Sacrifices

I’ve been feeling pretty low about our prospects of meeting our financial goals in the next 12 months. I know that we can probably meet our main goal of paying down my husband’s student loans by the time I turn 37 (eep! that sounds so … old) in February 2017. We can hustle to make that happen. But can we pay off another $13,000+ (my student loans) by the same time? No, probably not without some kind of big changes.

I just don’t know what to do, and it’s totally stressing me out.

There are two options I see:

  1. Give up on the secondary goal and just do the best we can and hustle in the ways we planned to over the next 12 months, or
  2. View this as an opportunity to get rid of our debt so we will be completely debt-free by 12 months from now.

The second option sounds way better, of course! But after sitting down on Friday and really diving into what it would take (and it was an emotional experience for me), we would need to find at least $7,000 in the next 12 months.

$7,000.

Is that even possible for us?

If we wanted to really make that happen, we could, but it would mean my possibly taking on a second job that would require my being out of the house in the evenings or on weekends (which is our family time). Or trying to figure out a job that I could do online (which seems like a big stretch because while I think I have some of the skills that would make me a good online worker, I don’t know how to find the kind of job that fits my qualifications or time limitations). But … isn’t that what you do if you really prioritize getting out of debt? Is that the right thing to do? Won’t the sense of accomplishment be amazing if we manage it?

Sacrifice

I made one decision on Friday: I will stop contributing to my Roth IRA for the next 12 months. At a measly $100 a month, that will give us another $1,200. I hate to not contribute (especially as my retirement is really quite low compared to H’s), but it’s a way to make up some of the difference. This may not seem like a sacrifice to some of you out there (I get that), it is to me because I viewed it as a mark of success that I not only was able to put extra money aside, but that I understand that it’s important to save for retirement.

But what else to sacrifice? There’s bills and expenses, and then there’s time.

Already, we have some very low expenses compared to our peers: we don’t subscribe to cable, we no longer have crazy-long commutes (so gas is way down for us), we only donate about $28 to charity each month, and our internet is under $40 a month. We just cut the $100 per month to the Roth IRA, but there’s only one other spot I really see as feasible for us to give up, and that’s food.

If we could save $200 a month on our food, then we’d be $2,400 closer to our goal. But can I do that? Surely I can feed our family on $400 a month, right? Surely! It would be a challenge, for sure (meal planning out the wazoo, most definitely). I might even enjoy the challenge!

But that still won’t get us where we want to be. That still isn’t enough to get to our goal. I feel so disheartened. I simultaneously want to say, “F*ck it” and “Any little bit will help, and the effort will make me a better person.”

Is it better to let my crazy stretch goal go (so that I don’t feel like shit for not taking on a second job that takes me away from my family, and I don’t feel like a huge stressball for 12 months), or is this opportunity knocking (a chance to stretch myself, learn something new, and be a better person)?

Will I be able to forgive myself either way, if we still don’t reach the goal(s) I set?

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February 2016 Snowflaking Report

Welcome to the February 2016 Snowflaking Report!

As a reminder, I’m doing this once a month for the following reasons:

  1. We pay our minimum payment automatically around the 13th of every month, and I send our extra payment as soon as the payment posts to improve the likelihood that our Snowflaking payment will go entirely to the principal and not to interest.
  2. My monthly recaps are kind of long, so I’d like to take out some of the details to streamline them.
  3. Snowflaking will make or break the achievement of our 2016 Mintly Goal(s)!

Note: Beginning in March, we will be budgeting $1504 per month as additional payments to these loans, but as that money is budgeted as part of our strategy to meet our goal, I don’t consider it “snowflaking.”

What is Snowflaking?

“Snowflaking” can be defined as putting all of your extra income (often in small amounts) to your debt. For instance, if you do an odd job or have a side hustle, that money would go to your debt. If your mom sends you money for your birthday, you can send that money to your debt. If you get a refund on an item, that money can go to your debt. For more, see this.

Mintly Snowflaking 2016 by the numbers:

  • $239 – amount needed per month to pay off all of H’s loans by our target of February 2017 (for more information on our debt, including the amount, please see this)
  • $1091 – amount needed per month to pay off all four of our loans by our target of February 2017 (definitely our “stretch” goal!)

February 2016 Minimum Payment

I include this information because our snowflaking will continue to decrease the amount of interest we pay every time we make a payment, and tracking that decrease helps me see that we’re making a difference, even when it seems like we’re barely making a dent each month!

