Doingitallwrong's Personal Finance Blog

Fairly decent week for snowflakes, considering I haven't done much of anything to try to get them, although most of them did involve spending money. I used $7 in coupons at CVS (for drug store items that I actually needed ) and then saved another $4.79 on things I picked up while I was there. I got $20 in Kohl's cash (which of course means I spent $100, but considering the full price total was $500, I think I came out ahead!). The 'save the change' rounding total for May was $14.78. I also had interest on the ING account, I'd forgotten about it in April so I've got April ($0.26) and May ($0.47) here.

52-Week Mega Savings Challenge
Week 22 [started late, now on my week 16]

Snowflakes
CVS Coupons: $7.00
CVS Savings: $4.79
Kohl's Cash: $20
Rounding: $14.78
Interest - April: $0.26
Interest - May: $0.47
Total Snowflakes: $47.30
Rounding (to reserve): $2.30

Beginning Balance: $890
Deposit: $45
Ending Balance: $935

Reserve: $0.80 + $2.30 = $3.10

The look back/look head is just my way to try to keep myself on track with my saving and spending. I have an Excel spreadsheet I love for tracking my debt paydown but it doesn't translate well to saving and spending; I find I'm more about words than numbers for those areas. I was going to combine this with my 52-Week Mega Challenge update, since I figured they'd both be short, but apparently I had more to say in this one than I expected!

May
Not a whole lot going on in May; it's a high-spend month for several reasons (my annual 'pilgrimage', our anniversary, and my birthday, plus getting ready for the family garden) but we plan for it and set aside money from my overtime (Feb - April).

Overall in May I paid off $2,292 in non-real estate loans, paid $770 in interest, and paid $158 extra to my 'avalanche' credit card. I wrote yet another letter to Social Security informing them of my mother-in-law's death (in August of 2012) and requesting that they stop depositing her monthly benefits into her checking account. (There's almost $30,000 in there now -- no wonder the system is going bankrupt!) I also informed them that this was our last attempt at remedying the situation -- they've been informed at least three times by three different people (including the funeral home), the bank was instructed to return the first two deposits and close the account back in October 2012, we've tried calling multiple times but can never get through (when we do get through, it's hold-hold-hold-hold and then they disconnect us). So, it's on them, and I'm not even going to worry about it any more. (We don't have any access to the bank account, it's in her name only, so there's not much else I can do regardless.)


June
We have another vacation planned this month, for S's family reunion (among other things). It's unusual for us both to go anywhere together that's not a day trip, because of the critters. We're dividing them up among friends so that no one has more than they can handle. (Once we get this debt paid off and a good EF built up, I'm going to start saving up to buy a big cargo van so we can just bring them all with us. Since we don't go too often it's not that big of a hardship to ask friends to babysit, but it's six trips getting them there and back and about 20 hours of driving total! It does save tremendously on boarding fees, though; we'd be looking at four figures, easily.)

We're staying with family for the duration of our trip and S has a company car so doesn't pay for gas (they take a set amount out of each check to cover personal use of the vehicle), so our actual vacation expenses should be minimal.

I am expecting some big snowflakes this month. Of course, one I've been expecting for a few months now (payment for a side gig), but I'm moving up the ladder now and should have a resolution soon. The other is $200 from a round of physical therapy I had last year; I paid a $20 per session co-pay, but then the insurance company ended up paying the entire bill. I heard back from them last week that they'll be processing the refund and I should see it in a few weeks.

On the down side, the tenants at the rental let me know about several areas that need repair at the house. (Honestly most of them are items that needed repair when we moved out 12 years ago.) They do most of the work on the house themselves -- they plan to buy it at some point (and I'm not pushing them, honestly, because a) they're like family and b) the longer they wait the better for me, because the mortgage will go down and the home's value will go up) -- but they're in a tight situation financially right now and can't afford to pay for the repairs and pay the rent. So they'll likely only pay a portion of the rent for the next several months, while they tackle these repairs, and I'll need to make up the difference since the rent is used to repay family loans. (It should only be a few hundred dollars each month, which I may be able to cash flow from S's bonuses, side gigs, etc., but if not I've asked them to find out about recharging the a/c one more year instead of replacing it, and then I can use some of the money I had set aside for the new a/c now, and start saving again to replace the a/c next June.)

We started on the family garden yesterday (late, we were waiting on the rototilling to get done) and hope to get the bulk of it finished up tonight, if the rain holds off. This is our second year at the community garden, and I'm really hoping it's better than last year was. We have a new plot, that's on a little bit higher ground (apparently our plot last year was in what used to be a riverbed), and the soil seems much better. To be fair, everyone at the garden said they had a bad year last year, we got quite a lot of rain and not many really sunny, hot days. This year they're predicting extreme heat, which I'm hoping also means lots of sun. I'm not sure what the rainfall prediction is, but water is free so it's just a matter of getting there as needed. (My sister lives a mile away and I drive by every day on my way home from work, so that's not a problem.)

I think that's (finally) it! More than I expected to write, but I guess I needed to get all of this out of my head.

LAL's blog entry reminded me (peripherally) of a conversation I had with my sister yesterday, and I figured I might as well get some thoughts from those of you here who have been through this. My niece (E) is 4 and a half, and starts kindergarten in the fall. When school starts, my sister is going to start giving E a small allowance and teaching her about finances.

Of course at E's age (nearly 5 by then), it will be simple, but we were discussing different ways to handle it. Sis doesn't want to just give E money as an "entitlement", so there will be 'chores' attached to it. She also doesn't want to 'pay' E for doing tasks that she should be doing anyway -- making her bed, putting away toys, cleaning her room, etc. Yard work -- picking up sticks, or helping rake leaves -- would be a 'payable extra'.

We got into a grey area with tasks like helping clean the house, doing the dishes, etc. On the one hand, those are things E should be doing as part of living in the house; on the other hand, dusting and vacuuming are pretty typical "chores", I'd think, or at least they were when we were growing up.

The other question was how much she should get. One book my sister was reading said kids should get half their age per week, at least at this age. So $2 or $2.50 per week -- which Sis feels is a lot. (Though I did suggest she start right off having E put 50% to savings, and then dividing the remaining 50% between spending and giving. They're not religious, so there isn't a 'tithe' requirement; I had suggested 25/25 but maybe 30% spending/20% giving would be more appropriate.)

We got an 'allowance' as kids but it was basically just enough to pay for lunch every day, until high school when we got $5 extra. I don't recall having any chores attached to it. My sister doesn't even remember getting an allowance, so we don't really have a lot of our own experience on which to draw!

What have you all done with your kids (or what did your parents do with you)? What worked and what definitely didn't? Do you pay for household chores, or just those that go above and beyond? What's an appropriate allowance for a 5 year old?

Slow week (as usual, it seems!). I need to get moving on some side projects; this weeks I should get a couple done, though they won't pay out until next month. Anyway, I remembered at the last minute to turn in some medical bills for last year's flexible spending plan, so that reimbursement came through for $59.68. I also returned a bag of pop bottles that came to $5.20. (I wasn't even paying attention when I left for the store -- there was a whole other bag waiting to go!)

52-Week Mega Savings Challenge
Week 21 [started late, now on my week 14]

Snowflakes
FSA Reimbursement: $59.68
Bottle Return: $5.20
Total Snowflakes: $64.88
Rounding (from reserve): $0.12

Beginning Balance: $825
Deposit: $65
Ending Balance: $890

Reserve: $0.92 - $0.12 = $0.80

I'm working on paying off credit card debt, I have a plan in place and its going well, and I'm also able to save for upcoming expenses, a small emergency fund, etc. I just got the latest statement from one of my Chase cards, and the balance is under $200.

I have money in the bank. It is earmarked for property taxes, but I know I can make up $200 before they come due. The Chase card is second to last in my debt avalanche repayment plan, because the interest rate is only 6%. (In fact, it will be paid off just with the minimum payments before I even get to avalanche it.) It's only costing me $1 a month or so in interest, and the payment is $23.

