The Budget Bride | Debt & Savings Check-In

Third Time Wife, Wedding Planning

Remember this girl?

Bride climbing her way out of a rut

Yup, that’s still me, climbing her way out of the debt rut white saving for the wedding. It’s been just over a year since Todd and I decided to get married and the modest savings plan that went with it, all while I’m also trying to pay off my credit cards and other debts.

Let’s start with the debts:

Earlier this year I paid off my second store card and in August I’ll pay off a third. Store cards, I think, are one of the easier cards to pay off, regardless of balance, because the temptation to use them is easy to avoid: don’t go into the store! They also tend to have slightly higher interest rates, so it doesn’t hurt to get them out of the way. Heck, it just feels good to take another line off the payments list every month, you know?

But what I’m really excited about is that I also paid off my car this month! That’s the biggest shake-up my monthly budget has seen since my freelance writing contract wrapped up (only that was for the negative). Now that I’ll have the car payment funds to appropriate, it was time to take a look at the landscape and decide what to tackle next.

The dilemma is that I’ve got one store card left, only I really like using it. It’s my Kohls card and, if you’ve ever shopped their sales, you know how awesome it is to spend $100 while the receipt reflects $200 saved! It’s pretty much the only recreational spending I do, these days, and only every few months. And continuing to use the card increases the number of discounts I receive a year. I’m sure you see why I’m torn.

That said, I have 4 major credit cards (MC or Visa) that I’d really like to make a dent in, too. The smallest of them is not that much more, balance-wise, than my Kohls balance, and has only a slightly lower interest rate. And, while I’m fairly confident in our savings plan (as I’ll go into a bit more, below), I really like the idea of having a fall-back fund as the we approach wedding crunch-time, just in case something goes haywire at the last minute.

So I’ve decided to take a less convention approach, and pay down 2 cards at once, tag-team style. One month the Visa will get $200 and Kohls will get $50, the next month vice versa. No, I haven’t run the numbers to see what this approach will cost/save in interest and, yes, I realize I won’t be crossing them off as soon as I would if I focused on one at a time, but I feel better doing it this way, like I’ll see results faster, overall.

Plus, when I pulled my credit report and score a couple months ago, the main way I can increase my credit score (which was actually pretty good, I was happy to discover) is to widen that gap between my balances and my limits. While we’re not planning on buying a house right away, it is something we want to start thinking about post-wedding, and the better that score, the better our chances at a great interest rate!

Now onto the savings:

At first I wasn’t sure how well this was going to go. I mean, yeah, $100 a month seems like so little but also represented a big stretch for me. I’m happy to report that I’ve more-or-less stayed on track this past year.

A couple months had to be skipped due to life issues while others were only half-funded, but I made up for them with my tax refund this year and when I plugged everything into the spreadsheet I was happy to see that we’re right on track to meet our budget needs by the end of October, 2013. Sure, I’d love to be ahead of the game right now, but on-track is better than behind schedule and I’ve still got 444 days (just over 14 months) to make some headway.

There’s even a possibility that I can increase my monthly savings a bit, I just need to see how everything shakes out in August and September. And the biggest positive out of all of this is that I’m now used to saving each month. That’s something I’ve never been able to keep up with and I love having that cushion in the bank account (we’ve yet to combine the savings into a single account–I’m not even sure if we will, at this point), just knowing that after all the bills, groceries, gas, and rent are paid I’m not in single digits is a novel feeling for a girl who used to balance her online checkbook every other day to make sure I didn’t bounce anything!

I won’t be out of debt by the time we’re married (there’s still a few more accounts left to go after the two I’m tackling next, and their kinda biggies), but I’m looking at being in a lot better shape than I am now.

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Any other budget brides want to brag on their saving prowess?
Let’s celebrate together!

Climbing Out of a Debtor’s Rut: Old Dog, Meet New Tricks

Third Time Wife, Wedding Planning

Bride climbing her way out of a rutNow, before you can tackle a problem–debt or otherwise–you have to know exactly what you’re dealing with.

Come on, I can’t be the only girl guilty of looking only at the minimum payment and remaining credit balance and totally ignoring the bottom line, can I?

Frankly, listing out your balances on credit cards, cars, student loans and whatever other debt you may have can make even the strongest girl want to run for the hills. Or the ice cream hidden in the back of the freezer.

I know, I had to do it. And I’m ashamed to say the tally (not counting my student loans) was already in the 5 figures. Ouch! How did this happen?

Oh, right. Lots of dinners out, that cruise I was going to pay off in 3 months that I kept putting off. The shopping on said cruise. More dinners out. Clothes. Shoes. A new laptop, laser printer, Wii and Wii Fit. Throw a few parties and you’ve pretty much got it.

Frivolous? Maybe. Do I regret any of the purchases or experiences? Not really.

The important thing is to not beat ourselves up too much over this because self-loathing is counter productive. Instead, we can be grateful for the past and keep moving forward!

So, now that we know the problem, what’s the solution?

Ages ago (or at least it feels like it, I suppose it was more like 12 years ago) I had a friend involved with a certain multi-level financial services company and, for a while, so did I. While it was a great learning experience (wherein one of the biggest things I learned was that I’m NOT made to be a salesperson) it wasn’t the best fit for me so I walked away. But not without learning a lot!

Tomorrow I’m going to go into the details of the how-to. It’s not a huge secret or anything, and if you’re familiar with Dave Ramsey you may have already heard of it. (He calls it snowballing. We called it Debt Stacking. I didn’t know who Dave Ramsey was until a few months ago, so take what you will from it.)

I do want to point out that last year I paid off 1 store card and will be paying off a second store card next month. This year I’ll also be paying off my car and that, plus the funds that’d been put towards the 2 now-paid-off cards will make it possible to pay off the remaining 2 store cards and get started on one of my major credit cards by the end of this year.

And that I’m pretty doggone pleased about!

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Have you ever sat down and totaled-up your debt?
Did it shock you or have you always kept up with the total?