Personal Mid Year Financial Check In

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Are you wondering where the first 7 months of the year went? I know I am. June and July truly went by in the blink of an eye because wasn’t it just Memorial Day? Now, somehow kids are headed back to school.  It feels like we should go ahead and pull out the Christmas decorations because Christmas is right around the corner at this point. 

Anywho, I couldn’t let another month go by without an update to my blog and what better way to do that than to provide a personal financial update. So here’s what has been happening with my finances:

Savings

Saving is on track with 4 different ways that I’m saving.  I like to separate my money and even “hide” it from myself.

1st – We have our emergency savings account which is funded with several months of our living expenses. We will continue to add to this regularly until we reach 9 months of living expenses.

2nd – We are doing the Sweet Money Challenge which started the first week of January. The goal is to have $1,275.00 saved by the first week of December. On track. 

3rd– Every year I personally save $80 biweekly in my credit union’s Christmas Club Account. This is will be fully funded at $2,080.00 by the first week of November.  On track.

4th – Lastly, I consider my Dependent Care Flexible Saving Account as another savings. In this account, I defer $5,000 a year. The $5,000 is contributed pre-tax biweekly ($192.31) via my paycheck and I file for reimbursement as needed. I like to forget about this money, however, I always use some of this money as a student loan payment at the end of the year.

Sugar and Money Tip: Hide some money from yourself.

Investments: 

Currently, my investments are pretty basic – LOL. I laugh at typing “basic” since that’s the new IT word that a lot of people throw around on social media. Anywho, they are basic because I have a 401k plan via my employer where I invest in 4 different Vanguard Index Funds.  My contribution is 5% and my employer matches dollar for dollar up to 4%. With stocks, I also have some company stock that I previously bought and holding. Otherwise, I’m not actively buying more stock because our stock price is currently pretty high, so I don’t feel it’s advantageous for me to buy more stock at this time. Also, my next move with the stock market will be to diversify and buy stocks outside of my employer and definitely not buy at such a high dollar amount. 

Sugar and Money Tip: Don’t leave money on the table at your employer. Participate in your employer’s retirement plan up to the amount to get the employer match. If you have questions on how to get started in your employer’s retirement plan, call or go by your Human Resources department today.

Credit: 

This year, I decided to track my credit score to see how it would change over the year. My plan was to check it once a month but that hasn’t happened. I’ve documented my score 3 out of the 7 months that have passed. Going forward, I will add a calendar reminder to my phone or write it in my planner so I can remember to check it monthly on a specific date. Since, I am not in the market to make any major purchases, I haven’t been stressing over my credit score but I do want to keep a good credit score. We plan to purchase a new home within 2 years so credit will be a factor in securing a mortgage with a low interest rate. In February, I looked at my score and it was 754. I checked again in July and it was 770 so I was pretty happy with that increase of 16 points. I also pulled all of my credit reports which I hadn’t done in a long time, because if I did apply for any new credit – it has been approved: examples being rental furniture for a short term apartment lease and also approval to lease an apartment when we moved last. When, I pulled my credit reports, I did see a negative mark from when I made a late car payment in August 2012. I am sure that the payment was late so it wasn’t anything for me to dispute but the good news is that, it will be dropping off in September (because it’ll be 7 years) so my score should tick upward a little more. My goal is to increase my score to 800.  So I will be tracking it to see how long it takes to reach 800 by continuing to pay my bills on time, keeping credit utilization low and there are no plans to apply for any new credit anytime soon. Only 30 points away from reaching 800!

Sugar and Money Tips:

Need a good book on understanding and improving your credit score: Click here. Book recommendation: Your Score: An Insider’s Secrets to Understanding, Controlling, and Protecting Your Credit Score” by Houghton Mifflin Harcourt

You can access your credit reports from all 3 agencies (Equifax, Experian and Transunion) once a year for free from www.annualcreditreport.com

The Fair Credit Reporting Act, or FCRA states that most negative items must be removed from your credit report seven years from the first date of delinquency. However, there are some exceptions to the seven-year rule and that includes:

  • Chapter 7 bankruptcy filings (10 years).
  • Judgments (seven years or until the state statute of limitations expires, whichever is longer).
  • Money owed to or guaranteed by the government (unpaid taxes or student loans stay on your report indefinitely or until seven years from the date paid). Source: www.bankrate.com