If I pay off the card and put the $23 toward building my savings back up, it would take me 8.6 months to repay myself. If I keep paying the minimum on the card, I'll have it paid off in nine months. The interest on my savings account is nothing to speak of, so I'm not really losing anything there; paying on the card for the next nine months would cost me less than $9, so not really losing much there, either.

My inclination is to pay it off, add the $23 to my avalanche, and find a way to make up the $197 through side gigs, selling some stuff, whatever.

What do you do with those straggling little debts? Is there a threshold amount where you decide it's worth it to just pay them off and deplete your savings a bit?

I actually got some stuff done this weekend -- between tax season and then planning for (and being on) my vacation, it's been a long time since that's happened! I had to renew my notary commission, which means driving out to the county clerk's office which is also the courthouse, so I figured a 1-2 hour wait. I got there at the right time, apparently, because it was only about 10 minutes, so I had time to get my nails done for our anniversary celebration (it's today, actually, but we celebrated on Saturday night).

They finally put the free compost out for city residents -- it's supposed to be available in April, but I'd imagine the weather delayed things. Which works out fine, since the community garden just opened anyway. So I filled several lawn bags to use when we start planting, probably this coming weekend. (Well, I say "filled". Really they're only about 1/3 of the way full, because compost is heavy! So I'm driving around with bags of compost in the back of my car all week, because I don't want to take them out and have to load them back in again.) I have several seeds started, which we got for the cost of postage, and then we went on Mother's day to buy some other veggies for the garden. We had a rather dismal year last year (our first), but everyone said it was a bad year, so we're hoping for more success this time around.

I also filled up my car's gas tank. That probably doesn't seem like an accomplishment, but I'm notorious for just putting in $25 at a time.

[LOL - just re-reading and it doesn't really sound like a busy weekend at all. That was all just on Friday, actually. Saturday was 'anniversary day' so we had lunch, went to an exhibit at the museum, then dinner and a play at the community theater. Yesterday I got caught up on all the laundry from my trip, made a couple of quick small gifts, and then we went to dinner again because the place we were going to go on Saturday had a too-long wait time.]

In the Savings Challenge, I'd forgotten a few things in previous weeks so I'm throwing them in here. I took some of my CVS savings from Lent (the half I hadn't used here previously) and bought some lottery tickets -- well, I think they called it a "raffle", really. It was special thing the state did, they called it a $40K tax-free raffle but really the prize was about $59K and you net $40K after taxes. For every x amount of tickets sold they added another jackpot, plus lots of smaller prizes. At any rate, the big push was "one in six wins", so I figured I'd test the theory. Tickets were $10 and we bought six, all from different places. (Not sure if that increased or decreased the odds of winning.) We did win, twice in fact, but only $15 each time. I was hoping to at least break even. So technically I'm out $30, but since the CVS money was an 'uncounted' snowflake itself I'm counting the raffle winnings as a snowflake here.

As I mentioned, I have my notary commission because at work sometimes a client needs something notarized, and the woman who was the notary retired. So my boss pays for my notary commission and once or twice a year I notarize something for a client. My sister's boss, however, has had a slew of documents she needed notarized, so I did those for her and as a thank you she got a me a $25 Visa gift card.

Finally, my "keep the change" total for the month of April (rounding my checking account transactions) was $12.82.



52-Week Mega Savings Challenge
Week 20 [started late, now on my week 12]

Snowflakes
Lottery/Raffle: $30
Gift Card: $25
Rounding: $12.82
Total Snowflakes: $67.82
Rounding (from reserve): $2.18

Beginning Balance: $755
Deposit: $70
Ending Balance: $825

Reserve: $3.10 - $2.18 = $0.92

That brings me through week 13, or 25% of the year. My progress so far (since I started late, I'm aiming to complete the mega challenge but tracking the regular and double, too):

52-Week Challenge: 60% complete
52-Week Double Challenge: 30% complete
52-Week Mega Challenge: 12% complete

I still have $625 coming from a side gig, someday, and more work to do for that client once they get me the information I need. The $625 by itself will complete the regular challenge, get me past the half-way mark on the double challenge, and to just over 20% of the mega challenge. Slowly but surely I'm getting there!

The Chase Freedom Rewards points came through today. I've estimated that we'd get about $50 per month in rewards, but this month was quite a bit higher, $90.06. It helps that the 5% category for this quarter is restaurants, and we do a lot of eating out in May (my vacation and Mothers' Day for this period; our anniversary and my birthday (though we might not pay for that one) for the next).

Gift Fund
Goal - $500
Balance - $437.76
Remaining - $62.24

Movie Card Fund
Goal - $100
Balance - $0
Remaining - $100

I may have the gift fund fully funded by next month, and then can start on the movie card, which should be funded by August, I'd think, at the latest. After that, I think I'll use 50% of the rewards for the gift fund, since the $500 was random and didn't include our anniversary gifts to each other or our dinner (our annual splurge!). The other 50% will go to the 52-Week Challenge.

I did make it to the movies once last month, so my current movie card balance is down to $62. I will be going again at the end of this month, but I don't see anything beyond that (yet) that I'm interested in seeing in the theater. If I do, though, I'll probably need to divert some of the gift fund money to get a new movie card. It all works out the same, just a different timeline. (Next year, if I repeat this, I'll fund the movie card first. )

I was on vacation last week (my annual pilgrimage to the Critter National ) and even though I bring my laptop, there's so much going on I rarely get a chance to to use it!

April Look Back / May Look Ahead

April
The adjustments we made at the family financial summit to the March payments ended up being adjusted back, because the renters' catch-up payment arrived on March 31. It's minimal so I'm not bothering to go back and revise the March info; I've accrued a little less interest than I expected, so that's a good thing!

Overall in April I paid off $2,421 in non-real estate loans, and paid $777 in interest. I also paid $141 extra to my 'avalanche' credit card. (I think I said $141 extra in March -- that was actually $146 extra.)

May
I'm back to my normal hours this month, and of course it works out that the paydays are exactly two weeks each (I get paid twice a month), so the two May paychecks will be the lowest amount I get paid if I work every day. (I do have vacation pay, fortunately.) S got a small raise effective the last April check, and we're getting into his busy season so his monthly bonuses should be increasing. It tends to balance out, but I so look forward to the day when I don't have to worry about whether it will or it won't, because we have money in the bank and no huge debts hanging over our heads!

52 Week Mega Savings Challenge

Two weeks to update here. The first week I had a quickie side job that brought in $22, and returned bottles for $72. (Normally the bottle money is used as spending money on my trip, but between a "happy trip" gift from my mom and friends buying me dinner and drinks a few times, I actually didn't spend any of my own spending money!)

52-Week Mega Savings Challenge
Week 18 [started late, now on my week 10]

Snowflakes
Side Job: $22
Bottle Returns: $72
Total Snowflakes: $94
Rounding (from reserve): $1

Beginning Balance: $630
Deposit: $95
Ending Balance: $725

Reserve: $3.79 - $1 = $2.79

The following week was my actual vacation, so not much opportunity for snowflakes there (other than the above). I did meet another monthly goal for my Diet Bet, so that was $30.31 in winnings. I'm not counting the money I didn't spend on cool stuff I wanted to buy!

52-Week Mega Savings Challenge
Week 19 [started late, now on my week 11]

Snowflakes
Diet Bet: $30.31
Total Snowflakes: $30.31
Rounding (to reserve): $0.31

Beginning Balance: $725
Deposit: $30
Ending Balance: $755

Reserve: $2.79 + $.31 = $3.10

It seems like this Challenge is the only update I'm doing! There's not been much going on for me finance-wise, I'm waiting for a few things to shake out and my side gigs really won't pick up until after my annual vacation the first week in May. So not much to talk about! Last week was the last week of Lent, so my $25 CVS savings are gone. (I have been to CVS after Easter, but only because I actually needed drugstore things, and then I got $8 in Extra Bucks that I'll count here if I end up using them.)

