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Financial Fitness: A Glance Back and a Look Forward

January 22, 2010

I have never been very good with numbers. I’m not good with numbers when it comes to my blood sugar levels, counting carbohydrates or calculating insulin (thank God for the Bolus Wizard Calculator!), and I am definitely not any better when it comes to my financial life. I don’t know when exactly it started, but towards the end of my college career, I started to rack up quite a bit of debt. At first it was just a thousand dollars. Then it was a couple thousand. And then it was more. And more. I don’t know how I left it get so out of control, but the next thing I knew, I had almost $7500 on my credit card. Now, thankfully, it’s my only credit card and I also don’t have any student debt, so I have never had to juggle multiple minimum payments or high interest rates.

When I had a charge that was reimbursable, either through my company or some other source, I would put it on my credit card so as to not drain my debit account. I also put a lot of miles on my credit card through purchasing items for my apartment, both in my initial move to New Jersey and when I moved to Hoboken in 2008. I also put my Apple computer on my credit card when my last company took away the corporate laptop I was using as my sole computer. That was a hefty $2,000 addition and I’ve been paying for it – literally – ever since.

I’m certainly not proud of the debt I’ve accumulated and honestly looking back at my statements I wonder why I even though to charge some of these items, but in reality I know that it was probably at a time of the month where I was running low on normal funds because I didn’t have a budget. For many of the months, the amount I paid off and the amount I added to the credit card, which means the debt never really went anywhere, and I still suffered a finance charge. Last fall, I became obsessed with budgeting. I downloaded a bunch of budgeting Excel spreadsheets, but like logging my blood sugars, that quickly turned out to be a fool’s dream. Instead, I’m trying to think big picture. I did manage to capture a couple months of expenses and I learn quite thoroughly that I spend way too much money on eating out. It’s disgusting. This is why Erik and I committed ourselves to cooking at home more often, breaking out the cookbook and purchasing items such as a waffle maker and a Crockpot to make some of the items we’d traditionally want to go out and eat (brunch is and always will be my favorite meal of the day).

I’ve also learned a few tricks to keep myself from eating out during the workday. I have all the items I need for breakfast, lunch and snacks in my desk or in the freezer at work. I don’t have to even get up to get something to eat, and surprisingly, I am not grazing or eating more than I would otherwise.

But I have been working on it, slowly. When I sold my car last summer, I stomped my debt down by $3,300, but sadly I haven’t made too much progress since then. The debt, through a series of poor choices and an expensive Christmas, has stayed relatively the same. This week, I deposited a check for $475 from freelance money I make, from the focus group I was in and to pay off the tickets to see the ballet that Erik and I are going to for Valentine’s Day (yes, you read that right: we are going to the ballet for Valentine’s Day. Why yes, I do have the greatest boyfriend ever.). This brings my debt down to a new total of just over $3600, the lowest that it’s ever been in almost 2 years.

One of the reasons I had such a hard time this past year was I was still using my credit card. A large portion (nearly all, actually) of one paycheck goes to rent, leaving me four weeks to subsist on just one. I don’t know about you, but I have a hard time living off essentially one paycheck a month. Plus, some additional savings and payments were coming from that first paycheck. For awhile, I was using my credit card at the beginning of the month, and then using my second paycheck to pay off the credit card and then used debit the second half of the month. But that left me with very little money to actually pay down my debt. Now, I have taken some of my automatic deductions and moved them to the other paycheck to help even things out, and hopefully I won’t have to rely on credit to get me by. So far it seems to be working, though I suppose only time will tell.

Money has always been a tricky beast for me to deal with. I don’t deal well with denial or sacrifice, which is probably why I’m an overweight diabetic with an A1C of 8% (for my new 20sb friends, I should be at 6.5% or lower). I do have some savings – not a ton, but some – and I’m working on building that so I can afford to take those vacations I keep talking about (hello Italy!), afford a house someday and, you know, a few other important life changing things that will cost money. It’s frustrating, because I always feel like I give and give and then I get burned out and want a piece of cake. I almost feel like I have to reward myself for my sacrifices. “Oh, my blood sugar is good so let me go have a cookie,” is a common thought of mine. Or “Oh I saved $20 on that dress, I think I’ll go buy some socks too.”