Unexpected expenses: Car repair

Recently, I’ve had expected car expenses but also unexpected car expenses. Both attributed to my car’s air conditioning. My car is a 2010 Nissan Altima and I swear I have had the worst luck with car air conditioning systems  (even before this car) and I won’t harp on it but this year alone, I have spent $1,300.00 in repairing my car’s air conditioning. I live in South Carolina and it can get pretty hot so it’s really tough to go without air conditioning. At the end of Summer 2018 – my a/c went out and I was told that it was my condenser that needed replacing and it would cost me over $600 to repair. At that time, I politely declined the repair, since it was the end of the summer and decided to save the money up to repair at the beginning of Summer 2019 (May). When Summer 2019 arrived – I took my car to be repaired and I tried another mechanic that I heard great things about and he concluded that I didn’t need to replace my condenser but the a/c line had a hole in it. Therefore, he replaced the a/c line and refilled the coolant and that bill came to approximately $450 – no big deal because I had prepared for it. However, in July- the air stopped working again, actually right after we returned from vacation and I took it back to the same mechanic. He inspected it and I was given the news that the compressor had went out at this time. He explained that since I had a new line and more pressure was now being placed on the compressor, that is why it probably failed. So, my most important question was, “How much to repair it?” and he replied $850.00! Trust me, I was definitely hoping for a lower quote than what he gave me and even tried to get a lower price but he was firm with $850.00. In the end, we went forward with repairing it at the cost of $850.00. I really hope that this is the last air conditioning work that I have to put into my car while I own it. I have replaced the compressor twice, condenser once and it has a brand new a/c line – all of this work started in 2015.

Sweet Friends, Please send me good car air conditioning vibes.

Tip: Keep an ongoing car repair savings account or sinking fund especially when your car is older.

Debt Payoff

January, I declared a pretty large goal for debt payoff. I declared and posted on Instagram that I would pay off $20,000 of student loan debt this year. If I actually pay off $20,000 in 2019, that would leave me with only $20,000 left to pay in 2020. Thinking ahead, I want to be debt free by 12/31/2020. Debt free except for our mortgage. That would have me at age 39 and Debt Free! That feels so good to write, to read and to say out loud – so that is my goal. It bears repeating, “I plan to be debt free by December 31, 2020 of all debt except our home mortgage”

So let’s get to the numbers – So far this year, I have paid off an additional $3,591.00 off my student loans. Honestly, that number should be bigger. I recognize that I have been enjoying too much of the sweet life over here. That looks like increased spending in the area of personal care, short weekend trips, conferences, local events, and we took a much-needed vacation. However, I don’t regret any of these decisions, but I recognize that for me to achieve my goal of paying off $20,000 by December 31, 2019 then going forward, some of the spending and trips will have to be minimized and even eliminated. Therefore, No will be said more to some activities and events, so I can say Yes to having $20,000 of debt paid off 2019. Plain and Simple.

Sugar and Money Tip: Achieving goals, especially big goals will require sacrifice. Say “No” to anything that takes away from your goals.

Book recommendation on paying off debt, click here. Book recommendation: “The Total Money Makeover” by Dave Ramsey.

Debt Payoff Plan- To reach the goal of paying of an additional $16,409.00 – it will take some serious budgeting, cutting back and also making additional money. The monies used will come from: Regular paychecks, 48 Week Money Savings Challenge, Christmas Club Savings, reimbursement from Dependent Care FSA, canceling subscriptions, reduced preschool tuition, selling household items we don’t need and lastly, my potential yearly bonus from work. Overall,  I believe it is totally possible for me to reach the goal of paying off $20,000 in student loan debt this year because I have all the numbers written down of what amounts will come from where and I will share those later especially once I see it all working out as planned. Worst case, if I don’t pay off $20,000 this year, maybe I will reach $15,000 or $18,000 – still progress. 