I did find $10 in my 'critter bag', and 'sold' an item (actually used the price to knock $ off a bill) for $66. So not a horrible week, all things considered. Still waiting on the $625 invoice to come in, he told me last week he was doing it that day, which means I might see it next month. *sigh*

52-Week Mega Savings Challenge
Week 17 [started late, now on my week 8]

Snowflakes
Found Money: $10
Sale/Bill Offset: $66
Total Snowflakes: $76
Rounding (to reserve): $1

Beginning Balance: $555
Deposit: $75
Ending Balance: $630

Reserve: $2.79 + $1 = $3.79

I cleaned out my car this weekend (finally!) and found $75 in the process. $20 went to my "emergency $20" car stash that I'd spent the other day when I left my purse at work; the rest I'm calling a snowflake. I also went to a movie and saved $1.25 at the concession stand with my Stubs card, so I'll count that, too. Plus I totally miscalculated last week so my total was $5 short, so I'll add that in here.

52-Week Mega Savings Challenge
Week 16 [started late, now on week 7]

Snowflakes
CVS Savings: $25
Found Money: $55
Correction: $5
Movie Savings: $1.25
Total Snowflakes: $86.25
Rounding (to reserve): $1.25

Beginning Balance: $470
Deposit: $85
Ending Balance: $555

Reserve: $1.54 + $1.25 = $2.79

Its Tax Day, which means the end of my 60-hour work weeks (yay!) but also the end of my overtime (boo!). Still, I'm pushing my mental and physical limits, so I welcome getting back to my 4-day work weeks, and my annual vacation in a couple of weeks.

We had a fairly major health issue with one of the critters last weekend, requiring unplanned surgery and overnight vet stays. The high end of the estimate was just about our entire emergency fund, but better that than not having the EF! She ended up staying at the vet an additional day, so I was expecting to hit the high end and perhaps go a bit over. Fortunately, I have a CareCredit card, which you can generally get at least six months at 0%; I figured I'd do that and set aside the money to pay it off, rather than depleting the EF and then building it back up. When I picked her up, though, the total cost was less than the low-end of the estimate! So I was able to just cash-flow it, since I have a little bit of overtime coming still. I won't be able to put as much in savings as I'd planned, but I still have the EF and no new balance on the CareCredit card.

The Chase Freedom Rewards points came through today, so I can update that amount. I'm estimating we'll get about $50 per month in rewards; this month was a little higher, $59.26.

Gift Fund
Goal - $500
Balance - $347.70
Remaining - $152.30

Movie Card Fund
Goal - $100
Balance - $0
Remaining - $100

We were planning on going to a movie Sunday, but the scheduling didn't work out, so I've still got $83 left on my current AMC gift card. I am going by myself to a movie on Friday -- one of my post-tax-season treats -- so that will knock it down a bit. I have $10 rewards on my AMC Stub Card, but my membership is due for renewal, so I'll use that plus $2 from the gift card. (I don't usually pay for rewards memberships, but this one truly does pay for itself and then some. My first year of membership was free, so in three years I've paid $24 in membership fees, and between rewards and savings on concessions I've made $127. It helps that my mom goes to the movies with a group of her friends once a month or so, and uses my Stubs card. And of course I haven't really 'paid' the $24, between the rewards and gift cards.)

Finally, it was a pretty poor week for the Savings Challenge. Things were so busy at work I really didn't have time for any side jobs, and no snowflakes spontaneously appeared. I did have a couple of returns and while they're not technically snowflakes, I had already counted that money as spent, so I'll include it here just so I have something!

52-Week Mega Savings Challenge
Week 15 [started late, my week 5]

Snowflakes
CVS Savings: $25
Returns: $41.19
Total Snowflakes: $61.19
Rounding (to reserve): $1.19

Beginning Balance: $410
Deposit: $60
Ending Balance: $470

Reserve: $0.35 + $1.19 = $1.54

I got one side gig done last week for $25, found $3 when I (sort of) cleaned my desk at work, and won Round 1 of my DietBet for $16.31 (my initial bet was $12.50, so net profit of $3.81, but I'm counting the entire amount as a snowflake). I also decided to do a "keep the change" thing in my checking account -- rounding each debit up and each credit down to the nearest whole dollar amount. I just whipped up an Excel spreadsheet and at the end of the month will copy all my transactions over. (There aren't that many, since we use the Freedom card for whatever we can. I generally pay that in whole dollars but maybe I'll change that. I might look at doing the rounding on the Freedom card transactions, too...) Anyway, for the first three months of this year that totalled $30.46. And then I have my No-CVS-For-Lent savings -- so overall not a bad week!

52-Week Mega Savings Challenge
Week 14 [started late, my week 5]

Snowflakes
CVS Savings: $25.00
Side Gig: $25.00
DietBet: $16.31
Bank Account Rounding: $30.46
Found Dollars: $3.00
Total Snowflakes: $99.77
Rounding (from reserve): $0.23

Beginning Balance: $310
Deposit: $100
Ending Balance: $410

Reserve: $0.58 - $0.23 = $0.35

March
I have a home I'm renting out to someone who is practically family, so I'm very lenient with them if something comes up and they can't make the rent. They always send something, even if it's just $100, and make up the rest as soon as they can. However, that money goes directly to paying off my family loans, so technically if they're late with the rent, I miss payments on those loans. (The family is also understanding so it's not a huge deal, fortunately.) We had our annual family financial summit at the end of March, and so I adjusted the loan schedules to reflect those missing payments. (A little extra interest accrues, essentially.)

The end result is that it decreased my debt principal payoff for March, so I only ended up paying down $1,464 in principal (it should have been around $2,000). I also paid $801 in interest. (These amounts do not included real estate backed loans.) I also paid $141 extra to the current point of attack (highest-interest credit card).

I did join the DietBet 6-month challenge. The first round closes out this weekend and I'm on track to meet the goal, so I should get a little snowflake for that sometime in April. I also made a bet with Healthy Wage, another 10% in 6 months challenge. My initial investment in both was $275, but if I meet the goal (figuring low-average returns on the DietBet winnings), I should end up with around $600. That is more motivating than "health" "fitness" "smaller clothes" etc. -- I wish I'd found this 'dieting for money' thing a long time ago! I'll consider all of that money as snowflakes for my 52-week Mega Savings Challenge.

We also made a decision that probably almost everyone will say was the wrong one to make, but I'm not ready to talk about that just yet....

April
I have two more weeks of overtime at work, and then I'm back to my 'real' income. Fortunately we are able to set aside a lot of my overtime pay to cover upcoming expenses in the next several months. I do plan to revisit our budget once things slow down to see where we can cut our spending a bit -- really I think if we just got a little organized we could save a decent amount. (Mostly me, I guess, with breakfasts and lunches on work days. It's been better since I've been trying to eat healthily for the DietBet thing, but I don't always wake up in enough time to make a lunch so end up buying it at $5-8 a day. Lots to work on there!)

I'm also going to see if we can decrease our electric usage; we keep getting letters from the company saying we're using so much more electricity than our neighbors, which I'm sure is true. I know exactly why that is (40+ days in a row of round-the-clock below-freezing temperatures will do that!) and we've already decreased our usage by about 50% from last month, but I might try things like unplugging stuff rather than just turning it off (if the plug is easy to reach, that is!), putting things on a power strip and turning that off (if there are no clocks or programs to reset), etc. We do have one light on a timer and I need to adjust the timing for that now that the days are getting longer. I'll look at putting in those pigtail light bulbs wherever I can, too, since they supposedly save money. Our billing cycle starts on the 26th, so I've got some time to formulate a plan of attack, and then get everything in place. (And talk S into participating!)

What do you do to save on electricity? What tips or tricks have worked well for you? (Or alternatively, are there any you've found haven't really made that much difference?)

Things are still pretty crazy so not a lot of time for side gigs, though I do have one that should pay out this week. I rolled up some coins, though, found six cents, and have my CVS savings, so not a total loss.

52-Week Mega Savings Challenge
Week 13 [started late, my week 4]

Snowflakes
CVS Savings: $25
Rolled Coins: $19
Found Coins: $0.06
Total Snowflakes: $44.06
Rounding (from reserve): $0.94

Beginning Balance: $265
Deposit: $45
Ending Balance: $310

Reserve: $1.52 - $0.94 = $0.58

I have lots and lots of debt, but I'm on track to have it all paid off within 10-11 years, assuming minimal commissions on S's job and 1-2% annual pay increases only for the next 3 years. (S's income fluctuates; he does have a base and generally gets 3% COLA, but commissions vary by tens of thousands of dollars each year.)

