Other than one payment to kill off student loan #2 after the financial bloggers conference, I haven’t made a large debt payment since October of 2010 (To heap insult onto injury, the company I paid off still owes me $50). It seems that once I backed off of the cliff, I took my foot away from the gas and “something” has always come up that has eaten into my debt repayment money, and at this point I don’t even have debt repayment funds dedicated as a line item in my budget – all of that has gotten swallowed by the catch all “everything else” category in mint. I do a lot of lip service talking about paying off debt, but looking back over the past 13 months, I havent done much in the way of action. Things that came up and appeared like they were “needs” came in and chewed into my debt repayment so often that I dont even try to budget for it anymore.
Unfortunately, I cant really pinpoint exactly where the increased spending has happened for the most part, either. Sure, I found out I spent a bit more on food in 2011 than I did during the summer of 2010, but that amount is paltry compared to the approximately 13,000 that would have gone to debt repayment normally during those 13 unaccounted for months. Looking back, it has gone to various places, some that were unexpected and difficult to plan for (such as friends weddings and bachelor parties and elk hunting) and some that were totally expected and could have been planned for (like my own wedding, taxes, yearly vehicle registration and christmas travel). Back when I first wrote about my snowball getting gobbled up in the most expensive month EVAR, that was the first month it had happened – like I mentioned earlier some things were unplanned then too (like the car repair) but others could have been budgeted for (like the registration). When I didnt make a debt payment then, it was an abnormality, but 13 months later, it’s a no longer something odd – making a debt payment would be.
Even the number in the above paragraph is probably a bit low – that number is based on the amount I was spending at the time on gas, which has gone down from approximately 400/mo to 200/mo since I got a new job and started walking to work. Of course, I still spend on gas, but nowhere near as much as I used to. In my mind when I switched jobs, I would simply hop right back on the debt repayment bandwagon with even more firepower than I had beforehand and everything would be grand and I’d be deep into my paying off debt. After I signed my new contract for my new job, I kind of eased up on the finances, telling myself that things were too “up in the air” and I should conserve the cash and make the payment later. Of course, that didn’t happen as you all can see. The only reason that I was able to make any progress on my debt this year was because of a hail storm this summer and a very favorable interest rate for the truck, and nothing more than token minimum payment reductions on the student loan.
In all honestly after looking at my situation, I’m not sure when I’ll be able to apply a large payment to my debt again. I was hoping that I’d get a tax refund this year and was planning on using that to pay down some debt, but after continuing to work on my filing over the weekend, the approximately 2k that it looked like I was going to get all but vanished as I added in my hobby income and my w2 from my old job at the lower withholding level. Currently I’m still in the green, but I have 1 more w2 to get and input, and that will probably take it down to where I owe a small amount. Even though I played the tax game just about as perfect as you can this year (not getting a large refund, not owing a large amount), I’m still disappointed because I was hoping to lower my debt level quite a bit more before the wedding (Friends cautioning that H and I were going to start “hemorrhaging cash” 2 weeks before the wedding didnt really console me much either).
I’m also starting to feel like I felt before I switched jobs about a year ago in regards to the wedding: So many changes are coming up and so many things are going to be so much different than they currently are that it’s just going to be too much hassle to try and do ANYTHING between now and then but stash cash away (or piss it away) because things are going to be soooo different soon. Even though it was that way with my job, it feels like this is going to be even more different because it wont just be me calling the shots anymore – H will have a say as well. One thing that I do have going for me is that she’s very debt-averse, so hopefully that will give me[us] some renewed vigor and possibly quicken the pay down of what will eventually become our debt (we’ve for the most part decided on joint finances, though specifics have yet to be worked out). Of course, that will mean adding to the priority list [H loves to travel] as well to make sure that we meet all of our goals.
After noticing this recently, I can clearly see how (and why) some people don’t quite get to debt freedom. Things come up that they would have previously said no to but now feel like they can afford, life goals change, and the intensity of being right on the edge of a cliff fades as you start to build savings and de-leverage. So, instead of digging in, I let my foot off the gas and am sitter here over a year later wondering where my progress went and what I can do to get it back. I have a feeling that this happens to a lot of people, but that thankfully I have avoided new debt since I’ve stopped the payoff. I’ll be working on ways to get back into the groove – do you all have any suggestions?
Readers: Did you have any long terms setbacks during your debt repayment? If you did, did you quit or did you figure out how to get back on track (I’m not sure my reward will work)? Obviously, finances change from year to year based on individual situations and circumstances, but how did you handle those changes in your finances? Did you rework your goals, or simply change priorities?
I’ve had no real debt(aside from current mortgage,) my struggle is getting things into savings(and it has kept me up at night many nights.) We are a 1 income family of 4(a small income) and our budget is as tight as sanity will allow. But the day in Feb when I put our refund check into savings and reached my 3 year goal of getting $10000 into savings in just over 2 years I eased up on our budget for Feb. Now the month is almost over and we have blown our budget so much! I didn’t think about it until reading this post so thank you. That could have been the start of a creep away from our savings goals for us.
My suggestion for you is to put extra debt payment back into your budget. Make it a small amount (say $50 extra) until possibly after your wedding. But start setting up a budget with H to implement for after the wedding. If you both have an aversion to debt then it will get paid off and combining your budgets will be when you start tackling big time again. But until then give yourself some slack. You switched jobs which is stressful and exhausting and now you are preparing to get married which is even more stressful and exhausting. Things will calm down after the wedding as long as you and H talk about thing openly and are both involved in the finances once your married
I think the best you can do is be honest with yourself about needs and wants. This is bound to be an expensive year for you, no matter what. We paid off about $15K in debt in about a year, the only reason that was even remotely possible is because nothing huge (like a wedding) was going around and we even managed to avoid the Murphys of life. I am pretty sure that I am going to regret writing that.
Once things get calmer it would be the perfect time to get back on it. There is enough to worry about during this time, paying off debt can be put on the back burner. You should be proud of yourself for not accumulating any new debt.
I know what you are saying about the new normal. I spent a small part of today worrying about a bachelor party I was just invited to. It is with work people so there are job dynamics that insist I go. This will probably cost me $750.
I think I went through a one year period where I was in the same boat. Things just kept coming up. I don’t know that there is a real answer.
Only when the situation becomes emotionally not worth it will one be able to truly get through it. You have to get mad. That was the only way.
Yes, in honesty, I have. But I am making concrete changes that will put us on a firm footing. Thanks for an article that challenges me to stay on the debt reduction path.
I have always asserted that you can’t scrimp all the time forever….there has to either be a break or you have to be able to see that light at the end of the tunnel – otherwise it just seems like you are going to be scrimping forever with no end and no eventual benefit.
It can be ok to take a break, and it seems like you are still focused on your goals so I doubt you ‘break’ forever.
On the other hand…..changes to your lifestyle can creep in, raising your standard of living and your expenses without you even realizing it is happening. That is the thing to beware.
You’ve said that you don’t have debt repayment as a line item in your budget and I think until you put it back in there you will simply keep treading water and succumbing to all the things that keep popping up. Make your debt repayment a priority again and it should fall back into place.