Well now that I listed most of my big bills from the year and I have yet to go out and find a washer, I am in a funk over how to set up the debt repayment budget for the new year. I think part of my problem with indecisiveness is that I make these goals and then *WHAM* they are shattered by a large expense. Remember in early November I had three $800.00 bills out of no where. Yes I paid them but there went the $3500.00 I was to pay to debt. I should have had the last CC paid off last month. I am not going to be able to pay it off this month either.
I feel like a big old failure. But I have not incurred any new debt with my large bills except for the car. I called and talked to daughter last night and she thinks that I try too hard and then I don't have enough money to live on and I go backwards. Redoing the bedroom cost about $2400.00. I did not flood the basement on purpose and I could not leave the mold to eat the sheet rock. But there goes my $3500.00 payment. J (daughter) just thinks that I should be happy I had a way to pay for this without debt. I see myself backsliding on my goals. She also wants me to slow down and pay at least $6000.00 into a studio savings for this summer.
My original goal was to pay off the last CC which now stands with a balance of $7219.00
I have $4100.00 to put toward this card. However, I have a $445.00 water bill, at least $500.00 worth of medical bills to pay, my emergency savings is under $500.00, and I owe another $512.00 to the pharmacy. So you can see that paying a huge payment to the CC is pretty stupid.
I was going to pay $3500.00 a month starting in January to the truck loan and have it paid off by May. J says this is impossible as things will come up and then I will still not have the truck paid off. The minimum payment is $500.00 easily doable, but not in the summer when we have no money coming into the studio. I need at least $2000.00 a month to get buy in the studio. She wants this funded first. She says to pay the CC off in the next two to three months, fully fund the studio savings and then put the rest to debt. Actually when she ran the numbers we could still pay off the truck in May but it will be very close. Budgets always look great on paper and then you start to try to live within them and all ^&%44 breaks loose. J just does not want to see me stress all summer about the bills. I run a zero based budget as I am trying to pay off debt and I have done really well this year but summers are always hard and I never have any money and then bang I am back in debt to a CC.
I guess my question to you is am I trying too hard? or am I caving?
I think I am struggling with the fact that my arthritis has been very bad the last few weeks. I am going up to a specialist tomorrow in Spokane. Both of my wrists are stove up. I had terrible fevers and chills for almost a week related to this disease. Now I still work and get things done but I am just miserable and in pain all the time. I hate it. It is hard to brush my teeth and comb my hair, just simple things that you need to do to live. Getting in and out of the tub is a nightmare. I am typing right now with a space heater on full blast blowing on my legs. I cannot get warm. My temperature gauge is faulty, the worst part of this illness I swear.
I worked all day yesterday to send out a letter and new schedule to all the parents. Over 90 letters, stuffed, addresses, stamped, mailed. What a lot of work. I also had some sewing that had to get done. Tonight hubby and I will go to a 50th wedding anniversary celebration for some friends of ours and then we will go find a new washer. Sorry I am in such a mood, but I will feel better soon.
Have a great and productive day.
Kim
Yikes! Give yourself a break! It's better to pay off debt a bit more slowly than to be riddled with guilt when your plans don't work out. I would agree with your daughter and pay stuff in this order: emergency fund, studio fund for summer months, water bill, medical bill, pharmacy. Then continue to make the minimum payment on the truck and the minimum plus a little extra each month on the credit card. The most important financial need you have is your emergency fund because emergencies ALWAYS come up but as long as you have some cash on hand to pay them, you certainly aren't a failure--you are financially ready for an emergency! You're heading in the right direction but like the rest of us, you will run into detours along the way...
ReplyDeleteI agree with your daughter, in that you can't control emergencies, but you should be VERY proud you did all of that without using a credit card. I think saving first, then go gazelle like on the debt. It make sense to save what you need and be ready.
ReplyDeleteYou are doing a great job!
I have to agree with J for a minute...if you put too much towards debt and don't have enough to live on....then you will go backward. I know I am victim to this cycle!!
ReplyDeleteYou did do awesome this year, and you need to be proud of it. But you need to take care of YOU first. Build up the savings...it will save you in the end.
I too agree with J. Like Mysti, I am a victim of the backward cycle. Even though I made great strides in 2011, it is not starting off too well. But I just forge on. You will get there. I know you will.
