Help! My Debt Snowball Is Melting!

The summer heat has taken a toll on my debt snowball. Two months ago, I paid off the last of my credit card debt, but I still have thousands of dollars in loans. I started the summer with over $10,000 in my savings account, no credit card debt, and a solid plan to pay off my remaining loans within the next few years.

Then life happened. I've been living out of suitcases for the past two months, traveling to New York, Buenos Aires, and Bangor. (I've blogged quite a bit about how travel is one of my budget weak spots.) So I spent some money. Not as much as I was afraid I might, but more than I probably should have.

Also, I have kids. Those of you with children may have noticed that they're expensive. There are a thousand articles out there on how to keep the cost of having children to a minimum. I've written some of those myself. But I'm here to tell you that whether you do your back-to-school shopping at Bloomingdale's or Goodwill, kids will add to your monthly expenses.

So here I am. Summer's ending. I'm writing from the lake house in northern Maine where I've been holed up for much of the past few months. In the peaceful quiet hour around sunset, I finally steeled myself and looked at my bank balance.

Resting on my laurels
It's not as bad as I'd feared. The numbers are still solidly in the black. My savings have a dent in them, but a smaller one than I expected. My checking account is in good shape. My bills are paid.

The shadow in this rosy picture: I haven't made any extra debt payments all summer. The hot weather arrived, my credit cards were paid off, and instead of rolling that debt snowball right into my car loan, I sat back on my laurels. No wonder I have more money than I expected: I've been letting all my debt snowball money (which adds up to almost $2000 a month) sluice around in my regular budget for two months!

I was going to try to slide this under the radar. I figured I'd turn a new leaf when the leaves changed colors, keep paying my debts off as quick as I can, and no one needed to be the wiser.

But then J.D. pointed out that my recent posts here haven't had a lot of “me” in them. That's not just because I'm focused on other things. It's because I don't want anyone looking too closely at me. I'm a little ashamed of where my finances are.

Not that there's anything wrong with taking a few months off from my debt snowball. I wanted to do something indulgent and special to celebrate being out of credit card debt. Taking a summer off would have been an expensive but reasonable choice.

The problem is that I didn't choose it. It just sort of happened. I let things slide. I put “set up increased loan payments” at the top of my financial to-do list in June. (A to-do list I literally left sitting on my desk when I packed my bags and left for the summer.) But I neglected to do set up those payments, or to do any other active management of my household finances for months. There was money in my checking account, and that was good enough for me.

Now there's a familiar sinking feeling in my stomach as I look at my bank balance and have no idea where my money has gone or what the numbers mean.

Failing forward
I'm not actually in any financial trouble. But my timeline for being out of debt has slipped, and it's slipped through some of the same cracks that led me into debt in the first place. I don't know where all that extra money went. Some of it went into preschool tuition and plane tickets and new shoes for the kids. Sure. But I was also careless budgeting for groceries and any number of small purchases. Those add up to a lot of dollars.

My shame isn't about my bottom line. It's about my bad habits. I'm making some of the same mistakes I made for years. The mistakes I'm prone to making with money when I don't pay attention. That's embarrassing, no matter what my bank balance is.

Of course, shame and fear about money was what led me into this debt trap. I didn't want to look. For years, I simply refused to know what my spending habits were, or even what my regular bills added up to. By the time I turned 30, that head-in-the-sand approach had saddled me more debt than the total income I'd earned in my life. I've spent the past two years digging myself out, and I'm starting to see a light at the end of that tunnel.

I've been living on a skinny budget for years. I've paid off a mountain of credit cards. But even though I had a lot of credit card debt, the credit cards were still the low-hanging fruit.

Now I have to pay off loans. They have lower interest rates and higher balances than my credit cards did. The bills just come quietly every month and I pay them. The balances only move down, but they move down slowly.

There's no exciting struggle. No relearning old habits to keep the plastic in my wallet and out of my hand when I'm standing in line at the checkout. No lifestyle changes that will suddenly free up hundreds of dollars to wipe out the debt.

