💸 The Debt Diaries: April 2018
This month in money, mess, and progress... it was a typical month on the debt front, with a few small wins, some ongoing frustrations, and plenty of determination. We’re focusing hard on knocking out our Visa and chipping away at that high-interest personal loan. While some things—like auto-drafted memberships—still sneak through, we’re finally starting to feel a bit more in control. We didn’t add new debt (aside from the usual suspects), and we’re slowly building better habits… one payment at a time.
💳 Debt Overview
Personal Loan
Starting Balance: $14,906.67
Payment: –$250.00
Interest: +$196.40
Ending Balance: $14,853.07
Debt Reduced: –$53.60
Visa Card
Starting Balance: $1,032.05
Payment: –$105.00
Interest: +$9.01
Expenditures: +$81.60 (our YMCA membership goes on here monthly. Need to switch it to our Debit card!).
Ending Balance: $1,017.66
Debt Reduced: –$14.39
My Jeep
Starting Balance: $5,601.07
Payment: –$233.79
Interest: +$19.08
Ending Balance: $5,386.36
Debt Reduced: –$214.71
Jerry's Jeep
Starting Balance: $6,085.11
Payment: –$171.26
Interest: +$55.17
Ending Balance: $5,969.02
Debt Reduced: –$116.09
Mortgage
Starting Balance: $74,241.85
Payment: –$796.56
Interest/Escrow: +$678.04
Ending Balance: $74,123.33
Debt Reduced: –$118.52
Student Loans
Starting Balance: $51,289.72
Payment: –$400.92
Interest: +$240.07
Ending Balance: $51,128.87
Debt Reduced: –$160.85
📊 Grand Total Snapshot
Current Total: $152,478.31
💸 Where the Payments Went (Interest vs. Principal)
Total We Paid: $1,957.53
Went to Interest: $1,279.37
Went to Principal (Actual Debt Reduction): $678.16
That means only 34.6% of our payments went toward reducing the actual balance. All I have to say it... ugh!
✅ Wins This Month
- Zero debt accrual this month, aside from the gym membership!
- Paid above the minimums on some accounts.
⚠️ What I Struggled With
- Spent too much dining out.
💠Real Talk
I’d say this was a typical month in debt payment for us. My main focus is to first kill off that Visa card because of how low the balance is. While our minimum payment for the month was only $29, we exceeded that by paying $105. However, because our Y membership of $81 goes on there monthly, I knew I had to pay at least $100 if I wanted to see the total go down. I really want to switch our Y membership to just be auto withdrawn from checking, so hopefully soon, you will no longer see that appear on our debt reports! I also want to be paying much more than $100 on this per month since this is our biggest focus at the moment.
The only other thing we paid above minimum on was our personal loan which is $233, but we pay $250 a month. Any “extra” debt payments will be focused on the Visa for now, then will switch to the personal loan… kind of snowballing the debt here.
By the way, our personal loan interest is only 11%, but as you can see, nearly the whole payment goes towards interest right now. I’m not sure why. I just assume that the interest rates on loans don’t work similarly to the interest rates on credit cards which are accrued monthly (hence why our Visa interest for the month was only $9.00). Anyone care to explain how this works? The mortgage works the same way. Low interest, but payments at first almost go entirely towards the interest, then later on, goes more towards the balance. Please point me in the right direction if you know what kind of interest this is so I can read up on it more!
As far as spending? It was a pretty good month. As you can see (aside from the Y), we accrued ZERO debt and did not use the card at all – yay! That’s what I like to see! We definitely spent a lot on dining out though. We like to go out to dinner on Saturdays since we only have weekends together due to work schedules, but we may need to select cheaper restaurants.
I’d really love to hit a month of reducing our debt by $1,000, and at nearly $700, we’re somewhat close. I don’t see this happening until next year though, because we are busy financially prepping for the baby, Caleb’s preschool tuition, and my maternity leave.
Hoping to step it up this month and hit at least $800 in debt reduction for May. It’s a five paycheck month for us, so we will actually have a little bit of “extra” money at the end of the month which is why I’m upping our goal.
No comments