January wasn’t a month for big progress. We had to run in place for awhile due to added medical expenses and sheer exhaustion. Of course we are thrilled to have Jimi home from the hospital, but it has been a real challenge for all of us to adjust to our new way of life.
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We paid just the minimums this month on all of our debts. I really hate doing that, and I haven’t done it since we got serious about knocking out our debt. We have a $1,000 emergency fund, but it didn’t make sense to me to rob our emergency fund so that we could keep making larger debt payments. Instead, the money that would have been our debt snowball payment is set aside for medical bills and expenses.
On the one hand, it feels kinda sad not to move forward. On the other hand, I am so proud of us for not going backwards. If this had happened even 1 or 2 years ago, we could have been bankrupt again. Two years ago we had ZERO savings and plenty of debt and no back up plan.
While we can complain that our money isn’t doing what we had planned, we still don’t have to worry THAT much. If we don’t make our “extra” debt payments for a couple months, will it really wreck our entire plan? No, no it won’t. We got this.
|Type of Debt||Expected Payoff||Balance|
|Credit Card||2018 – March||$3,737.28|
|Credit Card (HE Loan)||2018 – September||$7,936.04|
|Credit Card (Student Loan)||2019 – February||$9,900.00|
|Credit Card (Student Loan)||2019 – September||$10,804.36|
|Student Loan||2020 – September||$31,330.21|
|Auto Loan||2020 – October||$16,582.86|
|Student Loan||2021 – September||$35,369.51|
|Mortgage||2022 – November||$46,758.42|
|TOTAL DEBT INCLUDING MORTGAGE||$162,418.68|
|TOTAL DEBT WITHOUT MORTGAGE||$115,660.26|
While our balances didn’t go down very much, you might notice that our percentages changed quite a bit. We moved the balance from one of our private student loans to two different 0% credit cards. I was able to shop around and get low fees for the transfers. This change will save us close to $1,500 in interest!
Of course that means we have a deadline to get the balance paid off (close to 18 months) if we want to avoid interest, but we’re okay with that. We are committed to making that happen. There are LOTS of factors to consider before doing a balance transfer, but it’s a good move for us.
Our APR Distribution also changed since we moved the 5.68% student loan balance to 0% credit cards. It is awesome to see over $30,000 of our debt is now at 0% interest! Now our remaining debts are mostly lower rates. We have two student loans at 4.26% and 4.13%. Our auto loan is 3.79%.
The mortgage is a whopping 6% as I’ve mentioned before. It just doesn’t make sense to refinance and pay all the closing costs when we plan to pay off the mortgage and move in the next 4-5 years. The savings wouldn’t offset the costs involved in a refinance. If you know of a low fee refinance option, let me know!!
Method: Modified snowball method using Undebt.it
We moved our progress from 25% up to 25.6%. I didn’t expect much of a change since we only lowered our debt balance by $1,249.82, but it’s still progress. I am so happy we are still making progress with everything going on right now.
Our final payoff date was showing as October 2022 on the December Report. Now the payoff date is September 2022! It’s crazy that our payoff date moved up even with us taking a month off to handle other priorities. This has to be from interest savings.
We paid $518.96 in interest for January. It still bugs me, but it’s $90 less than last month and over $200 less than it was 6 months ago. I am always trying to figure out ways to reduce our interest costs, but I might be reaching a point where I’m stuck with what we have…we’ll see!
More Wasted Money??
We spent $156.04 on dining out in January which isn’t too bad all things considered. Most of that was fast food, pizza, and take out since Jimi can’t get out too easily. It’s much less than December, so I’m happy about that. We’re starting to settle into our routine, so February should be better.
We cashed out credit card cash back earnings in the amount of $39.57 in January. It seems like a small amount, but we have more accumulated that we aren’t able to redeem yet. (Some cards require you to have a minimum of $20 or $25 before you can redeem your rewards. Other cards only award the cash back when they prepare your statement, so the earnings aren’t available before that time.)
I’m not complaining. I’ll take it. Who wouldn’t love an extra $40? I’m getting money back for things I was buying anyway. I never could have done this before starting YNAB, but now I’m hooked!
How was your January? Are you still recovering from December, or starting off strong in 2018? Share in the comments!