Basically, I have the following types of debt:

Credit Cards and Lending Club Loan
401(k) Loans
Personal (Family) Loans
Real Estate Backed Loans

My plan has been to pay them off in that order, in essentially a snowball (or avalanche, I guess they're called now, since I'm paying the highest interest rates off first), and then I'll have nearly $5,000 a month freed up for savings, investing, etc.

After reading a bit here, and thinking about it, I may change that a bit. I'll still tackle the credit cards/LC loan aggressively (on schedule to be paid off 5/16, unless I'm able do a consolidation at a lower interest rate), and then the 401(k) loans (on schedule to be paid off 8/17, unless of course the credit cards get paid off sooner and then they'll be paid off sooner, too). Then I think I'll step back a bit, and build the emergency fund up to $15,000 and set up a $5,000 slush fund. That should take less than a year. Next I'll look at setting up Roth IRAs for S and me and get on a plan to fully fund those every year. Once that's done, I'll increase our 401(k) contributions back to the maximum (we're currently both only contributing what the company matches).

Ideally I'll still have some extra money at the end of the month once this all shakes out, and I'll start tackling the family loans. Unless the family gets impatient, which is conceivable, or the interest rates get too high. Interest is renegotiated annually, kind of a compromise between what the lender could get in a high-yield CD and what I would pay on a bank loan at the average interest rate. Right now it varies from 2-3% on a few different loans. Some of those will be paid off in the next couple of years, just from the regular payments, and that money goes to the next loan. It's basically a separate snowball/avalanche plan; the income from the rental is paid directly to the family so I never even see it, and it gets disbursed among the loans as we agree each year at the "Family Financial Summit" (FFS).

Once the family is taken care of, I can then tackle the real estate loans. (I should add, at this point S has a company car and we don't really see that changing, unless he takes a promotion -- knock wood, of course!! My car will be paid off by 2/17 (part of the family loan) and I expect to have it for several more years; if not, we have the option to buy S's company car when he gets a new one (that's how we got the car I'm driving now), which is about every two years, at a decent price.) First in line would be the rental, which may be sold by then. (They're on a 'lease to own' agreement, which actually was supposed to happen last year, but they've had some setbacks and aren't in a position to buy, and quite honestly I'm not in a hurry. The value is still below what I paid for it, though I think I'm just starting to tread water on the mortgage amount, and it's about half what it was when they started renting at the peak of the bubble.) If any money comes out of that sale, it would go toward the family loan.

By that point all of the unsecured debt will be off of my shoulders, we'll have a solid emergency fund, we'll be aggressively saving for retirement, and our only debt will be the mortgages. Which, frankly, sounds like both heaven and the impossible dream! I'll look at interest rates then, see about refinancing if it would be helpful (though my current rates aren't too horrible, 4.25-5.375%), and decide at that time which balance to pay off first or if I should pay extra on both. Excel is my best friend so I'll run the numbers and see what makes the most sense. I've got a little time to get there yet!

I've tried to not be too aggressive in planning these payoffs, and to not count on variable things like commissions and raises. Right now I still feel like I'm teetering on the edge -- a significant expense would be tough but probably manageable (>$5,000), but a major expense would be difficult, and of course a job loss would be catastrophic. Once I get these credit cards paid off, I'll breathe a lot easier. I'll actually have five paid off within a year, which will shave about $14,000 off my total cc debt and $450 off the minimum payment amounts. (Not that I plan on only paying the minimums, but it's nice to know that in the event of a catastrophe my obligations will be that much lower. It's still a lot to pay every month, don't get me wrong!)

It's kind of hard to believe, after all these years of debt hanging over me, that I might actually be free of it!

My big client payment still hasn't come in, I sent a reminder about that on Thursday so hopefully I'll see it soon. That will catch me up a few weeks!

I got paid $50 for a side gig and they over-reimbursed me (for a product I had to buy for the gig) by a penny, but I'm counting it! Plus the $25 CVS savings, so not a bad week even though I was so busy I didn't get a chance to do much of anything savings-wise.

Last week I didn't notice that ING had added a little bit of interest before they merged my accounts, so I started with a reserve of $1.51 instead of 41.37. And then I didn't use the $0.20 from last week, I deposited the full $70, so my reserve hasn't gone down at all.

52-Week Mega Savings Challenge
Week 12 [started late, my week 3]

Snowflakes
Side Gig: $50.01
CVS Savings: $25
Total Snowflakes: $75.01
Rounding (to reserve): -$0.01

Beginning Balance: $190
Deposit: $75
Ending Balance: $265

Reserve: $1.51 + $0.01 = $1.52

When I went to transfer my Week 11(2) savings to my ING account, I found that my bank account wasn't linked anymore. (I'd had two ING accounts, each linked to a different bank account; I combined the two ING accounts, which apparently dropped one of the linked accounts (the 'right' one, of course!).)

Anyway, I had to re-add the account so they sent two small transfers - snowflakes!

I also remembered that I'm using 1/2 of what I save by not going to CVS as a snowflake, and I'd forgotten about that. So the new numbers are:

52-Week Mega Savings Challenge
Week 11 [started late, my week 2]

Snowflakes
Subway GC: $3.53
Pinecone: $6.00
Free pizzas (3 @ $6.95 + tax): $22.10
Pizza sale (2 @ $3.81 + tax): $8.08
CVS Savings: $25
ING Deposit 1: $0.07
ING Deposit 2: $0.02
Total Snowflakes: $64.80
Rounding (from reserve): $0.20

Beginning Balance: $120
Deposit: $70
Ending Balance: $190

Reserve: $1.37 - $0.20 = $1.17

My client payment hasn't come in yet, so I'm not knocking off any of the big amounts this week. I did decide to use the pizza coupons as a snowflake, plus they had another deal going this week for "Pi day", $3.14 per pie instead of $6.95. Great for the budget, but I'm a little pizzaed out!

52-Week Mega Savings Challenge
Week 11 [started late, my week 2]

Snowflakes
Subway GC: $3.53
Pinecone: $6.00
Free pizzas (3 @ $6.95 + tax): $22.10
Pizza sale (2 @ $3.81 + tax): $8.08
Total Snowflakes: $39.71
Rounding (from reserve): $0.29

Beginning Balance: $120
Deposit: $40
Ending Balance: $160

Reserve: $1.37 - $0.29 = $1.08

One of the things I'm actually doing right is not using credit cards. For a long time everything went on our debit (Visa check) cards, so the money was pulled right out of our account, and we were getting rewards for the spending. Then Chase discontinued the debit card rewards program. Boo.

After a few months of no rewards, though, on a whim I decided to apply for a Chase Freedom card, which gives 1% on everything, and 5% on quarterly categories. Since I'm in a hardship repayment plan on three Chase credit cards, I really didn't think I had a chance of getting the Freedom card, but I figured I might as well give it a shot. Lo and behold, they gave me a card!

This was also a test of our dedication to not incur more credit card debt. We made a deal that we would pay that card off as needed to ensure we never pay interest on it. (Since we use it constantly, it's never really 'paid off'. I keep the balance low and ensure I pay at least the last statement balance before the next due date.) I'm happy to say we've had it for over a year now and no interest paid yet!

At any rate, we're getting rewards again and have taken advantage of them from time to time (movie gift cards, restaurant gift cards, a TV and a new vacuum). I've gotten a little bit wiser now, though, and have decided it's in my better interest to take the cash as needed and purchase the item or gift cards with the Freedom card -- that way I get another 1% on the purchase that I'm paying for with the rewards. (I will check to be sure the price is comparable; it used to be that a $25 gift card cost the equivalent of $20 in points, but now it's been a dollar-to-dollar purchase.)

