So, how was your summer?

We’ve got some catching up to do!

Camping with the family was a real adventure!  The story that will be told over and over is that of our very first night…

We had borrowed a 1970’s canvas tent with heavy steel poles from Perry’s dad rather than buying a new tent for the family.  His would easily fit two parents and three kids and it was kind of like a small canvas one-room house.  It was tall enough that we could stand up and the windows were more than waist high.  It had double door flaps that tied back and let a great breeze flow through.

We arrived at our destination in the afternoon and found my parents had already parked their RV and were preparing dinner for all of us.  Perry and I set up the tent and noted the dark sky and the smell of rain in the air.  After dinner, we hustled the kids into the tent for their first night of camping.  We spent some time settling in and reading books, then tucked in for the night to the sound of gentle rain on the canvas roof.

Somewhere around 4:00 AM, Perry and I were startled awake by strong whips of wind and rain pounding the tent on what seemed like all sides.  Perry and I talked quietly about whether we should move the kids to the car or wake my parents and join them in the RV.  Before a decision was made, another gust of wind knocked down the steel poles on the back side of our tent.  I jumped up to hold the tent wall up while telling the kids to grab their shoes, books, and stuffed animals because we had to run to the camper.  I was trying to hide my panic as the rain was beating through the canvas wall on my back, soaking my clothes.  The wind was swirling around the tent, blowing in the now unsupported walls.  Perry helped the kids find their things while I called my parents’ cell phones repeatedly to wake them and ask them to unlock the RV door.

Within about 45 seconds, everyone was ready to run.  At this point, all sides were collapsed and there was just enough space under my drenched outstretched arms for Perry and the kids to huddle around.  Perry struggled to unzip the 30+ year old zipper, and he and the kids bolted out and ran to the RV.  I followed, dropping the tent and abandoning our pillows and sleeping bags.  Perry insists that I did a barrel roll out of the tent like some kind of ninja.

We made it into the RV and dried off.  Our tent survived another two days, always leaning to one side and threatening to give in to the smallest gust of wind before we decided it would be in our best interest to spend the money to replace it.

After a night in the wind.

We had to laugh about how we’d given the kids a great introduction to camping.  The rest of the trip would be easy after running out of a collapsing tent in a rain storm.  We went on to see an outdoor play of Little House on the Prairie on one of the properties where the Ingalls family lived.  We explored Wall Drug.  We hiked the Badlands.  We saw Mount Rushmore all lit up at night.  The kids earned Junior Ranger badges and promised to appreciate, respect, and protect all national parks when they were officially sworn in.  We saw the Corn Palace and learned a lot about U.S. history.  We ended our trip by surprising the kids with one night at a hotel with a water park where they played to the point of exhaustion, then slept like angels.

It was a great trip and we have tons of family memories.  We’re already thinking about places we can camp and explore next summer.

To the future!

Apologies for my lengthy absence.  Debt repayment has been taking small steps forward and large steps backward in the last year and it has frustrated me to the point that I haven't wanted to blog about it.  I should blog about it though, because this is how debt repayment goes.  You think you're making great progress climbing out of the hole and some unforeseen circumstance knocks you back down into the chasm. It has happened before and it will very likely happen again.  I need to prepare as best I can and handle these things as they come.

Kindergarten expenses took a huge toll.  The initial plan was to split the girls' $8,000 worth of kindergarten tuition expenses 50/50 with their dad (he would pay for one child and I would pay for the other), but I found out with just a few weeks left of the school year that he hadn't made any payments.  I scraped together enough debt to cover her $4,000 tuition and promptly filed the child support modification request that I had intended to hold onto until after the wedding.  We'll see how that turns out.  I read through it a dozen times making sure I was being objective and fair in asking for a modification.  Ugh... I hate drama.

So, on to happier things!

We've got less than six weeks to the wedding!  We've managed to cash-flow everything.  We've shopped around and found deals on things we love.  We've asked to borrow things rather than buy them.  We've DIYed a LOT.  We've recruited a team of friends and family to help us make our wedding happen.  Will our wedding be featured on a wedding blog for other couples to fawn over?  Probably not.  But we're going to get married and celebrate and we're going to start our marriage without any wedding-related financial stress. I'll give up all the short-term fuss in exchange for meeting some long-term goals, thankyouverymuch.  We're not fancy people and I'd rather not fake it on such an important day.


