A Story About Paying Off Debt and the Obstacles Along the Way

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Waiting On A Raise, and Credit Card Plans

Tomorrow, Fortysomething will find out if he'll get a raise next year, and if so, how much. I'm going to assume they'll give him at least a cost-of-living raise, but we'll see. This is his first year in this position. We don't know exactly what to expect. But even a small raise would be appreciated, and a more significant raise of a few thousand dollars would go a long, long way towards us getting out of debt faster.

Ready-for-summer vibes
Speaking of which, I am JONESING to get the last credit card paid off. The current balance is at a little over $9100. We've been making payments of $405/month for the past couple of months while we build up our emergency fund. I see the balance decreasing, but the rate at which this is happening seems soooooo slowwwwww.

The pace should pick up soon, though, because Fortysomething has some summertime side hustles lined up to the tune of ~$4000. There's also a decent chance I'll get a small bonus of $500 or so in July, and rumor has it that Fortysomething will land a bonus soon, too. Like the raise, the details are fuzzy, but I'll estimate another $500.

All told, between summer work and bonuses alone - not including our regular monthly payments - I'm hoping we'll be able to reduce our total credit card debt to at least $4000 by the time school starts up again in the middle of August. At that point, our emergency fund will be in good shape, and we'll be making regular credit card payments of $1000 a month.

That means that all of our credit card debt should be gone for good by the middle of autumn. I CANNOT WAIT. 

To me, this particular credit card (which we unlovingly refer to as Credit Card #3) constitutes the most difficult part of our debt elimination journey. It has the highest interest rate of all our remaining debts, and of our three credit cards - two of which are now gone! - it has the highest balance. Of course we'll still be dealing with student loans once the credit cards are obliterated, but we'll be able to make a dent in those at a much faster pace, especially if we can refinance Fortysomething's student loan and reduce his interest rate by a few percentage points.

Also, for those who have asked, we ARE considering a balance transfer to a 0% interest credit card. Chase Freedom Unlimited looks particularly promising, so if you have any experience with this one, let us know.

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Planning Our Summer Staycation

Now that the Kiddo is a week away from wrapping up the school year, I'm finally planning out summertime activities and tallying related expenses. Most of my mom friends organized their summer activities, like, three months ago, so I feel behind. But let's get real: since we're not really going anywhere, it probably doesn't matter. How much preparation can a low-frills staycation require?

Summertime = berry picking time!
First, the kid-related expenses: Our son will be participating in the county's summertime soccer league, which carries a registration fee of $85. (I remembered to sign him up the day before the deadline. THE DAY BEFORE! Look at me go!) He's also an avid recreational swimmer who likes to suit up at least five days a week over break, so we'll be buying a two-month pool pass for $150. Lastly, I'm thinking about sending him to day camp for a week. He went last summer and seemed to enjoy it, but that's another $150, so I'll have to see how interested and invested he actually is. (Update: The Kiddo has informed me that day camp is for little kids, not mature and worldly people going into sixth grade, and he would rather stay home and play video games thank you very much, so... maybe that takes care of that.)

Next up, camping and running expenses: Although we're not embarking on any grand cross-country or international travel, we intend to camp fairly regularly. We're all set with tent, sleeping bags, and sleeping pads, but because we don't have a car that can handle the roads leading to free campsites on BLM land, we'll probably have to pony up for campsite fees. These usually range from $10 to $40 a night, depending on how popular the campground is. I'm anticipating a monthly camping cost of approximately $150.

We have great camping options near us.
As for running, I'd like to sign up for at least one area race this season, possibly two. My goal is to use them as stepping stones to a longer ultra run in the early fall. If I aim for small events close to home, I can probably limit registration expenses to less than $100.

Lastly, going-out expenses: I'll be working from home all summer. Fortysomething will be side hustling from home all summer. All three of us, plus cat, will be spending an awwwwwful lot of time in close proximity... all summer. To stay sane, we're going to need to get out of the house on a fairly regular basis. Again, being realistic, some of that going out will be to restaurants, breweries, and the bowling alley, because we enjoy all of those things as a family. We may ramp up our miscellaneous fund by $25/month to accommodate.

Fortysomething will be making some extra cash this summer, and we can use a small portion of it to cover these costs. Obviously we want most of it to go towards credit card debt. That's the ultimate goal - to knock out as much of that debt as possible, as fast as possible. But getting along and not going stir crazy are also crucial.

I like local craft beer. I like it very much.
Free stuff: We're close to several national parks and monuments, and we'll use our national parks pass to visit them for no additional cost as the weather and crowds allow. Our town also hosts a free outdoor movie series every week so we'll try that out. And of course we have plenty of opportunities to hike (though due to drought, huge swaths of the forest are closed to the public for the foreseeable future).