The Catch

But there’s a catch! Isn’t there always a catch? I am stopping with additional payments to my student loans for a couple of months. Therefore instead of paying additional on my student loans, I will save that money instead. It looks like this,  If I planned to pay an additional $500 on student loan debt, I will deposit that $500 into my savings account instead. Then once, I get an answer on something very important in the works, then I will use the money saved to make a hopefully large student loan payment. However, in the interim – we are choosing to bulk up savings. We are working on something important and until it happens – we are choosing to save more than paying additional on debt. After all, we can’t call the student loan company and ask for a refund from our payments. Therefore, we feel more comfortable with a nice savings cushion at this time.

So, that’s all that has been going on with me and my finances. Overall, I feel good about the progress I’ve made this year. I am very excited to see how these last 4 ½ months shape up.

How have you done with your finances so far this year? How does your savings, investments, credit score and just overall financial goals look? Let me know in the comments…

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June Student Loan Payoff Details

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June 2018 Student Loan Payoff Details

Just like that another month has passed by and we are halfway through 2018. As each month passes, I can’t help but think that I am one month closer to having no student loan debt. I look forward to the magical land of ZERO balance. However, which each payment and each month there are hard decisions to be made. There were two big things that I said, “No” to. One was essentially a free trip to beach. We had a free place to stay but we would still have to cover gas, meals and any extras that might pop up. This was a hard decision to make because I love going to the beach, I mean L-O-V-E. The next “No” came when I declined a trip to Essence Festival in New Orleans and trust me, I wanted to go. However, when I considered the costs of my plane ticket, meals, concert tickets, transportation, etc – the decision was, “I will pass this year.”

Sometimes saying “No” is the easy part and the hard part really comes in the action. The action of making those extra payments. Because I don’t know of anyone that truly finds joy in paying off debt or I dare to say any bills – or is that just me. True it is a great feeling to make progress monthly towards becoming debt free and also knowing that your electricity, water and cell phone bill is paid but that doesn’t mean that you like paying bills. I would pick spending my income on experiences or investing over paying off debt any day but its good to know that the fun stuff will come soon.

If you are new to my debt payoff story – currently I only have Student Loans (not including mortgage) six loans to be exact and at one point I had ten. The strategy that I am using to pay off my student loans is the snowball method where I pay the minimum required payment  on all groups and then throw all remaining money on the student loan with the lowest balance. I plan to continue with the snowball method except for when I get down to the last two loan groups. Then I will have one loan with a 2.125% percentage rate and one with a 6.3% percentage rate.  In that case, I will pay off the 6.3%  interest rate loan first and then the 2.125% interest rate loan, even though the balance will be lower on the 2.125% loan. Therefore, the last two loans will be paid off using the avalanche method. The avalanche method is where you pay off the debt with the highest interest rate first. This will save money on interest.

2018 Numbers and Progress YTD:

January – $2450.00 – Credit Card Payoff!

February – $900 .00– Paid off Student Loan Group G. YAY!

March -$126.00 – Cash flowed a beach house rental for April, purchased spring/summer items and cash flowed some other expenses that came up. Honestly, just did a lot of spending this month.

April -$899.00- I planned to pay $1000 but I didn’t fully submit the payment so it was added to May’s payoff amount.

May – $2000.00 – This payment put me under the $50,000 mark! It was great to see $49K….

June – $1175.12 – I set a goal to pay off $1350.00 and honestly, I am a little disappointed that I did not meet that goal. Even though, I was only off by $174.88, I was still off! But now I am super focused to meet my goal for July – which will include the payoff of a loan group so there will be strict budgeting for July and saying, “No” to more events and non-essential shopping. However, I am a real believer of making short-term sacrifices now for long term successes in the future.

The numbers reflected show payments made above the minimum payment required to show actual debt reduction.

Sugar and Money for the Month of June

Sugar for the Month- a weekend trip to Atlanta for a women’s conference. The women’s conference was worth the ticket price and more (To save money, the ticket was purchased during an early bird special and the hotel stay was split with a friend) Personal development is definitely worth the cost.

My husband and I also took a weekend trip to Richmond, VA to celebrate a friend opening a store front for her boutique. Thankfully, we were able to stay with our friends for free and our main expenses was only food and gas. Celebrating with friends and a low cost weekend getaway is a win -win in my book.

Now Let’s Imagine… What could I have done with $1175.12 if it didn’t go toward debt…

Sugar – Two tickets to see the off Broadway theatre show “Hamilton” when it comes to Charlotte, NC in October, which would be right around the time of my birthday.

