Our Debt Snowball – February

In January we began our Debt Snowball, per Dave Ramsey’s Total Money Makeover.  Check out the beginning of our Journey HERE.

In January we started to tackle one of our student loans, which had a total balance of $2,993.52.  Through lots of budgeting and scrimping we were able to pay off $1,520, leaving us with a balance of $1,485.16 after interest was added.  Our student loan had a monthly payment of $127, which we paid, and then added in every extra dollar we could spare.  I was pretty impressed that we were able to scrounge up that extra $1,520!

So for February we got that snowball rolling.  We were able to pay off the balance of that student loan, and start in on our next debt!  It was so satisfying being able to make the final payment on our first debt!  Cross one off of the list!

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So satisfying to see a $0 balance on our first debt!

Now, we take that $127, that we were paying on the loan, and roll it into the next on the list…a credit card balance.  Our second debt, a credit card that started with a balance of $1,895.52 is up to bat.  This has a monthly payment of around $60, but we are now able to add in the $127 from our previous loan, and automatically we can now pay $187 without changing anything in our budget.  But who wants to pay the minimum?  We want our snowball flying down the hill!

In addition to the saving and budgeting techniques that we used  in January we had a few extra income opportunities that were able to really help us pay down our debt this month.  My husband coaches two high school sports, and he received both stipends this month.  We generally take his stipend and spend it on a vacation, this year we divided it into quarters.  One quarter went into the vacation fund, one quarter into his spending money, one quarter into savings, and one quarter right into the debt snowball.  For the month of January this was an extra $1,500 that we applied straight into debt.  It helped take a huge chunk out!  I also received a bonus at work, since that was surprise income we applied it right to the debt as well.  These aren’t typical incomes, so we won’t be able to pay off this much at a time on a regular basis each month, but getting the momentum going and seeing our debt really start to lower has been so rewarding.

At the beginning of February we still had $1,485.16 left on a student loan…gone!  Then we moved onto a credit card with $1,895 which is now down to $315.52!

So far in 2016 we have paid a total of $4,593 in debt!  And it’s only been two months!  In March I know that we will be able to finish off that credit card, which now means when we move onto our 3rd debt we will be paying the $172+$60+the minimum payment.  That’s an extra $182 a month that we are adding to our snowball.

We are still continuing to add to our house savings account, but paying off our outstanding debt is really getting fun.  My husband starts a new job in a week, and his first month on the job will be a real pay cut, so I am definitely glad we completed the first step of Dave Ramsey’s Total Money Makeover, which was setting up a $1,000 emergency fund.  Hopefully we don’t need it, but if we do, we know it’s there.

And then in a few weeks I start my new job, I received a promotion at work, so they extra income will help with the decrease my husband will be seeing.  And then as his salary starts to increase we can take the extra and roll it into our snowball.

I’m excited to see if we can keep the momentum up.  What budgeting techniques do you use?

Check out a copy of Dave’s book here, I highly recommend it!


Bill Payment Checklist and Budgeting

After my husband and I decided this was really the year to buckle down and start saving for a down payment on a house, we knew that we had to really get a handle on our budget.  We’ve always been a little loosey goosey, generally knowing how much we spend, generally knowing how much we can afford, generally knowing when bills were due, but no solid set in stone plan to follow.
Between the two of us we have too many student loans, car payments, insurance payment, and regular bills to keep track of in my head.  Every few days I would check in to see what bills were due, did I forget anything, over look a due date?  Some bills come out through automatic withdrawal, but I don’t like to do that with everything.  When we became serious about saving I knew that I needed a better system.
I looked around to see what options are out there.  There are all kinds off Bill Pay Checklists, most of them are free.  I found two that I prefer.  One come from A Mom’s Take.  

Free Printable Bill Pay Checklist from A Mom’s Take

It is a free printable, for the whole year, and is nice and colorful.  This is my monthly go-to guide.  I write down all of our bills in order they are due, how much the bill is for, and I check it off each month once paid.  I’ve said it before, I’m a list person.  Having this physical piece of paper as a list is hugely helpful to me.
Another one that I like is from My Frugal Home.  This one is very similar, still a free printable, but it’s also editable on the computer.

Printable and Editable Bill Pay Checklist – From My Frugal Home

I like that this one is editable on the computer.  Each month I just need to open the pdf and electronically check off each bill as I pay it.
Something else that we have found extremely helpful for budgeting, is to pay all bills that are due within a time period right as we get paid.  So even if we are paying the bill before it is due, we pay everything that we know will be due before the next income check, right up front.  That way we know how much we have to push into savings, and don’t over spend on the little things.
Keeping track of what we have in savings, and watching it slowly increase has also been rewarding in and of itself.  What are your tips for keeping track of expenses and bills?  How do you budget throughout the month?