Somewhere I read that someone was using their rewards points to pay for Christmas, and I thought that was a great idea, so I'm setting that as my goal for the rewards money this year. (Christmas and birthdays.) We have a small family, so although I've never really added it all up, I'm guessing that $500 will more than cover our spending on these items for the year. So my first goal is $500 in the gift fund. Then I may set aside $100 for a movie gift card. (I honestly don't think I can actually pay for a movie again; I've been using rewards gift cards for close to a decade! I know it's the same thing in the long run, but psychologically it would just bug me.) We don't go to the movies very often, so $100 will last a while. (I just got a $100 gift card in November, and there's still $83 left on it.)

It looks like we average about 5,000 rewards a month, or $50, so that's $600 a year. However, I started out with $80 and apparently they give a 10% annual bonus, plus we had some large expenses in January/February, so I'm ahead of the game right now. I'll figure out what to do with the additional rewards once I get to that point!

Rewards Gift Fund
Goal - $500
Balance - $288.44
Remaining - $211.56

Movie Card Fund
Goal - $100
Balance - $0
Remaining - $100

The real kind, that is. We got dumped on with snow overnight, which means I couldn't get out of the driveway, which means I couldn't go to work. Since this is overtime season, that means I missed 10 hours of time and a half. I was able to work a couple of hours from home, I had an extra hour yesterday, and I can probably add a couple of extra hours the rest of the week, so I'll probably only end up missing five hours of overtime, but still, it's a pretty significant hit.

I am so over this winter.

In the good snowflake category (which I'm using toward my 52 week mega challenge), I had $3.53 left on a Subway gift card that I used for lunch Monday, and $6 from Pinecone surveys that I'd forgotten about. (I haven't gotten a survey from them for almost a year, but they haven't kicked me out yet, either. I'm going to send an email to see what's going on with that.) So, $9.53 goes to the reserve, added to the $1.37 that's already in there, for $10.90 available to use at the end of the week.

I'm still debating with myself about what kind of "saving" I'm going to use as snowflakes. The Subway gift card I'm comfortable using, because I would have spent that money anyway. However, we had some coupons for free pizzas at a new place that just opened, and I'm reluctant to include the $6.95 (plus tax) as a snowflake, since if we hadn't had the coupon we wouldn't have gone there. On the other hand, we would have spent some money somewhere for the meal, either at a different restaurant or at the grocery store.

How do you decide between a snowflake and money you just didn't spend?

I meant to put this in the February/March post, but I forgot!

We don't really do Lent in my church -- we recognize the 'season', but we've never done the "give up something for Lent" thing. Still, I know a lot of people do practice abstention for Lent, and so sometimes I'll play along and give up something, too.

This year, as strange as it may seem, I'm giving up CVS for Lent. (Yes, the drugstore.) There's one right next to where I work, and it's too easy to just pop over there for this or that -- "this" usually being Pepsi, and "that" being some kind of chocolate. I have a weird hangup, however, in that I can't only buy pop and chocolate at CVS, so I have to think up something else that's more "drugstore-y", so that it looks like I came into the CVS for the other thing and grabbed a snack while I was there. (I'm actually a very logical person in a lot of ways, but clearly this is not one of them!) So I grab batteries, or makeup, or some kind of first aid thing that I might eventually use one day but don't really need.

Cutting down on the Pepsi and chocolate is definitely something I need to do, but moreso, I'm wasting a lot of money at CVS. So far in 2014 (not including some lottery tickets I bought for a friend's birthday present) I've spent over $400 at CVS. In two months. On nothing. So, yeah, giving that up for Lent.

I'm going to try to do monthly reviews/projections to see if it helps me stay on track (I'm good about the debt paydown, but tend to let the savings side of things slide.)

February
I though I'd end up having paid off about $2300 in debt principal, but I forgot about some Bill Me Later purchases I made. They're 0% interest for six months, at which time I'll pay them off, but they're still technically debt. So I only ended up paying off $1990 in debt principal. Then, based on comments on one of my other posts, I set up my Excel spreadsheet to calculate the interest I've paid each month. Not including mortgage interest, this month's total is about $871. Ouch!

That said, I did pay $74 extra on the highest-interest card (that was a little low, actually, but I had a 0% BML amount due so that payment was higher than usual).

March
I've decided to attempt the 52-Week Mega Savings Challenge. I'm quite a bit behind, though, and there are some big amounts to catch up! I'm going to give it my best shot, and if I miss I should still hit the "double" challenge (which is probably called something else). I'm only going to fund this with snowflakes, which does not include hubby's (we'll call him S, just to save typing!) commissions, or checking account sweeps. Those will go toward upcoming planned expenses like summer property taxes, new a/c at the rental, etc. It will include money I make from my side gigs.

I'm also debating joining the DietBet 6-month "Transformer" challenge. It's $125 (if I pay up front, $150 if I pay month-to-month -- hm, can I count that $25 as a snowflake?) and if you meet the goals (monthly and overall, which ends up at 10% weight lost) you are guaranteed to at least get your money back. (They of course take a fee from the winning, but have pledged that they will reduce or eliminate their cut to be sure everyone that meets the goals gets their money back, which I really liked.) This may be a 'doing it wrong' thing again, since there's no guaranteed return on the investment (they say on average people get 1.5-2x their money back), and I could theoretically invest the money somewhere and make a small return (around $3 at 5%?) -- but I would consider it an investment in my health, since I really do need to lose (far more than) 10% of my weight. If anyone has done a DietBet before, I'd love to know what you thought of it.

Snowflakes
I finally finished up and set out an invoice that should have gone two months ago. That will really jump-start my 52-week challenge, since it's for $625.

I "found" money in a couple of savings accounts I'd set up at ING (now Capital One 360) -- I'd forgotten about them until I was working on our taxes, and they came up under the Interest schedule. So I logged in to see that there really wasn't that much interest to report but the two accounts had $67.31 and $54.06 in them. Coincidentally, that same day we got letters from Capital One stating that the accounts were at risk of being transferred to the state as abandoned property. So that's the $120 square checked off. I think I'll use one of those accounts as my 52-Week savings account, too -- that gets it out of my easy reach and will keep those accounts from going dormant again. (I should probably combine them, really; I have one in my name and one joint, but there's no real reason to have two.) (I'm going to call them ING accounts, because Capital One 360 is too much to type!)

I also need to track down the EOBs from some physical therapy I had last year. I paid the $20/visit co-pay, but if I'm reading things right it looks like my insurance company paid for the full cost of the visit (we have Health Reimbursement Account, and it looks like the co-pays were paid from that account). So I need to verify that, and then call the PT place and ask for my $200 back.

52-Week Mega Savings Challenge
Starting late, on week 10!

Beginning Balance: $0
ING Joint Account: $67.31
ING Solo Account: $54.06
Ending Balance: $120
Reserve: $1.37 (In case I need it to round out a future week!)

[Gotta love the Lazarus add-on for Firefox -- this entry was lost in the 'catastrophic failure' of the server, but with one (right) click Lazarus was able to restore the whole thing! It's free, too, though the do occasionally ask for donations.]

I posted before that I have an indifferent attitude about debt. I just figure it's always going to be there, and now that I comfortably pay the minimums every month, I'm not too fussed about it. I'd like to get out of debt, sure, and I am working toward that -- but it's not a driving force for me, I'm not especially motivated to cut my spending down to nothing and throw every cent I have at the debt. I want to enjoy my life while I'm living it, within reason. (I'm not going to take a trip around the world or buy expensive cars, jewels, etc., but I might buy a $12 ring (marked down from $60, of course) just because I like it.)

I've been thinking about that lately, and wondering why my attitude is what it is. Part of it is my overall personality -- I'm not especially motivated to do anything, and would rather curl up on the couch with a good book than do most other things. (Translation -- I'm lazy!) I do think there are a few factors that have contributed, or at least if they were different maybe my attitude toward debt would be different, too.