All three of the kids have finished kindergarten and are excited about the wedding.  They've had a great summer so far.  It is now clear that putting the girls in separate classrooms has been good for them because they're getting really tired of each other already and can't wait for school to start again so they can get some time apart.

It's sometimes strange living in our little sociology project.  Reagan was diagnosed with ADHD and Oppositional Defiant Disorder partway through kindergarten.  We suspected the ADHD long before, but put off having her screened by a professional.  We've learned a lot about how her brain functions differently than our other two kids (and our own) and she's doing just fine most of the time.  All three kids have their own bedrooms now and I think having her own space where is free to be alone if she so chooses has helped her immensely.  She is also responsible for that space and takes a lot of pride in organizing her new desk to make room for drawing.

Cow in a Thunderstorm - by Reagan

We have issued a reading challenge for the kids this summer.  We've asked them to read at least two hours per week.  Every week that they meet their goal, they each get to choose a new book to buy for their personal library.  At the end of the summer, provided they have met their challenge consistently, we are going to go to a theme park as a family.  They've really taken to it.  Those weekly trips to the bookstore are a lot of fun.  Kieran picked out Mercy Watson to the Rescue when we went book shopping on Sunday and she has already read it twice!

So overdue!!!

Ugh... These big balances are slow-moving, but I'm chipping away. Baby steps...

The girls and I moved in with my fiance and his son a few weeks ago. The kids are all settled in. The girls are looking forward to painting their room. My old apartment is the only place they remember living, so choosing wall colors and having a small yard is a lot of fun for them.

I started talking about my methods of handling finances before we were even engaged, so this hasn't been a shock to him. We have decided to keep our finances separate until after the wedding, though we may open a separate joint account solely for wedding saving and spending. Our current challenge is that my fiance is unemployed every July (he works for a local school district), so in our first month living together, I am the sole wage-earner. It's a challenge, but we held a garage sale one weekend and raised a good chunk of change in the miserable Minnesota humidity. I also had a nicely-timed bonus that helped us out and I have been working as many extra hours as I can without sacrificing family time (or my sanity). We're going to get through the month just fine and I think our emergency fund will survive unscathed.

The next challenge is going to be the school year. We've decided to put the kids in full-day kindergarten rather than continue daycare. Kindergarten tuition is not tax-deductible, nor can it be paid for using my FSA (don't get me started on how backwards this seems to me). I had a short mental debate about whether or not we should opt for half-day kindergarten and part-time daycare given these facts, but decided that I'll pay taxes for the kids to be in an educational environment all day. The cost for our local public school for full-day kindergarten is about $4,000 per child per year. We have to work that into our budget as well as saving for our wedding and continuing to pay down debt. This will be a challenging year, but we're a team and we're going to make it!

The Things I Wish I'd Learned BEFORE College

Seeing the balance on my student loans always makes me cringe. I have been in and out of college for 13 years and have yet to complete a degree. I just can't seem to decide what I want to be when I grow up. Making that decision even more difficult is the fact that I have a job that I love that pays well in a business where I have worked my way up from the bottom. With the job market as it is, though, I realize that my job may not always be here and, should it disappear tomorrow, I would be hard-pressed to find another position earning what I do based solely on my work experience. A majority of those in my department have degrees in something ranging from biology to theater, but they have degrees and that counts for something regardless of the fact that the required classes to earn these degrees do not apply to this position. As much as it irritates those of us who have not earned degrees, this is the world that we live in so we need to keep up or assume the risks.

I am crossing my fingers that work will slow down just enough that I can start taking classes again at the beginning of the coming year. I won't be taking out a single loan to make this happen, however. I will never sign another student loan document with the exception of a check to pay off each one. I currently pay them via online bill pay, but I want the satisfaction of hand-writing those final payments. Below are some of the things that I wish I had thought about prior to signing up for student loan debt starting at the tender age of barely-18.


1. Student loans must be repaid and will affect your lifestyle for years or even decades after you graduate (or drop out).

