401k Decisions

Since I recently changed jobs, I have to make the decision as to what to do with my 401k earnings. Right now, it stands at approximately $1200. It’s not much, but it still could be what gives me a small boost up in the debt war.

If I were to request a check, they would automatically withhold 20% which would give me approximately $960 after that withholding (and possibly subject to more withholding later when I do my tax return). But, if I transfer it directly to my IRA (which I haven’t contributed to since I opened the account 7 years ago…), I would have no penalty of course.

It comes down to security now versus security for the future. That money will be worth a lot more when I retire in 40-45 years (I plan to work beyond the standard retirement age of 65 should health allow me) and contribute to some sound mind currently knowing that I am saving for my [distant] future. The interest earned on the IRA would be far greater than the interest paid on the credit card. But, flip side, there’s a lot to be said for taking it and paying off a credit card for the sake of sanity.

What would you do? It’s such a small amount that I’m struggling to decide what to do!

I suck!

I just have a bad habit of disappearing these recent months! I have a lot of good reasons though, I promise.

Quick Debt Profile for you:

CC1: $1076 and some change (it was at $600 until this morning when I had to buy a new laptop)

CC2: $4059 and some change

So, what’s been going on and why aren’t those numbers lower?

Well, like I said, I had to buy a new laptop. My old one is still working, but barely, and that just isn’t allowing me to do the things I need to do. So, before it really kicks the bucket, I wanted to get a new laptop so that I can have some time transferring files.

Another reason is because we have been feverishly trying to fix up our house. We had an amazingly awesome turn of luck and sold it without having to put it on the market! We still have some stuff to do, though, to bring it up to snuff for the buyer, so there has been a lot of buying paint and other supplies, paying contractors, etc., to meet the contingencies. Sooooo, this means the obvious.

We bought a house!

Bigger, better, will meet our needs, current and future, better than our current home. We are purchasing the house on husband’s name and using some of the equity of this house to make a down payment. We are using another portion of it to create an emergency fund, and the rest husband is using to buy a bigger car (no, I’m not pregnant).

With the selling and buying of a home, it threw our finances into sharp relief, so we really talked (and fought a bit) over my financial situation. Husband put his foot down and said I absolutely needed to find a better paying job so that I can help more with the household expenses. With reluctance because I have only been with my current job a little over a year, I searched.

And applied.

And got an interview.

And got a job.

A job that pays me around 11k more annually than my current job.

So, after a night’s sleep and a discussion with my office manager, I put in my notice and accepted the job. I start the same week we close on the new house.

Needless to say, the past month and a half have been me doing those little things to fix our current house and packing. The silver lining is that because we are moving, the only spending I’m doing (besides the laptop) is groceries and house fixes. Husband has been covering a vast majority of the latter, but I help where I can. Since we have had a few honest discussions about my debt, he is on board with me at least paying the credit cards off ASAP. The new job will help too since it’ll be an extra $300 a paycheck approximately. I expect CC1 debt paid off by the end of the year, CC2 hopefully by March. Oh, by the way, I finally called my credit card company and asked for reduced interest rates on both credit cards and was rewarded lower rates by 4% each. Not a ton, but still it will help!

ALSO, I have heard from my ace-in-the-hole. I don’t have much time left to act on it, but with transferring my responsibilities at my current job, I will have time to call this week and check on the current status and hopefully it will be resolved within the next two weeks, which would mean extra money to pay off the credit cards. Maybe even pay them off completely before my above projections. I just won’t hold my breath in case it doesn’t turn out the way I expect.

I hope you all understand. With two major life events happening so soon, I have been a bit distracted. Both have been a blessing though in so many ways that I’ve really had to focus on the finish line for both of them and neglect my blog. It’s been a big year, and I’ll keep you all updated as much as I can over the coming weeks. 2014 will hopefully be the year I can REALLY focus on that student loan, but for now it continues to go on the back burner.

Home Sweet Home

I wish I had an awesome August Update for you guys, that I killed CC1 debt with my bare hands and made a sizable dent into CC2. Or that my ace-in-the-hole came through. Or that I won the lottery and haven’t said anything for several weeks because I’m too busy enjoying being debt free.