National parks and monuments are the best.
Being realistic: I've done staycations before, and to be honest, they make me a little stir crazy. I like going places! I like getting out of town! The likelihood that we'll go the entire summer without some sort of special, short excursion is low. If Fortysomething ends up getting a rumored bonus, we'll probably budget in a few hundred dollars for a two- or three-night trip somewhere within a day's drive. We'll have to see if that pans out.

What about you? What are your summer plans, frugal or otherwise? What are you most looking forward to?
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We're Still In Debt, But I Don't Worry About Money All The Time Anymore

Looking at my Yoga Cats wall calendar the other day, I was struck by two things: (1) disbelief that it's already the end of May (how?) and (2) the realization that I've been blogging here at The $76K Project for nearly a year. (Sidenote: come June, there will be a couple of celebratory giveaways in the works, so stick around!)

I started to run through the list of the changes we've made and the accomplishments we've achieved since this blog was born in June of 2017:

We've created and honed a budget.

We have an emergency fund.

We've started to invest (we had some meager investments a year ago, but now we're actively cultivating our retirement accounts).

We've increased our household income.

We've weathered some financial emergencies, including an expensive hospital stay.

We've paid off over $18,000 in credit card and student loan debt, and we no longer have a car payment.

I'm proud of all of that. Every one of those wins was hard earned. Personally, though, perhaps my biggest financial accomplishment is in the realm of the mental/emotional: I don't worry about money all the time anymore.

A few years ago, we were living paycheck to paycheck, always one large bill away from disaster. Not that anyone knew. By appearances, we had it together: We owned (well, held a mortgage on) a well-kept house. We had two cars. We took vacations every year, some of them to rather expensive locales.

But like an iceberg, there was so much going on beneath the surface that other people had no way of seeing. I had a chronic aversion to checking our ever-paltry bank account, which meant we went into overdraft on a regular basis. Bills would sit unopened on the kitchen counter for weeks. I'd make impulsive purchases without calculating whether we could actually afford them. Our monthly credit card and student loan payments rarely exceeded the bare minimum. Emergency fund? Ha. We didn't even have a savings account.

Not surprisingly, despite our efforts to ignore them, financial worries hovered in our lives like a specter. 

Nowadays, we don't own a house (perhaps more accurately, we don't have a mortgage). We're down to one clunker of a car that gets us around town. And vacations - for the foreseeable future, anyway - consist of camping out within a couple hours of home.

We still have a long, long way to go to get to where we want to be. Debt-wise, we're on the hook for almost $60K, including nearly $10K in credit card debt, and we have some major ground to make up with respect to retirement savings. Our net worth is very much in the red. We still feel the pinch when it comes to saving up for pricier one-time items like wedding presents, new running shoes, race entries, or household furniture. Sometimes I see my friends doing things that I know we can't afford to do, and I feel jealous (yes, I'll admit it).

So yes, we're getting our act together, but don't be fooled - this is no quick fix.

And yet, now I know exactly how much money we have, where it's going, and when it's going to go there. Our finances have started to run like clockwork, especially given that many of our bills are set up on auto-pay. It's true that sometimes our bank account runs low - we're currently at $150 for the next four days - but because our budget is dialed in, I don't worry about that, either. We have enough money in our emergency fund that we can cover at least one large-ish unexpected expense.

In other words, we have some safeguards in place now, and I sleep easier because of it.

So the major win after year one isn't being debt free, or being well on our way to early retirement, or having an emergency fund that would cover us for a year in the event of a job loss. None of that has happened (yet). We need another few years to reach those big goals.

But the major win right now is more peace of mind, and that's pretty much priceless.
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Winning, May 2018 Edition

I just realized that for the past FOUR MONTHS I have neglected WINNING, a (supposedly) monthly series in which I identify at least three concrete ways we're succeeding and thriving while on this long debt repayment journey. I started this series in part to stay motivated: it's easy to get bogged down by how far we still need to go, so we need to celebrate our small but mighty victories. I also do it because it reminds me to be appreciative of the process instead of getting consumed by the overall goal.

Anyway, Winning is back! And boy do I need to focus on some wins given that our debt repayment has slowed to a crawl and our office is being inundated by explanations of benefits and associated medical bills. They just... keep showing up: surgeon. Emergency room doctor. Anesthetist. Nurse anesthetist. Ultrasound tech. Hospital stay. And let's not forget the mysterious $6000 bill for "supplies."

Actual footage of our stack of bills
But I digress. As my friend in college used to say, Hey whiner, call the waaaaaaaaaahhhhmbulance. Also, this is WINNING, not WHINING.

