When I'm Debt Free

Now that I can see the faintest glimmer of light at the end of the tunnel, I'm starting to think about what I want to do when I'm finally debt free. To stay focused, I've gotta keep my eye on the prize-- or in this case, prizes.

I've started a list:

1. Write the Big Beast's bank and tell them just what I think about the rate increase they imposed for absolutely no reason. (I'd do it now but there's no reason to anger them and have them seek their revenge.)
   
2. Plan a real vacation. While the cruise with my parents last year was nice, it isn't a vacation I'd pick for myself. I'd rather spend my days enjoying the sights than wandering around on a big boat (and getting seasick). Here are some ideas: a spa/yoga retreat; Miami/South Beach; Spain or Italy; Viejo San Juan in Puerto Rico.
   
3. New bedroom furniture. First things first: a new mattress. I've mentioned before the sad state of my mattresses. I've had them for at least 20 years, and before I had them, they were my parents'. They are uncomfortable and I'd much rather have a queen-size bed. I also would like a new bureau. My current one is now 34 years old; the bottom two drawers are in bad shape.
   
4. Purge my closet of crap I hate and start building a wardrobe of things I love. Not like -- love.
   
5. Sign up for pottery class.
   
6. Join a gym or return to yoga class.
   
7. Buy myself flowers.

Needless to say, I don't plan on doing all this at once. I'd go broke! But they're certainly things I look forward to starting when I'm debt free.

I'm 15 months away from my first day of debt freedom. Let the countdown begin!

Making Do

This is a rare double post. Because it deals with changes I believe are going to take place in my life (or are indeed already taking place behind the scenes, unbeknown to me) and how my financial situation is somehow involved, I'm posting this in both my Veronica's Day in the Life blog and here in my debt blog.

A few years ago, I signed up for a pottery class. I loved the class. I loved how present in the moment you have to be in order to center that ball of clay on the wheel. I loved the feel of the moist clay spinning in my hands. While I had a long way to go, one would say I had potential to be a decent potter.

I did it for a year and half. I even threw in some yoga classes here and there, too. Every weekend was filled with pursuits to nurture my spirit, and I loved every minute of it.

But then one day I realized I owed almost $24,000. There was my car note and my ever-increasing credit card debt, the latter of which was being increased every time I registered for another pottery or yoga class.

So I did the responsible thing and gave myself an adult time-out. I decided to stop all classes until after my car was paid off. And let me tell you: It hurt that first weekend I didn't have anywhere to go.

But I stuck it out and paid off my car. And that felt so good that I decided to work on my credit cards, all $20,000 worth. (Talk about a humbling experience. Realizing I owed that much on credit cards made me sick to my stomach. And when I think now about what I could've done with that money -- things like grad school tuition, down payment on a condo, trips to Europe -- well, that still makes me sick.)

The most important thing, though, was this: Every time I pondered what I should do with my life, a little voice would say, "Pay off your debt and then we'll talk." And sometimes that voice wasn't so little. Sometimes it screamed.

So that's what I've been doing: following the direction of that voice and paying off my debt. Sometimes I have to risk being thought of as The Cheap Friend. I suffer through the winter months in a drafty apartment, turning on my heat only when it physically hurts not to, to keep my costs down. I turn down invitations to go placesI can't afford to go to. A former stylista, I now make do with clothes that are several years old. Most of my furnishings are extremely old or secondhand, and the rest came from Ikea. (I'm not knocking Ikea, but I don't think anyone would classify that store as a purveyor of fine, high-quality furnishings. The assembly instructions don't even have words!)

I feel like a recent college graduate just starting out, not an adult.

I'm not unhappy per se, but I do feel stuck. I want to be able to do things that truly make me happy. Like pursue pottery and yoga. Travel. Allow myself the freedom to explore what I want to do with my life without feeling trapped by my financial circumstances. Instead, as a result of years of irresponsible financial behavior, I am forced to make do not just with my old clothes but with my life.

Change is coming, though. And though I mentioned above that it's taking place behind the scenes, one could argue that I'm manifesting it center stage in my diligence to gain control of my finances, that my sacrifices will not be for nothing, and that when all is said and done, it will have been worth it.

We shall see.

July 2009 Update

This has been a better month. Here we go:

The Debt: $9,923
The Savings: $5,385

The debt has gone down nearly $550, and the savings finally swung in the right direction -- by over 700 bucks. I've still got a lot to consider, though. For one, my rent is about to go up. In the past, I've been able to offset my rent increase with my annual salary increase, but this year there are no salary increases, so ... Yeah. This may affect my savings rate, as I may have to scale back what I've been depositing. This means I may have to reconsider my $10K goal for next October. I'm not happy about that, but one thing is for certain:

I will not be scaling back my debt payments. I will be debt free come October 2010. Period.

So that's where we are for July 2009. Have a good month!

Decisions, Decisions

I desperately want to be debt free. So much so, that I've been thinking about suspending my automatic savings deposits. I've been considering it a while, but at first, the interest rate on my savings account was pretty decent. As we all know, though, interest rates for savings accounts have been in free fall since last year.

My idea is that rather than that amount going into my savings account, I could put it toward my debt. While it's not an insignificant amount, it would go a decent way toward helping me knock out the debt a little sooner. Of course, it would definitely affect my savings goal of $10K for 10/10/10.

My fear, though, is that I'll get out of the habit of saving. And I like seeing my savings grow. I really do.

Maybe I could make myself a deal -- I can suspend my savings deposits but only after I have a certain amount socked away.

So ... what to do? I don't know, but I welcome your suggestions.

On the Good Foot

This month is a three-paycheck month. That means I have the opportunity to start making things right -- to, as James Brown sang in his inimitable way, get on the good foot.

More than half of the first paycheck is going into savings, with the bulk going into an account I don't have the easiest access to. These deposits have already been scheduled. I've also scheduled the payment for the Little Beast, so that account will be back at zero by the weekend.

So, yeah, I'm starting June out on the good foot. :-)

P.S. While this isn't technically a "monthly update," I'm tagging it as such since it's really like the second part of yesterday's update.

June 2009 Monthly Update

Let's get straight to it, shall we:

Big Beast: $10,405.24
Little Beast: $68.00
Total Debt: $10,473.24

Total Savings: $4,682.82

Yes, I know. The Little Beast is back. But there's a reason: I bought a shirt. I'm going to do what I do when I use the Big Beast card: Pay it off immediately. I get the rewards from using the card (in this case, a rebate) without carrying a balance. I had been using the Big Beast for such things but then the bank changed my interest rate for no reason, so I'm not using it ever again.

The savings isn't as terrible as I'd feared, but it's not pretty. I will be making up for it this week, so next month's update should be much improved. (In fact, I'd almost considered not updating this month on the 1st and instead waiting until those savings deposits went through, but I decided to stick with the original plan. The first of the month is the first of the month.)

So ... that's it. Here's hoping June finds me regaining my footing.