I believe there is three things that get me sidetracked and keep me from attaining my goals.

1)women... they are a drain on my finances. I am single again and I am about to quit looking and just deal with the fact that I am terminally single. I'm just going to be an old cranky geezer in the hills.

2)projects... I have a lot of projects around the house that I want/need to get done. These put a dent in the available cash for debt reduction. While debt reduction is important to me so is getting these projects acomplished. Some actually save me money in the long run. I know that in 2012 I put some on a Credit Card and some was paid with cash. I need to find a happy medium, and I hope I found it with the way I am now doing my savings. I think this will allow me to work on my projects without having to rely on my credit cards. I guess only time will tell.

3)monitoring... I've been a little lax in monitoring my progress. This is a habit that I have to break. I have two spreadsheets that spell everything out for me... I just need to learn to rely on them. I spent the time to create an amoritization type spreadsheet that has all my debt on it and every month I DO update it with current ending balances. (On some accounts I am ahead of schedule for desired payoff, and some I am behind schedule.) The spreadsheet then calculates everything down the line and I get an estimated payoff provided I stick to the plan that is built into the spreadsheet. I have also re-worked my main debt reduction / budget sheet. It's now a bit more user friendly and I hope that helps me rely on it more.

Any advice on how to change, I'll entertain and consider.

You got that right. When you're broke, you can't give every woman the world. You have to go on picnics and free museums. If they don't understand that you can't buy them everything they want, send them packing.

Perhaps you should make a "fund" for projects. In your new budget, you don't have any spare money for projects, so as soon as you decide to pave the driveway, you don't have any money allotted to it, and you use your credit card. Either get friends to help you for free on projects, or minimize them until you get your debts paid off. You can't do both in your situation, and I think this is why your plans get derailed every so often.

Otherwise, I like your plan of attack, although I would use the overtime and bonus pay towards debt, not retirement, especially since you already have some $ going towards retirement right now.

Peachy... you're probably right on the derailment. I am hoping that putting aside money religiously (sp?) into my savings will help with this problem (which I have been doing for 2 or 3 months now). Since I have stated this I have only missed one paycheck to where nothing went into savings. I just didn't have it to put in there. Now that I have that 113 a month off my back (which feels great btw) I shouldn't miss another savings payment.

In reality, I guess my savings is my project fund because I am saving for things that I want. I do want to build it up and see just how high I can get it... but it's still there to cover the stuff I want and to keep me from adding to my debt. Currently I am adding $30 a paycheck to savings, and I get paid every other week.

Right now I only have 5% going towards retirement, and with me creaping up on 40 I am thinking I really need to be doing more. If memory serves me right... I've got around 33k sitting in retirement... thus my thought's of sending the extra's towards retirement. Do you still think I should be tossing the few bonus pay's I get towards debt considering that in 13yrs I'll have in my 20 and can retire?

I will double check my payoff spreadsheet and see if anything extra is needed to get my credit union loan paid off by the end of 2013 (which is my main debt goal). That loan alone is currently around 8 grand and with it gone it opens up 448 a month. IF I can get it paid off without the extra hours then I figured I'd be better off investing the extra in my retirement.

As for funding both my savings and retirement... this is what I have in mind.

Before paying off my mower I was moving $20 per paycheck to savings. Now that my mower is paid for I am adding another $20 per month to savings for a total of $30 per paycheck.

I currently have 5% going into my retirment and I thought about bumping that up to 8% since I paid off the mower. This however will take a little bit away from debt reduction and I'm not sure what that will do to my current payment schedule. I still need to run those numbers. I do however plan on bumping up my retirement to 10% once I get the Credit Union Loan paid off at the end of 2013, then for each debt "paid in full" I'll increase my savings by $20 and retirement by 5%.


**edit** I just ran the numbers and on my current paycheck the difference between 5% and 8% was 45.78. I am going to have to wait on bumping up my retirement amounts. That just takes way too much out of the $93 from paying off the mower. I need that to make my debt reduction goals for 2013.