I just need to roll that snowball over and keep paying it. I suspect that even being very aggressive about my debt payments, it will be two years before I hit another financial milestone worth throwing a party about. This approach is effective — but boring. That's what getting rich slowly is all about.

It's the beginning of September. The beginning of fall, and of a new school year. A great time for new beginnings. I'm back on the wagon with my budget, and making those extra loan payments this month.

I'm writing about all this publicly in the hopes that it's a teachable moment. The lesson I've learned so far: Sometimes we all slip. The key is to fall back on the skills and strengths you know you have, and start over from wherever you are.

What else can I learn here? You're a bunch of extremely smart readers. What do you do to stay motivated while paying down debt or saving towards a goal? What helps you keep your good financial habits going?

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Money Smarts Blog
Money Smarts Blog
9 years ago

I think when you decided to do a lot of traveling this summer, you had to put the debt repayment on the shelf. I believe you said that in your article where you announced your big trip.

You can’t do everything.

At this point, forget about it and just move forward with the debt repayment plans.

Techbud
Techbud
9 years ago

The fact the you did everything from savings, and after a short break are back on track is a good sign. It was a 2 month break not a 2 year break.

I find reading and writing blogs helps keep me motivated. Hearing other stories and sharing mine works for me.

Rob Ward
Rob Ward
9 years ago

As Techbud said reading finance blogs (and now writing one) has certainly helped. Our budget also helps to keep us in line, for the most part.

Recently I added all of my loan balances to the category name to remind us that we need to get things paid off as soon as we can. It is certainly going to be a long road but it will be worth it.

Larry
Larry
9 years ago

I find Ramit Sethi financial automation information to be invaluable. Kind of like cranking widgets! I have automated savings going into multiple ING sub accounts including Emergency (we used $400 on a repair, once we are back up these payments stop); Pet fund; Martial Art yearly tuition and competition fee fund, Vacation, Kids clothing, etc. This helps greatly! We are debt free, except for the home and have one in college and one in a private school. I kind of like looking at finances as dirty work or blue collar…roll your sleeves up and get to it. To me it… Read more »

SF_UK
SF_UK
9 years ago

Is this a situation where automating things may help? (e.g. set up an auto-transfer for the extra money with your bank) It sounds like paying the debts down isn’t where you’re struggling, it’s remembering/getting round to do it. And don’t beat yourself up. You didn’t slide further into debt, you just didn’t pay back quite so fast. So, you’re still winning, just a bit more slowly. One of my friends created a debt spreadsheet that he updated and posted graphs from on his blog regularly. One of the graphs showed his current progress at paying off debt (time on the… Read more »

Nicole
Nicole
9 years ago

This is a great post! It is nice to see a bit more substance from guest writers… recently some (but not all) of the posts have been pretty light and generic. I’m glad JD suggested putting more real stuff in. One thing I notice is that there’s a whole lot of “I” when you’re talking about finances. Since you have a family, it would be interesting to hear what the “we” part of the equation thinks if they’re willing to be mentioned. Are they on board? Do they keep the family accountable? What kinds of things do they do to… Read more »

Jan
Jan
9 years ago

We don’t have debt- but we have always saved. That has slipped terribly in the last few months.
Thanks for the kick start.
I did my accountability budget yesterday (the 1st)- today is the day to start again.
Try not to look back- but look forward!

Victoria
Victoria
9 years ago

Thank you! This was a fantastic post to read. You are completely right – people are human and sometimes we slip. But the thing to do is get back up, dust yourself off and start all over again! It’s really great to get reminded of that once in a while.

