January is almost over and it's been a great financial month. I owe less money on my credit card than I have in three years, and since the first of the year I've started to relax about it all. Don't get me wrong, I'm not relaxing the objective or becoming complacent in any way. What I am feeling is that I don't have such an insurmountable task ahead like I did when the debt was still $25K, $23K, 18K etc. As of today it's at $11,875 and I'm crazy excited to be so close to dropping below $10K.
I have started focusing on seeing some growth in retirement in savings as well as the shrinkage of debt. I'm starting small and certainly the largest part of my disposable income is still being thrown at the debt but I've increased my 401k contributions back up to 6% (they'll jump to 9% once my annual increase hits in March) and I've started to fund an IRA. I'm also making small contributions to savings.
Even though they're small numbers, seeing them grow is hugely motivating. I got crazy inspired by http://www.budgetsaresexy.com/category/net-worth/ and started tracking my net worth. It's still a negative of course but the last two months have both delivered over 20% increases on the prior month!
Buying shoes was never this satisfying... even when they were Louboutins.
Showing posts with label Growth. Show all posts
Showing posts with label Growth. Show all posts
Thursday, January 26, 2012
Friday, December 30, 2011
Grateful... and a New Year
Thankfully I have turned out to be a better financial planner than I am a blogger! I started this blog as a small attempt to keep myself honest, but as it's turned out, I haven't needed to keep honest to anyone but myself.
What started as an act of desperation to whittle down $40K+ of debt has become a new way of life that is many millions of times more satisfying. I have been telling my money where to go instead of wondering where it went, and in that process found my desire for mass consumption has all but gone. Crazy as it sounds this wasn't actually something I was trying to achieve when I set out, and because of that it's only recently that I have even become aware of it. If I'm being really honest back when I started this in August, in the back of my mind I knew I was just putting consumption on hold for a while until I could go and pay cash for a flashy handbag or similar. Debt free meant strolling into Neiman Marcus and throwing down cash for a new Balenciaga instead of flashing the plastic. After 5-months of changed financial behavior and gaining a whole hell of a lot more knowledge about personal finance, I have naturally become aware of making smart choices. Crazy thing is the smart choices are the ones I actually WANT to make! I've also stopped wearing or carrying a lot of the luxury brand items that I have; I'm turned off by the notion of "looking" rich. But enough rambling...
I am ending the year with $13,500 debt left, which is unbelievably ahead of the schedule I set back in July when I first developed my debt elimination plan. I had originally hoped to owe around $20K by the end of the year, which then went down to roughly $16,500 when I realized I could afford to send a bit more money each month.
Then an amazing thing happened. I moved banks and in order to qualify for a deposit at home feature I was required to apply for a credit card. I was terrified that I'd be rejected and was literally shaking as I clicked submit on the application. To my complete amazement I was approved in seconds with a high limit and a 6.9% APR. I then realized that the saving grace of my AMEX debt was that it reported as installment debt rather than revolving credit, and as a result my credit score has always remained in the 780's. I did a balance transfer of $18,500, which has been a MASSIVE saving in interest compared to AMEX's 15.2%.
That still left me with a balance of $4,600 on the AMEX but I suddenly found myself with a debt snowball and I killed that AMEX balance in a couple of weeks. I have never experienced motivation like that before. Talk about gazelle intensity!
I've had a couple of unexpected visits from Murphy, but I've made it this far and am finishing up the year in a much better place. I have an aggressive plan to eliminate the $13,500 by April 20th - over two months ahead of the original schedule - and then an aggressive plan to start building wealth and security.
Far from the anger I felt towards AMEX back in August, I am now eternally grateful for the wake up call. I feel truly blessed to be on this path to financial peace.
Happy New Year!