It’s really willy-nilly what goes on in my head.

Goal for 2010: No more willy-nilly!

  1. January 22, 2010 11:20 AM

    I thought I was the only one sucks when it comes to money. I’m getting a little better. Good luck to you this year. Have fun at the ballet.

  2. January 22, 2010 12:04 PM

    Girl, you are not alone! I was terrible with money until it came to planning a wedding. Alvin made a budget, and I stuck to it. Then we got married without using debt! After the wedding, he made a new budget for us and I have stuck to that also. I didn’t always smile about it. But I stuck to it. I haven’t used a credit card in 2.5 years. woohoo! If you can create a budget, you can stick to it. This is a great start. Congrats on paying down so much.

  3. January 22, 2010 1:04 PM

    I hear you! I only use one of my credit cards (it has the lowest APR I can get) and it’s scary how quickly things add up. Luckily I have a husband who pays rent, etc. but still for everyday items sometimes I use credit to stretch my meager paychecks. Groceries, etc. are so much more expensive now too. I’ve taken to discount stores or buying items on sale, and getting clothes only when I absolutely need them. And then I’ll have to refill my insulin Rx or something and boom! there’s a $200 bill from the pharmacy (and that’s with insurance). I guess you just have to pick and choose what’s important & worth spending money on.

    You’re already taking positive steps. Congrats on knocking down the number so far, I hope the trend continues!

  4. January 22, 2010 1:17 PM

    Hi Allison –

    The important thing is that you are chipping away at your debt. And it sounds like you’ve made great progress to date.

    A couple suggestions from cheapskate-at-heart-me:
    1. make lunch, never buy (even if you have to make 5 sandwiches Sunday night and throw in the fridge because you aren’t a morning person). Lunches really add up! Looks like you are doing this one already. (we also spent $40 on a cappuccino maker rather than $4.50 daily buying coffee, but you already kicked the caffeine bit, right?)
    2. Commit yourself to a bare minimum you *must* overpay your cc bill every month – just mentally add that bit to your monthly total – eg “it says I have to pay $375 but I really have to pay $475”. No matter how tight things are, just assume that’s non-negotiable – it will also keep you from adding too much extra on with any luck. I did this with my student loans and was able to pay them off much quicker than most of my friends.
    3. For cooking dinners in try grabbing Jacques Pepin’s Fast Food My Way cookbooks – from the library ; ) We can make a restaurant-quality (mostly) meal at home in 30-45 minutes – less time than waiting for your bread to come in some restaurants..

    • January 22, 2010 1:31 PM

      1) Yes, I definitely never buy anymore. I bring Lean Cuisines and Smart Ones to work and keep them in the freezer. After years and years of eating sandwiches, I honestly just can’t eat them. They make me a little sick, actually.

      2) I always over pay my debt, but I’ve always just added back on during the month, so that my debt never really goes down very much. That’s why I’m trying to orient it so that I’ll never get so rock bottom that I need to use my credit card to “hold me.”

      3) Thanks for the cookbook recommendation! That’s a good idea – going to the library for them. More ways to save money!

  5. January 25, 2010 2:13 PM

    Something that worked for me when we wanted to buy a house was simply that I had to pay 100% of anything charged that month, plus a minimum of $100. I was shocked by how fast the debt went down, especially as the finance charges reduced.

    If you get a tax return this year, bite the bullet and plunk it all down on the debt. You will be so happy you did!

    • January 25, 2010 2:31 PM

      Definitely planning on doing that, I just hope I get a refund. I do freelance work so I usually just end up owing money.

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