Everyday Tips
Everyday Tips
9 years ago

I don’t think you should be ashamed. You created fantastic memories, don’t taint them with guilt. Summer is difficult because there is so much temptation to spend. I have 3 kids, and I am the first one to say ‘yes’ to playing putt putt golf or whatever. I only have them in my house for 18 years, so I try and make the most of it. Sure a lot of activities are free and we do a lot of those too. But, variety is the spice of life! My finances slipped a little this summer too. Sometimes I underestimate the… Read more »

Steve
Steve
9 years ago

I have trouble staying on the wagon consistently due to a variety of factors. My girlfriend is on board with the end goals but has trouble getting started moving in the right direction (which is to say, she’s paralyzed by the big picture and can’t get started at all). When I need to focus on staying within my budget, I remind myself of all of the stupid purchases I have made in the past, and how much money I need to save (or extra money I need to earn) every day (~$15) to have the $5k I want to move… Read more »

Evan
Evan
9 years ago

Two things I’ve found keep me on track. First, my wife is a spreadsheet nerd and has some kind of alarm implanted in her brain that usually goes off before I do something stupid, or right after when she can call me on it. Being accountable to someone else is a huge help. Second is paying more attention. We have a spreadsheet where we track every penny we spend. If I don’t look at it for a few days, I forget where everything is and make a mistake. Taking a look every day at where you are will constantly remind… Read more »

Deborah
Deborah
9 years ago

If I find myself slipping, I do the “Track every penny you spend” for a week thing. That usually helps.

Like yourself, I’ve only got the big loans left staring me in the face. I’m in a different situation – married, but no kids. So I’ve made the decision to get a part time job to get rid of those loans, hopefully paying them off in 3 years instead of 6.

Amy
Amy
9 years ago

I gather from this post you have a lot of guilt that you aren’t paying down your debt as fast as you know you could. There’s always ways to pay down debt faster if you make that a priority. You have written all summer long about how you purposefully changed your priorities and budget in order to travel. Now you’re back and about to pick back up on the debt snowball. I don’t quite understand where this guilt is coming from? YOu made choices for your life and it’s working nicely from what I can tell. I hope you can… Read more »

Sarah
Sarah
9 years ago

It is harder once you get down to the loans. Paying off credit cards only took a year of obsessively frugal living and budgeting, and it felt amazing.

The loans on the other hand… even an extra $2k payment last December didn’t make much of a dent. It can’t be about the joy of being done, it’s more about discipline and habit.

And yes, I think it’s okay and even good to take a break from that. You got to relax AND remind yourself why you live the way you do most of the time.

Sam
Sam
9 years ago

I stayed very focused when we were paying down our debt, but I have found that my focus has decreased this year for personal finances in general and our savings plan specifically.

What helped me to pay down debt was to live my budget and plan almost every day, reviewing our accounts, updating our excel charts, making payments, etc. We were living so close to the budget edge required us to stay focused or we would toppel over.

These days we are more comfortable so it seems harder to focus on personal finances, savings, etc. So I need help myself.

Mike
Mike
9 years ago

Hi Sierra One of the things that has helped me tremendously is having 1 night per week where I review all of my accounts and pay my bills. For me, it’s Wednesday at 9PM. I do this almost religously. Prior to forming this habit, I paid bills when I got around to it, which also meant late at times. What this has also allowed me to do is keep track of my spending habits and patterns. I have a budget and savings goal every time I am paid. Just pick a day and try it. You really aren’t that far… Read more »

margot
margot
9 years ago

I had noticed in your prior postings, especially those about travel, that you were making lots of justifications for your spending. Those justifications are in this posting, too. Kids need not be expensive, and given that they are in your budget with the snowball, they need not have anything to do with slowing down the snowball. Travel, especially for an entire summer, is a huge luxury and not something I’d do until I cleaned up a debt mess from years of over-indulging. Good luck turning this around. I’m guessing it will help to stop finding justifications for spending money on… Read more »

sandy
sandy
9 years ago

Today is a new day! Today, we can all change one thing…a bad habit, adding to our debt snowball, or choosing an apple over a twinkie. Never beat yourself up…just know that today is the day to change! Remember how great it felt to get the CC debt out of the way? It’s the same when you get the student loan done, or the car loan, or the home equity loan all paid off. We’ve been chipping away at debts over the years…$60,000 in hubby’s grad school debt (paid in 5 years)house debt (paid in full this April.11 years..we now… Read more »

steven@hundredgoals.com
9 years ago

This article mirrors exactly how I feel about my current situation. My savings over the course of the summer have slipped and I’m feeling pretty guilty about it. Time to get back on track…

Jolyn@Budgets are the New Black
[email protected] are the New Black
9 years ago

Ha! You’re doing what I do: you’re blogging about it! Kudos to you for being so honest and forthright. Just getting it out there will be cathartic and act as a catalyst to get you back in the debt-paying saddle.

