I’m still here and reading the blogs, but took a break from posting for a while because my current job will be ending this summer and I’ve been job hunting. Until I have a new contract, I decided to slow down the extra payments to my student loans and to stockpile some extra cash on top of my current emergency fund instead.
There have been a few expenses related to this -got a new interview outfit and shoes, since I hadn’t bought a suit in years and they were looking a little dated. Looking professional and feeling confident was definitely a good investment though, and I did get it on sale! I’ve also paid $2230 in professional and licensing fees so far this year, which are not negotiable for my position and are required for any future jobs as well. A tax refund of $500 went toward these fees.
Viewing the 'Personal Finance' Category
Contributed $200 leftover in other budget categories to the IRA, bringing 2017 contributions to $2140. I have a $150 check in hand to deposit and send in as well, so after that the I’ll need $710 to meet my goal of $3000 for the year. My employer still owes me an additional $150 for overtime, they’re just slow to pay since it comes from a separate cost center. Still need $560 after that. Would love to get this done this month so I can file my taxes at the end of January. That will make it easier to reapply for IBR in February. Really looking forward to knocking the retirement goal out so I can go back to chipping away at my student loans. As a side note, my IRA balance reached $1,000/year of age for the first time ever with how high the market has been lately. It will probably dip down again, but kind of a neat milestone.
Today should be a low spend day. Currently making food to bring with me to work this afternoon. I plan to stop on the way in and get a replacement travel mug (mine disappeared, probably because a lot of us had the same style which caused confusion). This should also help cut down on splurging for coffee on long days, or at least get me the refill rate.
Yesterday was a no spend day. I was going to stop for some over the counter medication, but traffic and parking were terrible, so I came straight home after work and found a little bit left in my medicine cabinet! Brought food and coffee to work.
I also got a check for some previous overtime in December- $260 for retirement savings. Current total before this deposit is $1535, with a goal of $3000. The plan is to switch back to paying down debt after meeting this goal.
Just to put things in perspective, I also have $3195 of unavoidable education expenses coming up in 2018 (required for my career), which I’ve had to save up for.
Merry belated Christmas! I've been away visiting relatives this season, but now it's back to work and back to more ordinary financial matters after an expensive time of year!
Although there were increased holiday expenses (gifts, uber to holiday parties that had alcohol, extra gas for travel, etc), there was also some financial good luck. In December I was able to pick up some overtime that should be about $150 after taxes and received a couple of gift cards. I also talked to a salesman with some questions about one of the bigger, more practical presents for a family member, and he gave me a $75 discount that I didn't even request!
I'm hoping to keep the rest of the month as frugal as possible by continuing the battle against high utility bills; using my efficient space heater, lots of blankets, and dressing in layers to minimize turning on the central heat. I'll also be weatherstripping this week.
Today I slept too late to make lunch, but managed to grab coffee from home on the way out the door and just spent $1.10 on a snack in the cafeteria to hold me over until I got home to cook dinner. I cooked from the freezer and pantry since I just got back into town and may try to put off grocery shopping for a few more days.
Focused on beefing up my Roth IRA for this year as my next mini goal. My default contribution is $100/month, which doesn’t come close to the $5500 yearly contribution limit. I don’t have any retirement matching or benefits at work. While I would ideally love to get to at least $3000 for this year, this may be a stretch after sending any extra money to that student loan for so many months.
Recently got a check for $200 from a one-time side project, so I sent that in. I thought about holding off because the market is so high right now, but I’m not planning to touch my retirement for 30 years, so ultimately trying to “time” investments at this point probably doesn’t make sense. Also expecting about $160 or so after tax from some overtime earlier this month, but these payments can be slow, so I’ll wait until it shows up in my direct deposit before counting it.
It’s funny how much more emotionally satisfying it is for me to see debt drop than retirement contributions go up, but that’s why managing money requires discipline!
Did some calling around and decreased my phone bill by about $8 by removing insurance I don’t need on my 5 year old phone (I buy these in cash when they need to be replaced since I found out the “free” phone on most plans is just billed to you in monthly installments). I also bought a router/modem for $100 that will remove a $10/month modem rental fee from Comcast- wish I’d done this years ago, it would already have been so cost effective!
Disputed a fraudulent $99 charge I noticed this week successfully- it pays to read your statements!
Today I got out of work early and actually paid $10 to get my eyebrows done (I usually do this myself, but when I neglect it for too long it is hard to shape them correctly, so it was worth it. Plus sometimes it’s nice to get a little self-confidence boost from looking your best). Picked up milk, yogurt, and noodles at the grocery store, where I resisted the spray-on olive oil because I know those cans are terrible for the environment. Luckily the dollar store next door had a spray bottle I’m going to try using instead, plus ear buds, two packs of pens, and a USB/phone charger cord (can’t beat this place for electronic accessories, and the quality is the same!).
