Debt Free Wannabe

Forgot to mention that I put our federal tax payment ($1499) in the mail on Saturday. We got $1155 back from the state, so we only had to kick in an extra $344. Tried to carve it our of the monthly budget but ended up having to take it out of the EF instead. Oh well, at least it didn't have to go onto the credit card.

We are going to have to sit down with my parents (when they get back from vacation) to do some advance tax planning for next year. Scott got a BIG raise that is going to hurt our tax position. We increased his withholding which really took a chunk out of our monthly available income but I don't know what we are going to do if we need to pay a bunch in next year. Don't want to pay estimates if I can avoid them.

Another weekend has come and gone and I don't have a lot to show for it. My parents were in town for a few days, which was very nice, but not exactly relaxing. Since they were keeping the boy occupied, I was able to get a little bit of stuff taken care of around the house, though. Paperwork/filing had been taking over my dining room and I was finally able to get things put away/sorted. I am down to one small pile of stuff, but that is mostly catalogs so I should be able to go through it quickly. A little bit of laundry and keeping up with the dishes and that was about all I accomplished.

The weather finally started turn a little warmer this weekend so I did get my front planting bed cleaned up a bit. Still have a few bushes to prune, but it can wait a few days.

I did miserable with the menu planning this weekend. We ended up eating out most meals, but my parents insisted on paying as payment for them staying at our house. I SHOULD have put something in the crock pot for dinner last night, but I didn't get to it. Then all of a sudden it was 7:00 and I had nothing for dinner. We did have a small gift card to a restaurant in the area ($10) so we decided to use that. Still spent money eating out, but we tried to minimize the damage.

The good news that I have is that our wage increases came through for my company. I got a 3.7% raise which is above the company average (yeah!) of 3%. It works out to about $100 extra per month so I am going to put the "extra" money toward my buffer/debt payment rather than increasing spending like I have in the past. We will see how things work out. The wage increase is affective as of our next paycheck on the 27th so I will know better how much more money I am working with in my budget then.

Still haven't sold anything from half.com. Will probably keep them posted, but they are going to be in my way very soon. The idea of the rummage sale is still tickling the back of my brain but I am going to hold off making a decision for a few weeks. May ask my neighbor if she is interested in having one together. Of course, I may just wind up taking everything to Goodwill out of frustration before then. Will have to wait and see.

DH's payday was today and every penny of it has been given a job. And every penny of my paycheck tomorrow has also been given a job. Unfortunately, most of it is going out the door right away. However, for the first time in a while, we are not spending MORE than we are earning. That is the important part. Even though that is a common sense thing, we haven't been doing that in a while which can be evidenced by the debt balance on the left.

I updated the total debt balance to reflect the money that left our account today to pay down the Slumberland and MTU CC. Pretty good payoff for only 6 weeks! Also going out tomorrow is the payment for the Jeep loan, but I won't know the principal paid on that for about 10 days. They only take paper checks and I can't check my balances online; definitely in the dark ages.

Not shown there is the money that I sent to payoff the Wells Fargo card Scott used for traveling a couple weeks ago. Now that card is locked up and won't ever be used again. It will sit dormant or we will cancel it. Haven't quite decided which yet.

My parents arrived in town last night and Caleb has been having a blast playing with them. Everyone went to bed early so I was able to get a ton of stuff done. I re-updated our budget to reflect the latest income and outgo, cleaned up the kitchen, sorted a bunch of papers and avoided shoveling snow. I also listed more than 30 books on half.com. Nothing has sold and I really don't expect much of it to go quickly, but I will have to wait and see.

I am actually considering having a rummage sale this spring to get rid of some of the crap we have been collecting. Usually I just send everything to Goodwill because I don't want the hassle, but I might be able to make a little bit of money that can help fill up our YNAB buffer account. Can't get rid of all the dang baby stuff yet, but when we can that will be the mother lode.

Tomorrow DH gets paid and I get paid on Friday. I have already scheduled several payments that will go out from my credit union's bill pay system. One of the payments will pay off the small amount we have the credit card we did the balance transfer from and the other will pay off the dreaded Wells Fargo card for hopefully the final time.

Also being paid out on Friday are the monthly payments for the Slumberland account and the Jeep loan. SLOOOOOOOWLY seeing progress at the rate of 2.4% per month. At least it isn't going the other way!