Money – Continue funding the imaginary Roth IRA that I would have opened in May. I could add $1175 to it and I would only be $2325 away from the 2018 contribution limit of $5500.00.

Next Steps with Debt Payoff:

Currently targeting Group D with a balance of $1,447.83 and my current overall balance on my student loans is now under $49,000. Hello $40’s and now I am gunning for the $30’s.

As always the goal is to be as transparent as possible but I won’t disclose our income. After all, it’s not how much money you make but how you spend what you make.

Feel free to share a sugar and/or money moment of the month below.

Let me know of any questions or comments and Thank you so much for reading and all of your support!

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May 2018 Debt Payoff and YTD Totals

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Paying off debt isn’t fun but it is fun to see the balances decrease, especially when the balance FINALLY reaches ZERO.

With this post, I am playing catch up and then going forward these posts will be current and come on the first of the Month to show the prior month’s debt payoff progress. The goal is to be as transparent as possible but I won’t disclose our income. After all, it’s not how much money you make but how you spend what you make.

When 2018 started, I had one credit card that had an expiring special interest rate so I paid it off in January. Then starting in February and going forward, the only debt (*besides mortgage) that I have are student loans. I have 6 student loan groups to be exact.

The strategy that I am using to pay off my student loans is the snowball method where I pay the minimum required payment  on all group groups and then throw all remaining money on the student loan with the lowest balance. I plan to continue with the snowball method except for the last two loan groups when I will have one loan with a 2.125% percentage rate and one with a 6.3% percentage rate.  In that case, I will pay off the 6.3%  interest rate loan first and then the 2.125% interest rate loan, eventhough the balance will be lower on the 2.125% loan. Therefore, the last two loans will be paid off using the avalanche method. The avalanche method is where you pay off the debt with the highest interest rate first.

2018 Numbers and Progress YTD:

January – $2450.00 – Credit Card Payoff!

February – $900 .00– Paid off Student Loan Group G. YAY!

March -$126.00 – Cash flowed a beach house rental for April, purchased spring/summer items and cash flowed some other expenses that came up. Honestly, just did a lot of spending this month.

April -$899.00- I actually planned to pay $1000 but I didn’t fully submit the payment so it was added to May’s payoff amount.

Which brings us to this Month. May, where I paid off $2000.00, this was a stretch but was able to be done since I received 3 paychecks this month and really watched my discretionary spending in the areas of eating out and shopping. I’m pretty happy that I was able to make additional payments totaling $2000.00 and can’t wait for the balance to be updated on Nelnet’s website.

The numbers reflected show payments made above the minimum payment required to show actual debt reduction.

Sugar and Money for the Month of May

Sugar for the Month- a beach trip for Memorial Day Weekend which we only had to cover our roundtrip gas and $80 in food. Thankfully, a family member invited us so we had a free place to stay and most meals covered. Defintely sweet living in my book.

Money for the Month- Paid off a total of $2000 on Group D Student Loan. Also met Dennis Kimbro at the Black Expo In Columbia, SC where I was able to hear him speak, snap a picture and get my book signed. Lastly, I finished reading, “Richest Man in Babylon”.

Now Let’s Imagine… What could I have done with $2000 if it didn’t go toward debt…

Sugar – I can purchase a single “The Runway VIP Experience” ticket to Beyonce’s concert in Columbia, SC for $1995.00 (not including taxes and fees) Which would include:

One premium reserved ticket in sections along the Runway,* access to an intimate backstage tour-go behind the scenes and ask select members of the JAY-Z AND BEYONCÉ OTR II crew what it takes to put this elaborate production together (tour led by your VIP Concierge), one VIP parking space per order, exclusive access to the pre-show VIP Lounge, limited edition JAY-Z AND BEYONCÉ OTR II VIP gift item, & more!*

Money – Start funding a Roth IRA with a deposit of $2000 toward the 2018 contribution limit of $5500.00.

Next Steps with Debt Payoff:

Currently targeting Group D with a balance of $2,700.00 and my current overall balance on my student loans is now under $50,000. So, Bye Bye $50’s, Hello $40’s!

Let me know of any questions or comments about my first debt payoff report! Thank you so much for reading and all of your support!

 

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