On the earnings side, a raise became effective this July and will net about $148/month. Also completed a side job that should pay around $200 before tax- will have to wait to see the final amount when the check arrives, but it’s going to be thrown at debt.
The current high interest loan balance is $1156. I am sending in $130 left over from the June parking category and $55 from the July loan difference category, so it should go under the $1000 mark!
Current balance on high interest loan: 2614
(Interest rate 7.65%-woof)
A lot of expenses hit recently, though nothing unplanned. Ordered more contacts ($120), yearly renter’s insurance renewal (about $150), 6 month car insurance bill, etc. These expenses come from designated budget categories.
A pending direct deposit showed up today for $411 for some recent overtime. As soon as this clears will send a loan payment for $491:
25 cell phone category difference (May)
55 IBR loan payment difference (May)
I signed up for more extra work later in the month- these opportunities don’t come up that often, so I try to jump on them!
Frugal goals for the next couple weeks: Cooking meals at home, AM coffee at home, bringing lunch to work, using my fan instead of turning on the AC.
Loan balance after the last payment hit: $3569
Today I caught up some later-billed budget categories from March and sent in another payment of
160 from extra work hours
25 cell phone savings April
55 IBR savings April
68 parking category savings March
225 other misc categories/snowflakes March
Once the balance gets under $2000 I’ve been considering loaning myself the money from my EF to just pay it off and save on the interest difference. It makes senses mathematically and my savings are honestly probably higher than need be given my debt. On the other hand I’m usually a worst case scenario planner and messing with the EF category doesn’t strike me as a good habit to get into. Still thinking about it.
During school I took less than than the max amount of student loans every semester and worked part time jobs to help supplement living expenses. The financial aid office would send you a summary of the charges for a semester and how much you could get in loans, then you could go in and manually reduce the amount you were requesting before it was submitted. I don’t remember how much I adjusted it down back then, but I’m curious how much my balance would be today with interest if I’d taken the full amount possible.
Still here and lurking around! Can’t believe it’s been so long since I posted!
Recent financial events- this month has already been pricey due to some necessary car repairs. Grateful that 1) they were able to fix everything and 2) had the money for this in a special account and wasn’t trying to scramble to come up with $840 out of one month’s budget. Still, it will be nice to start replenishing this fund!
Since last posting I slowed down loan repayment to divert money toward my Roth for 2016, so the balance is $4780 on my high-interest loan (7.6%). My new goal is to knock this out next! I have state and federal tax refunds coming and picked up some overtime this week, so should get a good jump on it in the next couple weeks.
Lately I've been reading this "Money Diary" feature: http://www.refinery29.com/money-diary
Women in different geographic locations making different salaries share every penny they spend during a typical 7 day period. Very interesting to see how different people prioritize their spending, and definitely makes me more aware of little purchases during my own day. It's also an interesting read because this is not a personal finance-oriented website, so the approaches can be very different than you'd see here.
Just a quick mid-month update. My last paycheck contained $290 from overtime, which went to the Roth IRA. This brings total contributions for the year to 1320/5500.
Trying to minimize spending for the rest of the month to stay on-budget, but I did need to get some groceries today. I know I’ve said this before, but ethnic groceries are AMAZING for value in the city. I stock up there about twice a month. Today I spent $31 and got:
8 kiwis (on sale!)
1 large cabbage ( 4.7 lbs)
8 oz mushrooms
3 small tomatoes (89 cents/lb)
2 sleeves of garlic bulbs
1 lb fresh ginger
2 bunches fresh cilantro
4 16 oz bags of rice noodles
1 16 oz package of regular noodles
4 10-oz cans of vegetables
2 small cans of water chestnuts
1 dozen eggs
1 bottle seasoned salt
I looked for chickpea flour to experiment with socca, but didn’t see any. Plans include lots of stirfry with egg for protein, grilled cheese with tomato, egg fried rice with veggies, cabbage with noodles, pesto pasta, spicy lentils with garlic, potato, and green peas, and delicious kiwi for snacks. Will need to pick up more yogurt and a few other odds and ends.
I watched The Big Short on Netflix, which was pretty interesting. It's about a few investors on Wall Street who caught on early to all the mortgage fraud that led to the 2007-2008 housing collapse and bet against the big firms like Goldman and Lehman Brothers. Based on a true story. I had kind of forgotten how ridiculous lending used to be- no money down, bad credit? Mortgage approved! It just goes to show you that if you don't think you can afford something, don't let anybody talk you into going against that instinct.
