Monthly Debt Reduction & Savings Statement – November 2009

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photo credit to CarbonNYC

Each month I will be posting these Monthly Debt Reduction & Savings Statements. I do this so I can continually compare our debt amounts against Our Starting Debt Amounts from back in January, 2009 – when my wife & I began our Debt Free Adventure – and to summarize our progress toward debt free living.  Like charts/graphs better? Look in the sidebar for those.

Up-to-date Debt Reduction & Savings Statement for November, 2009

Before I get into the goals and progress I wanted to briefly mention a few things:

  • I know that the tortoise beats the hare every time… so we are working to be patient while our plan work us toward debt freedom!  It is nice watching debt be whittled away, but sometimes we just wish it would happen faster!
  • I was recently featured on The Barry Moltz Radio Show for my position as a Lending Club borrower.  To listen to the show click play on the player below.
  • Debt Free Adventure has a new logo in the header (designed by yours truly), tell me what you think.
  • Earlier this month I released my “How Much Debt Costs Spreadsheet” to help you figure out how much interest you’re paying and establish a proper relationship with your debt!  Let me know what you think of the spreadsheet.

If you only want to hear Matt’s portion he speaks from the 11:37 minute mark until the 18:06 mark.  Enjoy!

And now… on to the progress!

Our Current Goals

  1. Pay off our credit card debt by the end of 2009 (which started as $9,197 in January, 2009) Consolidated into Lending Club loan!
  2. Pay off our auto loan by the end of 2009 (which started as $6,036 in January, 2009) Consolidated into Lending Club loan!
  3. Pay off the remaining small amount on my wife’s credit card (was sitting at $632 in August, 2009) DONE!
  4. Pay off our Lending Club loan by the end of 2009 (which consolidated our credit card and auto loan debt – started as $11,080 in August, 2009)
  5. Save $6,000 toward an Emergency Fund by the end of 2009
  6. Pay an extra $50 in principal payments on both our student loans so as to pay them off early. **Update** We have decided against doing this until our Lending Club and Emergency Fund goals are met.
  7. Pay double principal payments each month on both our mortgages (we have a 75/25 loan) in an effort to pay them off in only 15 years as opposed to another 28. **Update** We are paying double principal on our 2nd mortgage, but not our first.  We will not start doing so with our first mortgage until we pay off our high interest debt.

Our Current Debt Progress

A little recap in case this is the first MDRSS you have read, back in August we joined and borrowed from Lending Club to consolidate our high interest debt under a single payment at a lower rate.  I only suggest that you do this if the rate you can get from Lending Club is lower than all the rates of the loans you are looking to consolidate.  We were quite successful in that respect, and will save at least $500+ over the life of the loan by consolidating through Lending Club.

  • Credit Cards – GONE!  Either paid off or consolidated into the Lending Club loan.
  • Auto Loan – GONE!  Consolidated into the Lending Club loan.
  • Lending Club – We have further reduced this loan from $11,080 – principal + loan origination feeand now owe $8,314.46.
  • 2nd Mortgage – We continued to pay double principal payments on our 2nd mortgage because it is only and extra $25.  Yeah that’s right… when you have a 2nd 30 year mortgage, you pay virtually ALL interest for a lot of years before you knock down any noticeable interest – which should make you really mad! If you are interested in getting even more mad at your debt, check out how much your debt costs.
  • Student Loans – We are still paying normal monthly payments only.
  • 1st Mortgage – We are still paying the normal monthly payments here too, and will be until everything else paid off.

For November of 2009, our high interest consumer debt was reduced by $884.42, from $8,964.30 down to $8,314.46.

Our Current Savings Progress

Savings contributions were again halted, with the exception of the earnings from our Side Hustle.  This was due once again to the focus on “gazelle intensity” we are trying out based on the leading of our Dave Ramsey Financial Peace University class.  Normally I am a firm believer in contributing at least a small percentage to savings every month automatically, but am forgoing this for now, and feel comforted by the fact that I am still saving the income from out side hustle.  More on this later…

  • Emergency Fund - Remained at $2,346.
  • New Auto Fund & Vacation Fund – Remained at $377.
  • Side Hustle Fund – Earned $814 this month, but saw expenditures of $400 (web hosting) and $164 (Flip UltraHD) bringing the total of this fund to $1,857.  At this point I am still putting all monies earned from my side hustles into this fund as a way to track the income.  I am not putting it toward debt repayment at this time, but may be soon… depending on how much I earn.  I only want to use this money to pay off debt if it is earning over and above the costs to maintain side hustle operations.  I am also looking to reinvest this back into the business.

For November 2009, our savings was increased by $814, bringing our total cash savings to $3,914.

Thoughts…

Things are moving very smoothly.  Although, to be honest I am getting a bit antsy!  Our plan is fully in place and is working… but I am very impatient to see those debt amounts disappear completely.  Part of me just wants to fast forward to the time when they are gone… but I know this period of patient fortitude is an important part of the equation.  Faithfully sticking to the plan is a great exercise in discipline for both of us.  Going through the process is helping cement in our proper financial mindset.  I’m afraid that if we paid everything off too quickly we may not fully learn our lesson.  The fact of the matter is… we love watching our debt dwindle and our savings grow, so all is good on Lake Jabs!

If you desire to track our progress, you can do so directly by following the MDRSS (Monthly Debt Reduction & Savings Statement) tag series.



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