Monthly Archives: September 2013

Week 26 – Spend and expense update

So, FINALLY got rid of credit card #2 last week. This means I can no longer rely on my credit card for back up cash to make purchases. At the start of this blog, I questioned whether or not I should have an emergency fund saved before I started paying off debt. I opted not to, and got right into the debt repayment – and had been using my 2nd credit card (in July particularly)  to cover any extra expenses. Obviously this was not ideal and it did see a few steps forward and quite a few steps back in debt smashing over a 6 week period.

Now I do not want to put a cent on my credit card. I still have 1 remaining card active (with zero balance) as I need to have it for work expenses when I travel. The other card I have closed off.

I have very little in the bank account at the moment to act as any buffer. So my plan is to put some coin into my savings to ensure that I will not touch that card for expenses. It means however, holding off on big payments towards the loan for maybe the next 2 pay dates. But I think it will be worth it.

Next pay date I need to pay $290 towards accommodation on a girls weekend away in November, and also  $385.00 for flights for a trip to New Zealand in February 2014. The trip to NZ was not something that was on my radar but the opportunity to go came up recently and I’m really excited about it and by Feb next year will be certainly looking forward to a trip!

They are 2 fairly big payments I need to make from my next pay, so I figure I will also put some towards a buffer in my savings account. I’m calling it a buffer fund, rather than an emergeny fund as I’m not planning on saving enough for an emergeny fund in the true sense of the word in the world of debt repayments. Its just $400 – $500 to act as a buffer between me and my credit card. I know for a proper emergeny fund, people save thousands or 3 months expenses etc.

So basically, it means my debt smashing will likely be rather uneventful over the next few posts. However, I will still contribute to my loan repayments even if only in small amounts.

Right, so here are my week 26 stats

Monday: $3.50 coffee, $6.50 health and beauty purchase

Tuesday: $3.50 coffee, $23.60 groceries, $29.00 loan insurance, $178 loan repayment

Wednesday: $8.40 coffee

Thursday: $3.90 coffee, $30 ON TRAVEL CARD

Friday: $20 on travel card

Saturday: $40.50 drinks, $35.00 dinner

Sunday: $4.90 coffee, $12,95 paint and paint brush, $2.90 health / beauty purchase

Total spending: $402.62

Debt summary

Credit card #1 – $0.00

Credit card #2 – $0.00 – WOO HOOOOOOO!!!!!

Personal loan: $6808.64

Total debt remaining: $6808.64

Total starting debt: $14,744.12

Debt reduced by week 25: $7,935.48

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Worried about money

As long as I can remember, I have worried about money.

As a kid, I was aware of the dire financial circumstances my parents were in for many years of my childhood. I saw the stress and tension it caused. Anxiety about money seeped into my small mind, took up residence, and has seemingly never left.

To this day, how I see money and finances is often through the eyes of a younger me – unpredictable, fleeting and the source of much worry.

Although circumstances have obviously changed, and as an adult , I have never faced the lack of money my parents did , although my mismanagement of funds led me down a path of debt , I am still often plagued by money related worries.

A HUGE reason for me to rid myself of this debt was to also attempt to rid myself of anxiety. But it occurred to me the other day that eliminating debt may not necessarily resolve this anxiety based issue I have towards money – although it will certainly help!

Looking deeper, I tried to think of words to sum up the general, unspecific worries I have about money. And this is what came into my mind:

‘I need to have enough money to be safe’

How much is enough, and what exactly is ‘safe’? I feel like this stems from the very basic thoughts I had as a child and I worried when I saw how a lack of money could make things very uncertain. People could take things from you if you didn’t pay bills. More money would help people calm down. Less money made people upset.

I had no way to help financially as a child. And yet I just wanted to make everything ‘safe and happy’ with ‘enough money’

I finished reading a very interesting book recently called ‘How to worry less about money’ by John Armstrong.