I’m also a sucker for travel. I’m not so sure that a couple months off the debt-paying focus isn’t worth it…

SJ
SJ
9 years ago

Nothing wrong with making choices, just accept that Buenos Aires and Bangor don’t count as “life happening”. Don’t try to find false excuses (“whether you do your back-to-school shopping at Bloomingdale’s or Goodwill, kids will add to your monthly expenses” – I’ve done my back to school shopping at Goodwill and Walmart, and it cost $25, or 1% of your monthly snowball downfall). Nothing wrong with a break from rice and beans, you’ve done well, just accept you took it and now you are done. And be careful with the “I’m not actually in any financial trouble” talk. The reason… Read more »

Tyler Karaszewski
Tyler Karaszewski
9 years ago

You have kids? Big deal, so does 90% of the world’s adult population. And life is happening? I’ll give you a tip — that’s true for every single person who’s not dead. These aren’t good excuses. Especially since you’ve spent the whole summer at “the lake house”, which is presumably not the most affordable place you could have been. Your kids aren’t the ones breaking your budget here, so don’t blame them. Just the other day J.D. was talking about “Talkers vs. Doers”. If you want to be a doer, you have to show results. Show us compelling results, or… Read more »

Laura
Laura
9 years ago

I also want to say thank you for posting this – it’s exactly what I needed to hear today. I have paid off my low-balance debts and have started on my student loans. It’s a lot harder to get amped about my large student loan than it was for my smaller debts. I don’t see many posts related to this part of the personal finance journey, so I appreciate your perspective. Slow and steady. 🙂

DeborahM
DeborahM
9 years ago

It’s great to have a partner in this. My husband and I frequently congratulate ourselves on how far we’ve come, and list a few of the most recent achievements. Not just financial, but in all areas of our lives.

Geek
Geek
9 years ago

I did the same thing, more or less. I don’t have any debt but I’ve been saving for a house, and I had to lower my savings amount for a 2nd dog, and to keep up with my summertime hobby. So I too felt horrible and guilty when I noticed that my special event clothing was putting me “behind” (usually I have all the money for a month in the bank on the 1st, but now I have all the money for a month in the bank on the 30th… 2 paychecks behind!). I took a very close look at… Read more »

PB
PB
9 years ago

Life always happens, disrupting budgets, and life always seems to happen in the summer. I have given up on trying to stick to any debt-paydown plan in the summer — it just doesn’t work. I figure that if I come out of the summer and settle into the school year again with no increased debt, I am ahead of the game. Our life is governed by the school year, and it is far easier to plan around the regularities of its rhythms than the irregularities of summer. Part of the reason that summer spending is so irregular is that it… Read more »

Joe
Joe
9 years ago

Thanks for sharing your personal situation. I’ve been putting off a review of the finances all week because I know we slipped on savings over the summer.

Sometimes I think it is healthy to take your foot off the gas when you have been pushing at your debt really hard for a really long time. Perhaps there is a balance that gives some more fun money while knocking down the debt (albeit slightly slower)?

Anne
Anne
9 years ago

Margot – very insightful!

I wondered how anyone can afford to just travel for months on end while working as a freelance writer and blogger. The answer, I guess, is you can’t. Not if you have other responsiblities like debts to pay.

