I’m still holding about the same amount of credit card debt that I did 5-6 years ago, if not a little bit more. The good news is that it hasn’t gotten worse. But I’m mildly upset with myself that it hasn’t gotten better.
I had made some significant inroads earlier this year (2012), but a few things wiped those out. I’m glad I did manage to pay some debt down before these latest charges and impacts happened:
- I ended up owing quite a bit in taxes this year, much to my surprise. It turns out that I must have changed my exemptions sometime in the past couple of years and just crossed an income line where the impact was noticeable. So there’s a big chunk of new debt. Not unmanageable, but it undid a couple of recent payments.
- Adjusting the exemptions means I’m taking home about $120 less a month, which is money that I had been using for credit card payments. So I get a big new charge while having less money to apply to monthly payments. This will even itself out when next tax season rolls around, but is still annoying.
- Had to do some big dental work this year with very little insurance help – $3000 in new charges. This is on a dedicated card and will be paid off in 2-3 more months, I think, which will finally free up money to go back to my main debt.
- A few vet-related bills on that same dedicated card has slowed down the dental pay-off, but not significantly.
- After a year of having cable tv and internet again, of course the promotional periods end and the bill jumped up significantly. I’ve pared down my service to make this more manageable. I wish there was a good high speed internet alternative in my area, but cable and its big bills seem to be the primary option.
Then, stupidly, I have made a few extraneous purchases that seem innocent enough on their own but add up quickly, particularly when there’s a little less available per month to apply to the main card(s). I’ve tried to practice austerity and will be good for a month, and then as a reward for myself I’ll get succored in by a fab.com sale and buy things I don’t really need. I’ve been a little better about this recently, but not good enough.
So – I did manage to pay down some debt just in time for it to balloon back up again. However, since I had managed to pay down a good amount, the debt level is back to about the same level it’s been over the past few years. And a couple of big charges will be cleared off the books within the next few months, which should hopefully make it easier to get back on track before the next crisis hits.
I did pretty good for a while, and got the line of what I owed down to … well, not a decent level, but to a line I was proud of. But then I racked up debt again on some purchases. Here’s me trying to reason them:
- Digital Camera – The $200 camera is never $200, for one thing, and I ended up paying more than planned for the package I ended up with. But it is nice knowing that damages are covered (even though I take damn good care of my equipment and have had to use very few warrenty’s or protection plans in my life). The camera was purchased primarily so I could get more pictures of the dog and not have to budget time to drop film off and scan prints in. It’s been nice to have, I guess.
- Reaktor 5 and Controller – music software and a hardware controller full of knobs and sliders. I was wanting to expand my collection of pedals and small analog modules, but decided it might be worth it to get a software package that can do much of that. I still prefer hard gear, but Reaktor gets me so much for a much smaller cost. I figured that having a controller would give me at least some knob turning satisfaction and cover me for a while until I can start investing in modular analog (real analog) synthesis again.
I’m not sure how well I’m sticking to my budget, but the apartment move that I’m supposed to be making was held back a couple of weeks, meaning that I’ll be paying less than I had budgeted for it. I applied some of the savings to my credit card payments and paid much more this month than usual.
I believe I still have enough left over in the budget to pay for assorted new-apartment related expenses without adding to the debt.
I put together a general financial plan for April ‘05. It does not make any significant inroads into my debt, yet, primarily due to moving this month and paying rent on two apartments this month. But it does give me a framework to work within. Even though the bills from AmEx and AmEx Blue have not been sent out yet, I have plans for them and other known (and projected) bills. It feels good to feel on top of this.
It’s payday today, and it’s the first payday after a recent raise. So I get to see the impact that has on my net income. On my actions list, I have it noted that after I pay rent on my current apartment for the last time, I really need to make a budget for the coming month to ensure that moving across town goes smoothly while I continue to chip away at the accrued debt of the past couple of years.
The last two bills of the month are usually the biggest (besides rent). AmEx and AmEx Blue. AmEx was particularly high this month due to annual membership and rewards program fees. I’m going to cancel the rewards program – I figure I’ve spent at least $120 towards getting a $100 gift card. It’s not worth it.
I wish I could have paid more towards both cards, however. But all extra money this month (which I do have a fair amount of due to some recent selling of computers) is going towards the move.
With recent salary increases and upcoming living changes, I should be able to put at least $100 more a month towards paying down the large debt built up on Amex Blue.
Minimum amount I want to pay per month: $300.
When regular Amex is payed down, I should be able to increase this to $350/400 easily.