Showing posts with label debt. Show all posts
Showing posts with label debt. Show all posts
Thursday, May 22, 2008
Henry Rollins on credit and retirement
Henry Rollins is awesome. I love his music, his show, and his spoken word performances.
Friday, May 2, 2008
April Update
The official monthly update.
Items:
The stimulus payment will show up soon. We had a direct deposit refund, so we'll get ours in a short while. Me and my wife had a discussion about what to do with each of our shares ($600 each, but I'm not going to decide what to do with her money.)
My wife has been halfway getting into this frugality thing too. I'm very proud of her. We agreed that half of our money will go to our largest debt (the new car), and the other half can be spent as desired. I'll probably just put mine in my IRA.
Right now, we just need to maintain, and cut costs where we can. I think at some point soon, we might sit down and discuss a monthly budget. I've got enough information from my pay stubs to know about how much I get paid now (paid per hour, and it varies by a bit from paycheck to paycheck.)
Items:
- My wife's bonus finally showed, and things are moving smoothly.
- My work union is negotiating a new contract, which will include a raise.
- I'm working as hard as I can to get back into school.
- I've increased my 401(k) contribution to 5% (3% matched).
- Review
- Financial
- Credit card debt totaling $0 (No change) ("deadbeat" credit card balance isn't counted. That card is paid off every month) (goal $0)
- Loan debt totaling $0 *GOAL REACHED*
- Loan debt totaling $0 *GOAL REACHED*
- Car loan totaling $18,448.46 (No change)
- Emergency fund totaling $7263.76 (up $1,955.04) (goal $7,500)
- Roth IRA contributions to date: In savings, $3590.74 (up $1114.8), invested in DCA plans, $300 (up $100)(goal $5000)
- Charitable
- Total hours volunteered: 21 (goal: 100)
The stimulus payment will show up soon. We had a direct deposit refund, so we'll get ours in a short while. Me and my wife had a discussion about what to do with each of our shares ($600 each, but I'm not going to decide what to do with her money.)
My wife has been halfway getting into this frugality thing too. I'm very proud of her. We agreed that half of our money will go to our largest debt (the new car), and the other half can be spent as desired. I'll probably just put mine in my IRA.
Right now, we just need to maintain, and cut costs where we can. I think at some point soon, we might sit down and discuss a monthly budget. I've got enough information from my pay stubs to know about how much I get paid now (paid per hour, and it varies by a bit from paycheck to paycheck.)
Thursday, April 10, 2008
March Update
The official monthly update.
First, I did end up buying a new car. I need something reliable, and this one will last me a long time. I plan to make extra payments to get it out of the way quickly though.
Goals Update
The car, of course, is new, but I talked about that already. I'll live. The car wasn't that expensive, but I was upside down on the first loan. Gap insurance was a must, and it was exceedingly affordable via USAA.
Other than that, things are going as planned.
First, I did end up buying a new car. I need something reliable, and this one will last me a long time. I plan to make extra payments to get it out of the way quickly though.
Goals Update
- Review
- Financial
- Credit card debt totaling $0 (down $1,000.00) ("deadbeat" credit card balance isn't counted. That card is paid off every month) (goal $0)
- Loan debt totaling $0 (down $2,020) (goal $0) *GOAL REACHED*
- Loan debt totaling $0 (down $3,029.58)(goal $0) *GOAL REACHED*
- Old car loan totaling $0 (down $7,728.01) (goal $5,485.41)
- New car loan totaling $18,448.46 (up $18,448.46)
- Emergency fund totaling $5,268.72 (down $272.82) (goal $7,500)
- Roth IRA contributions to date: In savings, $2475.94 (up $418), invested in DCA plans, $200 (no change)(goal $5000)
- Charitable
- Total hours volunteered: 12
The car, of course, is new, but I talked about that already. I'll live. The car wasn't that expensive, but I was upside down on the first loan. Gap insurance was a must, and it was exceedingly affordable via USAA.
