blogging through my debt: deep breath

i'm not sure if i'm celebrating or mourning, but feel free to do either with me. 

in other news, spotted:

finn in a box.

blogging through my debt: the progress bars

i just wanted to point everyone over to the nifty progress bars i've created and put in the right column of my blog.  i've been searching through different blogs lately and have really come to like the idea of having a visual reminder of both my debt (so i don't slip up and go on an impromptu shopping spree) and my hard work in bringing that debt down.  plus, it's yet another way of keeping me accountable since you can all see it and call me on it if those progress bars are stationary for any extended period of time!

things have been okay lately.  there were a few minor set backs when my direct consolidation application didn't go through as quickly as i initially thought it would, and i had to cough up another $800 worth of student loan payments this month, in addition to the new $115 private loan payment that came due this month as well.  unfortunately, what this meant was that the largest of those loans (the $488 one) is not getting paid on time this month.  it really just came down to making a tough decision and, with this, i took dave ramsey's advice: when you have to make these kinds of choices, always cover your basic needs first.  food, housing, living necessities.  when those are covered, then you hit the bills.  if it means that one of those bills is going to be a few days late one month, then that's what it means.

it seems counter-intuitive, but i don't think there really was much i could do about it.  perhaps better planning in the future, perhaps taking money out of the emergency fund to make the payment?  i just didn't know what was smartest, so i made the decision that felt right to me.  i've only been late on any sort of payment once or twice in my life, so believe me, this was a big deal to me, but i think i did the right thing.  i also called to check up on my consolidation application and was told that they should (cross your fingers!) be sending me out the necessary paperwork in the next few weeks, so hopefully i'll be able to avoid this situation in the future.

i also just did my taxes and (get ready for the celebratory dance) once my return is direct deposited into my bank account, i'll be able to hit the minimum $1000 in my emergency savings fund, pay off my vs angels credit card, and put the remainder toward either another credit card payment, or my miscellaneous savings fund for things like the upcoming travel i have to pay for this summer (sister's wedding), or saving for when i go back to school.  or to ensuring that my next student loan payment isn't late.

what's become clear to me over the past month since i started this journey (has it really only been a month?) is that it gets easier over time.  it really, truly is about changing your thinking just as much as it's about changing your lifestyle.  for example, though it seems like such a silly thing to me now, before all of this i think i really did consider my credit card to be my money.  when i wanted to shop and didn't have the cash, it was so easy to tell myself that i could just put it on a credit card and deal with it later.  well, now that's completely changed.  not only do i think about shopping less and less as i go along, but when i do, i never think about my credit cards anymore.  i think about the cash in my checking account, and i think about my budget.  because i've budgeted all of that cash somewhere already, i have no choice but to just accept the fact that i have no money to shop.

now this obviously doesn't mean that i never want to shop, but shopping has turned into something i'm looking forward to, a reward for my hard work in reducing my debt.  i know that when i have an emergency fund saved up, a miscellaneous fund begun, and my credit cards paid down, i'll actually have the money to spend on something nice for myself.  and the beauty of it is that, by that time, i'll have so much more control over my money that i won't overspend anymore.

so simple.  why wasn't i doing this all along?

blogging through my debt: a hard weekend

there's a certain time of the year that N. and i like to call "murderer's row."  it includes the following traditionally gift-giving days: christmas (dec. 25), our anniversary (mid-jan.), valentine's day (feb. 14), and our birthday (beginning of march -- yes, we share the same birthday).  this year, because of the state of our finances and our new outlook on money, we've decided that christmas was really the only day we'd exchange store-bought gifts.

overall, this was working out fairly well.  we did something really home-made and sweet for our anniversary, and have been budgeted within an inch of our lives this month so we haven't really been spending any money at all lately.  but then this weekend happened, and the fact that we couldn't spend anything really began getting to me.

now, i'm a huge fan of holidays.  big or small, i love going all out for them.  prior to meeting N., when i didn't have a valentine, i always tried to do something special on february 14th, whether it was getting my hair done, planning a dinner with friends, whatever.  it usually always required money.  and this year, aside from the fact that i haven't gotten my hair done in nearly a year, not being able to think of something special to do with N. that wouldn't cost us any money was just depressing.

added to that, my older sister called me sunday morning from the iphone her husband got her, sitting in the new car her husband got her, while she was just returning from the spa day her husband got her, to tell me what an awesome valentine's she was having.  when she asked what N. and i were doing to celebrate, i told her: we're going to run errands, go grocery shopping, and watch more of the olympic winter games on tv.  why?  because it won't cost us any money.

