Financial Retrospect October 2017

One of the blogs I read daily (or try to at least) is Get Rich Slowly. They’re having a contest for a Wii, so it was some good inspiration to actually post.

I’ve known for a long time that I have issues with money. I grew up feeling “poor.” Being told you can’t take cans of food to school for the food drive because we almost qualify to receive those cans of food doesn’t make for strong feelings of security. Even though I was determined to be more financially secure when I grew up, I still made a lot of mistakes.

I would loan money to boyfriends or let them influence me to make bad financial decisions. I let my emotions cloud my logic.

I was also something of an impulse shopper, based on the hoarding/packrat habit I’d developed growing up. I never knew when I’d be able to get a new toy or piece of clothing, so I kept everything I had that might possibly be useful. I also bought things I wanted telling myself that I didn’t know if it would ever be available again. And though there are things I do somewhat regret not being able to purchase, I’ve found replacements I’m happy with.

Most of my other mistakes came from lack of knowledge. I had two years worth of investing eaten up by fees due to following the advice of a broker who was only out to make money off me.

I also made the mistake of thinking I should pay off my debts first, and then I’d start investing in my Roth IRA again. But I realized that at the rate I was going, that would never happen, so after about 8 years of not contributing, I started up again, after moving my account to a company with no fees. I moved it to WaMu to get away from the evil broker, but they started charging me $15/year for inactivity.

I think my other mistake was thinking that having a mortgage that was too high (1/2 my income) was better than renting (throwing away money as I saw it). I was stuck in a job and a home that I became increasingly more unhappy with for over 4 years. I was happy with both at first, but the commute started to make a larger and larger impact on my health, finally triggering severe pain and depression. I put my house on the market and bought a “mobile/manufactured home” in the same city I worked in. Thought I had planned for six months of paying two mortgages, it took closer to 8 or 9 and I ended up having to have my mom help pay the mortgage (we’re both owners on the old home) and living off credit cards. For a while I was even looking into having to file bankruptcy.

The house finally sold, but I was still left with about $15,000 of debt. I’ve done a few things to help manage my finances better and work on getting debt free.

I moved all my payments to come from my credit union, so I can see everything in one place, rather than letting companies do EFT debits.

When I got a new job, I put part of my increase in income towards my retirement savings to increase it to 10%, and once I’m debt free I plan to up it to 15% – 20% (and that’s before contributing to my Roth IRA, which I’m also making monthly payments that will max it out starting next year, since I started partway through this year).

I put any extra/found money toward my debt – various refunds from taxes and overpayments from the old home, etc. And money from the freelance work that I do on the side.

I’ve also started to declutter my house, it makes it easier to keep clean, so I’m happier, and it’s been helpful financially too. I sell things on Craigslist first, then if they don’t sell I donate to the Salvation Army (and will use the receipts for my taxes – due to the house I have to itemize for one more year). And then if the Salvation Army doesn’t want it, I give them away free on Craigslist. So I’m making money, or getting tax breaks, and decluttering at the same time. It also helps me curb my buying habit, since I don’t want to buy new things to clutter the house. If I do buy new stuff, I make sure that I have the space for it and will use it, and I try to get rid of something else to balance it out.

I also just avoid going places that will tempt me to spend, like bookstores or malls. I even prefer to shop online at so that I can multitask while shopping, and not end up with things I didn’t have on my list. Deleting from my cart is easy, but putting things back in the store is a hassle. I just get my produce from the Farmer’s Market instead.

I also transferred what was left of my debt to two cards, one with 0% interest for the life of the balance (with a small caveat – after a certain date I must use the card two times a month… hello 50 cent purchases!) and 4.99% for the life of the balance. The rest is on my fixed rate card at 7.5% through my credit union. That one is down from being maxed out at $7500 to less than $3000 and should be paid off in a few months, at which point I’ll throw all that extra money at my 4.99% card.

I still let myself have $50-200 a month as wiggle/fun money, like buying a ticket to go see friends in Georgia that I’ve been wanting to visit for a while. But the months I spend more, I make sure to spend less the next one.

I also opened an ING savings account and put $500 as emergency money in there. I emptied my credit union savings account since the interest rate was much lower and put the couple hundred in that toward my debt. Once my debt is paid off I plan to beef up that emergency account, and create a savings account for bigger “fun” stuff like landscaping the house so that I can pay in cash (or at least pay off the credit card that month). I will probably usually pay with a cashback rewards card, and just not carry a balance. Especially since credit cards give you extra protection on purchases.

I also have gotten better at saying no to eating out with friends. Instead I invite them over to eat, since feeding one or two people is still cheaper than me and my boyfriend paying for meals out. Plus it’s healthier too!

I also let my World of Warcraft account expire, and spend more time with friends in real life rather than in game. And cancelled my Netflix and just borrow videos from friends or watch stuff online. I even switched my local phone service to metered since I make phone calls so rarely and they are usually short. I also refuse to get a cell phone (my old one was provided by my previous job for free) again till my debt is paid off. I also plan to start selling my craft projects on my other blog and make more items to sell on Cafepress. It’s just been hard to find time with working full time, doing the freelance project and taking care of myself properly.

I’ve been in debt twice before, though never this much, and I’ve buckled down and paid it off. So I know I can do it, it’s just a matter of patience and determination, and then setting up systems so that I can hopefully prevent ever getting into this situation again.

The first time I failed to have an emergency account in place, and with a $5000 roof replacement, followed by multiple $100-300 car repairs tossed me in debt. The second time I bought something on credit that I should have saved up for first at the urging of a boyfriend who promised to pay for the interest (but we broke up not too long after). They say third time is the charm, and I’m determined that this time I’m going to stay out of debt for good.

I really enjoy reading the advice on Get Rich Slowly, it’s straightforward and simple and thus doesn’t make my head hurt trying to understand it! For example, I found out after asking about switching my Fidelity funds to an Index fund, that my money was sitting in cash reserves making me no profit! Thankfully it was an easy fix, and had only been that way for a few months, but I wouldn’t have thought to check or change it without the advice from Get Rich Slowly. I’m sure there are other good finance blogs out there, but it’s one of the first I’ve found. And coming from someone who’s been there and done that, it’s very inspiring.

Ok, enough rambling about my finances! Back to work!