Last month in addition to regular debt and retirement payments (scheduled retirement is at 100/month), $83 extra went to debt and $380 went to retirement. The Roth IRA only has $930 for 2016, with a goal of hitting the 5500 max. I’m switching the focus from debt repayment for a while to beef this up. I figure that it’s important to take advantage of the time value of money by investing now while it has 30 years to compound. The fund also pays dividends quarterly, so investing early on will result in higher payouts from that. I’m in a relatively low tax bracket, so the Roth IRA is a good deal long term. My student loans are on income based repayment, so paying down the smaller high interest one instead won’t result in any freed up cashflow to put toward retirement. My job doesn’t offer any retirement match, and the company-offered plans are significantly less attractive fee-wise than a Vanguard IRA. Was hoping for a little dip with the Brexit hoopla so I could buy shares at a discount this month, but no such luck.
A small raise at work should be reflected in my next paycheck- will adjust the budget when I see the exact numbers, but last year it worked out to about $135 extra take home pay per month. I’m planning to put it toward retirement/debt repayment goals. I also nabbed a little overtime, but it usually takes a while to pay out.
Have some upcoming expenses for car maintenance, but it should be covered by the balance in the “recurring/long term expenses” category. (Contribute $150/month and roll it over.) I did call around for several estimates. Since I’m trying to make my older used car last at least a couple more years, this is expected.
Continuing to monitor my budget for any unused dollars and apply them to my goals. The student loan is at $6579.56 with an $83 extra payment pending. Don't know why, but five-thousand-something sounds so much more manageable!
I just sent $100 to the Roth IRA for June- if the market doesn't go down before it posts, this should finally hit $20,000 in retirement savings.
Comcast just raised my monthly internet bill from $50 to $80/month without saying anything to me- I'm going to call when their customer service office opens at 8 this morning. They're advertising a deal for new customers to get 12 months at $39.99/mo, so this feels like a rip off.
March was a mixed month financially, with some unusual one-time expenses (replacing broken items, etc) and a healthy tax refund.
After totaling things up, I have about $150 from surplus March income and $500 in a tax refund to allocate to my goals. The tax refund will go toward the student loan and the $150 will go toward retirement contributions.
Slow and steady wins the race, I guess. Except for buying some birthday gifts, I'll be trying to keep spending down in April to hopefully break the $7000 mark on the loan next month.
The student loan payment went through, bringing the new balance on the high interest loan to $7767.98. Looking back, when I started this blog in May the total was $13,671.78. I would have liked to see this closer to the $5000s, but the rational part of my brain knows that continuing Roth contributions instead of throwing every extra penny at debt repayment makes more sense in the long-term.
Filed federal and state taxes today. The amount of loan interest paid this year bumped up my refund, so hey, silver lining!
Other frugal things: Used a 10% off coupon code for the online tax prep website (which is only $13 to start with, including filing state and federal), drank free coffee this morning at work and ate breakfast and lunch at home (half-day). Yesterday I hit snooze too many times and didn't bring a lunch, but had a delicious spicy noodle bowl from the convenience store for $1.69 and tea from my teabag stash. The weather is beautiful today, so I have the windows open airing out the apartment and expect great improvement in the electricity bill! I'm also drying some laundry on the drying rack. Finally, I ordered a year's supply of contacts, which is more upfront but carries the lowest cost per lens. This was out-of-pocket because my vision plan only pays toward contacts OR glasses each year, and my current glasses need to be replaced. I tried to remember the last time and realized it was before freshman year of college! I almost never wear them, but feel like I should have an emergency pair that I'd feel safe driving with if necessary. Now that I have a current prescription, I'll need to shop around for the best deal on frames.
After submitting my income-based-repayment renewal application a couple months ago I finally saw my new scheduled monthly payment on the website today...and it's about $60/month less than last year, even though my income went up by about $1000/year?
I'm not quite sure where this number is coming from- they calculated it from accurate recent paystubs I submitted, and I know I didn't pay down enough principle last year to account for the difference. That said, I always seem to talk to a new person each time, so it's possible that last year they calculated a higher amount than strictly necessary by the terms of the program and I just never contested it.
If this IS my new repayment amount I will benefit by taking the difference left in my current budget and applying it to extra principle payments on the higher interest loan in my account. I'm going to wait until the first autopay withdrawal goes through before counting my chickens though-they may adjust it before then. Meanwhile I sent an additional $160 to the high interest loan today that came from picking up extra hours last pay period. Every little bit helps.
On the spending side, I've been working 90-100 hour weeks lately due to a tough assignment at work, so coffee and snacks spending is up because there has been no time to grocery shop. (I only come home to sleep at this point). On the positive side though, entertainment spending is zero and hopefully the heating bill will be down, since I turn it off completely when I'm not there. Even when I'm feeling self-indulgent I tend to stick to the less expensive food and coffee options at work, and I've been using up some old leftover giftcards for the cafeteria. Ony about 2 more weeks left at this pace before I can downshift to a less hectic schedule, so will try to keep the damage to a minimum!