ReplyDeleteWell I am going to make it unanimous(hey look I spelled it right). You are way to hard on yourself. I think the budget your daughter worked out will work great. You need money to live on, you need certain things to make your life easier. You need to take care of yourself. Budgets are a funny creature, they look great on paper then life happens and they go screwy.
ReplyDeleteI think you did great this year, and we will all get through the next year together and happily! Look you got parents to start paying tuition on time didnt you?
Ok - first, re-read your post. Pay close attention to the want you have and all of the directions you are being pulled. you say your studio is slow through the summer. Explore why this is, and see if you can do something about it. Since this is a recurring thing, you need to get it funded ASAP. Also, top up your Emergency Fund to $1,000. Continue to pay the truck loan at $500 per month, and $100 more than your credit card minimum.
ReplyDeleteSo, tackle things in this order:
1) Emergency Fund to $1,000 ($500 from the $4100 you have)
2) Pay for Washing Machine ($ money from the $4100 you have already)
3) Pay Water Bill $445 from the $4100 you already have.
4) Pay the Pharmacy $512 from the $4100 you already have
5) Pay $500 Medical Bills from the $4100 you already have.
6) Any money left of the $4100 you had ear marked for your CC, put on the CC.
Now you've got a $1,000 emergency fund, all of your medical stuff is paid for, and your washing machine is fixed. All of this money did not come from your budget as you already have $4100 earmarked for a Credit Card that you'll just have to put something on since you are stressing out and not helping your health.
Now set your budget for 2012 to get your Summer Studio saved for, and pay the required amount for your truck, and round up to the nearest $100 for your Credit Card minimum.
From what you plan on doing, you want to put $2,000 towards your credit card - put that amount away into an account for your Studio for 3 months. That's the $6,000 you need for that. That's January to March. In April, toss the $2,000 at your credit card. Same thing in May. Now you've paid down at least $4,000 plus the amounts you put towards your credit card from January to March. Voila that thing is more than half way paid off. Your truck can wait until after your credit card is paid and until after you've gotten through your summer.
Go back to paying a little more than minimum during the slow times at the Studio. In September, you should be close to being able to pay off that credit card. Take September and October to make sure, and now you've made it through your summer at the Studio, and Paid off your credit card. Save for Christmas, and toss a double payment onto your truck in November and December ($1,000 per month only).
Rinse and repeat in 2013. This time using the extra months to toss money at your Truck Loan and top up your Emergency Fund. This way, you've got the money saved for the Studio so you aren't stressing out for 3 months and causing more health issues.
You'll get the debt done. You just have to realize that your health is directly impacted by the stress you are causing yourself with not already having your credit card paid off.
You can do this. It just looks like you need to refocus your efforts and concentrate them on one thing at a time.
Kim... you are doing awesome! Give yourself a pat on the back woman! Life happens and you can't control it. You can plan for it though. Back when I first started attacking my debt I had a big expense that I had to put on a Credit card. That's when I stopped and said ok wait. What's the good of paying it down if I can't handle an expense.
ReplyDeleteI think your daughter has it right. Think of how much more you will enjoy the summer months if you already have the money saved up to cover the studio expenses?! And if you build that emergency fund back up then you have the money to cover those unexpected expenses again. Then attack the debt. If you have to use any of the emergency fund then you stop attacking the debt and rebuild the emergency fund. The debt is going away. You still need to be able to roll with the punches and not have to get stressed out about it.
Don't negate all the progress you have made! Progress doesn't have to only be how much debt got paid down but a change in how you are doing things...like handling all those huge expenses without incurring any new debt!!!
Yup - build yourself a nice emergency fund and provide for your summer. You have to live. And shit happens. Sometimes both at the same time! Put what you can spare on the c/c. You set yourself up for failure every month if you put a huge amount on your c/c then have to use it to live on. And that feeling is what gets you down. That and your constant pain of course. I have chronic back pain and it really gets me down at times. I really hope you can get some relief and then the financial stuff won't seem so bad!
ReplyDeleteSending you hugs!
I agree with the others and your daughter, you need a break. Sorry that you're not in a good mood.
ReplyDeleteShanks, guys! I have done really well this year. I am sure just feeling chilled to the bone all the time and feeling feverish is a great part of the problem. I will have labs done tomorrow and they will renew my meds probably up the low dose chemo and I will be as good as new, but right now I am low and it is hard.
ReplyDelete