It feels like I have been writing for Timeless Finance for a long time now, but I checked the calendar and realized it’s only been two months since my second post Attacking My $30,000 Debt. So much has changed since then that I knew it was finally time for me to take stock and do an update on where I’m at with my debt repayment goals.
For those of you who didn’t see the original breakdown of what I owed (or can’t remember the details of a virtual stranger’s financial standing) here’s what my debt looked like in November:
| Debt | Principal | Interest Rate | Minimum Payment |
| Student loan | $24,000 | 5.5% | $278 |
| Future Shop Credit Card | $520 | 29.99% | $20 |
| MasterCard | $968 | 19.99% | $32 |
| Visa | $2020 | 19.99% | $50 |
| Car loan | $1845 | 13.99% | $205 |
Pretty scary, right? Thankfully, putting all of that information on the internet for everyone to see was the kick in the pants (or KITA) I needed to change my situation. I got a low-interest Scotiabank Value Visa with an promotional interest rate of 0.99% for 6 months and immediately transferred the balances of all of my other cards on to the new one. And right now you can get a FREE $100 Gift Card from RateSupermarket.ca with a Scotiabank Value Visa (expires February 28th, 2013).
I continued to make the minimum payments on my student loan, and focused all of my energy on my credit card and car loans. In the 68 days since I shared my debt on TimelessFinance I have paid $3045.87 towards non-student debt, and eliminated nearly $2500 in principal.
Compare the last 68 days to how I used to handle my money: I checked my bank statement for the 68 days prior to that post and I had only paid $1000.12. I was paying 13% to 29% interest on those loans before I consolidated, so the money I was paying barely made a dent in my debt’s principal.
One item that I neglected to mention in my original post was my bank balance. On November 15, 2012 I had about $-250 in my account. Yep, overdraft (I didn’t even notice it when calculating my debt total). As of last Sunday I had $600 cash in my account. That’s $600 without a negative sign in front of it! I should also mention that, for the current pay period, I have already paid my debt payment, heating bill, and car insurance, plus I’ve purchased my bi-weekly necessities and added money to my savings account. I’m still waiting for water and hydro, but I anticipate still having more than $300 in my account by the end of the month.
On top of my chequing account’s inversion of polarity, I’ve also started a small savings account that sits at $300.
Aside from my student debt (which I plan to tackle more aggressively once my consumer debt is clear) I only have to worry about one measly Visa bill each month. My current consumer debt balance (total debt minus student loans) is now $2859.72. If I stick to the current plan I can have this paid off in under 7 months. The plan will be changing, however, before May rolls around –that’s when my promotional interest period ends and I’ll need to find a different solution that may not have such an awesome interest rate. (Editor Joe’s Note: don’t worry Sara, if it comes to that we’ll find you a good deal.) Tax season is coming up, though, and I do plan to put the whole of my return toward debt repayment. I am also working on a graphic design project that will pay a pretty decent amount, and I’ll put all of this against debt as well. Hopefully the consumer debt will be gone before I have to think about finding a new card.
As for the plan to quit smoking… whew! I have had no problem cutting down on work days, but weekends are proving to be a challenge; I smoked more than my allotted 3 per day on Saturday and Sunday. It’s evident that I’m a boredom smoker; I light up when I have nothing to do. Thus I think I need to come up with some creative approaches to fight cravings. I’ve heard some great tips and am thinking about cutting up some carrots and celery to munch while watching TV. I’ll also try to keep myself better occupied during downtime with knitting or giving myself a manicure. Obviously I’m now better with my money than I am with my health. It may be the patch or gum time soon (though I’ve wanted to avoid them because of the cost). Does anyone have any other good suggestions for beating boredom cravings?
That’s amazing progress, Sara! Congrats and good luck!
I am also very impressed / proud. Keep it up Sara and I like your attitude.
Thanks guys!
This is always great to see, when someone kicks it into high gear and starts making amazing progress. Keep up the great work Sara and kill that debt for good.
Thanks for the encouragement Grayson! Killing debt is waaay more fun than people might think. There’s nothing like a good update to make you want to pay it off that much sooner.
While I don’t get smoking craving when bored, I do get the munchies when bored. A tactic that works is to brush my teeth, it stops me from wanting to eat for a good while if I’m not hungry especially. I’ve heard it works for smoking habits too (at least those born out of boredom). Maybe worth a go!
Great work on the repayments! One comment.
I wouldn’t be too aggressive paying down the student loan debts ahead of schedule at the expensive of creating a life that you’re happy with (or retirement savings, especially those matched by employers). Student loan interest is tax deductible and a lower interest rate than almost any credit card or unsecured debt out there. I paid my student loans down early, but only when my income went up so much that I was able to make the accelerated payment easily without creating a false hardship, which didn’t happen until I hit my late 20s. I wouldn’t have paid them down fast in my early or mid 20s (I think I had an 8% interest rate too…which sucks looking back!)
Awesome suggestion, Adam! I never thought of brushing my teeth, but I definitely wouldn’t want to smoke after doing so. I will definitely try that out.
As for the student debt, I’m just going to put what I am paying now on the credit cards on to the student loan. My current budget isn’t so tight that I have no fun money, I was careful to make sure that I could still enjoy my earnings while saving and paying off debt, otherwise I would never be able to stick to the budget.
Nicely done Sara! Keep up the good work
All the TiFi readers are rooting for you in all your money and health goals!
Thanks Kathy! You guys keep me strong
Great work on tackling your debt. Keep it up!
Dunno if it would help you or not, but my uncle quit smoking via Tic-Tacs. He went through about 200 packs of them, but it did the job. He found the strong mint taste helped somehow. Might be worth a try. (although don’t ever calculate what Tic-Tacs cost per kilo, or you may faint!
Thanks for the tip, Bet. I’ve been chewing a LOT of gum, but I bet tic-tac would probably cost less, and anything is cheaper than smoking cessation aids so it may be worth a try!
Good job on the debt reduction. I would definitely go slow on the low interest student loan and ramp up consumer debt payoff. Cold turkey usually works better for quitting smoking. Cutting down keeps the addiction around which is what you are fighting when you are bored. Cold turkey requires concentrated effort in the beginning but gradually releases its hold on you as you move the chemicals out of your system. Good luck!
Sounds like you’re making some good progress!
I would suggest making a graph to motivate you to see the zero
Graph projected payoff against actual payoff. It makes it even more fun.