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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1 Jeff @ Sustainablelife blog

I know the feeling about getting antsy. It’s difficult to watch yourself chip away when we have been around a society where things are supposed to happen immediately, and it seems like everyone around you is doing things right away.
I just have to keep reminding myself that rome wasnt built in a day, and the journey will take time, but will be more than worth it in the end. Good luck. I’m hoping to get a similar “progress report” out soon too, but I’ll wait for the month to be over.

2 Matt Jabs

Awesome Jeff… keep it up. If nothing else we can encourage each other! :-)

3 MoneyEnergy

Congrats, you can do it! I like your side hustle fund philosophy, mine is the same way. $400 for web hosting?!? You must have several sites then? I can’t imagine paying just interest on a mortgage for years until hitting the principal. Another reason I want to start paying off student loans even earlier than I need to.

4 Matt Jabs

Ha ha… thanks Clare. The $400 was for an entire year of hosting on a dv plan with MediaTemple.net. It is a dedicated virtual hosting plan that I pay in advance in order to get a discount. I’ll be moving DebtFreeAdventure.com there soon.

Yeah, paying a lot toward interest is a bear… and is something I hope to put an end to ASAP! Godspeed with your student loans.

5 Mike Piper

It’s fun to watch your numbers. Paying off debt is neat that way–the numbers get better every month!

If only investing worked like that. :)

Congrats on your continued success.

6 Matt Jabs

I call it Oblivious Debt Reduction (don’t worry, I haven’t bought the domain name yet!) ;-)

Thanks Mike, it truly is nice to watch it dwindle away. I know that every month that passes gives me more money in my pocket… which we both know is a tremendous investment in and of itself!

7 Jim

Hi. I love reading these. Great Stuff. Also, I think the $400 for dedicated is money well spent. I have NO regrets with my webhost and going to a dedicated server. In a way, getting the dedicated now, and then planning for growth sure beats the other way where you’re SOL cause your post made it big time somewhere and your shared hosting can’t cut the mustard.

8 Matt Jabs

I agree Jim. Being prepared is always a good thing!

9 Money Funk

Congratulations for being featured on The Barry Moltz Radio Show.

You and your wife are making amazing progress. I cannot believe how fast your gazelle intensity has picked up and taken you. I think I really need to evaluate my snowball schedule and fine tune our schedule. Thank you for the inspiration!

FYI – your MDRSS tag series links at the bottom bring up an 404 error.

10 Financial Samurai

Howdy Matt! I’m a fellow Media Temple user, and just transferred my site to my own dedicated virtual server as well. It’s so much faster when I check. Do you notice any speed difference from your end visiting my site and your own site?

What’s the benefits of DV vs. grid service btw?

Dead eradication takes time. Just knowing you’re on the right path should feel great.

Good work on your progress!

11 Ken

You are making progress. Stay after it. Slow and steady wins the race.

12 Lydia aka Ms. MoneyChat

kudos! you two are making AMAZING progress. i’m very excited to see and follow your continued progress.

13 Rick Cadden

Matt are doing the same. I did a peer to peer loan at 5% for 24 months and paid off everything but the house. We have made two payments so far and reduced our interest rate from credit cards from as high as 19% to the 5%. We have our small emergency fund (1000.00) in place. With the savings from the high interest credit cards at the same time of paying off debt we are putting 400.00 each month toward our fully funded emergency of 3 months expenses. It is very slow right now just making payments but knowing in 22 months or less we will be debt free but the house. We have no other debt and will then start paying extra house payments and funding retirement and investing. We also pay cash for everyting and cancelled all the credit cards. Thanks for your blog and great information.

14 Tina

Super progress! Feels so good to be moving towards debt freedom and realizing progress. As a single mom of 3, I am especially glad whenever I see my debt go down (especially credit card debt). We are entering into 2009 without credit card debt and paying off the car loan in 2010. I can’t wait! Thanks for being so transparent.

15 Four Pillars

Great update – I like positive stuff. :)

There is no point in trying to rush debt repayment – I’ve seen people who put “too much” of their money towards debt and they end up backsliding because “life happens” and they end up needing some of that money. You have to have a bit of play in the budget.

FYI – I have a hard time reading the black print on the (somewhat) dark green background. I’d like a lighter background.

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