February 2010 Update – How much our debt cost

Over the course of February our debt cost us $1,189 – which is $42.46/day. That does NOT include the principal costs… that is just the cost of the interest on our debt.  The good news is, one year ago we were paying $1,328 – which was $47.43/day.  Our debt reduction efforts over the course of the last year are saving us nearly $5 every day!  That may not sound like much, but if I were to put $5/day into my Capital One 360 Savings account, by this time next year I would have $1,825 plus any interest earned!

One of my least favorite things to think about is the amount of interest we pay toward debt each month.  The good news is that it is shrinking with each passing month.  Pretty soon all the money we line others pockets with will become our own… it’s just a matter of time, sacrifice, and hard work.  What a concept eh… being able to keep the money that we earn rather than paying it toward interest on debt!

Here is the comparison between the last two months:

A few notes about the details of the numbers…

1. Lending Club will be GONE next month! Unless something unforeseen happens we will have this debt paid off with our March payment!  That will mean we repaid this $11,000 loan in just 7 months!  We reduced this debt by $2,300 in January 2010 and by $2,318 more in February 2010 – because of this, the interest we pay to Lending Club decreases significantly every month.
2. Student loan interest amounts vary month to month. As promised last month, I wrote a post detailing how student loan interest is calculated to better explain why the amounts vary so much each month.
3. Side hustle earnings continue to fund large debt payments. Once again this month, the earnings from our side hustle have enabled us to make huge strides in repaying our debt.
4. Killing debt creates great motivation. I hope this article makes you think… and if you are not currently tracking how much your debt costs you each month hopefully it motivates you to do so.  Think about it – right now we are paying nearly $1,200 just in interest on our debt. This makes me sick to my stomach, but it also lights a fire under my britches to keep going full-speed-ahead!

The “How Much Your Debt Costs” Spreadsheet & Graph

A few months back I released a spreadsheet that does all the above calculations for you and also gives you the nifty little graph allowing you to track your progress.  I call it the How Much Your Debt Costs Spreadsheet… check it out.

The spreadsheet will also give you the interest amounts paid for each month in HUGE BOLD numbers for you to print off and stick on your fridge.

January 2010 Update – How much our debt cost

One of my least favorite things to think about is the amount of interest we pay toward debt each month.  The good news is that it is shrinking with each passing month.  Pretty soon all the money we line others pockets with will become our own.

What a concept eh… being able to keep the money that we earn rather than paying it toward interest on debt!

Here is the comparison between the last two months:

A few notes about the details of the numbers…

1. Student loan interest amounts vary month to month. I have mentioned this before… basically student loan interest is calculated using the “simple daily interest formula.”  Interest calculated using this formula varies slightly from month to month… maybe I will dedicate an article to this soon to better explain – but for now this will have to do.  🙂
2. Interest to Lending Club loan is falling fast! We reduced our Lending Club debt by $1,500 in 12/2009 and by $2,000 more in 1/2010!  This means that the interest we pay to Lending Club decreases significantly every month.  We hope to have this debt eliminated by 3/2010 or 4/2010 at the latest.  This is great considering that will be an $11,000 loan repaid in just 7 or 8 short months.
3. Seeing these numbers recharges my batteries. I hope this article makes you think… and if you are not currently tracking how much your debt costs you each month hopefully it motivates you to do so.  Think about it – right now we are paying $1,200+ just in interest on our debt. This knowledge makes me sick to my stomach while simultaneously lighting a fire under my britches to keep going full-speed-ahead!
4. Huge extra debt payments funded by side hustle. If you are in debt and do not have a side hustle, 2nd job, or some other form of secondary income… go remedy that ASAP.  The earnings from our side hustle are enabling us to put an extra $1,000 toward our debt – and that number only stands to increase going forward.  Frugal living is great, but so is extra income – and when the two are combined… LOOK OUT DEBT – HERE WE COME!  😀

The “How Much Your Debt Costs” Spreadsheet & Graph

A few months back I released a spreadsheet that does all the above calculations for you and also gives you the nifty little graph allowing you to track your progress.  I call it the How Much Your Debt Costs Spreadsheet… check it out.

The spreadsheet will also give you the interest amounts paid for each month in HUGE BOLD numbers for you to print off and stick on your fridge.

We reduced our interest paid by $124/month this year!

You know what that means… an extra $124 of our own money goes where we tell it to go rather than being predesignated to one specific debt.

It feels good, and motivates me to keep on keeping on.

December Update – How much our debt cost

One of my least favorite things to think about is the amount of interest I pay toward debt each month.  The good news is that it is shrinking with each passing month.  Pretty soon all the money we line others pockets with will become our own.  What a concept… being able to keep the money that you earn rather than paying it toward interest on debt!

Here is the comparison between the last two months:

A few notes about the details of the numbers…

1. We reduced our interest paid by $124/month this year! The faster we pay this debt down the more money we save.  By aggressively reducing debt this year we are now $124 wealthier every month… not a bad return on investment!
2. Our interest shrunk significantly in one month. This is mostly due to the way the interest on our student loans was calculated over the last 2 months.  If you remember back to our November cost of debt statement… our student loan interest was higher due to the way their interest is calculated and the way the dates fell.  Interest on student loan debt is calculated daily so the interest amounts will vary each month, but will calculate out to 365 days charged at the end of each year.
3. Our Lending Club interest shrunk quite a bit. Actually it did not shrink nearly as much as I wanted it to, but that is because our extra payment for November was only around $280.  For December we were able to pay an extra $1,500 so our January interest will be significantly less once again.  MAN I cannot wait until this debt is gone!

The “How Much Your Debt Costs” Spreadsheet & Graph

In case you missed it, last month I released the sweet spreadsheet that does all the above calculations for you and also gives you the nifty little graph allowing you to track your progress.  I deemed it the How Much Your Debt Costs Spreadsheet… check it out.

The spreadsheet will also give you the interest amounts paid for each month in HUGE BOLD numbers for you to print off and stick on your fridge.