  • $391.83 – minimum payment we sent
  • $241.52 (62%) – amount that went to principal
  • $150.31 (38%) – amount that went to interest

February 2016 Snowflaking:

  • $1,127.06 – amount we sent (+$888.06 more than needed for our first goal!)
  • $1,127.06 (100%) – amount that went to principal
  • $0 (0%) – amount that went to interest

February 2016 Snowflaking Breakdown:

  • $250 – from Mom for reimbursement for L’s ballet classes for spring
  • $250 – H’s side hustle (2nd half of January)
  • $19.89  – Propay (Mary Kay sale)
  • $150 – Swagbucks (<– referral link)
  • $0.58 – interest from checking account
  • $64.36 – consigning
  • $100 – leftover from transition from January to February (if we have money to spare over the budgeted amounts, we snowflake that to debt)
  • $175 – H’s side hustle (1st half of February)
  • $22.90 – Ebates (<– referral link)
  • $79.95 –  reversal of charge we contested
  • $100 – from our emergency cushion fund (which is about $6,000) that I decided we could spare (and this brings us back down to just over $6,000)

Reflection:

Last month, the breakdown on our minimum payment was 80% to principal and 20% to interest, which was great! …But that was because I had a number of small payments in between the regular payment in December and the regular payment in January. So we’re now back up to a very unsatisfactory percentage of our regular payments going to interest.

On the other hand, I am super thrilled about what we were able to snowflake from the middle of last month to the middle of this month, though! A lot of the items were unusual – we had a payment go through on our card that we contested (it was some kind of subscription to Ancestry.com and we didn’t remember signing up for it, though it may have been a gift for my father-in-law?), so when we received the reimbursement for the reversal of the charge, I just put it in our snowflaking account. H also had a good month or so of side hustling. My mom also paid for L’s ballet lessons for the semester, but since we budget for that kind of thing already, I immediately plunked that cash right into the snowflaking account!

I have been thinking about how difficult this summer will be – it will be quite a challenge to find the extra money to snowflake, as H’s side hustle is only active during the school year. We will also have some additional expenses, such as yard care (which we outsource because of our lack-of-mower situation and the sheer size of the yard) and camps/childcare. So our expenses will go up, but our income will go down.

I have plans, though – I’ve taken my first steps towards selling on eBay. We have some jewelry from my mother-in-law that none of the daughters-in-law wanted, and while most of the items aren’t worth much to a jeweler, they might be worth something to the right person. I’ve done some investigations and have tentatively listed my first item this week. I don’t actually anticipate making a sale (I really am trying not to get my hopes up) but I want to sell a few smaller, less expensive things before I gear up to try to sell some more valuable pieces.

Anyone have advice for selling jewelry (or anything) on eBay? (I’m so scared of getting ripped off by unscrupulous buyers who will pretend they didn’t get the item…!)

January 2016 Recap

Welcome!

This year, I’m going to try to keep my monthly recap posts a bit more succinct, so here goes!

January 2016 Budget Recap – How We Did

Jan 2016 Budget Recap.png

We went over budget, and the categories were the usual suspects: restaurants (well, usually it’s food altogether, but I’m happy to see that we stayed under a reasonable amount for groceries this time around) and the slush fund (a curling iron, library fine, shipping costs for a box for my parents, new slippers, parking). The other areas were a $10 I forgot we would need for an activity for our daughter and our higher-than-normal electric bill, given then cold weather recently (brrrr!).

Month-to-Month Progress:

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There wasn’t a huge change this month – that $1000+ decrease reflects our regular monthly payment plus our snowflaking. It’s better than I expected it would be, but it wasn’t easy to pull it together this month!

How far we have come:

screenshot.png

Okay, at least that number is pretty gratifying! Almost $50,000 of debt paid off in a little over two years! (To clarify, that amount includes debts that are no longer listed above, as they’ve been at a 0 balance for a while, such as our car payment and other credit cards, as well as another student loan that has been paid off.)

January 2016 Snowflaking

As a reminder, our goal for each month is to snowflake at least $239 to pay off H’s student loans by February 2017. (For more on our goals, see this.)

We snowflaked an extra student loan payment of $281.99 this month, as you saw in our January 2016 Snowflaking Report. (For more details, please see that post.)

Things are already looking great for February’s Snowflaking, so I’m looking forward to sharing that when I send the next payment!

January 2016 Consignment

  • $64.66

I suspect this number will not be so high in the coming months, as I haven’t given them as much stuff to sell recently, so we will see what happens….

Other Money Details

  • We have saved another $1504 for this month, which gets us to our goal in our Savings Account! (In case H’s job situation doesn’t work out, we want to have a comfortable amount of money in our emergency fund – we should know something before May 1st. Please send us good vibes….)
  • Next month will begin our more robust repayment of our loans, as that $1504 we’ve budgeted for savings for January and February will now start going straight to extra student loan payments!
  • I completed our taxes last night, and I was disappointed (again) by the amount we’re (not) getting back. It will actually be around $1500 (knock wood), but I was secretly hoping for more. I did not include any possible refund in our 2016 Goals, though, so anything is icing in the cake.
  • I am still hoping against hope (and doing all I can to make it happen) that we can reach our stretch goal and have all of our loans paid off in February 2017, but while it still seems feasible now, I think the next few months will be telling in whether or not we can accomplish it. We could always hope for a windfall, right?

That’s all for now! How’s everyone’s February looking?