But here is the BEST news....I have not had to use overdraft coverage from our savings account for more than a month. I was using OD protection every few weeks and ended up in a BIG hole where I owe $1500 to our savings account. But I haven't added to that amount so I think that in and of itself is progress.

Maybe I will talk my way out of this bad mood yet....

I made a big mistake. I looked at the amount we are paying off each month as a percentage, just because I was curious. Currently we are paying 2.4% off each month. Ugh. At least all of our interest rates are low and we are paying the bills on time.

Today I am feeling really low. I am fat, in debt up to my eyeballs, and it is snowing in April. Add to that the fact that my house is a disaster and my back is killing me and you have an idea of my mood. My DH is gone turkey hunting for the weekend so we have canceled his birthday party. My parents are coming into town tonight for a few days, so as long as they watch the munchkin I have a chance of getting some cleaning done. My filing is so far behind that I have papers overflowing our bedroom, dining room AND kitchen. Where is this paperless society we were supposed to have by now?

Pulled a bunch of books together last night that I want to put on Half.com, but I was exhausted once I got DS into bed. I have about 30 books of various authors and conditions that I am going to try to sell. If they don't sell, I think I am going to try to put them up on craigslist. Would have just donated them in the past and not bothered with the donation form, but am trying to make a any extra income that I can come up with.

Well, even though I couldn't find the coupon for dinner last night, we still went out to eat for DH's birthday. Since he got to drink free beer and I only got soda, the final bill with tip came to $25. Not too bad, but should be less. It was strange how eating at the restaurant felt like a treat, whereas not too long ago it was an everyday thing.

Tonight DH is going to my parents to go turkey hunting for the next few days. Hopefully he will decide to stay at the house to eat most meals and avoid eating out, but I am not holding my breath. I know the peanut and I will be eating at home for sure. This month so far we have spent about $150 total for food (dining out and groceries) but it should be a lot less as we aren't even half way through the month yet!

Menu planning seems to be helping with the total overall cost of food, but not as much as I expected it to. I am planning on doing a OAMC (Once a month cooking) session with a friend later this month, so hopefully that will help with next months food budget. I am vowing not to do any grocery shopping (except milk and bread) until the OAMC trip. We should have enough in the freezer and pantry to last us until then if we get a little creative.

Did I mention that my DH has a terrible allergy to corn? Doesn't sound like a big deal until I mention "high fructose corn syrup". That one ingredient seems to be in EVERYTHING. As a result, we have to buy mostly high end things like cereal and peanut butter that are made with actual sugar instead of corn sweetener. That definitely doesn't help the food budget at all. We have to be very careful label watchers because they keep changing recipes of products. I end up making all my own marinades, sauces, side dishes, etc. which can be cheaper except for the fact that I tend to have more "staple" ingredients to buy that way. When I have to restock the pantry it hurts!

ETA: We recently found out that DH is also allergic to Nutrasweet and Splenda too. So he is avoiding all sugar free products as well. What fun.

Today is DH's birthday. He turns 32 and we were originally planning a small, informal party for next weekend but he has decided he doesn't want one now. At least that will help with the cash flow issues. He had lunch with his parents this afternoon as they were passing through town and his gift from them was $50. So now he has a little spending money of his own that he can use for his turkey hunting trip this week so that will help the budget as well.

The weekend went pretty well, spending wise. Dinner on Friday night was McD's drive thru on the way to my parents but then they provided the food for the rest of the weekend. We did pick up about $15 worth of beer, but that was it. Of course, there was about $50 of gas that we wouldn't have spent otherwise, but I did plan for it.

The only boo-boo came in the form of easter bunny shopping for DS. Since he is only 2.5 I have never done the basket thing before. So I went to Target and picked up a bunch of stuff for the basket and the egg hunt. Ended up spending about $40 total. OUCH! I will definitely have to do better next year. And he is not getting anything else for quite a while. May have to see what toys that he doesn't play with that I can sell to make up for it. Shouldn't be a budget killer but could definitely hurt it quite a bit.

Want to hear something funny? A few weeks ago we got one of those valupak kind of coupon flyers in the mail so I went through and clipped the coupons that I thought we could use. One of them was for a place here in town called the Nitty Gritty which bills itself as "the birthday place". Basically you get to drink all you want on your birthday and you get a souvenir mug to go along with it. The coupon was for a buy one, get one hamburger deal, so since it is DH's birthday and we had this coupon I thought it would be a good idea to splurge a little. Problem is that I CAN'T FIND THE COUPON! Dang! Of course I didn't file them away like I should have and now they seem to have disappeared. Don't know if we will still go or not. I don't have anything else planned for dinner and DH was looking forward to it. I feel really bad....will have to create better system for handling coupons in the future.

