Barely a reduction to write about.
After applying our April savings of $855.12 to our depleted $1000 emergency savings, we had no extra money to apply to my student loan. Though small, a reduction is a reduction. We’ll take it.
Our goal for May savings is about making up for missed savings from the past couple of months. We want to save big, and at this point we think it’s possible. With Brad’s freelance work back in full throttle, we are anticipating higher income this month. And I’m all about living with as little spending as possible to get by. We think we can, we think we can…
For a full recap of our debt reduction progress from the past 10 months click here.
By applying our March savings of $21.89 on top of our minimum monthly student loan payments, we’ve reduced our debt by $411.20. Not a huge reduction, but we’ll take it. We’re ready to reconcile our savings and come back with a better number at the end of the month. No foolin’ around in April!
The 60’s! We finally made it to the 60’s!
After applying an even $2,000 dollars to my student loan from our February savings of $2,382.28, I finally feel we are making traction. In the history of my student loan, I don’t ever recall paying it off in big chunks as I’ve been doing in the past few months. I was always a minimum payment kinda girl with student loans. My old thinking was, “Oh, this is good debt, and I have a locked down incredibly low interest rate. I should just keep paying it gradually for the next 20 years.” Who was I foolin’? Myself.
I honestly can’t believe I ever thought this way. It’s like I wanted to carry this debt around like a cherished relic from my college days. In only 8 months, while paying off over $10,000 in credit card debt, we’ve still managed to reduce my student loan debt by over $6,000. At the rate we’re going now, we can pay off this loan within the next year. And you know what? I don’t think I’ll miss it.
This is just the kind of savings we needed to regain some spark in our Operation Debt Reduction mission. Living on $30 for the last 10 days of the month help lay the path to BIG savings! Obviously, we would have had a pretty big number even if we hadn’t created that challenge, but it’s surprising how much money can waste away in a 10 day period if we’re not paying attention. As always, the majority of this, $2,000 to be exact, is going toward our current lowest debt which is my student loan. And that is being applied on top of my monthly minimum payment. As I wrote in last month’s savings post, we have started a separate savings account for travel that is on our summer calendar. We will apply February’s remaining savings of $382.28 to that fund. Of course, this savings account will also act as an additional emergency fund if we need it to.
My favorite thing about creating our budget for January, was that I did not have to include a credit card payment. In the beginning of our debt snowball in July, we were paying close to a $200 minimum monthly payment (which decreased as we paid down the balance). Even if we didn’t have any savings for the month, we still had to pay that minimum. Having that extra money to float around in our monthly budget is giving us more freedom this month - like a hair cut, oil change or budget travel money. Can’t imagine what it’s going to feel like when we get rid of our $750 monthly minimum payments on student loans.
(Art source: thingsweforget.blogspot.com)
Over the past couple of days, we’ve been reeling from our August savings debacle. Having an “off” month with such a goal oriented endeavor could so easily throw us off course. With this realization, last night, we decided to refocus our attention on all the good that we’ve accomplished thus far in only 2 months.
For starters, we’ve completely stopped using the credit card, which keeps our debt totals on a descent, even if gradual. A few months ago, If we found ourselves with a low checking account balance in between paychecks on this upcoming holiday weekend, our old selves would’ve reached for the credit card. Now, the thought of using our credit card makes us sick to our stomach, and we would much rather enjoy a low key weekend. That’s a huge behavioral modification for us.
Another uplifting thought is that we’ve reduced our overall debt by over $2000.00 in just 2 months. If we were only able to average this amount every couple of months, we would still manage to pay off our debt in 6 1/2 years. This may sound like a long time, but compare 6 1/2 years to the 15 and 20 year student loan repayment plans that we are currently on. If we stuck to Sallie Mae’s schedule, we would be paying our loans into our 50’s - that’s insane!
Lastly, and probably the most important to me, is the open communication exchange my husband and I now have over money. As we sat down last night to write out our budget for September, we found ourselves completely on the same page. We didn’t have a single disagreement about where our money should be spent. There were no petty arguments or snide remarks masking resentment. We’re on this debt free journey together and that’s comforting.