Monday, April 6, 2009

Debt Reduction Doldrums

It seems like I have been five months away from being debtfree for the past 6 months! Every time I recalculate how long it will take to pay off my last credit card, the pay off remains 5-6 months away. Buying a new house, moving expenses and an unplanned income drop have all contributed to my inaccurate estimates. Now, I'm just tired of the struggle to keep paying to debt reduction each month. I want to spend on house projects, new clothes and things for my kids, not credit card payments!
Objectively, I know that I have made tremendous progress in reducing my debt. I owed over $13,000 in July 2007, and I now owe $3500, reducing my debt by $10,000. On the other hand, I've been working on this for almost two years, so this journey is getting a little old. Another worry at the back of my mind, is that my income will probably be reduced by $600/month after September. That means that I really must get my credit card paid off by September. After that, I'll only have about $200/month over planned expenses in my budget, so my savings rate will be very slow.
Okay, enough whining! What can I do now?
1. Stop worrying about what will happen six months from now. Concentrate on what I can do this month--follow my budget.
2. Look at the positives--I have a little (almost $1000) emergency fund, as well as growing sinking funds for irregular expenses.
3. I have $60 in the house project fund. Decide what to spend it on. Landscaping? Wooden blinds for the dining room? Slipcovers for the living room?
4. Make a list of nonfinancial things I would like to do--distract myself with other things until these doldrums pass!

10 comments:

Ms. MoneyChat said...

for some reason i think the process is designed to be that way. there's something about that last mile that seems to invigorate some and frustrate others. i think your number 4 goal should be number 1. put the financial stuff on auto pilot - seems like you have a good plan in numbers 1 - 3, and then distract yourself with other things that you enjoy. this should buy a few more months of sanity;-).

jpkittie said...

wow this must be a theme this past week - I think everyone is getting tired of paying down debt ~ want to go out & spend $$ on things... you have done so good so far! you are doing amazing - it is going to be the end very soon... I am so happy for you!!!

Sharon Rose said...

Hi there-the last part about debt payment is the worst, it seems to take forever! Keep up the good work my dear, you will get there!

RTC said...

Thanks, guys. I just spent $129 on car maintenence. Maybe that will satisfy my urge to spend!

Miss M said...

Setbacks are common, is there any way to earn some extra money on the side? Can you sell some stuff around the house? Have you transferred the balance to a zero percent interest card? Just a few thoughts for ways you can speed up the process. Good luck.

Shtinkykat said...

I just looked at your debt-free ticker and you're so close to the finish line! I hear ya about feeling like running in place. But before you know it, you'll cross that finish line. Don't get discouraged!

Money Funk said...

You've done a fantastic job on your PF journey! *high five*

And I know it can be especially hard to keep the momentum. I am one to speak. You're an inspiration. Keep it up. :)

Woodblinds for the dining room sound nice.

RTC said...

Thanks, Shtinky and Money Funk. I appreciate the encouragement.

notesfromthefrugaltrenches.com said...

You sound very clear headed & sensible. I wish you the best of luck!

Saver Queen said...

I agree that focusing on what you can do today, and this month, is the right attitude. Small but focused steps will get you to your goal!