Control Issues

Photo by Sharon McCutcheon on Unsplash

I touched on us wanting to save money, spend less, and be stricter with our grocery budget. Upon our return from Germany, I used a few of my lunch breaks at work to kind of make a rough version of a budget since it wouldn’t have been completely accurate to really sit down and see what we spent on groceries, etc., when we were gone for two weeks.

So I did just that. I looked at the list of bills Kalen had given me. I wrote them down in my green notebook. I wrote down the amounts we pay each month, the amount we owe, and the due dates. I wrote down what our monthly income is. I wrote down the amount in our savings accounts. And I tried to figure stuff out.

For us, June meant a third check. We both get paid bi-weekly, each on the same day. That meant we ended up with some extra cash. Kalen received a raise before we embarked on our vacation, and it was backdated to the beginning of April. There was a snag and it didn’t hit until that last check, which would April, May, and two weeks of June. We decided to take that extra amount, after making sure we had left $2800 in our checking (we do that each time we’re paid, as a buffer), and put it towards our lowest balance credit card. With a limit of $3000, we owed approximately $1900. We paid that off, then put $500 to each of our other credit cards, and then put the rest of that into our savings account.

We decided that, rather than take Kalen’s raise into account, we’d continue to use our monthly income as what it was pre-raise, and then the difference in his pay will go to our savings account. With the other card paid off, that also frees up an extra $600 a month to go towards our other two credit cards.

So, I figured that if I posted here what we pay/owe as of 6/14/18/plan, it will help hold us accountable. Spending is a bad habit of mine – I love to shop, and I love to find new things. It is a habit I need to break though, because when/if we’re able to have children, I’d love to be able to stay at home with them and raise them. That will of course result in a loss of income, so the less debt we have – the less I spend, the better we’ll be.

Mortgage: $1193.86
Car payments: $597.95 (owe: $19252.37
Phone payments: $62.71 (owe: $752.48)
Phone bill: approximately $80.00 (we recently lowered our prepaid plans, so the new amount hasn’t been taken out yet)
NIPSCO: $169.00 (we’re on a budget plan)
Car insurance: $77.27/month and $927.20 every 12 months
Comcast Internet: $39.99 but increasing to $79.99
Discover student loan: $50.65 (this is Kalen’s loan) (owe: $4136.76)
Federal student loan: $419.58 (this is Kalen’s loan) (owe: $49657.63)
Hulu & Spotify bundle: $5.00(this is a student price)
Utilities: approximately $95.00 (this is water/sewer/trash)
Backblaze: $15.00
Costco Visa: $800.00 before the Chase was paid off, will be $1100 (owe: $6789.61 with a limit of $7500.00)
Discover: $800.00 before the Chase was paid off, will be $1100 (owe: $16351.45 with a limit of $20000)
Gas: approximately $150.00 monthly (I drive about 45 minutes one way to work, and Kalen drives about 10 minutes one way, and he periodically rides his bike)
Groceries: approximately $400 monthly is our GOAL, and this is without trips to Costco.

Without the mortgage taken into consideration (because I don’t have the total due for that), we owe $98891.05. If you take out the car loans and student loans, we owe $25754.29.

When I first saw any of these numbers, I had a “HOLY SHIT!” moment. I knew we owed money, but damn! The loans – well, we were not the smartest and took out more than we needed, and at the time it was helpful but now we regret that. I will owe a similar amount when I graduate. The car loans are equally stupid. When Kalen got his job, both of our cars were on their last legs, and so we leased our cars. Had we been slightly more patient, and researched more, we wouldn’t have leased. I had leased before and did not want to do it again, but we did not think we had any other option. Rather than turn them in, we took out a loan through our credit union (stupid low interest rate), and we kept the cars. We have prepaid phone plans, so when we needed new phones, we were able to set up a payment plan. Not the brightest idea, but what are you going to do?

Our credit card debt is pretty damn hefty. In our defense, some of that high balance is the result of house expenses, such as a couch and a fridge, and of course the painting of the living room. Could we have waited to purchase those items for a time when we had the cash? Absolutely. However, if we had done that, I wouldn’t be perched on my couch right now, our walls would be nicotine-stained white walls, and we’d be short a fridge. We’d actually be short quite a bit of our furniture.

So my plan/goal (well, OUR plan/goal) is to be more in control of our spending. The $1100 to each card will have the Costco Visa paid off in approximately 6 months. Then we’ll be at a balance of approximately $9900, and by applying the $2200 to that, it will be paid off in about 5 months. This, of course, is dependent on us not using the cards. I’ll be happy just to have the balances down to a manageable amount. Prior to buying a house, we paid them off each month.

Once those are down, we’ll take that money and put it towards something else – I want to put it to the car payments, but as those are the lowest interest rate bills, it would make more sense to put it towards student loans or the mortgage. Of course, this will be determined when the time comes, but it’s nice to have a plan in place.

If we put it towards the Discover student loan, we’d knock that out in 2 months. If you’re following, we’re now 1 year out (and of course, that amount will have changed by then). Following THAT, we could then put the $2200 and the $50.65 to the Federal student loan balance, which would be around $44620.51, and in around 20 months, that debt would be knocked out too. At that point, our cars would be paid off as well, as would our phones. THAT would then give us $3330.89 extra per month.

Of course, this is all without anything coming up, not including any raises or pay cuts, not including any other bills being introduced, and not including interest or other charges. BUT…that means that in about 3 years, we’ll only have our mortgage payment, and of course my student loans once they are in repayment (but then, those could easily be knocked out).

Three years seems like such a long time, but it also seems like such a short time too (around 1.5 years). Saying that in less than 5 years we will be down to a mortgage payment is pretty awesome.

Also, if I am not done with school in 5 years, I am requesting that someone come punch me in the face.

Anyone have any ideas or tips for this plan? I’d love to hear feedback!!!

One thought on “Control Issues

  1. Pingback: Baby Steps, Kinda | Life on the Cul-de-Sac

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