Ditch the Debt: January Recap

One month into ditching our debt and our journey is already off to an interesting start. The boys were home for two weeks because a child in one of their classes tested positive for Covid. Hank didn’t work outside of the house due to hiring delays at the company he’s seeking employment. But I had the most profitable month in my business – by far. And then, to top it all off, thanks to an unusual amount of rain, we found a leak had developed in our roof.

All of this together allowed us to put extra toward paying off our debt while building our savings.

If you missed out on our full plan for ditching our debt, you can catch up here.

Somethings that went particularly well this month:

  • Not only did we greatly reduce how much we ate out, we actually had money left in our Dining Out budget at the end of the month.
  • We were successful at avoiding “stocking up” purchases.

Somethings that didn’t go well this month:

  • Even though it’s been planned for, our credit card balance increased and we can’t pay cash to pay it off due to an investment for my business. Unfortunately, this means our overall debt has increased but as my revenue flows in from January invoices, we’re definitely taking care of that!

So here’s where we stand:

DebtBalance: January 1Balance: January 31
Student Loan 1$944.22$320.07
Student Loan 2$1,668.49$1,576.89
Credit Card 1$2,757.97$2,765.47
Student Loan 3$5,570.79$5,470.57
Personal Loan$9,762.52$9,722.42
Renovation Loan$11,478.99$11,400.60
Credit Card 2$19,692.04$22,816.81
Credit Card 3$20,000.00$19,000.00
Total:$71,117.96$73,072.83

Two things that are keeping us motivated:

  • Looking at our numbers this closely is really driving home how much of our money goes to interest and fees. So not a fan of it!
  • Student Loan 1 is sooo close to being paid off! It’ll be really satisfying to be knocking a debt totally off the list. Pst, spoiler alert: We already have the money to pay it off!

One of the beautiful things about using You Need a Budget to manage our finances is that while our credit card debt has gone up a little bit, we have cash set aside to cover some of the charges that were brought in. So this month’s payment to Credit Card 2 is going to be larger than we’ve made in the past but that’s because we’ve set aside the money for it. Eventually we’ll get to the point where we can pay the balance every month. Baby steps.

Until next month!

xo,
Jen

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