The book basically looks at the difference between money troubles (ie, inability to pay bills, dire financial circumstances, debt etc) and money worries, and , to quote the book “worries are about what is going on in your head, not just your bank account. Worries are connected with emotion, not just what is happening here and now”

The book explores the idea that “addressing money worries should be quite different to dealing with money troubles. To address our worries we have to give attention to the pattern of thinking (ideology) and to the scheme of values (culture) as these are played out in our own individual, private existences”

I have a very emotional relationship with money, which I believe stems from a place where, as a child, I felt money’had the ‘upper hand’ and my life, and that of my family , seemed to be at it’s mercy.

Obviously, as a child I wasn’t aware that correct financial management can put you in control, and make money a tool to work for you, not against you.

So, I guess in taking control of debt, I’m also learning a new attitude towards money.  Understanding how my personal relationship with money has been shaped over the years by my own experiences can perhaps lead to some re-shaping, re-thinking and in turn, less worry.

Debt AND worry free? Well, anything is possible!

Week 25 – Debt and Expense update

So, this post is a bit late! Now into my 26th week, but here are the spending and debt stats from week 25 – happy to say, the debt stats are getting less and less!

Monday: $35 groceries

Tuesday: $0.00

Wednesday: $4.50 coffee, $5.95 video hire, $140 board

Thursday: $6.45 breakfast, $23.90 gym fees

Friday: $80 on travel card, $30 phone recharge, $5 magazine, $30 clothing

Saturday: $10 sunglasses, $53 drinks, $20 lunch, $7.50 train ticket, $4.50 coffee, $3.50 train ticket

Sunday: $10.50 breakfast, $48 drinks, $16 dinner (bbq food)

Total spending: $533.80

Debt summary

Credit card #1 – $0.00

Credit card #2 – $0.00 – WOO HOOOOOOO!!!!!

Personal loan: $6893.69

Total debt remaining: $6893.69

Total starting debt: $14,744.12

Debt reduced by week 25: $7,825.69

I broke up with Credit Card #2!!

Yesterday I paid the final amount of $930 to credit card #2.

Things are officially over between us. I am dragging that ball and chain (and interest rate) around no longer!

5k of credit card debt – SMASHED! Balance $0.00

Final debt challenge – my personal loan.

Bigger than either of my credit cards, but I feel like I’ve built some momentum breaking up that last card and I’m ready to go all the way to splitsville with the loan!

Let’s DO this.

Week 24 – Debt and Expense Update

Happy 24th Week on Debt Smashing Mission to me.

Not my pay week, so no change on debt stats in the below.

BUT – this coming week is a big one….because this week I will be PAYING OFF CREDIT CARD #2…heck yes!

Monday: $25 groceries

Tuesday: $10 headphones

Wednesday: $155 accommodation (pre paying for xmas vacation – camping and cabins, nothing to expensive!)

Thursday: $3.90 coffee, $10 gift for colleague, $17 book (I’m taking my written drivers licence test soon and need the book to study), $3.60 groceries, $27.00 dinner

Friday: $3.90 coffee, $70 onto travel card, 13 cab fare, $10 dinner

Saturday: $36 lunch, $16 drinks, $14.00 snacks

Total spending: $414.40

Debt summary

Credit card #1 – $0.00

Credit card #2 – $932.00

Personal loan: $6893.69

Total debt remaining: $7825.69

Total starting debt: $14,744.12

Debt reduced by week 24: $6,918.43

Getting debt free isn’t the golden ticket

 

I have spent what feels like a long time thinking about and paying off debt.

All this time chipping away at my debt free goal, kinda feels like when I finally reach the target balance of $0.00, I will deserve some serious fiscal kudos and reward from whomever may be in charge of such things.

Some Financial Fairy should ride in on a white unicorn with a big trumpet and lots of glitter will rain from the sky and she will crown me with a magical I Am Debt Free crown and all my  financial troubles will be resolved.

And we all lived happily ever after in a mortgage free home.

Right?