Student loan payments can drastically affect your lifestyle. It's frustrating making hundreds of dollars worth of payments every month when all you have to show for it is a prestigious piece of paper, much less if you never earned said piece of paper. There are very few ways to get out of repaying your student loans. They're not bankruptable. You can't return or eBay your education to recoup some of your money. You are stuck with the debt that you signed up for, so...


2. Read the fine print. Just because it's a student loan doesn't mean it's a low interest rate.

Until I had to start making payments on my student loans, I had no idea that I had signed up to make payments at 18% interest for 15 years. 15 years!!! Had a loan officer said to me at 18-years-old, "You will begin making payments on this loan at age 22 and your loan will be paid off right around the time you turn 37." there is no way I would've signed that piece of paper without at least thinking about it for a while.


3. You don't have to spend every last penny that is handed to you.

Spending student loan overages on things other than school necessities only extends and increases the payments you'll have to make in the end. I'm making payments on pizza, shoes, and a $500 car that I drove for less than a year more than ten years after all of these things are long gone. Just because the money is handed to you doesn't mean you can't spend what you need and give the rest back. Carefully consider what is truly a need and what is a want.


4. If you don't have a major, don't attend a private college.

Yes, there is some prestige that comes with the names of some universities, but not if you can't afford to stay long enough to graduate. I spent $27,000 to for three semesters of general courses that I would've had to take at any school. Here is a tip: To say that you graduated from Harvard (for example), you only have to complete your degree at Harvard. You could spend three and a half years as a full-time student at UMass for about $41,000. One semester at Harvard costs over $19,000. So, to graduate from Harvard, you can spend four years there and spend well over $150k, or you can spend $60,000 (or even less if you attend a school other than UMass - I just choose a state school in Massachusetts for this comparison). Both students get a degree declaring their graduation from Harvard.


5. Student loans aren't a necessity.

Future students and parents: Plan ahead for college. This is a foreseeable major expense. You can save for it. You can work hard in school. You can apply for a million grants and scholarships. You can shop around and find a great school that is within your budget.


6. Financial aid can be negotiated.

Government grants may not be negotiable, but assistance from your school may be. Talk to a financial aid counselor and find out what kind of assistance is available. You may qualify for grants and scholarships for students in need or reduced tuition. When it comes to money, treat the school as a business and think of yourself, the student, as a customer. You have the option to obtain your education and spend your money (including grants and scholarships) elsewhere. It may be in their best interest to work with you.


7. Where there is a will, there is a way.

American culture pushes doing everything the easy way. Technology has advanced in ways that allow us to do more work with less effort. Much of the media promotes instant gratification and constant entertainment. I know parents have been using the phrase, "When I was a kid..." for generations and no teenager really wants to hear it, but there are some real lessons that can be learned not only from prior generations, but from those in the younger generations who have embraced hard work. If there is a gap between what your grants and scholarships cover and what college is going to cost, find ways to reduce that cost or pay for the difference. Consider living at home rather than on-campus or reducing your course load. Work during college. Sacrifices may need to be made. These may be your first real grown-up decisions if you've just graduated high school and they won't be easy, but they are important.


Please leave a comment with your own lessons learned regarding student loan debt.

Aiming for $7,500 by the end of July!

I took my first step in this journey on February 5th of this year when I put $1,000 in an Emergency Fund and made my first big payments toward my debt. It is now almost five months later and I have paid off a grand total of...

$6,279.94

Wooohooo!!! I broke $6k!! I'm going to aim for $7,500 to be paid off by the end of July. It is an aggressive goal for the next month, but I want to be half-way to my $15,000 goal by the end of my first six months of really working at this. I haven't been working as hard as I could have been at times, but I need to keep my nose to the proverbial grindstone.

Speaking of challenges, have you read the most recent report on the cost of raising a child? The average American family spends $222,360 to raise a child from birth to age 18. My cherubs being born a mere two minutes apart means that I have the divine privilege of spending somewhere in the vicinity of $444,720 before I give them the boot. I'm pretty sure they're mostly going to eat nine of the next fourteen years of my income with the way they go through pints of berries and cherry tomatoes. We're going to have to find a way to expand our farm off of this little apartment deck.

