I wish losing weight was as easy as paying off credit card debt. Of course, for the person buried in credit card debt without enough money to eat or enough time to sit around and get fat, I’m sure the opposite would be true.

I guess we all have our strengths and weaknesses. My weakness is clearly food. I wouldn’t quite say budgeting and reducing debt is my strength, but I have found that except for a few things that I really enjoy doing I have found it pretty easy to cut expenses. In fact, as time has gone by, I’m continuing to cut my expenses and October 2008 marked my lowest spending month since starting this get-out-of-debt project over a year ago.

As an example, I just made the ’sacrifice’ of cutting cable TV. I did this while my wife and I are earning more money than we ever have in our lives. I’m absolutely not trying to brag about that, we aren’t rich by any means, though we would probably fall into the above-average category for income. My point is that we could easily continue to spend the money on cable TV, but our priorities are changing. The more I work for other people, the more I realize that is not what I want to be doing and the fastest way I can see that situation changing is to continue to cut expenses, pay off debt, and save up cash. I’m getting off topic though. The point of this post is a long overdue update of my credit card debt progress.

When I last wrote about my credit card debt (as of the end of August 2008), I owed $14,338.45. As of the end of October, I owe $10,271.09. Not only did I pay off about $4,000 in two months, but I also bought a brand new MacBook Pro during that time!

So how the heck is this possible? We didn’t win the lottery or find a few thousand dollars of change in our couch. It’s simply been a matter of hard work and cutting spending more and more every month. I’m fortunate that my career easily translates to freelance work. I basically sit on my couch at home and build websites on my laptop. And I make pretty decent money for my efforts. It can be a drag sometimes, but it’s hard to say no to the extra money. I don’t make a lot at my day job, but the money I earn on the side is a nice supplement to my regular salary.

If you are working at getting out of debt I strongly encourage you to find something you’re good at doing and then find a way to get people to pay you to do that for them. It may be related to what you do for your day job or maybe not, but if you can find a way to make some money on the side for something you don’t mind doing it can really accelerate your plan to get out of debt.

At the start of the year, I had hopes of paying off all my credit card debt in 2008. It’s not likely at this point, but I’m not going to rule it out either. At the very least, I’ll be close and it’s starting to feel really good. I was able to pay off two different accounts and that makes life a little more simple too. Just two more cards and $10,000 to go!

By Eden, Fri 7 Nov 2008, Comments Categories: Credit Cards, Debt, Monthly Report

One of the greatest things about writing this blog is having a public place to post my goals and easily review my progress each month (also publicly). I started 2008 with 2 ‘big’ goals and 5 ’small’ goals. Here is a look at my progress so far.

Big Goals

Pay off all Credit card debt – I started the year with $18,504.78 in credit card debt. After 2 months I have $17,364.96 for a reduction of -$1,139.82 in two months ($569.91 per month). At that rate it will take almost 3 years to pay off the credit cards! Obviously that would be a huge failure given the goal to pay off the credit cards this year. With 10 months remaining in 2008, I need to average about $1,736 principal paid per month for the rest of the year. That is still possible and I think it can be done, but time is running out!

Get body fat percentage under 25% – I started the year with 39% body fat according to my new scale (the absolute accuracy of that may be debatable, but this is my baseline number). As of my last weigh-in for February, my body fat was 36.7% for an average of 1.15% lost per month. I need to average a little under 1.2% lost per month so I am just about right on track for my goal this year.

Small Goals

Increase the emergency fund to $5,000 – I set up an auto-transfer of $150 from every paycheck to the emergency fund. That alone is almost enough to reach $5,000 ($3,900 from the transfers). As of today, the emergency fund is at $875.11. That is lower than last month, but not because I have been spending the money, I am just changing accounts so some of the money has a different name now. I will be building the fund back up soon.

Earn $20,000 (gross) from side businesses – I consider any money we earn outside of our regular ‘day’ jobs to fall under this category. For me, this would primarily be freelance web development work and websites and for my wife this would mostly be tutoring (at least for now).  We have earned $1,722.59 toward this goal through February. We need to pick up the pace here, but I anticipate a couple of larger projects to come through later that will get us most of the way there.

Start a Roth IRA with at least $1,000 – Not yet, but soon!

Buy life insurance – Still have the quotes, need to follow up with our insurance agent.

Write a will – Nothing done with this yet. I want to do it, but our financial lives are so simple and our assets so small this is a low priority.

That’s it for 2 months into 2008. We aren’t off to an amazing start, but we have 10 months left so there is still plenty of time to achieve our goals.

By Eden, Tue 18 Mar 2008, Comments Categories: Goals, Monthly Report

One of the great things about writing this blog is having a public place to post my goals and easily review my progress each month (also publicly). I started 2008 with 2 ‘big’ goals and 5 ’small’ goals. Here is a look at our progress so far.

Big Goals

Pay off all Credit card debt – We started the year with $18,504.78 in credit card debt. After 1 month we have $18,034.11 for a reduction of -$470.67. At that rate it will take us more than 3 years to pay off our credit cards! Obviously that would be a huge failure given our desire to pay these off this year. With 11 months remaining in 2008 we need to average about $1,640 per month of principal paid. That is still possible and I think we can do it. It will require a little more dedication to frugality and some more efforts to earn extra money.

Get body fat percentage under 25% – I started the year with 39% body fat according to my new scale (the absolute accuracy of that may be debatable, but this is my baseline number). As of my last weigh-in for January, my body fat was 37.6%. I need to average a little under 1.2% lost per month and I exceeded that in January so I am on track for this goal. I expect it to get more difficult the closer I get to 25% so I do need to increase the intensity if I want to be sure of reaching this goal.

Small Goals

Increase our emergency fund to $5,000 – I set up an auto-transfer of $150 from every paycheck to our emergency fund. That alone will put us close to $5,000 ($3,900 from the transfers). As of today, we have $1,372.07 in emergency funds. If we can hold steady, we will reach this goal in 2008.

Earn $20,000 (gross) from side businesses – I consider any money we earn outside of our regular ‘day’ jobs to fall under this category. For me, this would primarily be freelance web development work and websites and for my wife this would mostly be tutoring (at least for now).  We earned $860 toward this goal in January. If we stay at that rate every month we will only get about half of the way to our goal so we need to find ways to increase these earnings soon.

Start a Roth IRA with at least $1,000 – We have done nothing with this yet. I don’t expect to look at it until the credit cards are paid off.

Buy life insurance – We haven’t made the purchase yet, but we did get some quotes and will likely get this done soon. I know, waiting isn’t smart, but we’ve gone this long without we can hopefully survive a few more weeks or so. 

Write a will – Nothing done with this yet. I want to do it, but our financial lives are so simple and our assets so small this is a low priority.

That’s it for the first month of 2008. We aren’t off to an amazing start, but we have 11 months to get things done so I feel pretty good about our prospects for success.

By Eden, Mon 4 Feb 2008, Comments Categories: Goals, Monthly Report