and i know there are things to do that don't require money.  in fact, N. ended up making our valentine's day dinner really special for us just so that the day didn't feel like every other day.  but i just wanted to share with you all the fact that this journey of ours, from being overrun by debt to hopefully being debt-free, isn't as easy and wonderful as i may sometimes make it seem.  there are somedays, like sunday, when i feel angry that i got myself into this situation, when i wish to my core that i could buy something for N. that he's really been wanting, when i get frustrated with him after i find out he tried to get us reservations for a restaurant we in no way could have afforded (and then i feel terrible, because it's such a sweet thought).

this isn't fun, and it definitely comes with its fair share of difficulty.  lifestyle changes usually do, i guess.

but sunday is over, and we came through it without breaking our budget.  while that may seem like a small accomplishment as it was only one more day, when you're doing something hard like this, you have to really appreciate every single accomplishment you make, no matter the size.

it's important to just take things one day at a time.

blogging through my debt: money and ostriches

this weekend was one of those knock down, drag out weekends.  this was the weekend N. and i set aside to work out our budget.  we wanted to get one done before february started so that we could begin the month as on-track as possible, and hopefully set off on the right foot in terms of newer, better spending habits.

to say that this was an emotional two days would be the understatement of a lifetime.

let me start by saying that i was really, naively looking forward to this weekend.  for some reason, it didn't quite register to me just how hard it would be.  i think logically i knew it would be difficult, but that logic didn't really register with the more emotional half of my brain.  the fact that i got through without bursting into tears gives me cause enough to be ecstatic.

i think it was so hard for me mostly because of the way i operated up until friday.  ever since high school, i've always been incredibly responsible when it came to money management.  growing up, my parents always made sure i was aware of the type of life i didn't want to have, and that meant i had to be particularly aware of the money i earned, where i spent it, and how i saved it.  this hadn't been a problem for me until i graduated from college and moved down to california.  i now recognize that move as pivotal in my financial well-being, in that it completely wrecked it.

i don't know why, maybe it's because i didn't have any money for the move to begin with, or because i'd become so used to having an income (i worked all through college for any and all money i used...which is probably why i was so responsible with it) that when i began law school and couldn't have a job, i just didn't know how to survive on financial aid alone.  whatever the cause, it was my own personal recipe for financial disaster and, because of my history of being pretty smart with my money, it also became a source of shame.

i'll go into some of my more specific debt mistakes in a future post, but let me just say that i've made a lot of them in the last three and a half years, and have racked up most, if not all, of my credit card debt in that time.  once i became aware of how substantial that debt was becoming, and once law school was over and i was really broke (because the financial aid stopped rolling in and i couldn't find a job for a while), i began being really afraid of my money, and so began taking the "ostrich approach."

the ostrich approach is obviously enough when someone has something they really don't want to deal with, and so they just stick their head in the sand hoping they'll never have to.  unfortunately, this never works because bills still need to be paid and your debit card still needs to be used.  so when you finally do work up the courage to log into your online bank account, you get hit with that sick, punch-in-the-gut, stomach-dropping feeling when you see your balance and realize it will not pay for you and your lifestyle.  and it's too late, this month, to change so, hey, why not wait until next month?...

that was me.

i knew this weekend was just going to be a whole lot of those punches.  and saturday was.  after finishing my initial budget and realizing that my expenses (and these expenses don't include any sort of extra's, no clothes shopping money, no miscellaneous money, no savings money, nothing) exceeded my income by more than a thousand dollars, i won't lie, i wanted to cry and throw up and bury my head back in that familiar, safe sand.  but i didn't.  instead, i worked with it.  i tweaked and moved things around, and tried to figure out how i was going to pay for certain bills at certain times.  and while my expenses still exceed my income, it's only by about $200.  and, with N.'s help, my bills are getting paid.

by the end of sunday, i was feeling pretty damn good.  this month will be tough (dave ramsey said so), and N. and i will probably go over budget as we adjust to these new habits, but i feel so good now just knowing where my money is going.  even though i don't have a lot left in my bank account after writing those checks for student loans and utilities, at least i know that those things are paid.

so this is my first word of advice for those going through a financial make-over like i am: don't ignore your money.  know exactly how much you have at all times, and tell it exactly what to do and where to go.  doing this, even when you don't have very much, will be a big step toward relieving some of the stress that comes along with money problems.  knowledge, as always, is power.