Don't get me wrong. They're worth every penny, but the girls were born as a two-for-one deal and I'm going to do everything I can to keep those deals going. Either I'm going to have to be diligent about my frugality or they're going to have to find a way to break into showbiz. Maybe we should try a two-fold approach. That's it. We're starting a band. Please leave your band name suggestions in the comments below.

If we someday adopt the metric system, will I have to call these kilometerstones?

As of this morning, I've made two big accomplishments.

1. I paid off another credit card!  This is the last card from my college credit card debt and I am so happy to finally be rid of it.
2. With the payments made today, I've crossed the next big marker on my debt-o-meter.  I have now crossed the $4k threshold for debt paid off.  That means I've paid off more than 11% of my debt in under three months!

So, here's the update in numbers:

Direct Deposit Advance - $0/$550
Store Card 1 - $0/$323
Credit Card 1 - $0/$400
Line of Credit - $0/$510
Credit Card 2 - $0/$685 - PAID!!
Student Loan 1 - $1950/$1951
Store Card 2 - $2,638/$2,800
Student Loan 2 - $2,765/$3,148
Auto Loan - $3,735/$4,140
Credit Card 3 - $4,376/$4,577
Credit Card 4 - $4,910/$5,150
Student Loan 3 - $5,610/$5,614
Student Loan 4 - $5,904/$6,048

Total paid to date:  $4,131.05

(plus I have my $1,000 Emergency Fund in the bank, which didn't exist before this process started)

All of those little balances are out of the way.  The remaining larger balances look a little daunting, but I'm determined to keep the momentum going.  I'm going to skip over Student Loan 1 for now and knock out Store Card 2.  Student Loan 1 has a whopping $6 monthly payment which must be spread over about 72 years or so, but it has an incredibly low 3.25% interest rate.  Store Card 2, meanwhile, sports a 25.24% interest rate and a $80 minimum payment, $56+ of which goes to interest every month.  I'm looking forward to the day that I never again have to look at a statement with a double-digit APR.  In fact, when I'm through paying off this debt, the only interest rate I ever intend to see again might be for a mortgage.  Maybe, but we'll see.  Maybe I'll just save up for a house and pay cash.  Or maybe I'll build one a little at a time as I can afford whatever Lincoln Logs are needed to build a real-people house.

If I can keep going at this rate, I can be debt free in less than two years.  That would be amazing.  Most or all of this debt is going to be gone before the girls start kindergarten.  That means that I'll be in savings mode throughout most of their school years.  I can't believe that as a single mother raising twins I'm going to be able to pay for both of them to go to college by myself!  Paid-for college is going to be a reality!

I'll do a really bad robot dance for $150 if you want to pretend this is Chuck E. Cheese.

The chicklets turned four at the beginning of April and we celebrated with a dinosaur-themed party at our apartment with a bunch of good friends.  I'm not much one to spoil my kids, generally, but it's really hard not to get them a ton of presents and throw big party.  I find myself thinking, "but there are two of them and they have to share a birthday..."  In the end, though, I know that I really want to do those things for me, not for them.  I want to buy them lots of things because I usually don't.  I want to throw a big party because most of our fun is just the three of us.  But, seriously, they were turning FOUR.  Would the girls (and the guests, for that matter) really have that much more fun if I spent $200 for bad pizza and jerky animatronic entertainment at Chuck E. Cheese rather than spending less than $50 for surprisingly delicious Costco pizza and cupcakes at our place?  $150 cheaper and far more interaction between people.  Granted, there was no giant dancing mouse, but I'm pretty sure that would've resulted in at least one terrified child anyway.

One of my birthday gifts to the girlies is a membership to the Minnesota Children's Museum.  I contacted their membership coordinator and finagled a modified membership.  Many museums, zoos, etc., provide family memberships for married couples with children or two cohabitating adults with children, but I've never seen any membership specifically for a single-parent household.  Since I usually bring a second adult with me but don't feel that a museum membership is justification for asking someone to move in with us, I asked if I could get a family membership without naming the second adult.  I figured it was worth a shot.  The membership coordinator contacted me yesterday and she's going to make it happen!  We're going to try to go this weekend to see the dinosaurs (this is R and K's current obsession).  This birthday present is going to get us out of the house and keep us entertained all year, so I have no doubt that it's worth it.

