Digging out

or: "How I am slowly getting myself out of debt"

I am just like the majority of Americans...well, only in the sense that I have personal debt. Not counting our mortgage I have just about $15000 of credit card debt. That includes 3 bank cards (one that has my car loan consolidated onto it...had to do it to get the house), one best buy card (laptop only, never used it again...and never will), one express card (dumb, i know), and a partridge in a pear tree.

I am attempting to use Dave Ramsey's Debt Snowball Method but I have been unsuccessful thus far. Why is that you may ask? Well after looking at my lifestyle and payment plans I have come to these conclusions

1) I was not angry enough at my debt. Yeah, yeah, I understood that just paying the minimum means you'll be paying forever blah, blah, blah...but I wasn't REALLY pissed off at the amount of money that I spend every month on crap I don't even have anymore...like the washer and dryer that my ex still has. After cutting back on spending and looking at my budget, I realized that I spend the same amount on my debt each month as I do on all of my other living expenses

WTF?!!?

2) I thought I was being responsible by using cash for purchases rather than my debit card. Yeah, it made purchases more "real", but there was one small problem. Since I get paid daily in cash (tips) from work, if that $ never makes it into my account, I never really know where it goes. I used to put all of the "big bills" in the account and keep 5's and 1's for random spending through the day. But this led to spending more each day. Not anymore. ALL cash goes into the bank and I use the debit card for EVERYTHING and...

3) I am using my check register RELIGIOUSLY! Might seem simple to some of yall, but I had gotten in the habit of using my phone to check balances or online checking...led to 2 NSF fees in a week...WTF!? again!

4) NO SPENDING IF IT ISN'T BUDGETED! Again, may sound simple, but for YEARS I have had a budget...and still managed to spend more than I had. I had to seriously stop spending. No new clothes (I have WAY too many...more on this in a later post), no quick trips to Target or Wal-Mart, or my personal demon, the Dollar Store. Now I honestly do have some budgeted for fun shopping/house stuff since we just moved in and do need some "stuff"...but not much...and it gets recorded.

5) I set up a .ING savings account. It lets me move money electronically from my checking account into a savings account that I set up just to pay off debt. Now, you can set it up to automatically deduct, but since I never know exactly how much I will make each week/month I prefer to do small transfers every few days of whatever I can spare. Less painful than transferring $100 at a time and at the end of each month, I am going to empty this account to pay down one CC.

6) We are setting up a joint checking/savings account for house expenses. One of my problems has always been that when I have extra $ to pay on a card, I am afraid that the next month I will come up short for bills. So starting this month I am putting enough to cover next month's mortgage (since that is obviously the most important bill!) in savings and then using what's left to pay down a card.

First on the chopping block, Express. It has the lowest balance ($537), therefore I can pay it off quickly then roll that payment into the next card...Best Buy. I'll see if I can make some type of graphic to keep up with my progress.

The hardest part of this is being in my 20's and not doing the things that my friends are doing in order to save $ and pay off debt. No fancy dinners out, no big nights out drinking, no expensive vacations, no shopping sprees. But in the long run (hopefully not that long...maybe I can do this in a year?) I will be debt free and able to fully love life!

Anyone out there with me who wants to share their progress and hold each other accountable?