So. Moving on to the positive stuff:

(1) We're almost 2/3 of the way to meeting our emergency fund goal. Prior to the Great Appendectomy Adventure of 2018, we kept $1000 in reserve just in case. Now we'd like to have $3000 set aside for emergencies. By moving $600 into savings this month and another $600 into savings next month, we'll meet the goal by the end of June.


As a bit of a side note on this topic, there have been some lively conversation on personal finance Twitter recently regarding emergency funds and how much to stash away. Some folks have tens of thousands of dollars in their EFs; others stick to more of a bare-bones plan but have alternative safeguards set in place in case they need to access cash quickly. From a purely mathematical standpoint, we'd probably be better off sticking to small, Dave Ramsey-style fund and sending the rest of the money straight to our credit card company. But from an emotional security standpoint, I feel strongly that we need more than that. I'll sleep better at night.

(2) Including employer contributions, we're putting ~$900 into investments and our HSA every month. Somehow I hadn't fully done the math on this one, and when I finally got around to doing so earlier this week, I was kind of bowled over. If we can manage to do that even during slimmer times when we're not making much progress on debt repayment, well, I'd say we're still kicking some financial butt. It's a different kind of progress than chipping away at our loans, but it is progress. We weren't doing this a year ago. And because these are automatic paycheck deductions, we don't have to think about it or second-guess our decision to deploy our money in this way. Boom.


(3) And back to those medical bills... On the bright side, we've met our deductible and we're close to our out-of-pocket maximum. Thus, even if some doctor does decide to send us a $10K bill half a year after surgery, it's not going to knock us back much further than we've already been knocked back. So... yay?

In all seriousness, I'm incredibly grateful for HAVING health insurance. Yes, this situation has been stressful, and yes, I've had to call the insurance company three times in the last 24 hours to address billing errors, but our medical emergency would have been far more stressful had we not been covered. I've seen the pre-insurance totals. One night hospital stay, no surgery, $19K? No thank you please.

(4) Bonus win, for which we can take no credit but which we enormously enjoy for free: It's spring, and it's warm, and when we're not dealing with forest fires, the weather is absolutely glorious here. Perfect running and hiking weather.

Especially for those of us paying off debt, it's important to recognize and celebrate our victories. So what are your recent wins, financial or otherwise? 

Disease Called Debt
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May 2018 Budget: Ramping Up Our Emergency Savings

I'm about 10 days behind schedule in posting the May budget, but late is better than never!

This month is shaping up to be pretty standard (aka boring) from a budgeting standpoint. Most of our line items reflect recurring fixed and variable expenses. The only real one-off here is the kitchen table, which we've already purchased, assembled, and started to use. The card table was working okay for meals, but it wasn't particularly comfortable for doing homework or just hanging out. The new one is much sturdier and more user-friendly.

One note about the table: Although it was somewhat expensive, I'm willing to make that work because I'm tired of buying crappy furniture. I'd rather pay more for something that will last than spend very little on something that will fall apart next year.

Another item of note: for the next couple of months, we've limited debt repayment to just over the minimums and will be dumping more into savings. Medical expenses explain part of this. Although I hope to cover most of the bills through our HSA, there's a chance we'll need to dip into savings. I don't want to put any of these payments on our credit cards (well, unless it's for the travel points, but in that case we'd want to pay it off immediately).

But aside from that, I'd feel more secure if we had $3000 in our emergency savings fund. I don't want us to get derailed by the unexpected. (Can you tell that our recent medical emergency has left me feeling skittish? It has!) We're about 2/3 of the way there. Once we've hit that benchmark, we'll return to larger payments on the credit card, which we're still hoping to pay off by the end of the year at the latest.

Lastly, I've increased my HSA contributions by $100 a month. Not only will this help us pay off those hospital bills, it'll be beneficial from a tax standpoint.

May 2018 Budget:

Recurring Fixed Expenses:
  • Rent: $2100
  • Health Insurance: $207
  • HSA Contribution*: $260
  • Retirement*: $282
  • Student loan and credit card payments: $1000 
  • Phone bill: $78
  • Internet: $65
  • Auto and renter's insurance: $73
  • Thousand Trails: $108
  • Netflix: $13
  • Fortysomething classroom budget: $40 (money for classroom supplies)
Recurring Variable Expenses: 
  • Utilities: $165
  • Groceries: $775
  • Gas in car: $50
  • Very Expensive Feline: $125 (higher this month due to upcoming checkup with vet)
  • Savings: $500
  • Miscellaneous: $350
One-Time Expenses:
  • Table: $480
Total budget for May 2018: $6,671

*Not including employer contribution
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Doing More Of What I Love

Lately it's begun to dawn on me that I've spent most of my life believing in an employment fairy tale: that for each one of us, there's a job so well-aligned with our interests, knowledge, and experience that it feels more like a passion project than work.

