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June 2016 Debt Repayment

June 24, 2016
AUTHOR: Emilie
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So here is how I started the month.

May
Loans
ECSI (College Debt): 8528.77
Upstart (Starter-life Debt): 4970.92

Credit Cards
Southwest (Chase): 3080.86
Discover: 1074.44

Combined Debt: 17,654.99 

And here’s all the progress I made:

June
Loans
ECSI (College Debt): 8471.31 (-0.7%)
Upstart (Starter-life Debt): 4813.25 (-3.2%)

Credit Cards
Southwest (Chase): 3054.27 (-0.9%)
Discover: 1374.53 (28.0%)

Combined Debt: 17,713.36 (58.37 or 0.33%)

… So I acquired debt this month. I know, I know. It’s terrible. But here’s what happened. After a bummer last month, I decided that in addition to continuing to be extremely strict on my finances, I also needed to generate more revenue. There’s only so many hours in a day and working and freelancing take up time. Then The Paradise Pack appeared before me and with it, the opportunity to buy Elite Blog Academy 2.0, which I was having serious remorse over not having invested in when the opportunity came. I was able to get the entire Paradise Pack and EBA for less than the cost of EBA had I bought it last time. I didn’t have the ability to cashflow it because I don’t have a couple hundred dollars in my wiggle room, so I put it on my Discover card. I’m sorry and I do feel bad about it, but I know it was an investment in me and I’m optimistic that I will be able to garner a return from it!

I also didn’t aggressively pay off debt because I’ve been focused on rebuilding my bank account. I live on last month’s pay which means I keep one of my two monthly paychecks (~$1300) in my bank account at all times. It’s still really important to me to have at least $1000 in my separate savings account in case of emergencies. I did have more before but it was depleted by my decision to move in May. This means I like to have $2300 in combined savings (bank account cushion + liquid savings). That’s more than the Dave Ramsey Baby Step of $1000 but considering any family emergency requires a flight and that flight could be international, it is really important to me to have this piece of mind. I only paid minimums so that I can rebuild that savings account. Unfortunately, I did not reach that threshold this month, so I will have to work towards it again next month, but I should reach that pretty easily, letting me go back to attacking my debt.

Also, I’ve made a new adjustment on my debt snowball. I was determined to attack my Southwest debt, as if it was my smallest debt, but I feel like I’ve been working on it for a while and not making much progress. This was limited in large part by the face that I was paying $175 on my Discover card, a huge amount but not enough to make a substantial difference. The advantage to this method was that since the Discover wasn’t accumulating interest, I could put extra to help decrease my interest payments on my Southwest card.

Emotionally, though, it’s been hard to feel like I’m working so hard and not making any progress. I decided that I needed a win, so going into next month, I’m going to be attacking my Discover card with the goal of paying off the balance (currently: $1375) by September.

It’s easy to get sucked into needed all the little wins to keep motivated and as I caught myself doing that I wanted to take a second to reflect on my progress so far! I started off 2016 with over 22K of debt in six different places. I’m down to four debts and under 18K in six months while living in a major city with high cost of living, notwithstanding multiple trips (Georgia, South Carolina, Ohio, Florida) and a cash-flowed multiple-state move.

Let’s talk: How did you do with your debt repayment this month?

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Emilie is a data engineer by day and lifestyle blogger by night. A Jersey girl at heart, she is currently living in her fifth home in three years, Savannah, GA with her college sweetheart. She’s learned the hard way that home is wherever the Army sends them. She enjoys eating food, cuddling with her dog, and binge watching HGTV.