My Mom Is Frugal
That's putting it mildly. She returns food she doesn't like, she will drive to four different stores to save 25 cents on a certain item at each, etc. Granted, she was divorced and raising two kids alone in her late 20s/early 30s, back when being divorced was unusual. (Her parents were nearby, and a great help to her, but still, I know it wasn't easy for her.) She had to pinch pennies to keep food on the table, especially since child support was unreliable. So my sister and I didn't always have the trendy toys or the Jordache jeans (I'm dating myself now!), because we just couldn't afford them. (Don't get me wrong -- we weren't living in poverty by any means. We had a nice home in a good neighborhood, I never really knew it was a struggle to put food on the table until I was much older, etc. Plenty of people had and have it far worse than we ever did; overall we were still very fortunate, I know.) As a result, I think as an adult I subconsciously rebel against any restrictions on my spending, because we were so restricted when I was young.

No One Taught Me About Budgeting
By the time I got to high school, they'd stopped offering personal finance classes at all, much less making them compulsory. This is probably one of the worst ideas ever. (I know my mom could have taught me -- she probably tried, but I was a typical teenager and no doubt thought she was just 'getting on my case'.) So off I went to college, with no real idea of how to manage money and lots and lots of companies wanting to give me credit cards. Is it any surprise I was in over my head in debt well before I graduated? (And I didn't have any student loans, so I don't even have that excuse!) We inherited/bought my grandparents' house after they died, along with all of their 'stuff', and as we were cleaning things out I found several of my grandmother's "household budgeting" notebooks. Just a steno pad, and her records of where their money went, but it was fascinating. Every transaction was written down (well, almost -- my grandpa got a weekly lunch allowance, and that was the only tracking of that amount), a running balance of all outstanding debts, weekly savings account updates, etc. It was a fascinating glimpse into their life back in the 40s, 50s, and 60s, and also illustrated a clear schism between what she was taught and what I was taught about personal finance.

I Don't Have A Clear Self-Image
I think one of the biggest issues is that in my head, I'm still in my mid-20s. I have lots of time to pay off my debts, save up for retirement, etc. The reality is that I'm quickly approaching my mid-40s, and that 'far off' retirement age is a whole heck of a lot closer! This is probably my punishment for not having children -- at the very least, they insist on aging, so I'd have that constant reminder that I was aging, too. (I do have a niece now, whom I see fairly often, so maybe she'll help!) This is one of the reasons I'm overweight, too, of course -- I was skinny in my mid-20s!

A shrink would probably come up with some other, deep-rooted reasons for my nonchalance about debt, no doubt stemming from my parents' divorce when I was 3 years old. (My grandmother used to think I had abandonment issues because I use to put 'leashes' on all my stuffed animals. I assume that was actually just because I wasn't allowed to have a real dog.) To me, though, there's a certain amount of sense in the reasons I've listed, even if they're not especially deep.

*Update* There was a comment to the original post about retirement planning as a potential motivation to get out of debt. It's a good observation -- I have done some retirement planners, including the detailed one we use at work (I work in the financial services industry, ironically). There's such a wide variety there, of course -- about a $1.5 million difference in what they estimate I'd need to retire, depending on the calculator. So in some cases I'm doing well, in others I'd have to work until I'm 77 or so! I do stand to inherit a decent amount at some point; I don't want to depend on that, of course, but at work we do always include inheritances in our retirement projections. I'm estimating it low, without accounting for long-term growth, and subtracting the money I owe against it (which ideally will be paid back well before then). With that, I'm in good shape, but again, I don't like to depend on it. So perhaps I'll work on a 'motivation board' for our retirement, and link it up to my debt-repayment plan. Thanks for the thought!

Something I am doing right this year is planning ahead for expenses I know are coming throughout the year. The year it's a Federal tax bill, a new air conditioner at the rental house, and property taxes for both our home and the rental. (The property taxes are an annual thing, of course, but I've never really planned for them before, just hoped something would come along to cover them. Got burned on it a few times, too, and ended up borrowing the money to pay them (still paying that back, three years later -- stupid!), or once we paid them a couple of months late, because we knew we'd have a big commission check coming in; that cost about $400 in late fees, but still probably less than the interest on borrowing the money. Still, even paying $400 is stupid for an expense that I've known will come up at the same time every year for 15+ years.)

Anyway -- I've got the money set aside already to cover the tax bill. I just added $500 to the savings, so now the a/c is about 2/3 funded and I won't need to pay that out until I'm guessing June or so. (I don't know, maybe there's value in having it done in April or May? Lower prices, probably less busy? I only have one quote so I'll need to have a couple more people out there to bid on it regardless. I may also see if we can get one more year of recharging it, but apparently the type of freon it takes is hard to come by these days.) Taxes are due the end of August and end of September, so I have lots of time to save, do some side jobs, etc.

Right now I'm at about 52% of where I need to be. Comes out to about $700 a month I need to set aside. I'm get overtime at work for the next six weeks, so that gives me a good opportunity to sock some money away. (Though now are also, of course, our high heating bill months; I know I could go on the budget plan, but honestly it's better for us to pay the high bills during my overtime and the $20-30 bills the rest of the year. Our dryer is gas, too, so we always have some usage.)

I do have $1200 set aside in a separate account, which technically is intended for reimbursements I'll owe some folks, but around $100 at a time and spread out over the next two years or longer. (Half of those might not ever be paid out.) So until I get a few other things set up, I'm considering that as my "emergency fund", mostly so that I'm not as tempted to dip into it. Even if I had to deplete it, it wouldn't be too difficult to come up with $100 here and there for the reimbursements. I'm not really comfortable at having only $1200 as an emergency fund, and will be looking at ways to beef that up without affecting my debt payoff plan.

Overall, I'm pleased with my progress in 2014. Of course it's very early in the year, but this is the first time I've really done a complete assessment of my financial situation. It's not pretty, but I'm confident I can make significant progress in turning it around within a few years. I'm using an Excel spreadsheet to keep track of my progress (as well as to calculate the additional payment I'm making each month); I'll update the monthly balances (based on the card statements) probably over the weekend, but I'm usually pretty close. Unofficially, it looks liked I paid off $2,332 of non-real-estate-backed debt this month. I'll take it!

Now that I've detailed all the ways I've done it wrong, both getting into and getting out of debt, it's time to talk about what I'm doing now to try to get it right. I'll still be doing some things wrong, because I'm just not willing to make the massive sacrifices I'd need to in order to do it 100% right, but I have a plan, and a goal, and have made a lot of progress already. So, here are some of the things I've done right:

Stayed Current on Payments
Except for a handful of late payments when I just got disorganized and forgot to pay the bill, after the fiasco with my college credit cards I've pretty much always paid at least the minimum, on time or within 30 days of being late. (They don't ding your credit report for being 25 days late! Still get hit with late fees, though.) Of course, two of the three times I was more than 30 days later were on the same card, so that doesn't look so great on my credit report, but those are starting to fall off now, finally.


Negotiated With Credit Card Companies
When hubby was living in another state, I contacted all of my credit card companies and asked for assistance. A couple of them wouldn't do anything since I was paying the minimum. (How strange is that, I call to try to make arrangements to keep paying in good faith and they won't do anything to help me until I've defaulted with them.) The others -- Citi and Chase -- put me on a 'hardship program', which lowered my interest rates, closed the cards, and put me on a 6-year repayment plan. Both offer auto-pay options so that was a one-and-done deal. Interest rates are 7.24% and 6%, down from 19-22%.

Found Ways to Earn Extra Income
I haven't been utilizing it much lately, but I now have a handful of options for some extra income if I need it. It's very dependent on how much time I put in, but at the peak of my production I was bringing in an extra $400-500 a month, while still working full time and enjoying free time on the weekends.

Took Advantage of Lower Interest Rate Offers
For some reason, credit card companies still wanted to give me money, so I've done a handful of balance transfers to lower interest rate cards (including the transfer fee in the calculation -- an interest rate decrease of 2% when there's a 3% balance transfer fee doesn't always make sense!). We also got an unsecured personal loan from Discover that knocked out some higher rate cards (that has since been paid off with one of the 401(k) loans, for 1/3 the interest and 1/3 the monthly payment), and I recently got a personal loan from Lending Club that, if I use the full amount of time to pay it (I plan on paying it off earlier), will save me three years of payments and about $12,000 in interest.

