Wednesday, 5 June 2013

The Debt Diet

My dirty little secret.  A crippling credit card debt (and I know it’s not as bad as some!) and the remnants of a car loan – a hasty decision made when I knew better.

I am generally an anti-debt philosopher, though you wouldn’t know it from the start of this conversation.  I drove a beat up old car that was getting to be embarrassing, and I had made significant extra payments on my mortgage and maintained a credit card limit of $1000, which I didn’t fret about, as I could pay it out at any stage.

Then things changed.  I’ve wondered how to broach this, how to admit guilt without blaming myself, how to acknowledge where I was at fault without admitting all that is wrong with me.  The fact was, that I had previously lived within my means, and for various reasons, I started to try to keep up with the Jones’. 

I started to get embarrassed about my beat up old car, so launched into debt on a whim one day for a new car.  Hey, I didn’t have much debt, I could afford it, right?  Then one day over commiserations with a girlfriend, I booked tickets for TWO trips.  I had never taken a holiday with my children, and it was stupid having the money sit in the bank and not use it, right?  And then, well, Miss M had left home, and life was difficult.  I made a lot of little, bad decisions, and spent some money bailing her out of hers.  But hey, that’s what mothers do, right?

And all of this led me to where I am today.  In credit card debt that I’m really struggling to move, and flailing towards the finish line on the car loan that I knew better on.  Son C and I have been very seriously considering buying a second house in a gorgeous little suburb, but that ambition is very much beyond our reach while I’m still in debt.

I won’t sit here and state goals.  I’ve done that.  For whatever reason, it hasn’t worked this year.  I don’t want to keep reporting in my failures each time.  I’m happy to share this information with you, and I’ll be happy to share my success with you.  I have a plan in mind that this should all be paid out in around two months, which includes using my tax return.  I won’t promise it, I don’t know what life is going to throw at me, but I paid $1,400 off the credit card last month, and hope for a similar amount at the end of June.

For the month of May, I can report the following:

In:                                                             4253.01
Borrowed on credit card:                   449.99
Spent:                                                     1491.74
Saved:                                                     1053.82
(this went on to the credit card at the end of the month.  No point having savings if you’re holding credit card debt)
Bills:                                                            725.32
Repaid Debt:                                        1432.12

And that is how the finances go at Brish’s household.  We are only a two-person family, and we are not enjoying this stage of our debt diet, but we are doing well. :-)

How’s your debt going?

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