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Brittany’s February Debt Progress Report

Brittany's Debt Progress Report - Fun on a Budget Blog

January and February of 2015, mark a major turning point in my debt payoff journey. In the middle of February I gained an amazing husband, his additional income, and really the only raw end of the deal—his student loan debt (to be fair, he is getting stuck with my $43,000 of debt too).  Because of my recent change in income and the addition of a partner and partner’s debts, my progress reports will have to be adjusted as well. We still haven’t ironed out the details regarding how I will be reporting progress, but we have March to get all of that sorted out don’t we :)

Until then, here is my final single lady debt progress report. I nearly paid off half of my debt all by my big girl self in 18 months.  It’s pretty anti-climatic seeing the progress compared to previous months, but the events of the last couple of months are priceless and worth much more to me than a few thousand dollars extra put towards our debt.

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 December 31, 2014, and the green columns represent my debt totals for individual loans as of February 28, 2014. If you make payments above the minimum monthly requirements, looking at the debt progress in this format really emphasizes how paying more than the minimum has a significant impact on your debt decrease. In January and February I paid only minimum requirements on all of my loans, and as you can see the amount of “progress” I made was very, very minimal.

Monthly Progress on Individual Loans - Fun on a Budget Blog

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.

total debt progress

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!

If I was paying above the minimum monthly requirement on my focal loan, the percentage being paid towards interest would have been much smaller—I’ve been ranging between 10% and 16% of my total payment being applied towards interest; however because I paid only minimums on all my loans this month, 29% of my total payments across all loans went towards interest. You want to pay as much as possible toward the principal because that is what helps speed up the process of eliminating debt. The chart below gives you a visual representation of these numbers.

Percentage towards interest

It might seem like cash flowing money right now is rough, but if you make minimum monthly payments until all of your debt is gone, you will end up paying MUCH MORE than your original loan amounts in the long run.

Tell your Income Where to Go

Typically at this point in my progress report I share a pie chart that summarizes where I delegated my earned income during the past month. This month I don’t have a pie chart to share because I actually spent more than I earned. January and February were the final months of using my already-stashed-away savings to pay for the remainder of our wedding expenses. A pie chart wouldn’t represent the actual income and outgo of my cash, but I am considering writing a post to explain how I stayed organized during those two hectic months—well at least organized enough to stay sane 😉

January and February Roadblocks: The big road block was simply having the patience not to debt snowball as I sat on cash that I might need in the event of an emergency or unplanned expense for our wedding.

January and February Dollar Holllllllaaaaaas: No extra scrilla to write home about this month. I’m just happy to have experienced the most exciting day of my life without adding any debt to our already large mountain :)

 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? I recently read a blog post about living on a budget without a written budget—do you think you could do it?

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 Brittany

* You can find this post linked up with lots of other good financially blessed stuff at Thrifty Thursday, Frugal Friday, and Financially Savvy Saturdays!

Brittany’s December Debt Progress Report

Header

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 December 1, 2014, and the green columns represent my debt totals for individual loans as of December 31, 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 decided to pay a predetermined amount above my minimum requirements before halting my extra payments until after all of my final wedding expenses are completed. My car loan has an interest rate of less than 3%, so even though I only paid its minimum, it decreased by 2.7%. I paid just under eight times the minimum requirement for my Great Lakes Student Loan 3 and in result its total decreased by nearly 6%!! I am only making minimum monthly payments on Great Lakes Student Loan 2, and therefore its total only decreased by .04%. Pretty defeating.

indiv.debts

The bar graph below represents my overall long term and short term debt progress. 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.

total progress

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—11% of my total payment went towards interest—than percentage being paid towards interest on my other loans—an average of 40%! You want to pay as much as possible toward the principal because that is what helps speed up the process of eliminating debt. The chart below gives you a visual representation of these numbers.

interest

It might seem like cash flowing money right now is rough, but if you make minimum monthly payments until all of your debt is gone, you will end up paying MUCH MORE than your original loan amounts in the long run.

Tell your Income Where to Go

The pie chart below summarizes where I delegated my earned income during the month of December. About 43% of my earned income went towards debt—that includes my minimum monthly payments and extra cash flow. Just below 33% went towards my living expenses (food, rent, etc.), and 24% of my earned income was put into long-term savings this month to sit there until after my wedding so that I can sleep at night. I may have an over-planning problem…

brit.piechart.12-14

December Roadblocks: Because I’ve been over planning ahead for the past few months, I didn’t get hit with any major expenses. I had previously purchased airfare for the Christmas traveling, and while back in the Midwest, I was fortunate to stay with family and share their food and homes (and many other perks that my parents/future in laws provided—like family gym membership benefits, dinners out, and a pedicure—I am spoiled).  As the wedding gets closer and becomes more tangible (aka I actually start making the payments I’ve been saving for) it has been easier for me to stash my extra cash into my savings account without grumbling about it.

December Dollar Holllllaaaas: I was able to milk the Christmas money I received into grocery and spending money for the rest of December (and spoiler alert, since I am writing this post in mid-January) and at least half of January. That’s a few hundred bucks that goes into my savings account!

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? Do you have any tips that help you stay motivated when you aren’t able to put as much as you’d like towards debt because you have other looming expenses?

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 Brittany

*Part of Financially Savvy Saturdays on brokeGIRLrich and Autoimmune-Protocolling Around the World*

Frugal Friday

7 Days to a Debt Payoff Plan

Starting your debt snowball or a plan to pay off debt, can be overwhelming, scary, and frustrating. Procrastination is a major roadblock for many people who are faced with the task of paying off debt because it can make a person feel like he is staring up to the summit of Mt. Everest and being asked to climb it!  If sitting down and trying to tackle the job of getting organized to pay off your debt makes you want to put on your tennis shoes and run in the opposite direction, you are not alone. I’ve been there too. That’s why I’ve come up with 7 days of “jobs” that will have your debt payoff plan feeling less like climbing Mt. Everest and more like stepping over an anthill :)

debt snowball defined7 Easy Steps to a Successful Debt Payoff Plan

Day 1: Gather it up. Find all of your student loan/debt paperwork (including the car, mortgage, etc.) and put it in one spot/folder/pile.

Day 2:  Protect it. Find all passwords, and create a word document labeled (something like “debt payoff”, “debt snowball”, “hello financial freedom”) for all of your usernames and passwords. Create accounts if you don’t have one.

Day 3: Get technical. Log on to all of your debt accounts. Make sure that you save them on your web browser as a “favorite” so you can easily click and go.

Day 4: Create your DEBT SNOWBALL. Either write down or start a word/excel document listing your debt totals in order from smallest to biggest. Include interest rates.

Day 5: Schedule it. Write on a paper calendar and in your phone all of your payment due dates. Set an alarm to alert you of a payment 2 days or 1 week before each payment is due to ensure on time payments and avoid fees.

Day 6: Plan ahead. Use your budget to decide when (month and year) you will make your first EXTRA payment.

Day 7: Easy access. Make a filing bin, cabinet, or folder for your debt paperwork ONLY! Put it in a spot that is easy to access. Most people are more willing to do something more often if it’s convenient (i.e. fast food, pre-packaged foods, etc.). Make it easy on yourself and make your debt snowball information easy to access and organized!

debt snowball picThere it is. In just 7 days you will go from, “I just pay the minimum and forget about it because it’s too overwhelming to look at” to “My first extra payment happens on 12/1”! Congratulations on taking years off of your total debt payoff time!

debt snowball congratulationsHow did you begin your debt snowball journey?

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Sam