Getting Started

By now, half the country has read about Joe’s quest in paying off his 90k student loan in 10 months and how he not only succeeded, but succeeded a couple months ahead of schedule. It appeals to people like me because we want that freedom too. I may not have a 6 figure job, and not get huge annual bonuses, but I think with hard work and dedication that it’s not an insurmountable feat to accomplish for those of us who barely make 5 figures a year.

I *know* I cannot pay off my debt in 10 months- my salary would have to quintuple in order to do so. It almost seems impossible to do so in 10 years. But, I can with the correct mindset and determination.

I am blessed to have a fiance who lets me work multiple jobs (so he barely sees me) and yet doesn’t really expect me to help pay my way too much (I think he has a little misplaced valor, I should help him with expenses, and hopefully I’ll do so in the form of getting the house ready for the market next year and gaining him a decent equity on the house). I’m also blessed with multiple talents that allow me to work a bunch of different jobs, one full time and two part time, to help me meet my monthly financial obligations and have money left over. But, I’m not blessed with the dedication to properly spend my money. My parents are both very money smart- my father’s an accountant and my mother, who grew up in near poverty, understands the value of my dad’s dollar and always spends wisely. Somehow those genes completely skipped me and two of my siblings and were bestowed upon my other three siblings (yes, big family!). I at least got the “work hard for your money!” gene.

My debt includes a student loan, cosmetic loan, and some credit card debt. I also have a wedding to pay for, but that is where I’m at least working really hard to save money. I may break 30k, before taxes, in my income this year. I spend most of my money each month and don’t save anything. I’m changing that starting now.

I can’t put a time frame on paying off my debt. I want to get rid of the credit card and cosmetic loan debt by the end of this year, which I believe is doable. So rather than saying I’m going to pay off ALL my debt in “x” many months, I’m going to make it realistic and keeping with most of my peers who also barely make enough to break through their debt. Small, incremental steps to get where I need to be is a good start.

Let’s break it down in bullet form as to the order I am trying to pay stuff off:

  • Credit card 1
  • Credit card 2
  • Cosmetic Loan
  • Student Loan

Dedicated money management is what I need to employ to pay down the debt. As Joe would say “cut costs, increase revenue.” I like the idea of the envelope system, in which I take out as much cash as I budgeted for my major categories (Food, Gas, Entertainment), put the money into it’s proper envelope and once the money is gone for the month, no more spending in that category! It has a couple of benefits- one, I’m not using my credit cards to pay for anything, they’ll be put on a diet; I may even literally freeze one of them. Two, it forces me to see where my money is going. That way I can see where costs can be cut further.

So, June’s cut costs challenge it to employ the envelope system!

What about increasing revenue?

Two methods here. First, I’ve been actively looking for a new full-time job. This time, rather than going after any ol’ job, I’m actually applying to jobs that will give me better benefits and a higher paycheck. I’m one to settle for any job that gets me out of my current job, but this time I’m going for what I want and deserve.

Method two will be to sell some things off. I have some things that have been eBay bound for a while, I just have been lazy about listing them.

June’s increase revenue challenge: get a better paying full-time job and list unwanted “stuff” on eBay.

That’s all I can muster for now. Those things will be hard enough, I need to focus on the baby steps!