My upcoming 30th birthday has made me think about a lot of things, as 30th birthdays are wont to do. The biggest question has been what I want the next 30 years to be like. The biggest realization is that I don't believe I'll ever be out of debt. (Thanks, impoverished upbringing!)

I'm fighting that expectation head on, and also cleaning up my financial life so that I can make life decisions without worry. Anyway, here are some of the goals I'm working on for the rest of 2007:

1. Pay down $15,000 in credit card debt on four cards with interest rates of 0%, 10.99%, 11.99%, and 15.24%.
I just paid off the two higher-interest cards, and now I use one of them for all my expenses. I pay it off in full every month. The remaining cards have balances of $7,100 (10.99%) and $4,000 (0%).

2. Earn $6,000/month before taxes.
This requires some very steady projects, but I'm starting up with at least one client who adores me and will probably have a lot of work for me.

3. Clear up the clutter in every area of my life, and lower my consumption significantly.
I have lots of parallel issues that all center around clutter: I'm overweight, I have debt, and my basement is full of junk. I'm working to clean up the messes of my past overconsumption and return to the minimalist lifestyle I had a few years ago. I'll really help my financial situation by selling things, eating out less, buying less food, and buying less other junk. And of course, there are the mental and physical health benefits.

More to come, but for now I need to bill some hours!

Hi, Alicia, and welcome to the forums. I think your goals sound great. I, too, used to think that I would never be out of debt. Now, however, I can see that I'll finally be free of consumer debt in the next year. This has me psyched. It makes me feel good, so now I'm exercising more. I'm de-cluttering things. It's an awesome cycle of positive feedback. I know that you can get there, too. It may take some time -- it took me years to reach this stage -- but it's doable.

As for "debt the rest of my life", well I still have my mortgage for the next 27 years. At one time, my wife and I believed we were going to attack it aggressively, but more and more I'm beginning to believe that we'll carry the mortgage and invest the money instead. (See the recent entry on the blog.) My ultimate goal is to be able to stay home and write all the time. I need to set up some sub-goals for this, though, so I can actually start moving in the right direction. Somebody here has a tag-line that says something like "a goal with a plan is just a dream". Good advice.

Oh yes, I studied that post closely! We've been paying ahead on our mortgage, but are going to talk about changing that. Thanks for the welcome. Love the blog and boards.

Here's an overview of my non-mortgage debts.

$11,000 credit card debt
$17,000 owed to Jef for house down payment (interest free)
$45,600 school loans

My income is unpredictable. I'm hoping for $60 to 70K for the year.

I tend to pay my debts in large chunks. This is something most people can't do, and I tend to take it for granted. In the last two months, I've paid over $6,000 toward my credit cards. If I get a steady stream of business over the next four months, I could easily pay the remaining $11,000.

I'm not especially worried about the school loans. The interest is only 4%. I can't deduct my interest payments because of my income, but it will still be more profitable to pay only $300/month and invest the rest.

I tallied up my net worth this weekend--debts and liquid assets only. It went down 5.62% between May 1 and June 1.

Your plans sound great. As someone whose income was also unpredictable (when I was a freelancer), I would just advise that you remember to set aside enough for your quarterly estimated taxes. Paying estimated taxes is probably required in your situation to avoid penalties on April 15, and as your income goes up you may have to increase your installments accordingly. When I was freelancing I zealously attacked my credit card debt whenever I got paid for a big job, only to discover one day that I had forgotten to set aside enough to cover my quarterly estimated tax installment. Oops.

Good point, Brad. That actually relates to my next update: I was approved for a Citi Business card with 0% APR for a year and no balance-transfer fees. I'm not sure yet what the credit limit will be, but I assume somewhere around $5K.

With most of my credit card debt at zero interest, I'll be able to make the quarterlies a priority without getting frustrated.

In other news, we're considering a refi on the house, to trade in our 5/1 ARM for a 30-year fixed. Thanks to what I've learned here from JD and Sam, I'm planning to cancel our escrow account and reduce the extra amount we're paying on our mortgage to $100/month and throw everything into a high-interest account instead. (I think we're currently paying about $300/month extra, plus Jef sends big extra checks for the equity mortgage once in a while.)