But I can’t. 😦

I paid down CC1 a bit, CC2 barely and I haven’t heard from my ace-in-the-hole. The cat needs to see a specialist, I still struggle with productive ways to handle stress without shopping and now the house.

Oh, the house. We are getting ready to sell. The one good thing to come out of it is that because I don’t want to haul more stuff to storage, I am forced to not shop as much. I did have a bit of a weekend splurge because I had to get birthday gifts and there were things I wanted on sale. There hasn’t been much beyond that though it’s still probably too much money going to frivolous stuff.

With selling the house, however, we have to invest in some improvements. I’m hiring a painter because there are some difficult rooms I need a professional to fix, but luckily he is a friend and doing it at a discount. Boom, there goes most of what I would have used to pay off CC1. I also bought a deal for a maid service to clean once we declutter. We are trying to sell some of that clutter (that money goes to husband though), but we are not having any luck. Today, a realtor came over and pointed out a dark spot on the ceiling. I drilled a hole and water is dripping out currently. It’s slowed since I drilled the hole, but it hasn’t stopped, so money will have to go to at the very least cutting out and replacing that piece of the ceiling if not also fixing a pipe someplace in the house. More money. Have to power wash the house, finish painting the fence, replace the little front step roof. Money, money, money. Oh, let’s not forget the cost of renting a storage unit. It’s adding up, quickly. Not to mention we aren’t going to see much of a return on investment on any of it, but if we want to sell our house quickly, we have to do it.

It hurts, it pushes back my credit card kill date, but hopefully the ace-in-the-hole comes through. And hopefully some miracle will happen, and I do have a glisten of hope for a miracle actually, but I don’t want to get my hopes up. I’ll know by Sunday or Monday definitely on whether that miracle will happen (so please say a prayer!).

 

I’m Going to Sell Out Now

I hate to do it, but it never hurts to put it out there, and at least I don’t run ads?!?

Ebates.com, one of the websites I’ve mentioned in the past that I legitimately like to use to make money back, has a referral program. I could earn some money on people who use this link to sign up and make a purchase using the ebates portal by the end of the month. I’ve actually used ebates a few times recently and have over $20 in money that I can have them send a check to me for. The site I use to buy my contacts actually has an awesome cash back percentage. It’s legit, I’ve gotten money before and it has a lot of big name retailers, you just have to remember to go to ebates.com, find the online store you want to make the purchase at (if it participates) and click that link so that it opens a ticket connected to your ebates account. So, if you sign up or get anyone else to sign up using the link and help me earn referral credits, I will be greatly appreciative to you.

Hopefully you all won’t hate me for doing this rather shameless promotion 😦

“I wonder if I ask for a raise, will I receive one…?”

I wrote that line in a blog post just 9 days ago.

I also speak often how I need my income to increase to help with paying off debt.

Today, I walked into my boss’ office to discuss one thing, and ended discussing some administrative issues we are encountering with the staff. I was kind of put off yesterday by the fact there were ten of us in the office, and barely anyone had work to do. The front office ladies were working on some mundane busy work, but that’s only 3 of them. The 7 of us who were left had nothing to do, and in any other job I had worked at, that either meant find work to do or go home (which I did yesterday), something that is not practiced in this office but should be to try to instill some work ethic. After I suggested that we start sending people home on quiet days such as yesterday and maybe it will make the scheduling ladies a bit more cognizant of how they are scheduling, my boss agrees and tosses in that she had meant to do it this pay period, but I’m way overdue for a raise and that she was going to retroactively date it to July 1st (so I’ll get an additional check in a week or two).

WHAT THE FLIPPER?!?

I was stunned. I had been hearing since last Christmas how no one has had a raise in ages. I suspect a person or two probably had gotten one, and the ones who hadn’t weren’t working hard to prove their worth. But, since so many hadn’t been given raises (one woman has been there four years and has never received a raise…), I just assumed that I would be in that majority. I started to fume recently that all I do is work my ass off, take on more and more responsibility without blinking an eye and get nothing in return. I created a new, married name email address Sunday, busted open Word Monday night to create a new resume and started scoping out jobs I wanted to apply to (one really caught my eye, I may apply *just to see* if they might have a nibble of interest in me) after an especially angering day last Friday. So, when she made this declaration today, all I could do was mumble my appreciation and thank yous since I truly wasn’t expecting it and was starting to pave the road to get out of there. The latter is still possible, but the sense of urgency has decreased (mainly because I feel guilty leaving someone after they give me a raise and feel a sense of obligation to do right by them).