While at my parent's house this weekend, we found out that our neighbor's 20 YO son, Neal, really screwed his life up but good on Saturday morning. Apparently, he was in a minor accident but decided to flee the scene at a high rate of speed. Less than 5 minutes later he ran a stop sign and got into another accident, but this time he killed the driver of the other car. The man he killed was a pillar of his community and is being mourned by thousands of kids that he coached, mentored and taught.

Neal was ejected from his vehicle and taken to a local hospital. While at the hospital they discovered that he was not only drunk, but also high on cocaine. There is little doubt that he is going to spend the next 6-20 years in prison. I feel so bad for everyone involved in this horrible situation. It just makes me sick.

Logged on this morning when I couldn't sleep and am LOVING the new look. And I love that we can do so much customization, although I will probably be too scared to try different colors for a while.

A few posts ago, I was lamenting how much having another baby would hurt our new budget and whining a little about life in general. Well, after many long heart to heart conversations and some close examination of the budget, DH and I decided that we are going to try for another baby this summer. That way the baby would be born in May 2008 or later. This is important because my parents own an accounting firm and the winter months are just INSANELY busy for them. They can't focus on anything else and I don't want to stress them out anymore than they already are.

So, step one in this process is to attempt to secure a spot on the waiting list at our daycare. Currently they are theoretically booked until 2010 for infants, although no one on the list is even pregnant yet. I thought it would just be a "put your name here" kind of thing, but they actually required us to pay the deposit and application fee in full! Are you ready....$325 NONREFUNDABLE, NONTRANSFERRABLE dollars. Yikes! I had to pull money out of our savings account to cover this unexpected cost....guess this falls under the heading of "miscellaneous". The good news is that this fee will cover the first week of care once Baby starts, but what if there is no baby?

In other news, we are headed to my parents this weekend for the holiday. Well, actually we are headed there so they can see Caleb before they head to Key West, Florida for 6 weeks like they do every year after tax season. They have been going to the same place and staying in the same room for 15 years. Have become great friends with the owner and his family and the thought of going there is what keeps my mom sane though the months of February and March.

Caleb (2.5 YO DS) has been asking for the past week to go to Nana and Bumpa's house. He was SOOOO excited this morning when I was able to tell him that we are going there today. He is being so sweet and snuggly lately that I seem to be forgetting his bratty behavior from the past few weeks. I have been trying to be firm and setting boundaries and he seems to be responding well to that. He is whining a little less (THANK God!) but that could just be a coincidence.

BTW, I checked today and the payoff that I sent in the other day has cleared the bank. We will be closing that account today and that feels really good. Any progress is good, but this feels great!

I have two credit cards that I would love to close the accounts. One I paid off yesterday, the other will be paid off as soon as DH's reimbursement check comes in. Right now between ALL of my cards I have a total limit of $51,300 (OMG!) and am carrying a balance of $11,754 which gives us an overall ratio of 22.9%. If I close these two accounts, it will reduce our credit limit to $39,500 leaving us with a ratio of 29.8%. The other thing that puts a wrinkle in this equation is that one of the cards (Wells Fargo, $7800 limit) is our second oldest card overall. The other card (American TV, $4000 limit) is only a couple months old so I will probably close that one for sure.

I am waffling because I don't know how this will affect our credit score (I assume it will be negative). On one hand we aren't planning on applying for anymore credit anytime soon, but on the other hand I don't believe in completely disregarding our credit score as irrelevant. I have been hearing more and more about how your credit score can affect everything from insurance rates to interest rates, so I want to keep it as healthy as possible.

Yes, I am probably over thinking this. I REALLY want to close the Wells Fargo account so I can be rid of this albatross once and for all. Worst customer service I have ever had and just plain miserable tactics for getting every penny out of us that they can.

Any thoughts?

I recently found out about Half.com and was wondering if anyone here has used it. I have a bunch of books and CDs that I would be willing to part with but am wondering if it is worth the hassle of packaging and mailing. What do you think? Any words of caution? I am generally overly cautious about this kind of thing but the extra income at this point would be greatly welcomed.