October was a whirlwind (and very spendy!) month! I just got around to totaling all the categories. After all the damage, I had $225 left over to throw at my goals, so $200 went to the student loan and $25 to the Roth. These totals don't include work expenses that I will be reimbursed for eventually- airline and hotel costs for a business trip. Unusual spending for Oct included finally biting the bullet and getting new work shoes (the old ones fell apart) for $53. I splurged a little because I spend a LOT of time on my feet, and have noticed a comfort difference. Also bought a bunch of extra food to make appetizers for a friend's party, gave a few birthday gifts, ate out much more than usual during my trip, and had to pay a parking ticket because I didn't notice my street parking sticker had expired a few days before - eighty dollars, ouch! The quarterly parking permit renewal itself is budgeted for.
It was a great month, but I also feel the urge to buckle down and refocus on my goals in November.
Frugal things recently:
- Have been planning to get some art for my walls since I moved in, but family gifted me a few pictures from the attic nobody was using anymore. They'll look great in the space, and I already have wall-hanging hooks.
- Have been bringing all my food and almost all of my caffeine to work lately instead of buying something there
- Been wanting to send a particular book to 2 friends and was planning to buy it on Amazon for them, but got two copies of it for free at a yard sale this weekend!
- have been leaving the heat off and using extra layers and blankets at home
- Snagged a few extra hours of work helping on a special project at work. Not sure how much I'll net after taxes, but probably around $100
My paycheck on Friday included the money for some extra hours I picked up last month- $190 after tax. Right now the student loan stands at $9,546.50 before that payment. Should be able to get under $9,000 by the end of October!
The budget totals for August are in and they're ugly. I blew way past my $350/month general spending cap at $588.83. This wiped out the "cushion" category and cut into the parking category as well. Unusual expenses this month included
About $45 in medical costs (visit and prescription copays, dressing supplies)
A friend came from out of state and stayed with me for a few days. I treated her to a couple meals out because she had to buy a train ticket down, which has worked pretty well for us in sharing the cost of visiting. Also got some snacky groceries to keep around the apartment while she was here that I don't usually buy. It's rare that we have any matching days off to visit, so this was totally worth it.
Another close friend got married in August, so that meant traveling out of state, extra gas costs, etc. I wore a dress I already had, so no extra spending there. Again, totally worth it.
Some long stressful days at work that ended with me buying dinner there after only bringing a lunch. This is an area for improvement.
I worked a few hours on a side job this month, but since payments are very slow from these projects, I just count them as snowflakes when they actually show up in my bank account.
Won't post the whole boring spreadsheet, but I have $140.88 to send to debt repayment after balancing the budget, in addition to the $50.50 already sent in from the utility and internet category earlier this month.
It's time to get back on track for September. Today I need to clean out my kitchen/fridge and make a menu plan to limit waste and eat from the pantry. Otherwise it was a low key day off- chores, lots of paperwork for my job (can do online), studying, writing a letter, taking a walk with a friend and catching up.
Meal options from a preliminary look at the pantry:
Halushki (a cabbage and noodle dish, delicious. I make it without onions from personal preference) Have a large head of cabbage that will make several meals
Stirfry with noodles
Vegetable fried rice (have some seasoning mix packets to use up)
Cereal with milk
Potato-lentil Indian curry
Frozen bean burritos
Samosas (use crescent roll dough and fill it with a mixture of spicy garlic mashed potato, peas, garlic, ginger, and Indian spices)
I also moved an extra $100 from the emergency fund to my Roth when I saw how low the market had dipped- love when the stock market goes on sale! As I've mentioned before, my EF is actually higher than it rationally should be, so it's a good thing when I bring myself to put some of that cash to work on investing or debt : )
Personal discretionary spending (food, toiletries, entertainment, household supplies, etc) was $266.61 before table, $ 396.60 with the furniture purchase. Above the budget of 350/month, but could have been worse considering my splurge.
Budget numbers for July
Budgeted- actual = difference
Rent 1175-1175 = 0
Parking 150-7.75 = 142.25
Utilities 100-35.23 = 64.77 (already paid to loan)
Insurance 64-54 = 10
Phone 112.88-66.34 = 46.54
Recurring expenses 150-0 = 150 (rolls forward)
Retirement 100-100= 0
Student loan 386-386= 0
Internet 80-22.73 = 57.27 (already paid to loan)
Food and misc 350-396.60 = -46.60 (from cushion)
Cushion 206- 46.60 = 159.40
That leaves extras in parking (142.25) + insurance (10) + phone 46.54 + cushion (159.40) = 358 surplus. 50 will go to the Roth IRA, 308 to the high interest loan. I'll post the new loan balance after the payments hit.