Becky
Becky
9 years ago

This seems like a timely post (at least it was for me)…maybe consumer spending was up over the summer because this is happening on a much larger scale! I moved accross the country in August, and although Ikea appreciates my increased spending, my savings account has not. Last night my partner and I sat down, went over our finances, and recommitted ourselves to our budget. Good luck, Sierra!

momcents
momcents
9 years ago

For me to stay on task with my financial goals, I have to remain extremely organized. I need to have at least three goals planned out beyond what I’m working for now. I also need to send my money where it belongs as soon as it reaches my hot little hands. My husband’s a very supportive and easy-going guy. If I want to pay down debt, he supports that. If I want to spring for a little indulgence, he supports that too. So one of the best ways I can keep on track is tell him over and over again… Read more »

MM
MM
9 years ago

FYI

The two biggest gym membership gains are in January and September.

Those are the self-improvement months.

Aaron
Aaron
9 years ago

“But then J.D. pointed out that my recent posts here haven’t had a lot of “me” in them” I noticed this as a common trend from the “staff writers”. Seems like most the posts lately have been more like long articles than blog posts about how the personal finance topic relates to you. This is what I enjoy about JD’s posts, is that they usually tie into his life somehow, which make them more engaging than the staff writer’s posts (at least lately). I’d rather no post than a lengthy boring post that I could find on a typical journalism… Read more »

Nicole
Nicole
9 years ago

@32 I’m good with the lengthy informative posts, especially the Motley Fool guy (and I like CNN and MSNMoney articles too… especially Walter Updegrave, Liz Pulliam Weston, and Donna Freedman). Not so good with the brief obvious paragraphs that I could have read if I accidentally clicked on a “Real Simple” article off CNN.

MOR
MOR
9 years ago

I agree with the folks saying that your giving justifications/excuses for your spending, but disagree with their general sentiment. This is your life. There is nothing wrong with simply saying, “This summer I chose to travel rather than contribute to my debt snowball.” As long as you weren’t taking on additional debt to travel (which you weren’t), there is not a darn thing wrong with that. There are things more important than paying down your debt more quickly. Experiences can’t be replaced and they can’t necessarily be replicated at a later time when you’re completely out of debt, either. The… Read more »

MP3
MP3
9 years ago

We all tumble periodically. It’s the courage to get back up and start again that’s important. Like dieting – it has its ups and downs. Summer time for me is also a bad time.

alison
alison
9 years ago

“The lesson I’ve learned so far: Sometimes we all slip. The key is to fall back on the skills and strengths you know you have, and start over from wherever you are.” I appreciate this post and particularly the quote above – I’ve had a bit of a slip these past few months, not intentional but a combination of life circumstances, priorities + choice. While it is annoying and a bit disheartening (I was SO close to reaching one of my financial goals when things shifted!), I know that the skills I employed to get “so close” are right there… Read more »

LNH
LNH
9 years ago

At times like these, I remind myself that energy spent castigating myself for the past is energy not spent moving forward. Habits are hard to change, and the fact that you caught it, means that you have established a good habit…you just haven’t completely expunged the bad habit, and you may never, but the point is to get it mostly right. You know what I did when I planned out my debt repayment plan? I built in two months (one in June, one in December) where I only paid half of what I normally paid. Yeah, it meant longer, but… Read more »

chacha1
chacha1
9 years ago

My savings are down by $1000 this month because last month my cat needed dental work. I knew it was coming and had saved extra for it, which is what PF is all about. My debt snowball will reach the bottom of its biggest hill at the end of October. I’m celebrating by taking November off, going out of town for Thanksgiving (which we haven’t done for years) and buying a long-desired piece of furniture. Then I’ll be back on track in December on the next-smallest hill. What keeps me motivated is mostly my increasingly detailed vision of the retirement… Read more »