Well, the payment went out this morning to pay off our first debt in our "debt snowball". Very exciting! Of course,I will probably be compulsive about checking my account to see when the payment is actually credited some time in the next couple days. Then we will be closing the account for good. And with all the trouble we have had with this company, we will never be financing anything with them again, no matter how good the terms are. Just isn't worth the effort. Besides, we are supposed to pay cash for everything from now on anyway, right?

I spent some more time with YNAB this morning and I think it is starting to make a little more sense. Still not entirely clicking, but I am going to have to bend the program to my will until I can get to the point where we are working under "Rule 1". I don't know how we are supposed to determine what our "extra" money for the month is when I seem to need every penny left at the end of the month for the beginning of the next month.

I sat down and did an extensive cash flow analysis (meaning I wrote all my bills on a calendar) and it looks like we are eventually going to get ahead, but it won't be until about the end of June that we start seeing a balance building in our account. I don't know why, since our costs are generally fixed, but it shows I am going to be down to nothing at the end of this month and probably next as well. I guess there is just a lag in the results.

One of my first priorities is to pay back money to our savings account that we have "borrowed" in the form of over draft transfers over the last several months. Right now we owe ourselves $2,060. So before we start building our buffer, those accounts need to be flush. I am going to do that by only budgeting the money that we receive as paycheck each month and then any additional income we get (i.e. daycare reimbursements, gifts, etc.) toward these accounts. We should be back to the actual numbers in about 4 months or so.

Yet another monster post. I can't seem to be brief, even when talking to myself.

Here are the totals for the month of March, 2007:

Current balance as of 3/31/07:
MTU Master Card = $10300
American Furniture = $385
Slumberland = $581
Circuit City = $805
Jeep loan = $9234
2nd Mortgage = $13050

Total = $34355

$35104-$34355 = $749 paid off since 3/1/07!

WOW! It didn't feel like we were making any progress this past month, but I guess we did. Also, what doesn't show up there is that I have scheduled the payment to PAY OFF the American Furniture loan IN FULL tomorrow.

If all goes well, we will have paid off another $1100 by the end of April (inc. American loan payoff). If I could do cartwheels, I would.

Looks like our balance transfer from a credit card at 9.9% to a card at 0% for 12 months is going through as I type. It is going to be a big savings over the next 12 months, to the tune of $800. And if you can do the reverse math to figure out the balance we transferred, you are right we have too much in CC debt. But we are working on it. Slowly. Too slowly, or so it seems some days.

How is it that we can be making this much money and still be broke? Man, this cycle of earning and spending is scary. I would LOVE to live on one income and save the other, but that just isn't possible. Even if we cut out all the "extras" like cell phones and internet and cable that won't make a dent and then we would be miserable on top of it.

I guess I am just getting frustrated and depressed as I look at where we are, where we want to go and how it is going to take forever to get there. Ever feel like you are walking on a treadmill with this debt crap? You are walking and walking and walking but never getting anywhere? That is definitely how I have been feeling the last few days. I just hope next month is better. It has to be or I am going to scream.

So I finally got some more of the story on the American TV card that I posted about earlier. It turns out that there were TWO charges on the card one for the $700.69 and the other for $77.85. We have been paying interest on the $77.85 all along and that is where the finance charges are coming from. Problem is, I don't know WHY there were two charges that day. Of course, the bank can't help me out with that because they "just take care of the financing, not the selling". Now I have to dig through my giant "to be filed" pile to find the original receipt. Had hoped to do that last night but it didn't happen. At least it will maybe give me the incentive I need to tackle and deal with my laziness.

Looks like today is basically going to be a no spend day. I packed my lunch and my hubby's lunch, we will be having leftovers for dinner, and both trucks are full of gas as of yesterday. We did have to give Caleb $4 for a special lunch they are having at school today, but we took that out of the pig at home.

