Buh-Bye Student Loans!

As I was thinking about writing this post I realized that I don't even know who (if anyone!) actually reads this blog. I have these wild dreams of having a thousand plus followers but realistically if my mom used a computer she might actually be the only one keeping up with me. It's been a crazy mix of personal stories, design projects, party planning, & everything in between! So for today's post if you are here for the design projects & fun stuff hold tight with me while I share some personal exciting news! Since I'm not married, pregnant, buying a house, or have any other huge life changing event happening ... I have to be excited about other things. Sooo ...

 

TODAY, I PAID OFF ONE OF MY STUDENT LOANS!

wahoo!!!

You might remember when I started reading Dave Ramsey's "Total Money Makeover" book a little over two years back (& wrote this post: Total Money Makeover). Throughout the last couple of years I'll admit that I haven't been the most diligent in sticking to a budget & when I went back to school for my second degree my loans were in deferment (aka I didn't have to pay them). Looking back I wish I would have made more payments during that time because the amount would have gone directly towards lowering the principal and wouldn't have collected any interest. However when the time did come that I graduated (again) & was required to start my loan repayment (again) I always paid 3-4x the amount due on this particular loan.

How did I do it? I increased my income. I started by asking for a raise at my current job. Then, I started working a second job. I pretended as though I wasn't making any more money & instead put it all directly towards the loan. While the second job is only temporary, it gave me more momentum & I was able to make a bigger dent than before.

Whenever I read articles on "how to save money" I usually get bored because they are things I already do - no cable, avoid late fees, eat at home, bla bla. I stopped getting my nails done, going tanning, & cancelled my gym membership. Instead of never going out I pick places to go based on my favorite time - happy hour! I can never say no to spending time with friends so I often suggest to go on a walk instead or invite them over for a bottle of Two Buck Chuck. I patch my old jeans instead of buying new ones. I make sure I only make one trip into town for work & coordinate all my errands to get them done before or after. I stopped buying fancy coffee (everyday) & make it at home instead. I didn't renew my season football tickets (SO SAD about that one) because now living three hours away makes each game that much more expensive to go to! Every little thing adds up.

It would seem that one less monthly payment would mean more money in the bank! BUT, I'm going to follow Ramsey's "snowball" principle of now putting all the money I put towards this loan towards the next one! I didn't really understand the concept of paying off your smallest debt first, but it really does encourage you to keep at it when you reach your goals. It also allows you to pay off the larger debt in less time in the end.

My goal was to have it paid off by December ... and I'm three months early! So this "back-to-school" season, I'm celebrating NOT going back to school & NOT having to pay towards that student loan ever again.& damn! it feels good.

One down, one to go! Time to crunch some numbers & set my next goal.

Progress

Here's a little update on those goals I recently posted!

RUNNING - well, I got my buns movin' & have decided to add an additional quarter of a mile to my workout each week. That way I can actually force myself to keep on track instead of the ole I'm-going-to-the-gym-every-freakin'-day routine ... because that never works for me. I always start the day out with the best of intentions ... and by 5pm let's be honest, I'm ready to do anything but go to the gym. By adding that amount, 2 months from now I will be at my 5 mile goal! A couple days ago when I hit 3 miles, it was a milestone. I'm not shy about the fact that I do. not. run. SO, 3 miles was a record (don't judge). And it felt GOOD. I also got my Nike+ all figured out! So I'm keeping track of my runs on that bad boy. They are super-duper handy. If you like to run, and don't already have one ... support the swoosh. They are worth your monayyy. I'm excited how attainable this once far-fetched goal now is. I have no doubt I'll cruise on by 5 miles in no time ...

MONEY - Paying off my student loans is really my biggest goal, and making progress on this is top priority to me. It is a chal-lenge let me tell you. I constantly get the 'shopping-bug' and I love to wine & dine ... but I keep remembering how great it feels to put chunks of money towards my loans & see those balances drop. I've added an extra $900/month towards my payments. It also feels great to NOT pay interest ... when you pay over the minimum amount due, that amount goes straight to the principal. Worth it? Most definitely. Saving money lately has become more of a fun challenge. I have become a coupon clipper! Every Sunday I cut coupons out of the paper & make grocery store purchases based on whats either on sale, or what I have a coupon for. Now that I have started using them (& saving money!) it seems so silly to go shopping without them!


SHOOTING- Well, first things first, I renewed my hunting license & put in for my deer tags! I picked Wagontire since that is where the men of the family usually go. Over this past weekend I also went out shooting with the boys. I shot a 243, which I loved. So, well on our way with this goal too.