What started as an act of desperation to whittle down $40K+ of debt has become a new way of life that is many millions of times more satisfying. I have been telling my money where to go instead of wondering where it went, and in that process found my desire for mass consumption has all but gone. Crazy as it sounds this wasn't actually something I was trying to achieve when I set out, and because of that it's only recently that I have even become aware of it. If I'm being really honest back when I started this in August, in the back of my mind I knew I was just putting consumption on hold for a while until I could go and pay cash for a flashy handbag or similar. Debt free meant strolling into Neiman Marcus and throwing down cash for a new Balenciaga instead of flashing the plastic. After 5-months of changed financial behavior and gaining a whole hell of a lot more knowledge about personal finance, I have naturally become aware of making smart choices. Crazy thing is the smart choices are the ones I actually WANT to make! I've also stopped wearing or carrying a lot of the luxury brand items that I have; I'm turned off by the notion of "looking" rich. But enough rambling...
I am ending the year with $13,500 debt left, which is unbelievably ahead of the schedule I set back in July when I first developed my debt elimination plan. I had originally hoped to owe around $20K by the end of the year, which then went down to roughly $16,500 when I realized I could afford to send a bit more money each month.
Then an amazing thing happened. I moved banks and in order to qualify for a deposit at home feature I was required to apply for a credit card. I was terrified that I'd be rejected and was literally shaking as I clicked submit on the application. To my complete amazement I was approved in seconds with a high limit and a 6.9% APR. I then realized that the saving grace of my AMEX debt was that it reported as installment debt rather than revolving credit, and as a result my credit score has always remained in the 780's. I did a balance transfer of $18,500, which has been a MASSIVE saving in interest compared to AMEX's 15.2%.
That still left me with a balance of $4,600 on the AMEX but I suddenly found myself with a debt snowball and I killed that AMEX balance in a couple of weeks. I have never experienced motivation like that before. Talk about gazelle intensity!
I've had a couple of unexpected visits from Murphy, but I've made it this far and am finishing up the year in a much better place. I have an aggressive plan to eliminate the $13,500 by April 20th - over two months ahead of the original schedule - and then an aggressive plan to start building wealth and security.
Far from the anger I felt towards AMEX back in August, I am now eternally grateful for the wake up call. I feel truly blessed to be on this path to financial peace.
Happy New Year!
Monday, September 12, 2011
Adaptation
I am in the middle of a couple of weeks of "out of the ordinary" with a few trips and a few visitors in town. I've been stressing over how much additional money these special events are going to cost. For the past 2 months I've been saving a special fund plus allocating money gained from eBay sales and I've been fretting it won't be enough. In the last week of August, I had a hard time falling asleep at night because my mind wouldn't stop calculating the money I had vs. the money I was going to need and trying to figure out how to cut costs without cutting enjoyment. Budgeting is certainly not fun if you allow it to drive you crazy.
Here I am in the midst of it though, and it's amazing how quickly it is becoming second nature for me to use cash and use it wisely. I haven't scrimped on anything or denied myself anything I would have had under the old American Excess routine. What I have done is made better choices. I haven't felt the need to impress with a $400 dinner when a tasty $30 grill at home was fantastic. I haven't felt we needed a $175 spa day to enjoy time together, when a $35 pedicure was the perfect way to relax and have fun with friends.
Most importantly I'm not stressing about a potentially more expensive few weeks and I'm amazed to find everything is much more enjoyable when I'm not over-spending. I have only the lingering pleasure of the activity and none of the unavoidable guilt of another few hundred charged to a card.
Just 2 months into my new financial world order, I'm proving (for myself at least) life is better when it's paid for.
Here I am in the midst of it though, and it's amazing how quickly it is becoming second nature for me to use cash and use it wisely. I haven't scrimped on anything or denied myself anything I would have had under the old American Excess routine. What I have done is made better choices. I haven't felt the need to impress with a $400 dinner when a tasty $30 grill at home was fantastic. I haven't felt we needed a $175 spa day to enjoy time together, when a $35 pedicure was the perfect way to relax and have fun with friends.
Most importantly I'm not stressing about a potentially more expensive few weeks and I'm amazed to find everything is much more enjoyable when I'm not over-spending. I have only the lingering pleasure of the activity and none of the unavoidable guilt of another few hundred charged to a card.
Just 2 months into my new financial world order, I'm proving (for myself at least) life is better when it's paid for.
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