Hi N2Deep, I very much agree with peachy. If you have a separate project fund (or even mentally designate a specific portion of your savings to projects), then that may help you avoid running overboard on the projects. I totally hear where you're coming from, though, and you're right that it's better to stay ahead of the ones that would actually save you money in the long run (e.g., fix the leaky roof before it turns into a mold problem or causes other damage). If I were you, I definitely would NOT do any project that required me to put the costs on a credit card (unless you have the full amount of cash already in your savings-project fund fully ready to pay off the card by the due date). If you implement that rule -- not enough cash? then no project -- I think you can keep that tendency in check. I also agree with peachy that I would put the extra money towards debt repayment, rather than retirement, because you already have a good amount going to retirement, but really either way is good for your future.

Finally, I want to congratulate you on all your progress in 2012! You may not have reached the initial goal you set, but you know that was an aggressive one, and you went a looong way towards it. Seriously, if this is the first year that you did not go further into debt, but instead paid off $4,300+ of debt, then you ought to be very happy and proud of your progress! Keep up your great momentum for 2013!

Thanks for the comment LeRainDrop

I'll take yours and Peachy's advice and look at creating a seperate fund for projects. It may take me a bit to get things worked out and figure out what goes to savings and what goes towards projects. It's also going to be hard not to raid the savings when I start a project if there's not enough in that particular fund.

**Paycheck update**

One thing I want to do is give an update each time I get paid. Maybe this will help with the monitoring of my finances and keep me on track.

Guess it's time to take the lashin.

According to my Debt Reduction Plan my impulse spending at Sams Club has cost me. Back in Aug 2012 I set up this worksheet and it shows when I will have a particular debt paid off if I stick to the plan. Each month it recalculates when I input the ending balance for that month. According to the plan, thanks to impulse spending I am now 996.26 behind schedule for paying it off by May 2015. Sam's is actually debt number 6 in the payoff rotation. The reason it is that far down the list is because I will always have a Sams card and I'd rather re-train myself on the debts that will be going away for good vs paying off Sam's earlier and then adding back to it. So the three cards I will be keeping open will be the last to be paid off (Sams, Lowes, Chase).

With that being said... now I know that if I want to stay on track for that debt I need to add in some extra to it where I can in hopes of negating my lapse in judgement (some lapses in Dec ).

Now on to the reason for this post.

Sams Card --- $0.97 above what's needed for debt reduction plan, monthly progress... (211.51), still owe... 1820.26 ... (996.26 behind schedule)
Discover Card --- $2.16 above what's needed for debt reduction plan, monthly progress 48.16, still owe... 5672.37
CU Loan --- sent in extra $50 from debt reduction fund, still need 80.37 to meet debt reduction plan.

Current overall debt reduction for Jan:
(163.35) ... two debts in, five to go


2013 Debt Reduction Goal --- 8663.35 left to go
2013 Savings Goal --- 620.00 left to go
2013 Retirement Goal --- 3974.42 left to go

Since apparently I have no life, and have spent the day (Christmas Eve) reading other folks journals, I have been trying to learn from others… isn’t that what you’re supposed to do here after all .

While my roadmap to debt freedom is still a work in progress I feel that I have learned a lot along the way. I have been giving some thoughts to those that said I need to have a separate “projects” fund from my “savings” fund. In the conventional sense, I agree.

Of course I’m not really that conventional. Let me explain my current mindset.

When I think of savings… I think of saving dollars for the things that I want. This is a great improvement over my “I’ll just put it on the card cause I can afford the min payments” mindset. To me the savings is for projects and other misc. items that I want. It’s there for me to save up and then get what I want… sometimes those wants are projects around the house. So I guess you could say my savings fund is my projects fund.

I have also come to the conclusion that I need to be doing more to bolster my eFund. Currently it is sitting at $200 and I had a goal of getting it to $500. Considering my current train of thought… this isn’t nearly enough. My eFund will be not only for emergencies, but also long term savings (kinda like other folks savings accounts).

I am going to re-set the goals for the e-fund at a min of $1,000 for 2013. I just have to figure out how I’m going to pull it off. I am also going to pretty much do away with the goals for the “savings” fund since it will most likely always be fluctuating. I am however considering setting a threshold for the “savings” fund. Maybe something along the lines of IF it hits 1500 then any overages automatically get diverted to the eFund. I dunno… this is still something I am thinking about.