Started Snowballing Debt Payments
Once I rearranged all my debt, my payments decreased quite a bit. While I'd like to say I'm putting all of that decrease toward paying off the debt, the reality is that a significant portion of it is going toward our monthly expenses. The upside is that I can afford our monthly expenses now! I have dedicated a specific dollar amount per month to credit card debt, and a nifty Excel spreadsheet to keep track of it. (Seriously, if I could get paid for the time I've spend making Excel spreadsheets for my various budgeting/financial uses, I could retire now!) I subtract all my minimum payments from that amount, and whatever is left over goes as an additional payment to my highest interest rate card. Once that's paid off (right now on track for January 2015) I will snowball to the next card, etc. I'm also increasing the dedicated amount by $200 per month each year, assuming COLA increases at work (or additional side jobs, if need be).

Faced My Financial Reality
I finally sat down and calculated my total assets, liabilities, and net worth. It was pretty sobering. On paper it doesn't look all that bad, really -- we have a positive net worth, at any rate, and it's over $50K. That's not including the family loans, though -- add those in and we're very negative in net worth! Granted, if we don't get these family loans paid off -- and we are paying on them every month, with interest -- it will eventually come out of my inheritance, but part of owning up to what I owe includes even those debts that no one other than my family and I will ever know about.

Created a Realistic Plan With an End Date
One of the reasons I'm starting this blog is that I've finally got a plan to get out of debt, and it's sooner than I honestly thought it would be. There is a light at the end of the tunnel, but I want to be sure to keep on track and be accountable to someone, even if it's only faceless strangers on the Interwebs. (I can't admit to my family how in debt we are. Even hubby only has a vague idea, mostly because he tends to over-react and get all doom and gloom about things. He knows we have a lot of debt, and he knows we're working toward paying it off and what the basic timeline is; the details are a little fuzzy, but we talk about big spending and how we're going to afford things.)

Left Commissions (Mostly) Out of the Budget
One of the biggest mistakes I made at first was counting on hubby's commissions as part of our income. That was great until he changed to a job that didn't pay commissions! Now that he's getting commissions again, I'm only counting on a portion of them as income. I took the average monthly commission he's made over the last four years, not including his year-end bonus (which has ranged from $0 to almost a full year's salary), and figured we could safely count on half that amount as part of our budgeted income. (That amount is also not completely beyond the realm of my ability to make up with side jobs, if need be.)

Finally, the biggest thing I've done right is...

Stopped Using Credit Cards
Well, sort of. I do use my Kohl's charge for the discounts, and sometimes Bill Me Later for the six-month interest-free financing, but those are amounts that I plan for and know I can pay off when the bill comes due. Other than that, we pay for just about everything on our Chase Freedom card, which is a rewards card. Technically I "carry a balance" on the card, but it's always new debt -- I'm not paying in March for the gas I put in my car in January. I pay a chunk on it every week or two, and there aren't any interest charges, because I pay off the statement balance throughout month. (For example, if the February statement closing balance was $2300, I'd be sure to pay at least $2300 on the card before the March closing date. I generally pay well more than that, because I want to keep the balance manageable and at a level where I could pay it off entirely, if I needed to.) Meanwhile we average about $75-150 in rewards every month; we've used those in the past for a new vacuum cleaner (sorely needed), TV (total want), movie tickets ($100 gift card should last a year or so, we don't go to the movies often), our anniversary dinner, etc., but this year I might let the rewards build up and use them for birthday and Christmas gifts instead.

I am happy to say that, other than the exceptions above, I haven't used a credit card in well over a year. That is a huge improvement for me! I was a little leery of the Freedom card, given my past history with building up credit balances, but I've made a real effort to keep it paid off and it's working.

Barring any catastrophe, I was on track to have all of my credit cards and the Lenders Club loan paid off by May 2016 ($50K) and the 401(k) loans paid off by August 2017 ($56K). The family loans should be paid off by June 2020 ($135K). Then I could knock out my mortgage by February 2024 (19 years early!). That's also assuming only COLA increases; I'm actually looking at a possible large bonus and salary increase this year, which could accelerate things exponentially, but I don't want to count on that until/unless it actually happens.

However, that was before I realized (last night) that the HELOC on our main home will be coming due in a year and a half. (I'm glad I thought to check the paperwork -- the whole balloon payment thing was not made clear to me on closing!) So I will need to make some adjustments and/or shift that loan to somewhere else if possible. (Hubs has good credit and most of the cards we've paid off were in his name, so he could probably get a loan from Prosper or Lending Club if we need to go that route. I had the HELOC scheduled for payoff in April 2018, but it will be due in full in October 2015.) A new loan will probably have a higher interest rate, but we'll be able to throw lots of extra at it within the first year, so it should be paid off fairly quickly.

Mistake In The Making?
Remember in my last entry when I said a potential mistake might be coming up that will end up better for us in the long run? There's a home up for sale that my husband is itching to buy -- it's where we're planning to retire, and it's right next door to his cousin. It's a bank-owned property, so from the looks of things is listed at 3/4 to 1/2 of its market value. Of course we'd get an appraisal first, and an inspection, before we even seriously consider it. Taking on more debt is one of the last things we need to do, honestly, but it is a pretty good opportunity. What's more, my mom has been wanting a 'vacation home' and we have talked about getting a family home in this area. The ideal -- though I'm not sure how on-board my mom will be about it -- would be for her to pay cash for the home (easier to get the offer accepted, I've heard, with a bank-owned property when you pay cash), and then we would finance it, taking some additional (assuming it appraises high enough and there's some equity there) to pay off the credit cards and HELOC. The monthly payment would come out of the currently assigned credit card payment, and the rest of that would go to the Lender's Club loan (paid off July 2015). That would let us pay off the 401(k) loans in February 2017 and the family loans by November 2019. Then we'd tackle the 'vacation home' loan, paying that off by July 2022, and our primary mortgage paid by October 2025. While it's an extra 18 months on the primary mortgage, it's also an additional $125K (or more, by that time) in assets with the vacation home. (This is all assuming hubs and I take on the entire cost of the vacation home; mom might offer to pay 1/4 of it herself, since she'd be free to use it whenever she wanted.)

Again, more debt is the last thing we need, but the long run is looking more and more attractive. I know you're not supposed to tie up unsecured debt in your home -- and I've made that mistake many times in the past! -- but the interest rate is still considerably lower and again, we'll have a nice increase in assets when all is said and done. The home undoubtedly needs some work (paint job, new floors, I'd like to add a bathroom at some point since there's only one), but since it will be a vacation home for the next 10 years or so, at least, it's not anything that we'll have to do right away. With a cousin next door to keep an eye on the place (a cousin who, I might add, is very motivated to get us to move down there!), and lots of "kinfolk" in the area to help with any projects -- and a new roof in the last year or two -- on the surface it seems like a reasonable fixer-upper over time. (It will all depend on the appraisal and inspection, really.) While we'll still ideally buy a larger piece of land and build our ideal retirement home someday, this will give us a vacation home in the mean time, a place to stay when we do first retire and are building, and ideally an appreciable asset (that we can live in for two years before we finally sell it and avoid capital gains taxes). Hubs is down in that area every year, as well, for family reunions and his 'fun stuff time', so having a place for him to stay will ease the burden on family and hotel room fees! (Oh -- and the property taxes? $400 a year. Not even a consideration, really.)

Anyway, that's where we are at this moment in time. I am working on building up an emergency fund -- I had $4700 but then we ended up owing $2800 to the IRS (bad planning, but it shouldn't happen again this year). We will have property taxes due in the fall, about $3700 between the two houses (home and rental), and the rental will probably need a new air conditioner this year ($3500) -- it's losing freon, and apparently the new units don't use that type of freon so it's hard to find these days. (Still, I'm going to see if I can get it recharged one more time to get another year out of it, but if I can't I'm saving up for that expense now.) I'm allocating the rest of the $4700 as $1000 in an 'emergency fund' and $900 for the a/c, but honestly in an emergency I could probably use the Freedom card and with commission/side jobs pick up the $1000 during the 25-day grace period. Still, by the end of this year I'd like to have at least $5000 stashed away until I get the debts paid off, and then work toward increasing it to 6 months of expenses. Hubby's commissions and any 'leftover' from the checking account at the end of each pay period will go toward all of that -- a/c, taxes, and emergency fund. We'll get there, I know it!

