So, it’s official. This is really, really just a personal blog where I write about groundhogs, and my own little journey towards debt freedom. First, just to keep score – it’s now day 77 into my little journey.
Where have I been? After a weekend of laziness as I hibernated and napped, yesterday I did not update this site due to the fact that I was neck deep in receipts, as I sorted through an entire years’s worth as I get ready for the taxman for yet another year. It’s Feb now, and I’ve been blowing off this little project for about a month now. In short, it was time to get rockin’
I read a book where there’s a principle where the more time you give a project, the bigger it will become mentally. But if you had a deadline, you have no choice but to do only what needs to be done and you still end up getting it done on time. I’m definitely following this procedure this year. I had been blowing off and blowing off this job for so long. It started to be one of my christmas holiday projects and then one of my new years projects and then finally here I am yesterday, about six weeks later finally getting around to completing the job.
And you know what? It wasn’t that bad, really. The idea of the job was way worse than the reality of the job. It took me 12 hours to enter every little withdrawl, and payment into my accounting system but now that I’m done, I don’t have to do it for another year. I used to enter the data weekly, and even daily sometimes, but over time my priorities have shifted and I only end up tackling the shoebox yearly. I like the yearly better, I think. You only have to allocate one day to the job and you focus entirely on that as your project for the day . No email, surfing, or other farting around. Just do it, and don’t come up for air until you’re done. This year, it was 13 hours. I started at 7am, and ended about 8pm.
The downside of this method is you can’t, or don’t – track your spending to see if there’s room for improvement over time. You haven’t really checked up on your financial health for an entire year. You don’t know what you’re spending or how much. The money just seems to come and go. You don’t have the data for a budget, or to make any adjustments.
And I’m paying for it. I’m in this mess due to the fact that I was spending more than I made. My income slowly dropped over time – a few percent here, and a few percent there, and yet I was still spending as if every day were my birthday. So what happens is you don’t pay off the credit cards monthly as you were, and you start carrying a bit of a balance, and then you pay off less each month, but still keep using the damn things. That’s, how it happened for me. I’d feel better if I had 30k of credit card debt and had a big honkin’ stereo system for it, but it’s the small little buys that end up biting you in the ass – the 36 steak dinners from two years ago, the fifty bucks for filling up the SUV. My 30k worth of credit card debt grew in little $40 increments for the most part. Over time it adds up, and I’m blogging about it.
Please, don’t be like me. Spend less, and make more. Start Today.
The numbers
One of the fun (well, if you can call it that) things to come about all this is you can see where the money went over the course of the year. I’ve done real well in spending in some ways, and others – not so much:
Auto: $5800.
This number seems spot on. I returned the Nissan Pathfinder on July 23rd, and I’ve been on foot ever since. This works out to about $1000/monthly for the payment, and gas and insurance. I don’t miss spending the $1000 a month on a car.
Banking Fees. $500. I need to find a better system for managing my finances (no shit, eh?). I end up using my business bank card for most purchases. And the bank loves me for it, and tags me about .50 each time I do. I’ve been with the same bank for 20 years now. When I was ‘rollin in the dough I didn’t care or notice $40 a month. Now I do.
Cellular Phone/Internet $3500
$3500! Gosh, that seems high, but for nine months I had cable tv/cellphone/internet/homephone all going to the one cable company. I’ve since killed the cable/homephone and I’ve minimized the services on the other two. I’m hoping next year this number is half this. Is your iPhone really worth $300 monthly? Yikes!
Clothing $500
The joys of working from home: A few new pair of jeans at the Gap, and you’re good to go. This number willb e higher this year, if I start to work outside. Which is a consideration: If I have to wear a monkey suit every day, and drive to the new job – how much am I really earning each week. It might be cheaper to not work, or work at McD’s where they supply the uniform and you can walk to work. Your take home pay might end up being the same.
Credit Card Interest $5800.
Just shoot me now. I have much, much nicer ways to spend $5k/year than give it to the banks. I should frame this number and hang it on the wall for inspiration. At first, when I saw this number,I thought: No way, it’s wrong. But then you do the math. two credit cards, at 200+ a month in interest = equals one big number.
Entertainment $2600 You know, this isn’t as bad as I thought. This is a pretty wide category. Every movie, dinner out, hotel stay in the summer when out on the motorbike, everything goes in here. This also includes a fair number of meals too. I’m single, and sometimes it’s just as cheap and easier to eat out, so I do. Still, I could probably cut back a bit, but this could be way worse.
Groceries $8000
Holy. I swear, I’m stapling my stomach shut. I don’t like cooking much, or eating, really. It would be cheaper and easier. This number should be smaller for this year. There were lots of $300 Costco runs with this number. Now that I’m car-less, I can only buy what I can carry, so no Costco, or grocery runs where the cart overfills. This works out to $666/month, about – which, sad to say, I don’t know how you could do much better: Groceries are expensive. Plain pasta every night, here I come. 
Rent $14,000
You have to live somewhere. $1,000 a month, give or take. You have to live somewhere, and that’s what it costs. It’s a bummer to add it all up, but I doubt this number’s changing much in the next few years.
Starbucks $1,380 I saved the best for the last. You know, considering that this number includes coffee for home in this too, and it’s my only vice. I don’t drink, or smoke, this number could be worse. This works out to be about $100/monthly. If you factor in the pound or two of coffee, this really isn’t too, too bad. I wonder though: could I do better next year? Do I want to? The latte run keeps me sane some days, in more ways than one. I’d rather have the $1000/year in debt, than to be caffeine free. There’s a limit to how far I’ll go.
More Bad News