Today after getting my first quarterly water bill I confirmed with the landlord that yes, water here runs nearly thirty dollars a month! I pulled out my last two years of utility statements before I moved and I was paying around $8/month in an individually metered apartment. My new building just divides total water bill for the building by number of units, regardless of use or how many people live there, it seems. Oh well- to account for this, I'll be adding $32 per month anticipated water cost to each utility bill going forward, which will build up in the account until each payment comes due.
On a happier note, I finally received a reimbursement check for some work-related expenses totaling $370.99. Since I paid for this upfront a few months ago and haven't missed the money while reimbursement was taking a long time, I decided to use $65 of it to cover the first water bill (prorated from the move) and send $100 to retirement savings and $100 to debt. The remaining money will go back in the general savings/emergency fund.
Stopped at Trader Joe's on the way home from work today to pick up a few odds and ends- I've been craving pesto and ran out of milk for cereal in the morning, etc. I'm grateful that even with an unexpected utility expense, getting near the end of the month doesn't mean not being able to buy any more food until August comes around. Not everybody gets to spend $13 on groceries just because it's a convenient time to go, without thinking twice.
A yearly raise hit my paycheck this period- takehome pay increased by about $60 every two weeks. The difference will go toward retirement saving instead of debt paydown this month. Starting next month I'll update the budget- should be getting the first quarterly water bill soon, so I'll finally know how much to allocate to that.
In other financial news, I finally bought the last piece of furniture for my new apartment. After failing to find what I had in mind on craigslist or at Ikea/Walmart/Target, I spent $130 on a small bar-height kitchen table with two stools from ebay. It also came with free shipping. Not strictly a need, but something I've been planning to get since I moved in May and my old dining set didn't fit in the new space. I'm excited to be able to start having close friends over for dinner or drinks (with somewhere for them to sit to eat now!)
The summer is flying by! Time for a quick financial check-in. The high-interest student loan balance is currently $10,222.84. Should be able to get it down under the $10,000 mark by the end of the month, if everything goes according to plan. So far I've already paid the internet and electric bills for July. The electric bill was $35.23. Since I budget $100/month for this, that leaves $64.77 left over for extra debt repayment. The Comcast bill was $22.73, out of a budgeted 80. Don't totally understand how they arrived at this number, as my new monthly plan is more than that, but it looks like some money was credited back from switching plans midmonth. That's another $57.27, so I'm sending a $122 extra loan payment.
Still doing pretty well with bringing coffee from home in the morning- haven't managed to do this every day, but definitely more than before. I did coddle myself a little this weekend after catching a nasty cold that knocked me out most of Saturday- turned the AC on to 83 degrees, ran a load in the dishwasher, and used the dryer to speed up the laundry process. On the frugal side, no appetite and no energy = minimal spending. I'm feeling better now, so I made a noodle stirfry for dinner which used up some odds and ends from the fridge- leftover red cabbage, the remains of a bag of frozen broccoli, and half a can of sliced bamboo shoots from earlier in the week.
June budget totals:
Budgeted- actual = difference
Rent: 1175-1175 = 0
Parking: 150-20= 130
Utilities: 100-57.23= 42.77
Car insurance: 64- 54= 10
Phone: 112.88- 113.17= -0.29 (last month at this rate)
Recurring expenses: 150-164= -14
Retirement: 100- 100= 0
Student loan: 386-386= 0
Internet: 80-27.38= 52.17
Food and misc: 350-351.18 = -1.18
Cushion: 206- (total negative overages from above 15.47) = 190.53
The utility and internet surpluses were already applied to my student loan as they became available. I made $15 selling some old chairs on craigslist this month. Additional leftover funds are 130 (parking) + 10 (car insurance) + 190.53 (cushion) + 15 (craigslist) = 345.53 for the high interest loan.
Gas spending has been through the roof this month because I've been driving to a different site for work that's an hour away, compared to my usual 5-10 minute commute, so I've had to fill the tank up WAY more frequently. Of that $351.18 personal spending category, $115.51 was for gas! It makes me grateful to live close to work and drive a small compact car. A lot of my coworkers commute from a similar distance every day in a giant SUV, not as a temporary thing. Can't imagine how expensive that is, not to mention adding two hours onto your workday and the hassle of parking a giant tank in the tiny parking garage spaces.
With a little bit of internet research, I was able to call my cell phone carrier and get them to drop my bill from $113 to $65/month plus tax. $40+/month savings for 20 minutes of my time. May end up dropping to an even lower plan when I have more time to do research, but it's a good start. After that, I googled advertised Comcast internet rates and called to ask why I was being charged so much more. They reduced my monthly bill from $80 to $50 and also credited back a $10 charge for a "home installation kit" I never received when I moved- I just used the old stuff from my last apartment and it worked fine. As part of moving I had to "pay ahead" several weeks, so the balance total for this month's billing cycle is $27.38. The new rate will show up next month.