BLOGGING - okay, okay so I think about blogging like, every day. But ... this is the first one I've posted since that goal. I'll keep working on that one :)

Goals

I'm a big fan of setting goals. Goals give you direction, motivation, & a sense of accomplishment once they have been attained. They give you something to look forward to (which I think we all need) & the cool thing is, they can be anything! I think we are very good at setting our 'new year's resolutions' that last maaaaybe three days (max!) but setting goals for me has been something that focuses me on things I want to do. They are passions & aspirations. For example, last summer my goal was to learn to ride & own a Harley. Done! I LOVE my bike & I'll admit it, I sort of feel like a bad ass when people ask me about it ;) But that was last year, so here we are ... 2011 ... time for some new goals!

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RUNNING- Compared to a lot of runners, it may be pathetic for my goal to be able to run 5 miles. But let's be honest, I'm not a runner ... nor have I ever ran that far ... mmm in my life. I'm giving myself a shorter timeline for this. 8 weeks. Doable? That's only increasing my current distance by 3 miles. Which is clearly more than double what I'm doing now. Hence the goal. This may end up being easier (or harder) than I expect! I am going to get the Nike+ for my ipod & keep track!

SHOOTING- I want to own my very own gun & shoot a deer. Bad. It doesn't have to be a huge elk or anything ... just a deer. I'll leave it at that for now.

MONEY- Pay off my student loans by next August. This is a big goal because it requires me to be extremely diligent with my money in the next 16 months ... $18,000 worth of diligence. My mom always said that people that don't have money are the ones that talk about it the most. I tend to be private with my money but after reading the Dave Ramsey book, I'm more excited about sharing the process. P.S. Check out Dave Ramsey on Facebook ... did you know the average person graduates college with $24K in student loan debt & takes on average 20 years to pay it off ... aka still paying it while their children are in college. Yikes.

BLOGGING- This is kind of silly. But I really do LOVE blogs. I love reading them, following them, spending (way to much) time oooo-ing & ahhh-ing over what people have done! The blogging that I want to do is just a way of documenting some of the things I have done! I don't have a particular goal for this. But just to do it :) I guess I'm well on my way. Cheers.

Total Money Makeover

In the last week or so I've been reading a book called "The Total Money Makeover" by Dave Ramsey. I'm not a huge book-reader so it takes something extra special to grab (and hold) my attention. For those of you who haven't heard of Dave Ramsey or his philosophies about money ... you should get your hands on this book! The reason I started reading it in the first place is because I know several people who have followed his plan & have amazing things to show for it ... including student loans paid off, cars & houses purchased, & large savings accounts built up - sounds great, right!?

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It's not a get-rich-quick thing ... instead he challenges the standard American way of life in that you don't have to buy anything (& SHOULDN'T) on credit (including your car, house, etc.) & you can live debt-free. I would say that I'm good with money. I don't spend money I don't have, I try to buy things on sale, & I even own some stocks! But I didn't really have a plan. Thanks to reading this book, I have a refreshed prospective on the reality of debt & spending. This marks the beginning of my 'financial journey' to better understand & control my money. I realize this is somewhat ironic as I'm majoring in accounting! but nonetheless, there is SO much to learn ...

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I'm fortunate enough that my parents taught me in a roundabout way never to buy a car unless you could pay for it in cash, so that is one debt I'm thankful I don't have. However, I am one of those Americans that uses a credit card. I justify that it is good to use because every month it is paid off completely & it is 'helping my credit'. I am also one of those Americans that has student-loans. My current financial goal is to get those student loans PAID OFF and quick. I've kept a 'budget' for two years now ... but let's be honest, my 'budget' was really more of a record of my spending (athough it is a pretty fancy schmancy spreadsheet, color-coordinated and all)! At the end of the month I would add up how much I spent on various things & let me tell you, money goes fast! Of course I would see things I was spending too much on, like coffee and make little adjustments here & there. My adjustment for my coffee addiction was buying a Barista off Craigslist! Wah-lah, Starbucks at home! But my new perspective is to attack my finances fiercely now & not just casually like before. My new goal is go create a budget before the month comes & STICK TO IT! If I am willing to cut down on my spending in a dramatic way, I will be setting myself up for a successful financial future.

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I looked at some of the other things I can cut out - nails, tanning, & gym to name a few. I realize how much I spend on things like that & how much BETTER it would feel not to have ANY debt. It's not to say that I couldn't 'afford' those things, but when you add up what they cost - tanning $804/year, gym $480/yr, nails $600 - that's nearly $2000 that I could apply to my loans instead. I'm also going to limit what I spend on eating out, entertainment, & shopping. The concept of the book is live like no one else NOW, so you can live like no one else later. Who wants to keep up with the Joneses anyway ... the Joneses are in debt! I'm looking forward to posting more blogs about ways I've saved money, creative ways I've earned money, & progress I'm making towards getting my student loans PAID OFF. :)