Other than that, things are going as planned.
Friday, March 21, 2008
Update, just because
Lots of new things have occurred since the last update, so here's a spring update for the beginning of spring.
Goals Update
There was a little episode of "New Car Fever" that I almost succumbed to, but I was saved by the lack of ethics of car salespeople. My car's fuel pump went out, and I was tired of having car issues (although that warranty saved me over $600. Worth it) I wanted to look into a new car with a good warranty, and the dealership was only too glad to help. I had a great deal lined up: 0.0% financing for 60 months, invoice price for a new Chevy Aveo5, and $4000 trade in for my car (more than it's worth). Then, "oops, the %0.0 is only on the impala, but we do have %2.9 for the Aveo5."
Well, no problem. That's still a great rate, and everything else still applied. I set everything up ahead of time, confirmed the numbers, and went down to seal the deal.
2 hours into the paperwork, they pull me aside and say "we made a mistake: The %2.9 is on the Chevy Cobalt. The best we can do for the Aveo5 is %6.75".
That was the final straw. I thanked them for their time, and walked out. Of course, as always happens, the salesman ran out at the last minute and stopped me. "Wait! Let us see what we can do." So I did. The short answer? Nothing worth my money. Tired, cranky, and up way past my bedtime, I drove my own car back. A new car can wait. Besides, with the market the way it is, I predict low, low, new car prices soon.
So, I feel I've made great progress this month. Next month should look good as well, as my wife's bonus is still due to show up.
And, of course, I did splurge a bit with my bonus. I bought a new Archos 605 wifi, with accessories. I plan to use that thing everywhere, from work to the gym.
Goals Update
- Review
- Financial
- Credit card debt totaling $1,000.00 (down $308.83) ("deadbeat" credit card balance isn't counted. That card is paid off every month) (goal $0)
- Loan debt totaling $0 (down $2,020) (goal $0) *GOAL REACHED*
- Loan debt totaling $0 (down $3,029.58)(goal $0) *GOAL REACHED*
- Car loan totaling $7,728.01 (down $169.13) (goal $5,485.41)
- Emergency fund totaling $5,268.72 (up $2,008.32) (goal $7,500)
- Roth IRA contributions to date: In savings, $2,057.94 (up $902.31), invested in DCA plans, $200 (up $100)(goal $5000)
- Charitable
- Total hours volunteered: 3
There was a little episode of "New Car Fever" that I almost succumbed to, but I was saved by the lack of ethics of car salespeople. My car's fuel pump went out, and I was tired of having car issues (although that warranty saved me over $600. Worth it) I wanted to look into a new car with a good warranty, and the dealership was only too glad to help. I had a great deal lined up: 0.0% financing for 60 months, invoice price for a new Chevy Aveo5, and $4000 trade in for my car (more than it's worth). Then, "oops, the %0.0 is only on the impala, but we do have %2.9 for the Aveo5."
Well, no problem. That's still a great rate, and everything else still applied. I set everything up ahead of time, confirmed the numbers, and went down to seal the deal.
2 hours into the paperwork, they pull me aside and say "we made a mistake: The %2.9 is on the Chevy Cobalt. The best we can do for the Aveo5 is %6.75".
That was the final straw. I thanked them for their time, and walked out. Of course, as always happens, the salesman ran out at the last minute and stopped me. "Wait! Let us see what we can do." So I did. The short answer? Nothing worth my money. Tired, cranky, and up way past my bedtime, I drove my own car back. A new car can wait. Besides, with the market the way it is, I predict low, low, new car prices soon.
So, I feel I've made great progress this month. Next month should look good as well, as my wife's bonus is still due to show up.
And, of course, I did splurge a bit with my bonus. I bought a new Archos 605 wifi, with accessories. I plan to use that thing everywhere, from work to the gym.