June internet: 80 budgeted- 27.38 actual = 52.62 extra for student loans. Woo!
I'll leave the budgeted amounts for these services the same and just send the difference to debt repayment.
Otherwise the transfer from my old checking account and the leftover utility bill money for the month both hit the student loan account, plus the usual autopay:
1484.02- old checking account
42.77- leftover utility budget
Current principal balance: 10,563.31
After much internal debate, I did go ahead and transfer 100.00 to my Roth IRA for the month. This is a new line item in the budget. As much as I enjoy the immediate gratification of paying off debt, it will take years to pay off everything, and it doesn't make sense to miss out on after-tax retirement contributions at this age. (If you didn't read my earlier posts, that $10,500 account is just the tip of the student loan iceberg. Professional school ain't cheap.)
Currently on a decluttering kick - nothing like moving to make you look around and think, "Why do I have all this stuff?" Read an article a while ago about a popular organizer from Japan who tells people to look at every item in their home and ask, "Does this bring me joy?" If not, get rid of it. That seemed like good advice. I'm also selling some furniture I don't need anymore online. Nothing expensive, but I'll throw that at the loan if I find a buyer.
Other frugal minutia: Started using a drying rack for my laundry when possible, especially for towels. Really liking it so far. Found the birthday gift for a family member on Amazon, so I was able to use a gift card balance to cover it instead of cash. I would have gotten them the same thing either way, but this was a nice cashflow bonus. Just when my current work shoes became so worn they started rubbing my heels raw and had to be thrown out, I found an old pair in the back of the closet that have a few more months of use left in them. The theme for the last couple of weeks has been, "Use it up, wear it out, make it do or do without."
Looking at my budget makes it pretty clear that high fixed expenses are limiting my debt payoff, so I've been looking at ways to cut some of those bills. I get paid every two weeks, and ideally I'd like to pay all fixed bills except the student loan from one paycheck.
The biggest expense by far is rent, due to living in a costly urban area. I recently moved, reducing my monthly rent from $1450 (slated to go up to $1500/month if I signed a new lease!) to $1175. Still a lot ,but better. Without adding a long commute and living far from work and friends (or living in an excessively murdery neighborhood), it would be hard to get this significantly lower. As a bonus, I'm also much happier here!
Since my electricity billing cycle falls early in the month, I count this at the time it's due every budget period. The total for this month: $57.23. This is way over previous utility bills at my old apartment, but I'm pretty sure I know why. One reason is that the new place is a much older, draftier building, while my last apartment had fewer windows and was mostly on the interior of a big complex, insulating it from temperature fluctuations. More importantly, it was in the high 80s on several days, and I turned the AC on twice when I had company visiting. Not a regular indulgence, but don't want guests sweating. Will work on ways to get this back down to my goal of under $40 next month.
Still, $100 budgeted- 57.23 actual = 42.77 extra for GP loan
Water is billed quarterly, so won't have those numbers for a while. Should see less variability there though, since my use hasn't changed since moving. Will either cashflow this as general spending or take it from the recurring expenses category.
When I notified the insurance company of my move, the premium dropped $80 every 6 months, for a $13. 33 monthly savings.
You're next, phone bill! Currently paying AT&T the princely sum of $113.17/month for my smartphone plan. (Apparently this somehow crept up about a dollar since I made my budget, which is making my numbers look a little fuzzy.) My last contract should be ending now, so it's time to shop around. Don't need much data since I can connect to the wifi at home and there's guest wifi in most areas at work. Believe it or not, I actually don't have many "extra" features for that price- just unlimited texting, which I use all the time, and a middle of the road data plan.
Freakin' Comcast monopoly. Have tried. Will focus on other bills, maybe harass Comcast customer service again later. Mostly annoying because my introductory rate was half as much, and they obviously weren't losing money on that.
Long story, working on it. Leaving the budgeted amount as-is for now until this gets nailed down
To summarize, definitely some work to be done on the budget
My last loan payment took the full three business days to process, but did show up today:
New balance: 12,091.07
At the current interest rate of 7.65%, I'll save 37.83 per year in interest on the amount of principal paid off so far.
While thinking of ways to speed up the repayment process (I'm not eligible to do more extra shifts for cash for a couple of months), I remembered an old, neglected bank account with some money in it from college. When I went away to school they didn't have any branches of my bank in the area, so I opened an account with a local bank for day to day spending and depositing paychecks from my part time job. When I moved again for grad school I went back to using my original bank and left the college account alone as an emergency backup fund. (For a person with an insane amount of debt, I'm actually something of a money hoarder- have always felt better knowing there were funds to tap in an unexpected emergency. This is unfortunately totally irrational, and I obviously should have forked over that money for grad school tuition and borrowed less.) I set up online access to the old college account today and will transfer $1484.02 to the GP loan.
