Tuesday, January 19, 2016

Tempering Expectations

I'm a planner.  I'm a list maker.  I'm a mental organizing freak.  Each year in the days before we find out our raises and bonuses, I have to make a concerted effort to avoid planning how to spend money I don't have yet.  Once I get the numbers, though, I'm off and running.  I allocate that money out like it's a science immediately.  Yes, I do factor in more ambiguous expenditures like "Shopping-$200, Trip $500", but the point is that I know where it's all going by the time that money lands in my account.

This year, when I'm placing such a focus on paying my debt off, I'm having to fight extra hard against these urges.  My bonus money is all allocated and I'm very happy with what I've done with it.  I just sent another $800 bucks to a credit card today and it feels amazing each time I can make such a good contribution to rectifying my past mistakes.  I also checked my credit scores today via Credit Karma and my Equifax score went up 16 points in one week based only on paying off one credit card.  I have since paid off another as well as placing a major dent in two others, so I am excited to see how the scores continue to change in the coming weeks and months.  :-)

Right now my thoughts are focused on my taxes.  My W-2 should be arriving next week, and I always file my taxes via Turbo Tax within a day or two.  My mind is working in a million different ways trying to guess what the numbers will be.  I had a large bonus this year, I had an HSA account, pre-tax transportation benefits, etc.  I have no idea how it will all shake out and it's driving my OCD self a bit crazy.  I'm crossing fingers I still get a refund (and a decent refund at that) because that would just be more money to send to my debt, which would help me pay things off even sooner.

It's funny how addictive it can be to pay *off* debt instead of creating debt.  ;-)  With each pay cycle I get closer and closer to that big, fat zero that I've not seen since my credit history started.  The idea that I'm single digit months away from that huge victory is so tantalizing.  Now I just need to be patient and hope that the numbers shake out in a favorable way for my taxes again this year.  With my low ball guesstimating on my refund, I may be able to cut one more card's balance in half, that being the highest interest rate one.  After that it would take one more pay cycle to eliminate it entirely!

I've been using Credit Karma to monitor my progress, and today I downloaded an additional app called Debt Payoff Planner. It helps you to track your debt and gives you specific payment amount recommendations for each month depending on how you want to pay off your debt (highest interest rate method vs. lowest balance method).  I'm going with the highest interest rate because, while it is tempting to reduce my total number of cards I'm paying on, ultimately I feel like it's smarter to pay off the highest interest rate card first.  I am down to three accounts with balances and the lowest balance one is also the lowest interest rate by far.

I know these debt posts are probably super boring, but this is a pretty momentous experience for me and it makes it exciting for me to think about.  :-)  Forgive me, as this shall pass...hopefully sooner than later!  Though do expect a huge, happy dance post upon full payment of my credit card debt. Can't blame me there.  ;-)  My car has been paid off for a couple of years now, so the only debt I will still have is student loan debt, and my ex-H pays that loan since we consolidated them before things went sour, and he agreed to keep that debt in our divorce.  His portion is much, much larger than mine, so it seemed fair considering everything that happened.  So that debt is on my credit report, but it's always paid on time and that's good debt compared to bad debt.

I feel really, really good about what I'm doing right now.  I'm taking responsibility for my past financial missteps and paying for them with my own money.  I am righting my wrongs and taking away a massively valuable life lesson about how easy it is to misuse credit cards, yet how hard it is to pay them off.  By the time my birthday rolls around in June, I should easily be totally credit card debt-free, and that will be the best gift I could ever give myself!


  1. I think it's helpful! Going to check out that app you suggested.

    1. Hope you find it interesting! I think it's a good added tool to my little arsenal for this challenge. :)

  2. I love talking about budgeting and all that kind of stuff. I'm trying to pay off all my debt this year, but I'm sure I won't get my main CC to zero this year. It's usually best to pay off the high interest card first, so good plan! I typically allocate all my tax return to savings and then I would spend my state return on a spurge item. Texas doesn't have state taxes, and I'm sure I'll get something back from CA, but probably not much. Although I'm expecting a hefty federal return because of the almost 4k in tuition I paid, and all the donations I made to Goodwill (got receipts!) when I moved. Plus not having a job for 4 months :/

    1. My state return is usually pretty negligible, LOL. Federal is usually decent. I plan to put at least half of what I get to my debt and either spend or save the rest.

      Hopefully all the things you mentioned will help with your taxes this year! :)