My new job is miles - miiiiiiiles - better than my previous gig. There are many things I appreciate about it, perhaps the most important one being that it doesn't leave me crying in the bathroom during my lunch hour. Then there's the decent pay, the flexibility, not having to deal with back-to-back face-to-face meetings, the lack of commute, my hilarious boss, and the fact that I can take conference calls while cozied up in my favorite (but highly unprofessional) craft beer hoodie. Indeed, there's a lot to like about it.

But I've discovered that this job, like pretty much every other gig I've worked over the past 10 years, is... just a job.  It utilizes my experience and covers the rent, and every now and then I'll receive an email or phone call that inches what I do into the realm of rewarding. But it's not a calling. I know most employers want their employees to be personally invested in the organization, consumed by the mission. I want that, too, because again, I've bought into the employment fairy tale - but the truth is, I've never felt that way about any job where I'm working for someone else.

So lately I've been thinking that I need to spend less time worrying about finding passion in my work and more time doing the things I love outside of work - cultivating those interests, investing in them, enjoying them. Taking some of the brain space currently occupied by work and giving it to my hobbies. Making those interests more significant in my life than my job. Seeing where they take me.

There are two main areas where I want to invest more of my time and passion:

(1) Running: Anyone who's been following for a while knows I am an ardent runner. Fast? No, but damn, do I have heart! I'm particularly interested in ultra running: running distances greater than that of a marathon (26.2 miles). After a year of IT band issues, I'm finally back on the trails and have started to build up my running base. My hope is to run a 50K this year, and I'm in the process of looking for one that is affordable and not too far away.

But besides running for myself, I also want to share it with others. I've been a runner for 20 years, and what the sport has given to me in that time is manifold: it keeps me healthy, allows me to explore the outdoors, and bolsters my confidence. It's also a crucial fixed point for me because I have a mental health condition that sometimes blurs the lines of my self-identity. On days when I don't know exactly who I am because my brain has muddied the waters, I always have an anchor: I am a runner.

Not everyone wants to run or benefits from running, but it can be a life-changer for some people, and so I want to help share it. To that end, I've signed up as a volunteer for a Couch-to-5K program that my running club puts on during early summer for folks who are new to the sport. Every Thursday evening, I'll buddy up with a few of the participants, walk/run beside them, and basically let them know how amazing they are for being out there.

Volunteering with this group is a first step. After that, I'd like to help out with races organized by my running club and get involved with Girls on the Run. In short, I don't just want to be a person who runs in my community. Rather, I want to play a role in supporting and strengthening the local running community.

*Side note, just to illustrate how much I love running:

This is me under normal circumstances:


Like, were it not for the poodle, I could be convinced that that's me as a child.

This is me when I'm running:


2) Etsy-ing: My ultimate pie-in-the-sky career goal is to be gainfully self-employed. It's something I've been pondering for the last three years. The possibility of it excites and energizes me. Although I do have a Big Idea in mind (opening a "base camp" to host runners, hikers, and scientists who visit our area), I don't know how or when that would pan out. I figure now is a good time to assess my interests, build upon my strengths, and curate a toolkit of skills and resources that I can use later on if I manage to transform this nebulous dream into a solid reality.

As a (very) small stepping stone, last week I started an Etsy store to sell plastic-alternative cloth beeswax wraps. Just getting to the point of signing up for an account took months of deliberation. First of all, between work, parenting, running, and blogging, I don't have a ton of extra time. And second, as you can tell from the decidedly un-snazzy nature of this blog, I'm not really into building websites or taking Instagram-worthy photographs. That sort of thing stresses me out, which is why I hemmed and hawed for months about what it would take to build a space on Etsy. Finally I decided to just go for it, even if it looks clunky and even if my product pictures are a little poorly lit. I figure I'll improve it as I go along.

The store's been open a week. Much to my surprise, I've made four sales to the tune of $72. I've spent several gloriously meditative hours scouring the fabric store for remnants, cutting out the fabric pieces, ironing in the wax, and thinking about how much I appreciate each person who placed an order and how cool it is that they're going to use less plastic because of a thing I made. Woot! Worth it? So far, yes.

Don't get me wrong - I don't think my Etsy store is going to pay the rent anytime soon! But it's a good playground for me to explore entrepreneurship at a small scale. Plus, it's one business I can actually afford to take on right now. And it's fun.

What I hope to achieve by doing more of what I love is to stop treating work as the centerpiece of my daily life. If I can re-allocate some of the massive amounts of mental space that I currently devote to my job to the things I love, I think I'll feel more rooted in my own life, and less frustrated by the sense that work is stealing my time.

Disease Called Debt
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