As my username/blog title suggests, this blog will be a lesson in how *not* to budget, manage credit cards, pay off debt, etc. That old adage, "Do as I say, and not as I do" applies quite well here. I know exactly how to effectively and responsibly use credit cards, I know how to budget and scrimp and save and pay off debt, I know how to snowball and consolidate and all of the things you do when you want to get out of debt. Actually doing those things, however, somehow manages to escape me. It's a lack of willpower (which pervades all areas of my life, not just finances!) and the knowledge that I have a safety net (family) if things really get bad (a blessing and a curse!).

I laugh when I read that the average US household has $6,000-8,000 in credit card/unsecured debt. I have more than 10x that amount, not including loans from family (which is itself about 15x that amount). You would think I'd be panicked, depressed, stressed, *something*, but I'm not, most days. Debt is a fact of life, something I've pretty much always had to deal with, like grocery shopping or laundry. Clearly, I need an attitude adjustment! I do have a plan, which I will get to momentarily, but even then, I'm doing it all wrong.

First, how did I get into the situation I'm in, with around $250,000 in unsecured debt? Well, it took a little time, but very little effort.

What I Couldn't Really Help

A significant portion of my debt is due to factors mostly outside of my control. I most certainly could have managed the situations differently, but the situations themselves just happened.

First, my husband and I moved into a family-owned house. For the first few years, it wasn't a bad deal -- we paid the bills and taxes, but no rent and the house was paid for. We tried selling the other house but not aggressively, so we were carrying two "homesteads", although only one mortgage. After a few years, we had to settle up on the inheritance, which meant we took out a mortgage on the house and paid off the family on their portion of its inherited value. So now we had two mortgages, plus two HELOCs.

Then, my husband lost his job, and got a new one in a different state. Since it was a short-term stay (and then we'd be relocated), and since I had a job and family and critters that would have been a major hassle to move, I stayed. So now we had three homesteads and rent.

Fortunately, the relocation fell through and hubby got a job back here. Meanwhile I'd found a renter for the other home, with a 'rent to buy' plan for five years out. The rent money went to paying some of the family loans (which were used to buy that house in the first place) so we still had two homesteads, two mortgages, two HELOCs. Then the economy crashed and the renters, while still paying the rent, are not in a position to buy, probably for several more years. They're like family and it's fine, really, because technically once we sell that house, the family loans come due, but it's still two homesteads, two mortgages, and two HELOCs. (The renters do pay all the utilities except water, so that helps a bit.)

Over the next five years, we've had four surgeries, all in different years, of course (so medical deductibles/co-pays of around $6,000 per year), two funerals that we ended up paying half and all of (around $15,000 total), and a handful of non-routine critter-related medical expenses that total about $15,000. Some of that went on cards; some of that we took IRA withdrawals to pay (and, of course, paid the 10% penalties to do so).

Since we were essentially living paycheck to paycheck for most of that time (and practically still are, really), most of that debt went on credit cards. Plus when we were first living together I was the sole earner, not earning much, so many months the only way we could eat was by putting food on the credit cards. (I read a blog recently where the overwhelming majority felt it was much easier to spend cash, or to lose track of cash spending, than it was to buy things on credit. I am exactly the opposite. I can take $40 out of the bank and still have $30 left at the end of two weeks, because I hate to part with my cash, but credit? No problem, that's not 'real money', right? Again, pretty clear I need to change the way I think about money and debt!)

What I Did Wrong

Oh, so many things! First and foremost, I went to college (not a bad thing, really) and got tons of offers for credit cards, which I of course accepted (bad, bad, bad idea) and of course used (even worse idea) and then of course couldn't pay off. I ended up settling those debts after graduation.

When I bought my first home, I was gifted money from my family for the downpayment, which because of the way the loan was set up I actually ended up using to pay off the credit card debt and car loan I'd acquired since settling the other debts. Of course, then I just built those credit card debts back up.

About five years after I bought that house, I got talked into refinancing it. Which, of course, also involved paying off credit card debt I'd racked up and the loan on the new car I'd bought in the mean time. This was at the height of the mortgage lending frenzy, so I ended up financing 100% of the home's equity, between the mortgage and the HELOC. I paid off higher-interest debt, sure, but increased what I owed on the house by about $30K. (Then, of course, the housing bubble burst and the home's value decreased by more than half.)

Two years later we had to take out the mortgage on the house we were living in. This time we only financed about 90% of the home's value, but again used a big chunk to pay off credit card debt (seeing a trend, here?) and student loan debt. Mortgage and HELOC, of course. Housing bubble burst, house is just starting to be worth the mortgage amount (the HELOC is something else entirely!)

Mistake #1
The biggest mistake, of course, is that I paid off my credit card debt three times, and kept using the credit cards. You'd think I would have learned after the first time!

Mistake #2
I used IRA funds to pay off debts. Truth be told, though, I probably did end up saving money in the long run. Most of that happened shortly before the economy (and markets) crashed, and I lost about 38% in my 401(k) at the time. So even with the 10% penalty and the 15% income tax, I eliminated some bills at 29-32% interest and avoided a 38% loss in the IRA. Still, it's not the way you're supposed to do things!

Then, I didn't fully understand the terms of the HELOCs. They had a 10-year draw period (not a concern, since we maxed them out from the start), interest-only payments (again, not a big concern, I thought we'd have the first house sold by then), and -- the part I missed -- a balloon due at the end of the 10 years. Typically those are just converted to a 30-year fixed, P&I payment loan, apparently, but since the first house is no longer my primary residence, they wouldn't do anything for me. Which led to...

Mistake #3
Taking a 401(k) loan to pay off debt. Two, actually, one from hubby's and one from mine. Again, though, I think we'll come out ahead on this. Unlike the IRA withdrawals, there's no penalty or tax on the 401(k) loans. We're paying ourselves back with interest, which is only slightly lower than the average return on S&P500 investments, and we knocked out some higher-interest debt (25-29% on some credit cards -- we took the one 401(k) loan before we knew about the HELOC coming due). Yes, the interest we're paying in is after-tax money, and will be taxed again when we withdraw it -- but it still adds up to less than the credit card interest rate.

We've made other mistakes, too, along the way, Such as:

Mistake #4
Used large bonuses to buy "stuff" rather than pay down debt. Sometimes this was necessary stuff -- a water heater, or new siding on the rental property that just (fortunately) happened to coincide with a big commission month. (Hubby works on salary, but with commission that varies wildly.) The worst was a bonus that was almost a full year's salary, half of which we spent on a 'toy' for hubby. Granted, he uses the thing almost daily and will have gotten more than its worth out of it, but in the long run we would have been much better off using that money to pay off debts. I admittedly feel guilty, however, telling he he can't buy things he wants with his own money, especially since I don't tend to curtail my own spending that much. Which ties in nicely to...

Mistake #5
We have not remotely adjusted our lifestyle in an effort to pay off our debt. As I said, I know I should. I could drop the home phone, eliminate the movie channels, stop drinking pop, bring lunch from home every day, shop more at Costco, and so on and so on. Lots of fat we could trim from our budget. And we might, at some point, especially now that we're talking about it and setting goals. On the other hand, I don't want to deprive myself. I want to enjoy my life, within reason, while also working on getting rid of this debt. If hubs or I die tomorrow, life insurance will take care of the debt -- what's the point of living a miserable life in the meantime? (I know, that's rationalization. I get it. Part of it is rebellion, too, from my childhood when my mom did have to scrimp and save and budget to put food on the table. Still, I'm not at the point where knowing what to do and knowing why I don't want to do it is enough to actually persuade me to do it!).

Whew! This has gotten far longer than I'd intended, so I'm going to end it here. I'll be back for another entry about the few things I'm doing right, and the plan for the future. (Though there's another mistake on the horizon that, if it pans out, might just end up saving us in the long run.)