A few weeks ago I was down and out. I won’t get into the reasons behind it, but I have to admit I used spending as a temporary pick me up. I know that is going to come back to bite me in the Jan bills. My justification at the time was… this is my Christmas present to myself. It didn’t fix the reason I was depressed, but at the time it’s not like I was thinking rationally (financially speaking).

Tonight however my mind is thinking rationally (financially speaking)… and now I just have to get my physical body to follow thru with it. I decided to give myself a Christmas present that keeps on giving. I have already logged into my Amazon account and deleted every credit card I own from the system (and there were many). Now if I want something it has to come out of my checking account (which is usually pretty low). The hard part for me will be step 2 of my Christmas present to myself. Sometime after midnight (so it’s officially Christmas day) I want to turn my American Express, Discover, and two other credit cards into confetti. This way there is absolutely no chance of me adding to that debt ever again. This is going to be VERY difficult for me to do. I know mentally that this is the best thing for me to do, but there is also a part of me screaming… I worked hard to get those cards, do not slice em up!

I guess tonight will be the true test of just how dedicated I am to this journey.

Hope everyone had a Merry Christmas.

Merry Christmas to me... It took me till 3am, and it was a battle the whole way cause I kept putting it off, but I did shred those 4 cards

I guess I am finally on my way to a new life.

I've spent the morning working on my finances trying to figure out how I'm gonna finance some of these funds. Here is what I have come up with....

Since I paid off the mower that opened up $113 a month and here is how I am currently going to distribute it (of course this is subject to change if I find a better way)

$20 is going towards my savings/projects fund
$50 is going towards my eFund
$50 is going towards debt reduction

Yes... I know that adds up to more than $113. The extra is coming out of my checking account and going towards a good cause. Hopefully I'll never miss it.

Something I would like to try, to see if it keeps me motivated is do a monthly goals post since I am scheduling advance payments into my different funds.

Here is my Jan Goals:
0/200 ... extra put toward Debt Reduction
250/400 ... increase eFund

if I can meet these goals it's because I stuck to the plan

My mind has been racing the last few days, and it seems like it is always going in multiple directions. Since shredding the four cards I feel like I might finally be getting a grasp on my financial freedom.

I do know that here lately I have been posting a lot… primarily to get my thoughts down on paper so I don’t lose them. This gives me something to go back and refer to. Now let’s see if I can’t get them sorted out into something more legible.

2013 Goals
Reduce my debt load by $8500 … (8663.35 left to go)
Increase my eFund to $1000 … (750.00 left to go)
Increase my retirement value by $4000 … (3974.42 left to go)

Monthly Goals & Achievements

Goals for January…
0/200 ... extra put toward Debt Reduction
250/400 ... increase eFund

Achievements for January…
Sams Card --- $0.97 above what's needed for debt reduction plan, monthly progress... (211.51), still owe... 1820.26
Discover Card --- $2.16 above what's needed for debt reduction plan, monthly progress 48.16, still owe... 5672.37
CU Loan --- sent in extra $50 from debt reduction fund, still need 80.37 to meet debt reduction plan.

Current overall debt reduction for January:
(163.35) ... two debts in, five to go

Notes
Thanks to mindless spending at Sam’s, that account is way behind schedule for payoff. It is two and a half years before that debt becomes the targeted debt (according to my debt reduction plan). I do intend on adding extra payments in occasionally to get it back on track before it becomes the targeted debt. I WILL be out of debt by May 2016 then I can attack my mortgage.

Going forward, I am going to consistently try to add the following amounts into the listed funds per paycheck.

$40 is going towards my savings/projects fund
$25 is going towards my eFund
$75 is going towards debt reduction

I know some will say I really need to add more into my eFund and less into my savings fund per paycheck. Right now I am also shuttling every additional dollar I can into the eFund… thus the reason in the Jan goals I show increasing from 250 to 400 vs the allocated $50 increase. By the end of January I should have that fund well over $500 thanks to Christmas bonus pay. I also have some liquidity in one of my retirement accounts should a dire emergency arise (although I hope I don’t have to touch it). While getting that fund funded is a priority since I shredded 4 credit cards, I have to also consider the projects that I have to start towards the first of March, thus I need the money going into the savings account.