I also got some great deals on some new Leapster games for R and K by using Diapers.com's price-matching service and the referral credits I haven't needed to use for diapers/pull-ups (yay!).  After all was said and done, I ended up with $50 worth of games for $6.  Bargain shopping WIN!!  I've been using this site since the girls were teensy.  I've always been able to get good deals but, honestly, my favorite thing was that I didn't have to carry cases of diapers up to my third floor apartment when I was also juggling a pair of squirmers and umpteen million other things.  The UPS guy got to haul them up the stairs for me.  Some days, I probably would've rather he carried the kids and I took the diapers, but c'est la vie...

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I forgot to post the best birthday present ever!  My mom and I made dino-hoodies for the girls and they turned out awesome!

the baby steps

I've mentioned that I'm following the incredibly simple debt-reduction plan taught by Dave Ramsey.  To give you an idea of what exactly that plan is, here is a list of the seven "baby steps" he teaches as a means to get out of debt and build wealth.


Baby Step 1
$1,000 to start an Emergency Fund
Dave frequently refers to this Emergency Fund to as "Murphy Repellent," meaning that Murphy's Law ("Anything that can go wrong will go wrong.") seems to apply far less to those who are prepared to deal with the unexpected.  It is crucial to keep perspective on what is truly an emergency when considering using this money.  Is it really an emergency?  Could I save money to cover this expense rather than pulling money from my Emergency Fund?


Baby Step 2

Pay off all debt using the Debt Snowball

The Debt Snowball pays off all debts except a first mortgage.  Dave suggests paying off the lowest balances first.  Pay the minimum on everything except the lowest balance and put everything you can toward that creditor until it is paid off.  Then take the amount you were putting toward that balance and attack the next lowerst balance.  As each balance is paid off, the snowball grows and more money is available to pay toward the lowest balance each month.  Learning to live on a budget and within your means (living on less than you make) is the only way to get out of debt and stay out.

Baby Step 3

3 to 6 months of expenses in savings

After the debt is taken care of, it's time to beef up the Emergency Fund.  More savings means you're better prepared for bigger emergencies should the arise.

The next several steps overlap or occur simultaneously. With the first three steps, you are digging out of a hole and ensuring that you are prepared to handle emergencies without incurring debt. The remaining steps are about building wealth.


Baby Step 4

Invest 15% of household income into Roth IRAs and pre-tax retirement

This is just the start of retirement preparation unless you're already on the verge of retirement.  Once the rest of the Baby Steps are complete, more may be invested.  My company matches 401(k) contributions, doubling the first 1% and matching the next 3%.  That means that if I put in 4% they will put in 5%.  That's free money!

Baby Step 5

College funding for children

R and K will be starting college at the same time, so this step is a little intimidating.  R declared the other day that she wants to be a doctor.  Later the same day, we were driving past the private college that I attended briefly and she told me that was where she wanted to go to school.  Granted, she is not even four years old yet, but I want to support her big dreams.  After all, I want to be in a nice nursing home someday!

Baby Step 6

Pay off home early

Home mortgages are the only type of debt that Dave Ramsey understands as a necessity for most people.  He would prefer that everyone pay cash but that's not an option for most people.  He provides some guidelines for those looking to buy a home:

1. Utilize only 15-year, fixed-rate mortgages.
2. Your monthly payment should be no more than 25% of your take-home pay.

Using these guidelines helps you to keep the cost of your home within your means and if your payments are reducing your mortgage balance at a faster rate, equity in your home is built more quickly.

Baby Step 7
Build wealth and give!

With the first six steps out of the way, you can invest more in your retirement if you'd like.  You can give more to the philanthropic organizations that are important to you.  You can even add more cash to the fun envelopes!  A fortune cookie I got recently said it best: 

"If you continually give you will continually have."

So those are the Baby Steps!  That's not so hard, is it? :)

This blog is now open to the public.  Feel free to pass it along to anyone you think may enjoy or benefit from it.  The links over there ---> might help me pay my debt down faster if I find myself with some followers who click on them now and again.

I'm adding labels to my posts so specific topics can easily be found.  I've also added a net worth tracker.  It's not much to look at right now, but it'll be fun to watch it change.  I'm a nerd for math, graphs, and spreadsheets so all of this is kind of fun for me.  I like paying bills.  How weird is that?