Also, it turns out my battle with Wells Fargo is going to continue for another month. DH just spent the last week in Detroit and he only had the WF card in his wallet. Which meant that food, hotel and rental car for 4 days ended up on that card. Great. Even if he puts his expense report in today, he won't get reimbursed until the next pay period (4/12) and the payment is due on the 16th. Since it takes them 5 days to clear an ACH we are going to be cutting it really close. AGAIN. Grrrr....I just want this card GONE! Tonight I am going to take the card out of DH's wallet and put it into the lock box. Or better yet, shred it. *insert sinister laugh here*

I have spent the last several hours with my new budget and software (YNAB) and I think I am going slightly nuts. First off, I picked an awful month to start budgeting. There is income coming from some unusual sources that is making the numbers screwy, like tax refund, expense reimbursements, extra paycheck this month, etc. So I have an unusual amount of money to "spend" and I don't want to put it into the wrong places. If I do end up with a bunch of "leftover" money at the official end of the month I am definitely going to be paying back the money that I owe the savings accounts. Borrowed WAY too much from them over the last couple of months. yes, I am paying it back to myself, but it still needs to be done.

Since it is almost the end of the month, I am trying to get a handle on our actual expenses. Biggest shocker is food. We spent over $600 on food, both in groceries and period dining out. Last month we spent $500 for the same thing, but we ate out A LOT more ($430 worth). I thought that we were going to save gobs of money by staying home more but that doesn't seem to be true for some reason. I don't think I went overboard on the food buying but maybe I did. Will have to take a closer look.

April should prove to be a more "run of the mill" month. Two pay checks, maybe a couple expense checks, but nothing we can't handle. We still aren't going to be working with a "buffer" that YNAB seems to love, but that is going to be quite a while coming I think. We have a long ways to go and a lot of debt to pay off at the same time.

My mind is really spinning right now though. I am trying to figure out some historical numbers from MS Money and that is proving to be a nightmare as well. I can't get a read out of a single category for the past 12 months for gosh sakes! I just want to know a trend for how much money we spent on food. Shouldn't be all that hard. Argh! The new software (YNAB) is going to be much more powerful for that kind of thing, but I have to get the numbers in there first.

DH's turns 32 in a couple weeks and we are going to have a small get together with friends. Just going to do a cook out with burgers and sides. But the challenge is that I am going to try to do it for as little money as possible.

The menu should be easy:
Burgers and buns (Sam's club)
Potato Salad
Baked Beans
Chips/Triscuits and Salsa/guacamole
Cake

Do you think it would be tacky to make it BYOBeer? That is where we end up dropping the most money. I already have the paper plates, napkins, cups, etc. leftover from Caleb's last couple of birthday parties so that save a little. I am planning on making the potato salad and buying the baked beans in bulk. I will also make the cake and possibly the salsa. Depends on time allowed.

Any tips for planning a party on a limited budget? All help is appreciated!

The former title of this blog "Debt Free Living, Here We Come" just wasn't working for me. Hope you like the new title! Seemed a little catchier and a lot shorter. Not that I am known for being brief...

This past January we decided it was time to move my son into a "big boy" bed. We went shopping at our local big box electronic/furniture store, American TV, and found a bed, mattress and dresser. Total cost $700.69. We asked if they had any financing deals so that we could pay it off slowly without putting it on the credit card. (yeah, us.) They said they could give us 6 months interest free with equal payments. Perfect! [For those of you following along, this is the first of the debts in our debt snowball]

I didn't pay much attention to the statement when the first bill came and simply paid the minimum amount that it indicated, $132.00. NBD. I have now made 3 payments of $132 but DH is getting an unexpected reimbursement from his company and we want to pay off the balance this Friday. SO I check the bill for a payoff balance. That is when I notice that they have only been applying $117 of each payment toward the principal amount and the other $15 has been going towards a revolving balance for interest charges. But this interest charge seems to be a "threat" since the bill states right on the front "pay $XXX by 7/1/07 to avoid finance charges". Huh? So we have paid $45 towards interest charges that we don't have to pay? They sure as heck better credit that money back to us on this final payoff or send us a check for that amount. Ridiculous!

Has anyone ever heard of this before? Generally if you have 0% interest the entire amount you pay is applied to principal, not some fictitious finance charges.

Of course, since the card was opened in my DH's name only the CSRs won't talk to me. So DH is calling them today, while on a business trip, to get the whole story. Go figure.

So recently my DH and I have been talking about having another child. We already have Caleb who is 2.5 and he is wonderful. But daycare costs in this area are insane. Having another child in daycare would mean another $1000 a month in daycare charges alone (we are already paying $950/month for Caleb). Even figuring that we won't be buying anymore diapers than we are now because Caleb will be potty trained by the time Baby 2 were to come along and all other expenses could be easily absorbed, it seems almost impossible to carve $1000 out of our already tight budget.

