So I’m pretty damn motivated to get out of debt. It’s my #1 goal for 2010 (though by my calculations it will actually take exactly 24 months to get out of debt IF I don’t accrue any more)
I’ve been reading Suze Orman’s “Young, Fabulous and Broke” by the recommendation of @emilysayso and getting lots of good tips about what I plan to do after I get out of debt. Which seems lightyears away. I’m such an incredibly impatient person that the concept of waiting 2 years to achieve my goal is so daunting. And I have such big plans when I get there, that I just want to get there already.
So in an effort of being patient. Here are the baby steps I’ve completed towards that goal:
- No Chipotle December
- Balance Transfer from high interest rate to low rate credit card
- At the start of the new year Citi offered a 0% Balance Transfer for 6 months and then it goes to my regular rate (my 2nd lowest) so I transferred my Target credit card balance (my 2nd highest rate). Now I only have 2 credit cards with balances and they have the two lowest interest rates.
- Opened Bank of America checking account in order to participate in “keep the change”
- I haven’t yet decided if this will become my primary checking or if I’ll keep my Wells Fargo as my primary one.
- What’s great is BOTH that I’m saving some money without really having to divert away from my debt reduction goal AND there’s a match.
- Closed some credit cards
- Now this one I struggled with and had to consult my two financial advisers (and best friends) S and B. Everything I could tell was very against closing cards even if there was no balance. BUT some of them were store cards, and I have so many credit cards that its not affecting my credit ratio, or my ginormous amount of available credit, and I’m not looking to have my credit report pulled anytime soon, so a slight hit now won’t matter.
- I closed my IKEA and Home Depot card (but kept the H’s, we don’t really both need cards to the stores, we got them when we bought our house and had lots to buy and wanted the special interest rate offers).
- Closed my Bloomingdales card that I opened last January to buy an expensive shirt for my birthday which I later returned and never used the card again.
- Closed my Macy’s card which was both a store card and a VISA. I never shop at Macy’s (except makeup) because its too expensive, it had an outlandish interest rate, and I’ve only had it since 2007 so it didn’t have a long credit history.
Now, I’ve always known that my debt problems occurred October 2007 (which is when I started keeping track in a spreadsheet and have watched the number increase in thousands over the years). It’s also when I apparently opened 5 different credit cards as I discovered by looking at all of their “cardholder since” dates. I can’t believe that would be a coincidence. That’s also when we had a baby and bought a car, so I’m pretty sure that $1,400 a month in daycare we paid and $360 car payment plus $100 insurance contributed to that. We acquired a lot of new credit and a lot of new expenses, but our incomes didn’t rise that much (I did finally get promoted in Spring of ’08 with a $10,000 raise (trust me I still make piddly)).
I’m still hoping that when we have another baby (which I’m still hoping is soon) we will manage those expenses much better. The concept makes me a little nervous because while I won’t be out of debt for another 2 years, I also have no desire to wait remotely close to two years to have a baby.
I just need to get more money plain and simple. I think its time to stop talking about a second job and finally get on top of that!