Nope. Being debt free will absolutely without a doubt put me in a much better position financially. And it is the smartest thing to focus on in my current  situation. But it will not make me instantly rich. Nor will it increase my actual income. Or mean I can suddenly go out and buy everything I haven’t been able to buy in the last 6 months, all at once.

There is no fairy.

Or unicorn.

There may be some glitter – but only if I buy it myself.

Financial security and smart money habits are things that I will need to continue build on for the rest of my life. I will need to make financial plans that are achievable. I will have to define what is important to me in my life so I know how to make the money I spend worthwhile. I will require patience to slowly build a financially secure future.  I should use the tools and information available to me to educate myself in the area of personal finance.  

Getting debt free is just the beginning. 

Week 23 – Debt & Expense Update (credit card #2 under $1000!)

Woo hoo!

Credit card #2 is under $1000! Only JUST. But I’m taking it as a win! When I started this blog that card was maxed at $5k.

This week I did have a HUGE expense – I paid to have my household items currently stored interstate to be delivered to my parents home. It cost $1870 for the delivery and $140 for the remaining storage for September. While this was a big outlay, it means I will no longer be paying $180 per month like I have for the past almost 2 years.

Now my committed expenses are as follows:

$280  per month – rent

$360 per month – travel

$178 per month –  loan

$25 per month –  internet

$30 per month – phone

$44 per month – gym

$29 per month – loan insurance

 

My expenses this week looked like this:

Monday: $25.00 groceries, $3.90 coffee

Tuesday: $3.10 personal care, $100 concert ticket, $40.00 put on travel card

Wednesday: $8.95 earrings, $3.95 snack, $4.00 groceries

Thursday: $12.00 personal care, $18.00 drinks, $100 put on travel card, $23.90 gym fees, $2010.00 storage and removal fee

Friday: $3.90 coffee

Saturday: $30 drinks, $40 sports nutrition bars, $22 dinner

Sunday – $12.00 second hand book, $8.00 coffee

Total spend for Week 23: $2, 468.70

Debt summary

Credit card #1 – $0.00

Credit card #2 – $932.00

Personal loan: $6893.69

Total debt remaining: $7825.69

Total starting debt: $14,744.12

Debt reduced by week 23: $6,918.43

 

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Week 22 – Debt and expense stats

Well, the long and the short of it this week folks, is that my debt is the same as Week 21. It wasn’t a pay week so no debt repayments to credit card #2.

Good news is, it didn’t increase either , like it had been the last few weeks, very two steps forward, one step back. So – a good thing!

Pay day is Wednesday – can’t wait to get credit card #2 under $1000 with the next repayment.

I plan to have cleared credit card #2 by end of September. My original projection was end of August.  Never mind, the point is it will soon show the lovely figures $0.00.

Week 22 spending stats

Monday: $3.90 coffee, $22.00 groceries

Tuesday: $4.20 coffee, $174.00 legal documentation fee, $4.20 groceries

Wednesday: $4.20 coffee, $5.85 lunch, $45 running belt

Thursday: $10 tights /stockings, $10.00 coffees, $38.30 accommodation

Friday: $8.50 coffees (yep, there were lots of coffee’s on Thursday and Friday this week as I was travelling interstate via car with family – lots and LOTS of hours on the road)

Saturday: $10 travel, $4.90 coffee, $79.95 dress, $16.00 clothes, $51.20 present for my dad, $25 dinner, $15.00 drinks, $20.75 medication, $30.00 phone recharge, $4.60 groceries,

Sunday: $10.00 coffees, $3.50 bottle of water

Total: $601.05 Feels like HUGE spend this week, but the $174.00 legal stuff did push it up a bit, and there was no getting around that cost. Even I will admit I spent way to much on coffee this week. Perhaps I’ll try for a coffee free (or seriously skimpy!) week this week

Debt summary

Credit card #1 – $0.00

Credit card #2 – $1344.88

Personal loan: $6893.69

Total debt remaining: $8,238.57

Total starting debt: $14,744.12

Debt reduced by week 22: $6,505.55

 

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