I don’t know how large the raise is- I am an hourly employee and my boss works in dollars, so I’m confident it’s at least a $1/hour raise, but naturally I’m hoping it’s better than that. It’s better than nothing though, so I’ll take it! And it’s at least another $100 per month to paying off my debt!

I Peeked….

I finally looked at CC2 the other day…

Not only did my spending the past month negate what I paid off on CC1 last month, it exceeded it by a few hundred dollars. After some quick scrambling, it’s down to $3200 even. I could have paid more, but I held back a bit because new kitten needs her shots and I need to get a couple more Christmas gifts. I want to do as much of that as I can with one of my debit cards, so I needed to leave some money in the account.

See, I’m trying to be a little responsible here!

Obviously, it changes the landscape of the debt payoff a bit. I was originally hoping to have everything paid off by April if I were conservative in my estimates. Now we are looking at June, if I’m not aggressive, though I am not sure how much more aggressive I can be- going into January, I’ll easily be paying $1200-$1400 a month on my debts, which is approximately 63-73% of my income.

The landscape currently is CC2- $3200 and Cosmetic Loan- $3450ish, but I just paid $550 (I don’t have online access to this, so I can’t say how much that has actually shaved off once interest has been accounted for), so we’re looking at roughly $6100-$6650 owed on those two debts. My $1200-$1400 in payments include my student loan payment, which I had hoped to up come January, but will keep at $250 for now, so when it comes to the other two debts, I’m really only paying $950-$1150 a month. AND I still have a wedding to pay for and a house to fix….

It’s a little bit discouraging. Yes, my ace in the hole could prove a huge benefit if I just made a simple phone call, but that’s only if I get what I want, which there’s always the chance that I won’t. But I also don’t want to rely on it either, no matter how much or little I may get. I need to learn how to budget smartly and effectively, learn to use more constructive means of dealing with stress (instead of shopping…) and do things without the help of others.

Once I get more details of my wedding planned and I’m able to balance life and work a bit better, I’ll reopen the question of extra income again. I babysat for that friend and made some money, which is great, but I really just don’t have the time and energy right now. I missed some chances to earn cash doing market research earlier this month, so hopefully more opportunities will come along again, sooner rather than later. I’ll continue to plan and pursue, but yet again, I’ve hit a wall.

One Down!

Yesterday, I paid off the medical bill! Wahoo!!!!!!!!! It was definitely an exciting moment. I didn’t necessarily like paying so much money of course, but at least it’s one less bill I have to think about, one less debt that needs to be repaid. I have also made September’s payments on the other three, so we’re down to about $6825 approximately. That will be about $175 lower next week once I am reimbursed for my business travel expenses.

Overall, I have shaved around $900 off of my debt already, and if I hadn’t used my CC2 to pay for my business trip expenses, it would be over a $1000. Not too shabby, but still, exactly like targeted so I still need to find ways to shave money off my budget and make more money.

Ideas

Until the other day, I had forgotten about a website I had joined over a year ago. It brought in around $500 for me the past year, and it’s so simple to do. Market research participant! Basically, I get sent a screening email every couple of months asking me questions regarding certain topics. The people who need the participants screen that initial email and then call to set up a time for you to come in and participate in the actual research study. They ask questions, I answer, and off I go with a check for $100+ in hand. A couple of times I was invited to participate, showed up and then they didn’t need me, but they still paid me the money because I went and was available. I got a screening email the other day, but I haven’t heard if I was chosen for participation yet. I think today I’ll look into joining more market research companies lists.

I still haven’t pursued private dance instruction, but I think I need to start teaching my regular classes before I pursue the idea any further. I have enough on my plate as it is without adding burn out to the mix. As great as debt payoff and the reduced stress from doing that is, I know I’ll be more stressed if I over-extend myself so I will be treading lightly. I guess I am relying on that ace in the hole to deliver, but I need to actually do my part to get it to come through.