I've been enjoying reading the updates from everyone doing Mrs. Frugalista's Pantry challenge- seeing what other people are cooking motivates me to change dinners up a little here!
In other minor money happenings, coffee at work is definitely one of my most consistent spending areas. I can bring coffee from home in the morning, but during long days I generally get coffee at least once to stay alert and ward off crankiness in the evening. Trying to cut down on this, but sometimes you just need to wake up to concentrate on what you are doing. Since my last travel mug broke, I bought a new one yesterday for $3.99. Not only is this better for the environment, but you get a discount if you use your own mug: $1.29 for a refill vs $1.99 for a regular coffee. Out of curiosity, I'm going to track those savings for a while to see if it adds up to anything significant (or at least how long it takes to pay for the mug!)
So far I've gotten refills yesterday and today, so $1.40 in coffee savings.
The numbers updated after my last payment to get the interest down on the GP loan- 1,110 paid, of which $2.70 went to principle. Wooo! Go ahead and laugh, but this is the first payment that decreased the principle owed- actual progress! I'll take it. Of course interest will keep accruing, but from here out it should be a lot easier to get that the principle when making payments.
Pri nciple: 12582.88
Interest: 5.27 (yes, this keeps adding up!)
This loan is now considered significantly "paid ahead," so even though the automatic payments will continue monthly, my next payment is "due" in 2021. That's pretty horrifying if you stop to think about it- the government clearly predicts I will be in debt to them forever, mindlessly paying the minimum to cover interest for decades.
In other news, I'm off today (work random shifts instead of a traditional weekend/workweek schedule). Shouldn't be too spendy- I plan to spend most of the day at home cleaning and organizing, which will have the double benefit of making me less nuts when I can't find things that are still boxed up somewhere, and saving some money in the long run by not replacing things I just can't find.
I've been reading more of the archives from that Mr. Money Moustache blog I mentioned last time, and I really enjoy his point of view. Representative quote:
"It is ALL ridiculous. Your life and my life, and the lives of all of the normal people around us.
If you've ever bought a garment, vehicle or dwelling with "style" as even a remote consideration, or prepared a multi-course meal with "taste" as one of the factors, then congratulations - you live a big, wonderful, ridiculous life. If you have any means of transportation besides walking, congratulations again, because you've hit the big time. You have so many options open to you - so much flexibility to change your lifestyle, empower yourself, spend less, earn more, and move to new places as you see fit."
(link http://www.mrmoneymustache.com/2015/03/12/when-ridiculousness-is-ubiquitious/ )
This is so true! I can never get over how easy, safe, clean, and comfortable American life generally is compared to all of human history, even on low incomes. We have magical shots that you can get one time as a baby to prevent you from getting illnesses that routinely killed half of everybody's children for most of history...and we're so accustomed to this magical quality of modern life that we have people who TURN THIS DOWN. There is so much extra money flying around our society that people will give routinely give unemployed 18 year olds (or in my case, 22 year olds) HUNDREDS OF THOUSANDS OF DOLLARS of loans with no collateral. Most of the time they don't even ask what specifically you plan on studying with this cash! That may not always work out, but what an incredible amount of working capital this country must have! And don't even get me started on all the insane things you can buy at the grocery store- wars have been fought over the trading routes to reach spices that somebody in small-town Nebraska can pick up for $2 without a thought.
What a wonderful and interesting time to be alive!
I had another entry written, but then I stumbled across a very interesting article and decided to go with embarrassing but necessary honesty instead: I have been irrationally complacent, and I can’t even tell you why. I owe $13,669.14 at 7.6% interest, and do you know how much has been paid toward this debt on through the IBR repayment plan in the last two years? The online statement has it right here in black and white: $374.24. In that two years, how many unnecessary things have I thoughtlessly wasted money on? How many times have I bought breakfast or a snack at work through sheer laziness even though there was food at home? I've never thought of myself as the type of person who buries their head in the sand before- this article was really a wake-up call.
The link is here, with the caveat that tough love works for me, but it's hard to read: http://www.mrmoneymustache.com/2012/04/18/news-flash-your-debt-is-an-emergency/#comments
So now what?
I'll eventually be paid $670 for a recent side job- they can be slow mailing the checks out, so I'll pay this toward my GradPlus loan now and refund it back into the account when that eventually shows up. I tend to keep a certain amount of cash on hand in case it's needed when the bank is closed, etc, but if I'm being honest, it's probably an unnecessary amount. Since that money isn't earning 7.6% interest, I'll deposit and apply some of that as well. Last week I was paid back for picking some things up for a friend while running errands, $80 cash, which can be another snowflake.