Alex
Alex
9 years ago

I can feel your pain, just about literally. I recently quit my job, went to graduate school in another state from my husband, and I now live on my own till he moves down here. So needless to say our expenses went up considerably at the same time our income went down. We are being prudent in trying to keep each and every month in the black, but when we were used to saving 40% or more of our income each month, that “just staying in the black” goal seems like such a miniscule thing to do. I just have… Read more »

ami | 40daystochange
ami | 40daystochange
9 years ago

First – I think it’s fantastic that you managed to pay off the cards! Hurrah! Celebrate! Maybe you didn’t celebrate enough? My point being – you accomplished something big and wonderful, and maybe if you had stopped to acknowledge the accomplishment, perhaps even – GASP – spend some money and definitely some time and mental energy to recognize yourself, you’d feel more satisfied with the outcome – and also ready to tackle the next big financial goal. We had a similar experience with paying off debt. We paid off a LOT of consumer credit and student loans. It was really… Read more »

Jaime
Jaime
9 years ago

I actually like it when people share their personal stories of how they deal with finances,its nothing shameful you know,it lets your readers get that personal touch which is something that you can’t get with Suze Orman and Dave Ramsey. So don’t be ashamed, you’ll get there. 😉

partgypsy
partgypsy
9 years ago

Gosh is there something in the water? While we have not done stellar previously, the last 2 months have been bad regarding lapses in our budget and losing momentum of saving money regularly. Basically our goal was to increase the emergency fund. We started out at 4K, and if we are lucky we will end at yep 4k. It’s true we had (over)6K worth of unexpected expenses, but I reviewed our outgos and we also had so far this year over 5K of discretionary expenses (remodeling, clothes, trips, gifts, yummy food etc). Looking over it there were very few things… Read more »

Amanda
Amanda
9 years ago

Thanks for the post! I’m really happy to hear about “you”! The last one I read was really BORING! I’m going to review my spending over August. I’ve been putting it off and this is just the push I need to get to it! We’re going on a small trip next week (DH 1/2 paid for work) and I need to know our true situation. I’m at my seasonal job right now so it’d be awesome if this would cover our expenses! We didn’t have any debt after our minor CC blips were paid off, but I too relaxed! I’m… Read more »

bethh
bethh
9 years ago

Well, J.D. was right on the money when he said you hadn’t been writing from a personal level lately – this is the first of your posts in a while that I haven’t wound up skimming! (which says more about my interest in personal stories than it does about your other posts) I think that at some level you DID decide to take a break from debt repayment, but perhaps you didn’t want to articulate it. But now summer is over and it’s back to school time. Even though I’ve been out of school almost as long as I was… Read more »

battra92
battra92
9 years ago

I know this sounds mean, callus and whatever but personally I don’t care if your debt snowball is melting. You’re traveling all over the world for crying out loud! Saving and being frugal takes work and sometimes you can’t do everything you want.

Nicole
Nicole
9 years ago

You made a mistake. It stinks. Move on. Start fresh. The only thing you can change about the past is your present view of it.

I stay motivated by constantly (i’m a nerd) calculating when it will be paid and the “what if I changed our debt repayment by doing this”

brooklyn money
brooklyn money
9 years ago

Ugh I spent all my income last month for the first time since I started getting serious about my finances a few years ago. Not that I went into debt, and the things I bought are part of my budget, but I went over in other areas. That said, it’s summer and it’s worth it! You didn’t take any debt on either, so no harm done. Buckle down in the fall and it’s all good.

Jason
Jason
9 years ago

I find the same things happen to me with eating habits, exercise and getting decent sleep.

Kristina
Kristina
9 years ago

You’re feeling guilty because somewhere, somehow you crossed YOUR line between a reasonable reward, and overspending. Perhaps it was the unconscious spending that’s eating away at you. And if you’d really THOUGHT about it you might even have spent MORE, and felt LESS guilty because it was a conscious decision. Identifying what is making you guilty, and where that overspending line is, is a great exercise in life balance. Nobody’s line is in the same place, and what is a justifiable, not worth any guilt, expense is completely different from person to person. Good luck figuring out where your line… Read more »

Jennifer
Jennifer
9 years ago

It happens to all of us at some time or another. Just get back on track and start from scratch. It is very hard to break old habits.

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