Pay off all credit card debt

Luckily for me, I am a minimalist when it comes to material things, and I have only accumulated debt from necessities. Thus, the amount that I have built up is relatively low compared to many of those fueling the current credit crisis. With a steady position this semester, I should be able to dedicate a good portion of my earnings toward eliminating what I owe and start putting my paychecks into savings!

So ready for this debt to be gone!

The plan is to pay, each month, that month’s finance charges plus $200 . . . that way we see steady progress toward the $0 balance we so desire.

So why is it so painful to make even the first such payment? But I believe in the plan, and we’ve made the other changes necessary. There will be enough money left to live (and enjoy life!) on.

I have made the first payment, as planned, on the MasterCard.

We’ve budgeted to pay $200 plus whatever finance charges have accrued to each of our two credit cards each month. That means $400/month real progress.

If we thought we could handle it, we’d continue using one of them and add the total amount charged each month into the payment . . . but we’re not ready for the “advanced” course yet. That’s a better plan for after we get balances eliminated so that we’re not paying any finance charges. (And even then we’ll need to be extra careful.)

Did it quicker than I thought possible. Set you mind to a goal and get gets done.

My belovéd and I took an eye-opening look at our budget yesterday. By starting with our income (which we know) and subtracting out all the expenses over which we have no control (e.g. mortgage, insurance, utilities, car payment) and all the expenses we’re making an absolute priority (e.g. 2% to charitable contributions, 2% to savings, making progress paying down credit balances, saving for New Orleans trip), we arrived at a figure for how much we can spend every month on things like groceries, fast food, dates, and other fun stuff.

Then we compared that number to the amount we’ve actually been spending for the last several months on groceries, fast food, etc.

Ouch.

We are no longer confused about why our credit card balances seem to grow so much from month to month.

This is especially difficult to swallow right now since my dearest one has just given up smoking (a pack/day) and soda (6-12 cans/day), and we were hoping that might have freed up some reward money. No such luck . . . it certainly helps not to have those expenses, but they’re pretty small compared to the spending deficit we need to make up.

So we’ve re-grouped a bit. In order to feel like we’re not deprived of entertainment, we upgraded our satellite TV to the next more expensive package . . . a net cost of $14/month against staying (and eating) at home more evenings because we feel like there’s something worth watching. Then we joined the YMCA, so we’ll have a fun place to exercise and be even more motivated not to eat the fast food that seems so convenient but works against everything we hold dear (i.e. health, wealth, and being good to the planet).

Now we have a more realistic picture of what we can spend every month. It’s not pretty, but at least now we know what we need to do to actually get our credit cards paid off again.

It took us years to get back to the point where we could actually have credit cards again. Now the balances are starting to creep up again in a somewhat scary way. We need to get hold of these and use these the way we intended, never carrying a balance from month to month.

Time to crunch the budget numbers and start taking some serious bites out of credit card balances, lowest totals first. We’ve got just 2 cards to worry about this time.

Get all credit card debt paid off. Then develop a plan to pay down business line of credit and save 100k.

I’m almost there…!
Check back in a few months.