Debt Status September 2008

So, after completing balance transfers to new cards last week, here’s what I owe:

CC#1 - $11,400 at 5.99% fixed for the life of the loan.
CC#2 - $12,999.40 at 0% through February 2010, then converting to 6.99% fixed
CC#3 - $7004 at 0% through October 2009, then converting to 9.99% fixed
CC#4 - $57.47 at 23%
Grand total CC debt = $31,460.40
Utilization – 44.31%

Checking – $1500
Savings – $350

The balance on the CC#4 posted after the transfer, from some recurring payments I had set up and one DVD I had preordered for the kids.  I’ve already got that payment scheduled for 09/30, and then this card will be done.

As it happens,  the card with the lowest balance is also the card that will have the highest interest rate, and has the oldest lingering debt.  So whether I decided to tackle low balance, high interest or age first, it all points to that $7k. 

CC#1 has a minimum of about $230 right now.  I’m going to continue with that.  This will be the last card I pay off.  CC#2 & CC#3 aren’t due until November, and no minimum payments are showing up right now, so I’ve based my initial payment (to be made at the beginning of October – I’m not skipping that month they’re giving me) on the minimums from the higher interest cards.  I’ll be sending $500 to CC#2 and $350 to CC#3, and will adjust payments after I see what the minimum on CC#3 actually is.  I’ve also got a $500 credit check coming from CC#5 (CC#3 transferred too much and left me with a credit there, and I don’t list it because after the credit clears I will not be using it again – certainly not so long as they hold my interest above 15%); that gets applied to CC#3’s $7k as soon as I can deposit it.

All told, I figure I have about $1,112 per month I can put toward the debt right now.  I’m figuring $542 / month to CC#2 and having that paid off in 11 months, before the interest kicks in, with another $325 / month going to CC#3, reducing that principal to roughly $9100 at the time CC#2 gets paid off.  Then I’ll apply the former CC#2 payment to CC#3, and looking to pay that off in approximately September 2010.  Not too long after the interest kicks in.  This assumes I receive no raises at work.  If I do, I’ll add that to the payment.  This leaves CC#1 being paid off in roughly September 2011.

It is three years out of my life, but it’s three years paying back debt it took 8-10 years to accumulate.

I’m only paid once a month, and cable, cell phone, and daycare for the month also come out of that, so it’s difficult to make multiple payments, but if I can, I will.  This budget also leaves me with about $300 / month (after $50 specifically for savings) discretionary spending and health / medical necessities for myself and the kids.  This is after contributing 8% to my 401k.   I can’t forgo that.  The company matches the first 6, and I need the additional two removed pre-tax to keep us in a lower bracket.

Oh, and of course, no more charging.  Payments only while handling my own debt management plan.  If I can’t pay for it in cash, I either don’t need it, must save for it, or it had better be a real, honest-to-Maude emergency.  Needing shoes and/or clothes for the kids is not an emergency; it has to be a planned expenditure.  My biggest spending hurdles are going to be October (both kids birthdays) and Christmas.  I’ve already made some planned cutbacks, and hope to be able to pay cash for most everything (my first ever debit card is coming in the mail soon.  I’ll use that for any online shopping I need to do, assuming I can.)

So.  There we go – the big plan is done.  Now all it takes is sticking to it.