Monday, June 04, 2007

rambling about finances...

I transferred the money over the weekend in order to pay off one of my student loans...and even though it was terrifying, I am so glad I did it. Actually, it's almost paid off, but not quite....I wanted to wait until I got my final statement before I made the last payment because I want to give them the exact amount of the 10 Day Payoff amount instead of guestimating it.

So, I am going to ramble about some of the stuff I have paid off in my time and my goal for the next month in terms of my finances.

I paid off my car loan (5% interest) in June of 2006...about 2.5 years before the loan was due to be paid off. I don't know how much I saved in interest, but I know I did. I was really lucky with my car loan because I got in with a really nice interest rate...I think it was 5%. I know I couldn't get a rate like that today because of the change in the market.

Since I have paid off my car loan, I have started using the money I paid that with and rolled it into my SallieMae student loans(4.125% interest)...doubling the amount I have been paying. I started out with over 50K in SallieMae loans (I know it's horrific...I am tempted to write a horror movie just about educational debt...and it would be scarier than any of the SAW movies! lol). Anyways...I started out with that much in that loan and have since paid to down just about 30K, maybe a smidge below. It's still a lot of debt, but in 5 years, I have basically cut that debt in half. I am on schedule right now to pay off that loan in 2010...instead of 2032. I just went to a loan calculator and figured out how much money I am saving in interest...and let me tell you, it is motivating. If I paid the loan as scheduled for the 30 years (gulp!)...then I would be paying over 43K in interest loan. I would almost be paying as much as I borrowed in that's just insane. With the payments I am making now, the interest is just below 8K...which still is a lot of money for me, but I have justified that it is worth the price of my education. paying it off aggressively, I have saved about 35K. Now that's a statistic I like.

And then there is my Perkins Loan (5% interest)...which I didn't consolidate with everything because it is a type of loan which can be forgiven if you do certain types of work such as teaching, working with children and police work, etc. The catch is that you can't do that if you consolidate first...and then get one of those swanky jobs. So, I consolidated everything else and not that loan. I am glad I did because I worked at a job for about 2 years which provided me some loan forgiveness. So, I started out with a smidge over 10K debt in that loan and the government forgave $1500 of it. I was left with having to pay the remaining $8500 plus interest. I have been paying every month...about $100 more than the payment amount...until I decided to stop putting money in a savings account for a rainy day at 4.5% interest and pay off a loan which is costing me 5% interest. So, I transferred the money and made what will be the second to last payment.

So, let's see the amount of total debt I had and now where I stand....

Original Debt: 76,482.00
Debt Now: 30,700.00
Total Debt Paid (not including any interest): 45,782.00

You know...sometimes I just feel overwhelmed with debt, like it is never going to go away. But then again, I always have to remind myself that the debt is temporary and that in 2010...all of that debt will be gone. And I have to remind myself that I have paid off more than 45K of the debt I had. So...all in all...not too shabby.

So, what's my next step??? Well...I am not carrying any credit card balance, which is a good thing, but I want to go one step better. Sometimes I spend money on things and use my credit card to do it...and I probably don't NEED those all. Like eating out at a restaurant...or ordering pizza...or a new, pretty shirt. I always pay my credit card bill off at the end of each month...but it is more than is probably necessary. So, I am going to be a smidge more disciplined with my credit card spending. Starting on Thursday (because I get paid on Thursday), I am going to only buy gas and groceries with my credit card...and everything else either needs to come from cash or my debit card. I am going to take out $20 from the ATM each time I am paid for spending money...and if I spend them in one night...then the rest of the two weeks are going to be pretty bleak. It'll be interesting for me to see one month much of a difference in makes in my credit card statement. We'll see...

So...there is the blathering of my finances...where I am at...and what my game plan is from here on out. Alright, enough about least for now.

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