Yes, we are working hard at getting out of debt. In all likelihood, we will be out of revolving debt in the next year, but that would only free up about $500 per month. In order to come up with the rest we would have to stop putting money away in savings, which I am hesitant to do.

Everyone we have ever talked to has said, if you wait until you can afford kids you will never have them. And I can understand that you do what you have to and make sacrifices where needed, but I can't seem to wrap my head around the economic implications.

I know what some of you will be thinking...Could I stay home with the kids? While it is true that 2 kids in daycare is expensive, I currently make the same amount of money as my DH. So one of us staying home would mean cutting our income in half! Plus, I have worked VERY hard to get where I am and I ENJOY working. Many of my "friends" don't get that but I am done apologizing to them for making the decision that is right for me.

OK, whine fest over. I know I should stop being so selfish and just get over my hang-ups. *sigh*

This afternoon our new water heater is being installed. Our existing one has been making continually more noise for the last several months and we have put off replacing it as long as possible. It has gotten so loud that you can hear it while you are in the shower 2 floors away. You can even feel the vibrations through the floor if you are standing right above it (in the kitchen). Just crazy loud. Also, the current one was the piece of junk model that our builder stuck us with. It only had a 2-year warranty but now at only 5 years old is falling apart.

Since both DH and I are engineers we have been very anal about examining all our options from every angle. We looked at a tankless model, standard models and high efficiency models. The problem is that we have a gas heater that has to be power vented through the wall. Pretty much the most expensive standard type you can get. We decided on a middle of the road option that is priced reasonably but is energy efficient at the same time. And oh yeah, has a 6 year warranty.

The bad news is that it is setting us back about $1000. The good news is that we are using money we had in our emergency fund to pay cash for it. That is definitely a step in the right direction.

I am hoping to list my debt payments and totals periodically so that I can visually see the progress I am making. Here goes:

Original Balance as of 3/01/07:
UWCU CC = $10285
American Furniture = $648
Slumberland = $631
Circuit City = $1055
Jeep Loan = $9389
2nd Mortgage = $13162

Total = $35104

Current balance as of 3/22/07:
UWCU CC = $10285
American Furniture = $516
Slumberland = $581
Circuit City = $855
Jeep loan = $9234
2nd Mortgage = $13095

Total = $34566

$35104-$34566 = $538 paid off!

Also, since this is an extra paycheck month for us, I hope to be able to payoff the American Furniture debt completely next week and then pay our savings back for what we had to "borrow" due to shortages that last few months. Of course, that was the whole reason I started getting serious about getting out of debt. Being short every month was not my idea of a good thing.

Oy! I know I have no one to blame but myself, but I think I am in a bit of a pickle.

First, I reported a couple posts ago that on Tuesday I applied for a new CC with a 0% interest rate on balance transfers. When I filled out the application, I put in the account number for the card that I wanted a balance transferred from, my UWCU Visa card. OK, at this point no big deal.

Then, yesterday DH suggested that we try to simply upgrade our UWCU card to one with rewards as was advertised on our credit union website. Notice is said UPGRADE, not REPLACE. OK, so I call and they upgrade my account, but they have to issue me a new card and a new number. Hmmmm...

Basically if my balance transfer doesn't go through before the new number is issued, we may have a big problem. So, this morning I called the new CC company to ask when the balance transfer would occur. After some confusion, I found out that the balance transfer is set as pending until I activate the card. Should get the new card sometime in the next few days. In the meantime, they are sending me some paperwork to sign for the upgraded Visa card so if I delay that a few days until I get the new card I should be OK.

How do I do these things to myself?

OK, so I know many of you don't like the credit scoring concept and I completely understand why. But I just have to let you know that even though I was worried about our finances being in the toilet, it turns out that our credit score is pretty damn good.

Since Scott is going to be doing a lot of traveling soon (2 weeks in New Zealand, 1 week in Italy, misc. trips across US) he is going to need a credit card to make the purchases during these trips. Company policy is to make him pay for hotel, food, etc and then reimburse. They are usually pretty timely and we don't end up owing interest so it works out. So since he is going to be racking up all those charges, we thought it would be a good idea to upgrade our existing Visa Platinum to one with the "rewards". So I called and asked what to do and they said that we have to "reapply" which is silly because they are going to replace a card that we already have with the same limit.