Thursday, February 7, 2008
Much better
I checked off one of my goals. I've refinanced my auto loan.
My previous auto loan had an interest rate of 14%, which was killing me. My monthly payments were $308 (for a 5 year loan), and too much of that was just interest.
Here's what I did. USAA would give me a loan for 6.434%, A huge improvement. But, they wouldn't cover the whole amount, since I owe more than the car is worth. But, they were willing to extend a personal loan for the remainder (at 12% interest).
I know what you're thinking. "Aren't you just getting further into debt?". Here's how bad my rate was. The monthly payment for the personal loan AND the new auto loan are still less than my current auto loan, and the total interest paid is much lower.
Not only that, but I'm reenlisting very soon, and I plan to use that money to pay off the two personal loans. That means that I won't be paying most of the larger interest bearing loan, and my auto loan payments go to about $190 for a 4 year plan. That's one year less at minimum payments, and I'm still saving a huge amount of money.
So, this adjusts my amounts owed. This will be reflected at the beginning of next month.
Also, this highlights the importance of READING WHAT YOU SIGN! When I received the documents to sign, I noticed that the interest rate was 7.434%. They had failed to include the 1% discount for applying online. I called them, and requested they change it. That extra 5 minutes to call and check saved me a good amount of money.
My previous auto loan had an interest rate of 14%, which was killing me. My monthly payments were $308 (for a 5 year loan), and too much of that was just interest.
Here's what I did. USAA would give me a loan for 6.434%, A huge improvement. But, they wouldn't cover the whole amount, since I owe more than the car is worth. But, they were willing to extend a personal loan for the remainder (at 12% interest).
I know what you're thinking. "Aren't you just getting further into debt?". Here's how bad my rate was. The monthly payment for the personal loan AND the new auto loan are still less than my current auto loan, and the total interest paid is much lower.
Not only that, but I'm reenlisting very soon, and I plan to use that money to pay off the two personal loans. That means that I won't be paying most of the larger interest bearing loan, and my auto loan payments go to about $190 for a 4 year plan. That's one year less at minimum payments, and I'm still saving a huge amount of money.
So, this adjusts my amounts owed. This will be reflected at the beginning of next month.
Also, this highlights the importance of READING WHAT YOU SIGN! When I received the documents to sign, I noticed that the interest rate was 7.434%. They had failed to include the 1% discount for applying online. I called them, and requested they change it. That extra 5 minutes to call and check saved me a good amount of money.
Friday, February 1, 2008
Automating my banking
Following advice of some such as J.D. from Get Rich Slowly, I'm going to try to automate as much of my monthly issues as I can. I'm doing this a few different ways.
Direct Deposit - Automating my savings
I've turned in a change form for my direct deposit. Previously, it went into my online checking account at HSBC, and I would transfer payments to where I needed them to go. Now, I'm going to automate it. From every paycheck, $125 goes into my emergency fund savings account, and $209 goes into my IRA savings account. The remainder goes into my USAA checking account, which has a rewards debit card attached.
In addition, I have already set up for myself, and will set up for my wife (as soon as the account authorization finishes) an IRA account, to which $50/month will be drawn directly from the IRA savings account in a dollar cost averaging program, which is a good plan in times with price fluctuations, such as now.
So, with 2 paychecks per month, that means that the $250/month into my emergency fund, and the $418/month into my IRA savings account will happen automatically. Plus, we will then start making contributions to our IRAs at $50/month each. Once we're a little bit better off savings wise, we might set up another dollar cost averaging plan for a different mutual fund.
Automated payments - consolidating bills, and earning money for doing it
I've opened up a rewards credit card at USAA. This does a few things for me: It makes my debt/credit ratio much better, and it allows me to consolidate my bills. Many of my bills can be paid via credit card, and most of those can be set up to automatically charge the card. Once the card is charged, I can pay the balance on the card off immediately. The other upside to this is that it's a rewards card. I get cash back (only 1%, but it's better than nothing) just for paying my bills!
