The graph below summarizes my short term debt progress across all of my individual loans. The blue column represents my debt totals for individual loans as of November 1, 2014, and the green columns represent my debt totals for individual loans as of November 30, 2014. Looking at the debt progress in this format really emphasizes how paying more than the minimum has a significant impact on your debt decrease. My Great Lakes Student Loan 3 is my current focal loan, and I paid as much as I could above the minimum requirement in November. Because I used about half of the money I had left over at the end of the month to cushion my savings account as I prep for a wedding and travel expenses, the chunk I put towards my focal loan was smaller than usual.
The bar graph below represents the long term and short term progress I have made on my overall debt. The grey bar represents my original total debt amount, the blue bar is my total debt one month ago, and the green bar shows how much debt I have today. Sometimes it’s hard to feel like you are making progress when you look at your BIG number on a month-to-month basis, but looking back to the beginning can remind you how far you have come.
Having ONE target loan will increase the rate at which you can pay off your debt and decrease the amount of money you will pay towards interest to help you become debt free sooner!
Because I was paying above the minimum monthly requirement on my focal loan, the percentage being paid towards interest was smaller—16% of my total payment went towards interest—than percentage being paid towards interest on my other loans—30%. You want to pay as much as possible toward the principal because that is what helps speed up the process of eliminating debt. Because my savings was higher in November, you’ll notice that the impact on interest was smaller than usual. The chart below gives you a visual representation of these numbers.
Tell your Income Where to Go
The pie chart below summarizes where I delegated my earned income during the month of November. About 30% of my earned income went towards debt—that includes my minimum monthly payments and extra cash flow. Just below 52% went towards my living expenses (food, rent, etc.), and 18% of my earned income was put into long-term savings this month to prepare for holiday season travels and any surprise wedding expenses I haven’t considered in my budget. Much my my current dismay, I am staying on the safety train and continuing to build the wiggle room in my budget.
November Roadblocks: I’m not paying as much towards my debt as I’d like to because of the extra savings I’m building for any last minute or surprise wedding/holiday expenses. At this point it’s really just that darn wedding that is holding me up. I think it’s worth it 😉 Jokes—I know it is worth it ♥ I also had a significant increase in living expenses in November because of the way we paid our rent. Basically we were just slowpokes, so instead of going halfsies like we usually do, I wrote a check for the full amount upfront and was “reimbursed” in cash later. With the upcoming merging of our lives and bank accounts the whole “reimbursement” seems a little silly; however we currently have separate bank accounts, and I wouldn’t have made it through the month without being “paid back”. Because of the rent snafu and my higher than usual saving habits, the amount of money I put toward debt was nearly halved.
November Dollar Hollllaaaaas: I didn’t create extra income, but I really kept my spending under control this month and was able to capitalize on a work trip by stretching it out into a weekend with Sam. Without the flexible thought and strategic use of my funds, I probably wouldn’t have been able to see Sam’s new home until next Spring or Summer–and we all know that is unacceptable in a friendship
For more information on how to gain control of your finances check out our info on Getting Started by clicking the link in the menu bar at the top of the page. How do you stay motivated and track your debt progress? Is it getting harder or easier now that the year is coming to a close?
My progress and other financially mindblowing 😉 (exaggerating a bit–lots of coffee this morning) posts are linked up over at *Part of Financially Savvy Saturdays on brokeGIRLrich* Head over and check them out!!