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Debt and Denial

May 28th, 2016 at 10:24 am

I've started to write several blog posts, but I've never gotten to the point of finishing. Life and denial keep getting in my way.

I have to admit, I'm in denial. And denial. And DENIAL. I guess it would be best to start coming "clean" again. Hello, My name is Tarwalker, and I am in debt.


THE DEBT:
$96,972.85___Mortgage (29yrs left, $784.42/mo, 3.875%)
$26,243.00___Siding and Windows (10 years, ~$262/mo, 2.99%)
$24,569.93___Van Loan (39mo left, $641.89/mo, 0%)
$13,886.77___Home Project Loan (6.5yrs left, $220.89, 7.99%)
$_9,000.00___Student Loan (no payments while in school, $?, 6.8%)
-----------
$170,599.70


THE EXCUSES:
We were debt free in August 2014 after paying down something like $60k. For a month or two max. Then we bought a new van because two kids in rear facing plus a Golden Retriever and a 6'something husband... Then mid-2015 we bought a house because apartment and living with parents weren't working. That needed repairs. And then husband went back to school to get in a new field. And then he took a huge paycut to get his internship requirement completed. And both my kids have health issues and are autistic.

Just a roller coaster of a few years. Time to stop. Time to get my kill the debt intensity back.

(Side note: The siding and windows were the LAST big cost project for the house. Everything else we have the materials and just need to put in the sweat equity. There might be some small costs here and there left, but that's it! I'm so excited. Beyond excited!)


BUDGETING:
Income is tight right now with husband being at such a low income for the internship. He's completed his requirements, so is job hunting for full time work. Really anything with benefits would be a HUGE bump up right now.

We have cut down on our fixed costs as much as possible. Changed phone plans to Cricket which will save us somewhere around $50 per month. We are cutting back on electricity and water consumption. We got our internet cost dropped down.

We've switched budgeting techniques again for variables. I just don't have time to do quicken anymore, despite my love for it. Putting expenses on credit card and paying it off in full ended up to be too easy to overspend a little here and there. When I watched it frequently, it was different.

So we are on a variation of the envelope system. My take-home pays for the solid costs every month: mortgage, utilities, cell phone, internet, car loan, home project loans, and personal allowances. It's all on autopay, with me checking in before and after it hits. Hubby's little pay has to cover all the discretionary items, so we calculated what he brings home weekly, and then rounded down a bit for fluctuation, and then left our weekly gas money in checking. We left the gas there because it's so much easier with two little kids to pay for gas directly at the pump with a card than to run inside to pay.

The remaining gets divided up into Groceries, Restaurants, Boys' Stuff, Dog Stuff, and Misc Who Knows. First three weeks worked ok. It's definitely making me hesitate to buy things, because A) I don't carry the cash with me everywhere and B) I don't want to use cash. It's strange because it used to be that if I had cash, it was GONE, with no clue where it went. Now I hesitate to use it. Oh, how time changes us. Trying to count dollars as I go thru the crowded grocery store to make sure we stay under is interesting, but definitely helping curb the grocery budget.


LEFTOVER CASH:
If we have leftover in our cash envelopes, we are throwing it into a jar to save for hopefully a nice long weekend trip to the MN State Fair plus at the end of August. We will see if we can swing it. It's something we look forward to every year, but don't always get to make it. It's something that brings us so much joy, and will be a much needed break from therapies. If I didn't NEED that break, I would use save or pay down debt...

BUT I REALLY NEED THAT VACATION. It shouldn't be terribly expensive and anything left over will get thrown at debt. I'm an introvert with multiple therapists coming six days a week to my house, and I am taking the kids to special therapists for two hours to four hours a week. And then working in between and then trying to cram errands and chores in the one last day of a week. I am overwhelmed by people. TOO MUCH for me. If it wasn't doing absolute wonders for my oldest, I would say no thank you just for my personal sanity.

So knowing I just have to make thru the summer months before I get a good five day break, oh, how much that has helped me breathe. If we don't get the money saved up, we'll just stay around here. But cabin fever is getting a hold of me, so we'll probably find something to do somewhere cheap.


KILL THAT DEBT:
I do really well with the snowball method. I am going to do a mix of attacking the high interest first and the lowest amount first. The kill order is van loan (by virtue of how many payments left, no extra since it's zero percent), Home Depot loan (7.99%), siding and windows loan (2.99%), Student Loans (6.8% - since we don't know exact how much or when payments will be I am leaving this on lower priority, will re-evaluate later), then the Mortgage.

If I just plan to roll over our debt payments as each gets paid off (except for car), we will be debt free in fifteen, including mortgage. Less than ten if we include the car payment. Ideally, husband should have a HUGE increase in income by next summer at the latest (please cross fingers). That means we could be completely consumer debt free in three and mortgage free within 5 or 6 years.

I feel better knowing that there is a light in a tunnel. It won't be thirty years before we climb out of this hole we have dug.


CONCLUSION:
Not the best choices lead to where I am. I am not making the greatest choices in getting out. But I am going to make progress. And I am going to get out of this hole. I feel better coming clean and confronting it. Thanks for "listening". I really needed to do this.

7 Responses to “Debt and Denial”

  1. scottish girl Says:

    It's good to hear from you Smile I think a vacation will really help your sanity. Onwards and upwards from here. I like your debt payoff plan. Good luck!

  2. ceejay74 Says:

    Wow, mortgage-free in 5 to 6 years would be incredible! I didn't know you were close to the MN state fair. We've gotten really into it; last year we did a with-kids trip and an adults-only one. It was really fun!

  3. Mrs. Frugalista Says:

    You'll be just fine. Tackle the debt and at least try to get rid of as much consumer debt as you can. You got this!

  4. My English Castle Says:

    Love love love the MN State Fair. I could go for a Pronto Pup right now. The snowball method is really the best.

  5. LivingAlmostLarge Says:

    Good luck on job hunt. We are as well job hunting. Amazing that you are able to pay it all off in 15 years.

  6. rob62521 Says:

    You can do it!

  7. PatientSaver Says:

    I give you credit for being upfront about all the debt. That can't be easy to admit. Working at a bank, I am well aware that people take out home equity loans or lines of credit all the time for home improvements, even vacations! That nearly 8% rate on the $13K home project loan must be hard, especially with the concomitant payments on the windows/siding.

    My feeling is that if I can't afford to pay out of pocket, or at least pay in full the following month, as with a credit card, then I have no business buying it in the first place. Perhaps you felt it was essential to your home.

    You have my sympathy but you became debt free once before so you know what it takes. Good luck!

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