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I woke up this morning thinking about the three-hole punch I've been half wanting to buy. (I created my own custom daily planner, which should go in a three-ring binder, but I haven't wanted to actually buy the binder or punch.) They only cost $5-10, and it's not worth my time to try to find a deal that might save me $1-2. So why am I hesitating?

I realized that it isn't the price; it's the very quiet thought in the back of my mind that I might end up not maintaining the daily planner, which would make the three-hole punch just clutter. There's a big lesson here (for me, at least): When I'm ambivalent about buying something, it's probably because I realize deep down that I don't really need it.

I don't have a problem spending big money on stuff I truly need or value. F'rinstance, last month we bought a storm door for our front entry that cost more than $800. But it's handmade of cypress, fits the character of the house, has removable glass and screen panels, and will last for decades. The large screen helps keep the house cool without A/C, and we're very happy with how beautiful it is, and we supported a group of fine American craftsmen by getting it. Overall, I have no problem with how much the door cost because I believe it was the right thing to do.

Good luck with the escrow plans, let me know if you have any other questions and I'll do my best to give you guidance based on my experience.

Not really on the larger point you were trying to make alicia, but I had a three-hole punch once. It was quite handy when I was in university. A few months ago my fiance asked to borrow it. I haven't missed it since. It does make one think...

squished

Thanks, Sam. And squished... indeed it does!

My little plan with the new 0% credit card had one fatal flaw: I was planning to transfer from a Citi Simplicity card to a Citi Business card. That's a no-no, so I'm stuck paying interest for a few more months. Oh well. I can still use the business card for my business expenses (how novel!) and that will help me remember what to deduct next spring.

I also took a small step toward paying Jef back: I opened an HSBC savings account. Jef asked that I repay him in big chunks, because it's more emotionally satisfying that way (though he didn't actually say that last part). So when I start feeding the account, it'll probably take most of a year to get a $10,000 chunk together, and I can earn interest in the meantime. I'll either use that for myself or tack it on to the payment as a thank you. (He isn't charging me interest.) Or even better, I can use the interest to treat him to dinner somewhere nice.

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Two more things that will indirectly impact my debt repayment:
I have a meeting/interview today with one of the big ad agencies downtown. I have high hopes that they'll give me work, because I know people there and they seem to be impressed with me.

And tomorrow, I start a new project at a different big ad agency downtown--actually the place Jef works at. This place is "impossible to get into and impossible to get out of," as he says. There's a good chance they'll start giving me lots and lots of work if they like me and if other teams find out about me.

This could be the beginning of a really profitable time for me, and one that will give my career a big boost.

I'm proud to say that since the beginning of June, I've spent a total of $4.15 on optional stuff. Actually, I returned a cat toy worth $20, and used a Home Depot gift card for another $10. So I'm actually $6 better off now. Pretty awesome compared to my usual spending habits.

I'm also proud to say that I went downtown today and didn't spend any money at all. No diet coke, no snack, no nothing. Then I thought about ordering dinner in since I'm home alone tonight, but changed my mind and raided the fridge instead. And the big ad agency does indeed want to give me work. Could turn into full-time, though I don't know if I want that. Things is goin' pretty well.

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I just saw a really wretched commercial for cashcall.com--basically a payday loan place, I think. I managed to catch some of the fine print they flashed at the end, and saw that the APR is 99.25%. WTF? I assume it must be legal, but really had no idea anyone charged that much.

I've seen payday loan places that charge 400-600% when you add in the "fees". 99% is actually a good deal for one of those places.