I do know that I am going to be a nervous wreck until that eFund gets back up towards $1000 since I don’t have the cards to fall back on. Talk about diving into uncharted waters... I just jumped and hoped for the best. Once I get it back to $1000, I’ll slack off and just leave it on the $25 per paycheck autopilot for now. Then I’ll toss the extra either towards debt or retirement. I’ll make the decision which one gets the extra when I have it by looking at my debt reduction plan and my retirement plan. I’ll see which one needs it the most and go from there.

As long as I keep my debt reduction plan on course, I’ll be out of credit card debt in 3 years. I can live with that, I don’t necessarily have to get out of debt earlier. I have spent the last 21 years getting into this debt mess… taking 3 years to get out seems like a bargain. I just have to keep reminding myself to stay the course.

As a small green Jedi master once said, 'Do...or do not. There is no try." So easy for me to say to myself, "Well, it's only 25 bucks, it doesn't matter if I get one month behind." I find automatic withdrawals deposited into ING savings accounts are a great remedy for that! If I don't see it in my checking account, I can't spend it...

Good luck with your plan! Three years might seem like a long time now, but it will go by faster than you think. And along the way you will get excited about seeing the numbers drop and additional found money will be funneled towards watching then drop even faster.

I agree that getting the efund back up is important. Just try not to have any emergencies in the meantime

Ahhh yes... the great green one

I do have auto withdrawls but of a different sort. MS Money automatically moves the money from my checking register into the other registers so I dont see it. My biggest problem is to remember I only have so much in my checking and not overspend thus causing me to use the other funds to keep the balance in the black. I have been getting better but I still aint perfect yet.

I'll have to admit that I am already excited about seeing them drop. Since I started this little journey I have destroyed two debts completely. Now that I have shredded those 4 cards will it be even more difficult to increase my debt load. Notice I didn't say imposible... cause I still have the 3 cards that I plan on keeping. My Sam's Club, Lowes, and my Chase that I've had since day one with a 12% interest rate.

I have noticed that I have been paying a bit closer attention to my debt reduction plan since I started posting here again. 2013 is truly going to be a fresh start for me and one that I am really looking forward to.

Roger that on no emergencies

N2Deep, congrats on shredding the four credit cards! It's also great to see how much thought you've put into crafting your savings/spending plan for the next year. You can get where you want to be if you keep your goals in mind and stay true to your word to yourself. Surely, life will throw curve balls, and if you feel yourself starting to veer, just re-set and get back on your path.

P.S. Once you pay off your credit cards, you won't care what the interest rates are because you will never, ever go a month without paying them off in full!

Now a question for those that are following along.

I haven’t committed myself one way or the other, but I’d like your input on the idea.

As of right now I have around $7,000 that is somewhat liquid that I plan on re-investing since its part of my retirement.

A thought hit me today that I could go ahead and pull the funds and then throw them at my Credit Union loan. That balance is around $8000 – 8500 (I don’t have the numbers in front of me). While it won’t completely pay it off, considering I will be tossing around $500 each month towards principal it wouldn’t take me long to demolish that debt. That opens up $448 a month.

From there I could really do some damage to the other debts since I would be tossing somewhere in the neighborhood of $600 a month extra towards their balance.

I am thinking that this move would allow me to get my credit card debts paid off a full year in advance. If that’s the case then I could utilize that third year that I WOULD have been paying credit card debt to pay myself back with interest. As of my December numbers I paid between 1200-1300 in min payments on my debt.

If I go this route that would mean that I’d put $12,000 back into my retirement for that 3rd year.

I’d still stick to the rest of my budget and what I had planned to deposit into the funds.

I will admit one thing that appeals to me is a year without paying the credit companies interest, but pulling that amount out of my retirement makes me a bit nervous.

I would greatly appreciate your opinions on why I should make this move or not make this move…. Or even your opinion on a combination of both.

I am also going to post this in the regular section of the site for a few more inputs from those that normally don’t follow my journal.

Thanks for your insight, and I look forward to seeing what you have to say.

You say this money is part of your retirement? Is it in a retirement account or just a plain old investment account you have earmarked for retirement? If the former, we need more details about the type of account as you may be subject to penalties and additional taxes if you pull it out.

Sorry... I can't be more specific on the type of account it's in. I don't fill comfortable sharing that info. There is no additional taxes or penalties associated with these funds. I can say that within a couple days I could have my hands on it to send it in as payment if that's what I decided to do.