blogging through my debt: the beginning

i've been thinking a lot about money lately.  maybe because i've been reading Ashley's (of Writing to Reach You fame) new blog A Story of Debt, maybe because all of my student loans came due this month, or maybe it's because it's the season of giving (and by giving we actually mean buying).  any one of these reasons would be enough to get me to take a good, hard look at my spending habits, really, and it's about time too.

so i have a few confessions to make:

• as i know i mentioned in many previous posts, i have a problem with money.  in that i spend it too easily/quickly/arbitrarily/mindlessly/etc.  as N. likes to put it, i tend to "live above my means," or at least i seem to try to.  my family was definitely always one of those paycheck to paycheck households and, now that i'm older, the thought of getting my own electricity cut off, or not making rent, or not being able to pay bills still sends me into severe panic attacks.  but the point is that even though growing up we didn't have, and even though not having was perfectly fine in terms of what we needed most of the time as kids, i still wanted.  so now i spend, regardless of whether or not i have.  my vices include gifts for my loved ones, eating out several times a week, and clothes.  i have a severe, severe addiction to clothes shopping.
  
• my credit card debt (not to be confused with my educational uber debt) is astronomical.  because i want to be completely honest here, and because this will be a way to hold me accountable, i'll confess that my current debt falls somewhere in the vicinity of $13k.  roughly $11,500 of it can be found on what i'll call my miles card, and the other on my little card.  i have about a hundred dollars on a victoria's secret angel card as well.  admitting this is humiliating, to say the least.
  
• when i calculate my portion of the rent and bills, along with my phone, credit card payments and my latest personal hell's angel, the student loan payment, my monthly expenses (not including groceries) total more than half of my monthly income.  because i've been jobless for most of the past several months, i haven't paid my portion of the rent since september.
  
• even now, after having suffered another anxiety attack just this past monday because i didn't have enough for december's rent and all my bills this month, i still want to shop.  i probably want to shop because of all of this.  i've even bookmarked webpages.  it's a sickness.  this will undoubtedly be my biggest struggle.
  

aside from reading Ashley's blog and finding solace in the fact that there just may be others like me out there in the world, as well as talking to some of my closest friends (one of which is living primarily off of ramen at the moment), there are a few things i'm doing to begin to get myself (and my money) under control:

• at the suggestion of a really good friend of mine, J., N. and i have enrolled in Dave Ramsey's Financial Peace University.  now, let me just say a few things about this right off the bat:  this will not be for everyone.  i'm not even sure N. likes it right now.  dave ramsey isn't saying anything new or enlightening.  i can guarantee you that you've heard it all before and just didn't/wouldn't/couldn't follow through.  he's also quite preachy, and very Christian.  i sometimes feel like i'm surrounded by the mars hill superfans (holler if you're from seattle!) when i watch his lessons, and i'm only taking them online.  finally, and probably most ironic of all, you have to pay for this course.  it's about money management, about spending less and putting less on credit cards and all that, and yet, it doesn't come cheap.  needless to say, i wouldn't have done it had it not come so highly recommended by someone i've known for years who's gone through it with her entire family.  we've nearly completed the first lesson and i've already realized that i'm not where near where i want/need to be, financially, and i can't just ignore it.
  
• as part of the course, i'm anticipating having to create a budget for myself.  i'm really excited about this.  and i think i can make it work as long as i'm realistic about my budgeting.  i tried to make one last year, but the problem was that i tried to cut myself off from all of my habits cold-turkey.  it just doesn't work.  i left myself no wiggle room for going to a nice dinner every so often, or buying something for myself once in a while.  with the kind of personality i am, under that kind of restrictions i'm likely to just say "screw it" and head on out to Target.  so this time around, i'm really looking forward to creating a workable budget for myself, that also includes AN INCOME!
• i'm getting back to my roots.  somehow, my parents managed to raise an incredible family on very little.  we had food every night, clothes every day, and little luxuries every once in a while that worked perfectly fine.  they did it, and since i'm heading home next week, i thought what better time to pick their brains and get some money saving ideas.
• i have goals this time around.  not just some abstract idea of "saving money," but actual concrete goals that i can work towards if i follow my budget.  here are some of them:  1) i want to create a $5,000 emergency fund, 2) i want to cut up all but one credit card, and 3) i want to save at least $5,000 to use to possibly go abroad for grad school.

i'm going to try and continue to chronicle my own debt struggles and, if you find yourself in a similar boat, i'd encourage you to stop by every once in a while so that you too know you're not alone, and definitely head over to A Story of Debt, where you'll find even more support and an even better read!