Anyway, the nice lady doing the application happened to mention that we both have excellent credit with a score of 748. Whew! Nice to know that the score isn't hurting us. Not that I really CARE exactly what it is, just nice to know that it isn't awful.

Wow, 3 posts in 1 day. Hmmmm...don't think I will be quite this prolific in the future. But you never know....

We have taken a step forward in our quest to be free of Wells Fargo. I have always hated working with them as they can never seem to post anything in a timely manner (and end up charging us late fees we don't deserve) and the customer service has always left a lot to be desired. We have had a Wells Fargo credit card since we were forced into taking it as part of our first mortgage when we built our house almost 6 years ago. Never really used it for much, but ended up with a fraud claim when some one charged more than $2000 worth of stuff to the card both in Canada and Japan. That was a nightmare process that involved the closing of our number and the issuance of a new card. When the new card arrived, I didn't activate it for almost 2 years. Then, Scott decided to use that card to go to Germany for business recently, so he activated it. It has been nothing but a nightmare for the past month because of it. BUT, I didn't want to close the card because I was afraid that it would negatively affect our balance-to-limit ratio for the credit report. (i.e. having $10,000 in CC debt looks better if you have $20,000 in limit than if you have $12,0000) So, we decided to try applying for a different card so that we could cancel the WF card altogether. I applied online yesterday for an MTU alumni Mastercard and was approved with a much higher limit than I expected, $15000! That means I can close the WF account and still be ahead! Plus, this card offers a 0% interest rate on balance transfers for the first 12 months so we are transferring all of the balance from the UWCU card (9.9% interest) to the new card and will end up saving $500 in interest over the next year. Since we are planning on having the balance paid off in the next 12 months, that is a great deal! Then, that frees up the UWCU card, which I have never had any problems working with, for Scott to use as his travel card.

However, here are the other accounts that we have with Wells Fargo:

* Slumberland furniture
* American furniture
* first mortgage on house

We are working quickly to get rid of the first 2, but we will probably never be able to get rid of the mortgage. Up until recently we were with Washington Mutual, and never had any problems with them. Then we got a letter last month saying that our mortgage had been sold to WF. I cried. If we could get the same rate, I would even consider refinancing just to get rid of them, but that isn't possible and is rather silly. I will just have to make sure that I play their games. And it is even more incentive to make sure we can pay cash rather than financing all future purchases.

I have been blogging for my family for a little while, but I keep finding that what I have talking about recently is our personal finances. I have recently gotten my DH and I on the path to debt freedom and it is nice to be able to hash things out in print, but I am going to try to focus on that here and my family on the other blog. At least for now.

Where to start. I guess I will start with the present and move backwards a little from there. Currently we have the following debt short term/revolving debt:

* Credit card: $10300
* Truck loan: $ 9600
* Furniture loans: $2096
* Second mortgage: $13100

For a grand total of more than $35,000 in debt. That is the number scared the crap out of me. We also have a first mortgage of $189,000, but for purposes of this blog I am only going to focus on the debts listed above. These are the scariest to look at and the easiest to work on.

The good news is that we have been working on putting money into an investment account for the last 9 years. We put the money in automatically each month and then promptly forgot about it. As of the end of the year, that fund had $26,000 in it. Wow! So we are skipping the emergency fund step that most gurus advise because we already have it.

My plan:
Step 1) I am working at implementing the Debt Snowball along with using the You Need A Budget (YNAB) program. YNAB works best when you have a buffer equal to 1 months expenses in your checking account so that you are using last months money to pay this months bills. That way we won't be living paycheck to paycheck anymore. Obviously, we aren't anywhere close to that, but I am going to work towards that while using the debt snowball, just not paying anything EXTRA to the snowball until the buffer is in place.

Step 2) Once buffer is funded, aggressively paydown debt with snowball method. Maintain this to get out of revolving debt in 12 months, car debt in 24 months and second mortgage in 33 months.

Step 3) Make maximum contributions to IRAs and other retirement funds, fully fund savings for planned future purchases (i.e. car, etc) then pay rest to first mortgage.

Step 4) Start breathing easier.

I know we are not as bad off as some, but as the daughter of 2 accountants, I am ashamed of where we have landed. We have been doing some things right, but we have also been doing a lot of things wrong. That stops right now. We are done using credit cards forever (with the exception of DH's travel for work) and once we have worked to pay off the debt we are not going back.

A word of caution: I tend to be long winded. Read this blog with caution!