred a balance from Sallie Mae to our Citibank card (which is only used to house this debt as we pay it off at 0% interest). However, it did involve a transfer fee. We are continuing to pay this down at $450 a month (and it will be paid off in June 2015, as indicated above).

In February 2015, our plan is to snowball the $500 we were funneling to the Travel Fund to our student loans, along with some extra I got from other parts of our budget, and we’ll put $756 towards our student loans. Unfortunately, Navient is such a pain that I don’t want to send those payments in and then have to worry about checking up on them every month. Instead, we will pour that money into a new category in our Money Market account (which also houses our House Fund* and our Travel Fund). It will be known as the Student Loan Debt Eradication fund! (You’re shocked, I know.) Then, every few months (3? 4? not sure yet), I’ll write a big check and the very specific letter to Navient and send it off. And worriedly check up on it every day until the payment posts properly.

  1. (Related to #1) If I can convince H, I’d like to open another credit card (?!) that has a 0% balance transfer fee and no interest for 18 months and transfer a huge chunk of our credit card loans over there to save on interest. H is not keen on the idea of opening up yet another credit card. He’s worried it will somehow bite us in the a**. I don’t know exactly what would happen – it’s not like we don’t pay our bills, and we have great credit. Anyone heard of a problem generated by having a high number of credit cards that you don’t use?

My biggest concern about transferring part of our student loan debt to a credit card again is that if we have an emergency (losing a job, for instance), we don’t have any recourse to stop making payments. A lesser concern for me is that having the divided goals (credit card payment in addition to student loan payments) makes me feel like I’m dividing our efforts, even though I know that it’s really all part of the same debt. The satisfaction of paying down the debt and seeing one balance dramatically lower is a pretty big factor for me – watching two or three balances slowly go down is a lot less satisfying, even if it’s not particularly the most cost-effective method.

I know I wrote a lot of stuff up above, but really, our main goal is to get rid of as much Student Loan debt as possible. There are other goals, too, such as putting aside $1200 into my IRA this year (nowhere near to maxing it out, I’m afraid, but it’s not our main goal right now). It doesn’t make it on to the goals list, because it’s just an automated payment that we’ve already set up. We will also be striving hard not to go into consumer debt and to continue putting aside money into our sinking fund each month, but those are no longer “goals” as much as a way of life, I hope!

Do you have any suggestions or insights for me based on what we’ve decided? Have you decided to make a total shift in your financial goals for 2015?

December 2014 Recap

Copy of  January 2014 Accountability

December 2014 …. Happy Holidays!

I plan to do a little bit of reflecting on this year’s Debt Eradication (well, would you call it “Reduction,” since we didn’t exactly Eradicate it?) in a later post, but I wanted to get this information all updated! Exciting times!

2014 Debt Eradication/Reduction

Click to embiggen.

2013 to 2014 Debt Eradication/Reduction

Click to embiggen.

 

The Numbers…. 

I’m including – for the first time in a while – balances on our credit cards (with the exception of the Citibank card, which is where we house some of our student loans to avoid the hassles of paying Navient – formerly Sallie Mae – extra payments each month). All those previous months where there was no balance was often because those balances were paid off at the end of the month, so I didn’t count them towards our overall debt. We use credit cards to generate points (especially on our Chase Sapphire card, which I have called our “Travel Card,” as we plan to use the points towards our flights to France in July!), but we nearly always pay them off at the end of the month.

This month was more difficult because:

1) Despite planning, we ended up over budget in food.

2) L needed some expensive dental work (ugh ugh ugh) – and it’s not over yet

3) H made a business-related purchase (which can be used as a tax write-off, yippee!), but due to the nature of the purchase, he has to purchase three of the same type of item to determine which of the three is the best. The credit card is charged, but then two of the items will be returned later this week, and our card will be reimbursed.

The money for the business-related purchase(s) came out of our savings fund. The purchase isn’t reimbursable by H’s work, but is a business-related expense, and for those kinds of expenses, we have a sinking fund. By the end of December, we knew we’d have about $250 saved up, and he wanted to use that to make the purchase. We did, but that was before we knew that L would need three more (expensive) trips to the dentist over the next few months. At least about $400 of that credit card bill will be reimbursed in January (before the billing cycle is up and we get charged interest, with any luck!).

However, that does leave us with more than $300 owing on credit card bills that AREN’T the Citibank card. That’s all from L’s second visit to the dentist. In order to pay down that cost, we will be pulling from our sinking fund and emergency fund to avoid finance charges. Not fun, especially knowing that there will be another $600+ charges coming our way between January and February!


Additional Money this Month: $109.90 to Travel Fund, $100 to Medical Bills 

– $19.21 – from selling some Playstation 3 games to Game Stop

– $62 – money earned from consignments (woot!)

– $18 – money earned from book consignments (double woot!)

– $10.29 – interest paid on our savings account

– $100 – money earned from some side hustle work I did – but as I got this after we found out that L would need expensive dental work, I ended up putting this towards those medical bills (a little over $400 worth – now about $300, as mentioned above)


Money Accomplishments This Month:

  • Our Travel Fund is fully funded! It now sits at $5106.96. Our goal was $5000, but I decided to put the rest in there because I applied for a passport renewal (which costs about $110, plus the cost of the passport photos, which I did get with a coupon and a discount through Ebates, so that wasn’t so bad – about $7, all told), so that should cover that cost when the check is processed (whenever that will be).
  • We made an extra payment of $700 (from the sale of our car) to Navient. It was a pain in the a#$, as usual, and it still makes me sad that our overall debt reduction this month was only around $750. However, if we hadn’t had the other setbacks this month, that number would have been over $1400, so that’s some consolation (I guess? maybe? maybe not…).
  • We have designed a budget that we think will work for 2015, though we haven’t quite determined how we will deal with the setback of $1100 in medical bills.
  • I did some math and came to the realization that we are living on basically half of our income! We can’t say we’re saving it, but we’re putting it both into savings (the sinking fund) or to debt eradication. Woohoo!

Money Setbacks This Month:

The dental costs are a big set back, as you’ve already seen. By the time we’re done, it will cost us over $1100. Our current plan is to pay off the bills each time they come in (again, paying the credit cards off to $0), but we’ll have to use money from our emergency fund and from the sinking fund. With the visits spaced out, we’ll be able to use some our sinking fund deposits (we have a category for health costs), but we’ll still end up behind in that category, so using our emergency fund money and then snowflaking money to that until it’s built back up again might be our best course of action.

We certainly won’t be sitting around with that balance on our card for long – not long enough to get slapped with an interest fee, at any rate – but we have to discuss which fund we’ll pull the money from and how it may affect our goals we’ve set for 2015.


Life (as in, Non-Monetary) Accomplishments this Month:

  • The holidays!
  • The Nutcracker (both seeing it with L in it, and seeing it with L, when she wasn’t performing in it!)
  • Seeing the lights display with friends
  • Hot chocolate & hot tea
  • Family & friends
  • Time to read
  • My family’s good health (knock wood!)

Thanks for following along with me this year – I’m really looking forward to figuring out how the 2015 will look for us and our Debt Eradication… as well as figuring out what changes I’m going to make to how I share information here on this blog! I think I’ll be putting up a monthly budget – some of my favorites do this, and I always enjoy seeing their projected budgets, as it gives me some general guidelines and ideas for how to budget for variable expenses. I also expect to change the layout of my recap posts a bit. Exciting times! Hopefully with it, it will be bring exciting Debt Eradication!

Anyone else planning on shaking up the way they share their financials in 2015?