Other Good Things

As it turns out, I am already being given benefits at my new job! I don’t know if my health insurance will kick in sooner rather than later though (which of course I’m hoping for sooner so that I can ditch my expensive premium). I am at least accruing vacation and sick leave and was paid for the holiday last week, which I definitely was not expecting to happen so it was a nice bonus to see in my paycheck yesterday. This actually puts my mind at great ease because it’ll mean that by the time my wedding rolls around, I hopefully will have enough time accrued to cover all the days off I’ll need.
Hope everyone else is having a great week! I’m looking forward to many more exciting ones to come as I pay off my debt! 🙂

The Debt Numbers

I would like to start off by saying that I really never wanted to put this out there, but here goes nothin’.

(Green indicates the bills I’ve paid.)

That is the graphic I created to track each of my debts and what a payoff would look like if I snowballed.

Medical Bill-$600

I have had a horrendous sleep disorder for over 17 years. Last November, after I got health insurance, I had two sleep studies done- an overnight study and a sleep latency study. I thought it would be all good regarding my insurance paying for it, but I was wrong! They classified it as a pre-existing condition, and I have to pay out of pocket. Originally it was a $3000 bill that arrived in May, after I started the blog, but they cut it almost in half and I’ve been paying about $300 a month to pay it off. August was tighter than planned, so I didn’t make a payment in August, but I’ll pay this month and next and it’ll be gone.

Credit Cards 1 and 2-$1450.17 and $1800

One of the cards is in an introductory 0% APR period until next April, while the other is definitely not. I’ve been paying Credit Card 1 well above the minimum so as to keep the interest down, especially since the Medical bill and Credit Card 2 do not accrue interest.

Cosmetic Loan-$3865.31

Yup, I’m vain. I had plastic surgery because it was cheaper than I thought and it was an ego boost I’ve been waiting to pursue for years. I smile every time I see myself profile in photos or videos because my schnoz is gone! This was back in January, before I considered the other things that should have been on high priority to pay off. I justified it by saying to myself that I may not get a chance after I have kids, so I did it. And honestly, I really don’t regret it and of all the bills, it stresses me out the least to think about. I pay slightly higher (read= a few cents) than my minimum payment.

Student Loan-$73572

I am one of the many who use Income Contingent Repayment (ICR) to determine my monthly payments each year. There are some advantages and there are some disadvantages.

Advantages

  • Each monthly payment is determined based on your income. So, if you don’t make much money, your payment will be lower than standard repayment.
  • If you ever come on hard times, having a lower payment can alleviate some stress.
  • If you still have a balance after 25 years, it is discharged (but that remainder is taxable at that point, so if the remainder of your loan is discharged, you have to pay taxes on it as if it were income).

Disadvantage

  • You may pay less than what the monthly interest is, so you may never make a dent into the principal.

Just because you have a determined payment doesn’t mean you have to pay ONLY that much. You can pay more. Right now, I pay the amount calculated based on my income plus a few extra dollars, but that is only paying interest. I have not made a single dent into my principal since I started repaying two years ago. This was a God send deal for me though when I went into repayment and didn’t have a full-time job. I was hardly making ends meet, and having a high student loan payment wasn’t helping matters. I consolidated my loans, applied for ICR and honestly have the peace of mind that if hard times ever hit again, I can revert to a lower payment.

Analysis

The total damage: $81287.48. EEK!

That’s a 20% down payment on a decent house in my area. That’s buying 3 brand spanking new cars. That could finance both of my future kids educations. That’s just way too much money to be indebted.

The Payoff Goal

For right now, I’m only giving a target payoff date for the medical bill, credit cards 1 and 2 and the cosmetic loan. If I continue to pay as I’m paying like it’s portrayed in the grid, we are looking at a May payoff. But, my wedding is in June, so my non-aggressive goal is by my birthday in March so that I can have some financial leeway to help pay for the wedding. BUT, I also want to do some home improvements before we sell the house next summer, so I’d like to have a little bit more extra money lying around if needed.

SOOOOOO…

My goal is to pay those 4 debts all off by Christmas!!!!!!!!!!

Today is September 4 and those 4 debts total $7715.48. Christmas is 3 and a half months away. I make around $2000 a month after taxes.

Oh boy.