Not only that, but the card actually comes with checks that can be written, and the checks are treated as credit card transactions, for no extra fee! That's very easily abused, but I plan to use it for one purpose only: Rent. My apartment requires checks or money orders. This way, I can still earn cash back on my rent.
Only a few bills remain that have to be paid from a checking/savings account:
Direct Deposit - Automating my savings
I've turned in a change form for my direct deposit. Previously, it went into my online checking account at HSBC, and I would transfer payments to where I needed them to go. Now, I'm going to automate it. From every paycheck, $125 goes into my emergency fund savings account, and $209 goes into my IRA savings account. The remainder goes into my USAA checking account, which has a rewards debit card attached.
In addition, I have already set up for myself, and will set up for my wife (as soon as the account authorization finishes) an IRA account, to which $50/month will be drawn directly from the IRA savings account in a dollar cost averaging program, which is a good plan in times with price fluctuations, such as now.
So, with 2 paychecks per month, that means that the $250/month into my emergency fund, and the $418/month into my IRA savings account will happen automatically. Plus, we will then start making contributions to our IRAs at $50/month each. Once we're a little bit better off savings wise, we might set up another dollar cost averaging plan for a different mutual fund.
Automated payments - consolidating bills, and earning money for doing it
I've opened up a rewards credit card at USAA. This does a few things for me: It makes my debt/credit ratio much better, and it allows me to consolidate my bills. Many of my bills can be paid via credit card, and most of those can be set up to automatically charge the card. Once the card is charged, I can pay the balance on the card off immediately. The other upside to this is that it's a rewards card. I get cash back (only 1%, but it's better than nothing) just for paying my bills!
Not only that, but the card actually comes with checks that can be written, and the checks are treated as credit card transactions, for no extra fee! That's very easily abused, but I plan to use it for one purpose only: Rent. My apartment requires checks or money orders. This way, I can still earn cash back on my rent.
Only a few bills remain that have to be paid from a checking/savings account:
- My power bill will do credit card payments, but charges a fee. Not worth it. Maybe the credit card checks will help with that one.
- My auto and signature loans will only take bank to bank transfers. I'll have to pay that myself.
Thursday, January 17, 2008
That was one of the hardest things
If anybody knows me, they know that all I've been talking about car wise is the Smart Car. I saw them everywhere in Germany (their home town) and they work great, especially for what I would need a vehicle for. I really, really want one.
However, "buy new car" isn't on my list of goals. In fact, it's in direct opposition with one goal, to bring my auto debt down. It is possible to get one. What they would do is roll the current debt in with the new debt, and cut me a loan for that. The only problem there is that then, I owe far more than the car is worth: about $10,000 more. If the car gets totaled, the entire debt won't be forgiven, just the amount the vehicle is worth. I'm not comfortable with that.
So, I called Smart. They had a plan I bought into more than a year ago to reserve a Smart FourTwo. At that time, I had a car I owned outright, and less bills. Now, I have an auto loan, and more bills. So, I asked them to refund the money I put down (only $99), and I'll have to wait on the Smart car.
I'm bummed, but at least I know I'm avoiding a mistake.
However, "buy new car" isn't on my list of goals. In fact, it's in direct opposition with one goal, to bring my auto debt down. It is possible to get one. What they would do is roll the current debt in with the new debt, and cut me a loan for that. The only problem there is that then, I owe far more than the car is worth: about $10,000 more. If the car gets totaled, the entire debt won't be forgiven, just the amount the vehicle is worth. I'm not comfortable with that.
So, I called Smart. They had a plan I bought into more than a year ago to reserve a Smart FourTwo. At that time, I had a car I owned outright, and less bills. Now, I have an auto loan, and more bills. So, I asked them to refund the money I put down (only $99), and I'll have to wait on the Smart car.
I'm bummed, but at least I know I'm avoiding a mistake.
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