Please leave your answer in the comments below. :)

another one bites the dust!

I had my eye exam on Friday and discovered that I don't need new glasses. The glasses that I have are my current prescription.  It hasn't changed in seven years!  New glasses have now become a want rather than a need, so they're going to wait.  The money I had set aside to pay for my glasses has now been applied to my debt!  I have paid off three creditors this month and have $1,000 in the bank for emergencies!

Store Card 1 - $323
Direct Deposit Advance - $220
Credit Card 1 - $350
Line of Credit - $465
Credit Card 2 - $685
Student Loan 1 - $1,640
Store Card 2 - $2,800
Student Loan 2 - $3,145
Auto Loan - $4,005
Credit Card 3 - $4,470
Credit Card 4 - $4,910
Student Loan 3 - $5,615
Student Loan 4 - $6,025
 
According to the Debt Snowball Tracker that is part of my budgeting software, I have paid off $1,303.15 of my debt since I committed to this journey.  This includes both the larger payments I've made to pay off creditors as well as my regular payments to those still in progress.  I still have a long way to go, but this is an amazing start.  Next up is my Line of Credit.
 
I am using an envelope system for categories in which I tend to overspend the most or spend without thinking.  I have envelopes for groceries, restaurants, clothing and entertainment as well as one for fun money.  I have two checking accounts.  One of these is now being used solely for gas.  The reason for the gas account is that it makes it much easier to get gas when I don't have to take a pair of three-year-olds out of their car seats and into a store full of candy to pay for it.  That account is, essentially, my gas envelope.  The other checking account is being used to pay bills.

I'm still tweaking my budget with every paycheck.  I have discovered that I spend less on gas than I thought I did.  It's getting easier to admit that I don't have the money to do some things.  It's also very exciting to have money set aside to have some fun.  The girls and I are getting back into the habit of going to the library on our weekends together.  They love it and it provides entertainment for several weeks in the form of books and movies.  Gabe and I often cook as a form of entertainment and just generally enjoy each others' company.  I have maintained my Netflix account as an inexpensive form of entertainment as well.  We only get one DVD at a time and unlimited streaming movies online, so there is always something to watch if we're lacking things to do.  When we do go out, it's far less expensive with Gabe than most of my social life had been prior because there is no drinking on his part and very little on mine.  I used to buy friends drinks if I was getting myself one so the expense of one drink often doubled or tripled.  They're not cheap to begin with, so this is probably saving me more money than I even realize.

Things are great. My valentine's weekend was low-key and wonderful.  The girls and I are taking a road trip tomorrow to see Grandma Char and Grandpa Doug.  It'll be fun to spend some time with them and the girls always have a great time.  See you soon, mom and dad!

the approach

How do I keep it going?
I'm taking a few approaches to keep myself excited about paying off debt.  I want to stay focused so I'm trying to spend some time every day working on my finances in one way or another.  I look at my budget every time I recieve a bill to determine when it will be paid.  Because I'm in my first few months of using a budget, it is going to require some regular tweaking before I get it just right.  I am also listening to financially-focused podcasts on a daily basis to learn more and hear about the experiences that others are having paying off their debt.  Right now, I listen to The Dave Ramsey Show and Rebound.  I have also subscribed to MyTotalMoneyMakeover.com and am using the money tools there to help me in this process.  I'll blog more about that soon.

Why do I want to pay off my debt?
At this point, I spend about a third of my take-home pay on debt repayment.  That's ridiculous!  If I was able to save that money every month, I'd have the girls' college funds fully funded well before they were in high school.  I could afford to have them in preschool.  I could spend money on piano lessons.  And for me, I could contribute to a retirement fund and purchase stock at the company I work for.  I could buy new clothes when I lose weight.  I wouldn't be stressed out about how I'm going to pay for car repairs when they're needed.  And there is the fact that I hated going into my first marriage with debt.  I do intend to marry again someday and I don't want to bring financial baggage into the relationship.  I am currently dating an absolutely amazing man that has the desire and ability to be an entrepreneur.  Business ventures require capital.  I'd love to be a help rather than a hinderence in those ventures if we should end up marrying someday (and I hope we do <3).