That brings me to
670 side job
80 payback amount
200 cash funds
$950 for debt payoff
Right now the interest in that account comes to 1107.30, so in the spirit of recognizing the urgency, I'm adding another $160 from savings to make a total payment of $1110. From here on out, I should start seeing some payments actually applied to principle!
I'll update the official numbers when the payment finishes processing and shows up on the website, since I'm not sure which day they add in the new interest.
Girl vs Math
This month was unusual financially, with a lot of one-time expenses, so my new monthly budget will really start in June. It's still a work in process, but here is a rough outline of what I am picturing:
insurance (car) 64
recurring expenses (contacts, renters insurance, car tags/inspection) 150
student loan (IBR) 386
food and misc 350
That utility number looks high, but I don't know what it will be in the new place yet. When I called to switch the account to my name, they told me the recent monthly average for this unit has been $130/month; utilities prior to moving ran me 30-40- dollars monthly. Until I see some actual numbers I will keep this at $100 and pay any leftover money here toward my loans.
Internet in this area is a frustrating monopoly. That $70/month is AFTER I called and got them to knock off $10/month. Oh well. Don't have cable or a landline. When it is time to renew my phone contract I am going to see if that can come down a little- what is reasonable to pay for a smartphone plan?
I tend to use my debit card for everything and keep an eye on my spending online, but I have never budgeted strictly in divided categories (Christmas, eating out vs groceries, etc). I saved my emergency fund by just doing all my banking from one account, trying to behave frugally, and letting the unspent extra build up (hence the unbudgeted "cushion" category and brand new “recurring expenses” amount, which is really just a guess).
At least for the first month as I test out the new budget, my debt repayment plan is to use the unspent funds left over in each category at the end of the month as well as any extra windfalls/snowflakes. I was able to do some extra side work recently and should be getting $600 from that, although it's hard to predict when the check will actually be mailed. That will take a big chunk out of my first mini-goal: paying off the roughly $1000 in interest due on the Gradplus loan before payments start being applied to principle. This makes me really impatient to come up with another $400 to get going! Should definitely be doable.
On a different note, thanks to all of the brave men and women who give up their time and personal safety to protect the US! Happy Memorial Day!
Longtime reader, first time blogger. I love reading these blogs for inspiration, and I am hoping that starting one will be a way to hold myself accountable as I get serious about my debt repayment goals.
The situation: Graduated debt-free from undergrad thanks to generous help from my parents. Took out loans for professional school totaling about $240,000 (with the in-state discount!) and graduated a couple years ago. After graduation I started a training job that will last for several years at relatively modest pay, followed by a significant jump after all training is complete. I was hired at a good salary (a little under $50K/yr), but had to move for my job to an expensive city with high cost of living, where rent ate up a huge portion of my income. I totally deferred one small loan from a private group with a very low interest rate (this is allowed for up to 5 years) and put my federal loans into income-based repayment, which has kept them in good standing but isn’t touching the principle. I recently found a much cheaper (for the area) apartment and moved to free up some extra money each month.
This is the only debt I’ve ever had and it needs to go! I feel like it limits my retirement savings and my general sense of freedom. With no dependents to take care of right now, I have a great opportunity to buckle down and set myself up for a more secure future.
I currently have a paid-for car with over 100,000 miles on it that is thankfully still running well and a good emergency fund (can cover 6 months of expenses plus a small extra cushion to reflect the fact that my car is well over 10 years old with a ton of miles and you never know). I have a Roth IRA that I started with my very first summer job at age 15 but have not been funding it consistently since college, which also has to change! My employer does not offer any type of match for retirement savings and the investment vehicles they do offer for automatic withholdings for are significantly less attractive than a Roth IRA due to the management fees. They do offer health, dental, and vision benefits for a reasonable rate.
The ugly numbers:
Accrued interest: 13,266.37
Interest rate: 6.55%
Current monthly payments on IBR: 368.32
GradPlus: Total 13,671.78
Accrued interest: 1,086.20
Interest rate 7.65%
Current monthly payments on IBR: 17.14/month
Other private loan: 17,000 principle, deferred, lower interest rate (don’t recall offhand)
Roth IRA: 14,322
All payments are applied first to interest, then to principle, so my IBR payments are not making any headway on actually getting out of the hole. I also think the interest rates are a little shocking- this much educational debt is essentially a mortgage, and 7.5% seems a little harsh, Uncle Sam! Talking to older colleagues, many of them mentioned that their loan rates a couple decades ago were more like 2-3%. Feeling like you are being gouged is certainly more motivation to pay if off quickly, I guess.
My first goal is to make extra payments to the GradPlus loan, both because the rate is higher and because it is small enough I could realistically start seeing some progress in paying off the principle to keep me motivated. I also plan to start contributing to my Roth IRA again- it’s ridiculous not to when you consider the time value of money at my age (under 30).
I'm still tweaking my new budget and will probably post that at a later date.