Thursday, May 01, 2008

Reducing Debt With "Style and Flair"

It appears I never posted a March update. Hmmm, was that in my brain or did I post it to the WIRR message board? Anyway, March went well especially considering it was my first attempt at living within a budget. To help my success, I joined a group on the WIR boards who are committed to reducing spending by making "$0 Spend Day" goals. My goal was to go 15/31 days without making frivolous purchases such as magazines, Starbuck's iced tea, eating out, etc. I ended up increasing my goal to 18/31 days. I did a great job at cooking at home and taking my lunch to work. My bank statement for March was so short because usually half of it is for eating out.

I also opened a "Save Yourself" fund. Basically I deposit at least $50/month for a year and at the end of the year Ameritrade will deposit an additional $100. Seems easy enough, I'll gladly take their money.

My biggest accomplishment was going an entire billing period without using my credit card. This is huge! I can't remember the last statement I had that didn't have at least $200 worth of purchases.

April started off o.k. but then went downhill for a couple of reasons but essentially because I allowed it to happen. What really contributed was my tax refund. I kept making purchases outside of my budget because I had the extra money sitting there. I made another $0 Spend Days goal of 20/30 days for the month of April. I started off great but then completely fell off the wagon and went 10 days in a row with frivolous purchases. I injured my arm towards the end of April and I allowed that to be my excuse to start eating out since it hurt to cook. It actually DID hurt a lot but I could have made better choices. Instead I basically gave up for a week and a half. It's scary how quickly I let my goals fall to the wayside when I have something upset my routine. I'm really concerned that if an actual crisis came along, I would really let things go to hell and find myself 100 lbs heavier and even more in debt. I also experienced a similar feeling of losing control when I went to visit my parents earlier in April. There's always good (think unhealthy) things to eat there. My parents seem to have a self control that I don't possess. I really need to have a plan ready to implement the next time I go to visit. Something that will give me the willpower to avoid the damn cookie jar!

April wasn't a complete bust. I ended up going 15/20 $0 Spend Days. I didn't hit my goal but I did better than say...3 months ago.

I also accomplished a few other items on my debt reduction to do list,
  • My emergency fund has $1000.
  • Since my emergency fund was where I wanted it, I upped the deductible on my car insurance to $500. That will save me about $100 a year.
  • I cancelled my census records subscription. I hadn't used it for several months but it was still hard to get rid of.
  • I got rid of my EasyEdge plan on U.S. Cellular. I didn't use it much, it was mostly a toy and a waste of money.
  • I opened an online savings account for my "Scuba Fund". Right now it's for my trip in June. After that it will be to save money for another trip in January 2009. Maybe to Bonaire, maybe to Hawaii? That is yet to be determined.
  • I've gone another billing period without using my credit card. Now that is really something to cheer about. Even though I let things slide the past few weeks, I didn't whip out my credit card. I'm not making huge payments towards my card yet but at least I'm not adding to the debt. Yay me!

So what's up for May? Figure out what I want to do with the rest of my federal tax refund (there's not much left) what to do with my federal rebate (go to Scuba Fund) and what to do with my state refund (holy crap, it was $400+!) Once I move my money where I want it, I will be forced to stick to my budget.

Cancel my Rhapsody music subscription. This will be hard. I really enjoy being able to pull up pretty much whatever music I want. I meant to cancel it last month but "forgot" until after I had already been billed for the month. This month I'm definitely taking care of it. I'll go to the libray with my laptop and acquire my favorites from the cd's there for free.

I've committed to 20/31 $0 Spend Days. Hopefully this month will go better than last month.

I also want to start riding my bike to work. I have a goal of riding it 10 days this month. Since May is National Bike Month and May 10-16 is Bike to Work Week, this seems like a great way to get started. I'll be getting a late start since my arm is still injured now and then I will be out of town through the 7th. Hopefully both my arm and the weather will be good to go next week.

Current credit card debt - $25789.

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