The other day I came across an old GRS post called The High Cost of Being Fat. It's so true. About a month ago I realized that I've spent just as much on getting fat as I have on trying to lose the weight--and both sides are in the thousands. The highlights:

Gaining
Living in the city, it's easy to drop $35 on a dinner ordered in. We used to go on kicks where we would order in almost every night! Thanks to living in a not-so-trendy neighborhood, our only options are pizza, Chinese, and Thai.
I used to buy lots of groceries that would usually go to waste. There are two scenarios here: 1) I buy lots of healthy food that goes bad before I get in the mood to eat it, or 2) I buy expensive processed foods and eat too much of them. Either way, overeating could easily cost me $100+ a week in groceries for two people.
I don't have numbers for clothes, health, and professional success, but I know there's been a high cost in each of these categories (or will be, in the case of my health).

Losing
For the past four years I've spent $25 to 40 a month on gym memberships. Too bad I almost never used them.
Because I'm so bad about getting to the gym, I decided to sign up for a personal trainer back in January. 48 sessions at $53 each = $2554, plus the interest I've paid on my credit card. I'm now two thirds done with those sessions, and I'm still fat. Good times!

I don't regret signing up for the personal training; I've learned a lot. I do regret my ambivalent behavior, though. Since I had this realization, I've really cut down on my food spending. The gym membership and personal training are all paid for, so I can take advantage of those for several more months without spending another dime.

Probably more importantly, I've noticed a very close connection in my relationships with food and money. When I start practicing frugality, I automatically eat less. And when I closely watch what I eat, I spend less on both food and non-food things. I basically get into a consumption mode that covers both things, I guess.

Not to get too far off topic, but you opened the door on this one...

There was a story on NPR a few weeks ago about a weight loss study that indicated that most people are stuck (for lack of a better word) within a specific weight range. As the participants dieted (and it didn't matter which diet- Atkins, SouthBeach, etc) they consistently binged and blew their diets when they reached the bottom of the range. The study's author likened it to holding your breath- your body won't LET you suffocate yourself that way, and neither would it let them diet their way into a smaller dress size. Regardless of the conscious signals, the body thought it was starving. I found that both interesting and disheartening.

I'm not surprised... and yes, it is disheartening. I used to belong to an online weight-loss community, and ya know what? Just about everyone I know from there who was so successful in losing weight gained most or all of it back as soon as weight loss was no longer their #1 priority.

Not to give TMI, but this is something I'm working through with my therapist. Her take is that anyone who has been overweight most of their life is out of touch with their body, and they won't successfully lose weight (i.e., forever) by trying to lose weight. She tells me that once I value my body enough to want to be healthy for health's sake, I'll lose weight as a side effect. She specifically warned me against trying, and was worried when I hired the trainer.

She actually has different reasoning than the NPR study gives, which is that someone who is fat her whole life identifies herself as a fat person. The body can lose weight MUCH faster than an identity shift occurs, and a thin person who still thinks of herself as fat won't stay thin. Many recently-thin people just don't know what to do with themselves, basically.

(Of course there are exceptions, but chances are most of them either weren't fat their whole lives or for whatever reason didn't identify as fat people. Or they just haven't gained back yet.)

I think the key to permanent weight loss for most people is to "lose weight slowly" (analogous to "get rich slowly"). And I mean really slowly, like no more than 10 pounds a year.

I was in a relationship for two years with a low-fat cookbook author. The food she made was delicious and I never felt like I was on a diet (I wasn't particularly overweight to begin with), but over those two years I lost about 20 pounds without even being aware of it. More importantly, the habits and tastes I picked up during that period have stayed with me ever since (about 15 years now); I literally feel repelled by most high-fat foods, although I'm eating a lot more fat than I used to now that I live with a French woman. I think the key was that my eating habits simply changed over time, and changing your daily habits is one of the major approaches to improving your finances as well as your health. Once something becomes a habit, you don't think about it anymore, it's not an effort.

I know that obesity is a very complex issue with many contributing causes, but for some people it does boil down to changing long-held habits. And I think changing those habits in a gradual way, so it's not an immediate disruption that takes the body by surprise, could be one of the keys to success.

If you're dangerously overweight of course you need to shed pounds more quickly. But if you're not in the danger zone, I think taking it really slowly is a good way to keep weight off longer, possibly forever.