I LOVE paying off debt!

Hi to all of my uber fab readers out there! I know I haven't been posting like I want (i.e. 3-5 times a week). Life has gotten so busy for me! Not only have the usual end-of-the-year rush at work and the holiday hustle and bustle started, but I'm actually beginning to plan my wedding!

But, to not lose sight of our focus, I have an update on my debt snowball progress: As of Monday, I paid off TWO MORE cards! Woohoo!!! Y'all, it's like I can't wait to get paid because I get EXCITED about paying off my credit cards! You know why?!?!? Because once they are paid off, I can use my money for whatever I want. And you know what I want! Yep, that's right. A FAT bank account. AND I don't have that chain around my neck! It's like being an independent woman! ***all my ladies, independent***

Anyhoo... I will update my networth info later. I'm a few days off from a month from when I updated it last. From now on, I want to update after I've paid my bills and the payments have posted for my credit cards. I guess I should do it on the last day of the month before payday then, huh?

Well, next up, I'll keep you posted on my wedding budget (and woes), Christmas shopping, and job search updates.

Oh, just in case you wanted to know, my favorite word for the day is Fiance'! LOL!

One down . . . nine to go.

I just called and closed one of my high interest rate, low credit-limit cards. And boy were they trying their best to keep my business! It's funny how having a balance of $0 changes your bargaining power!

Just a few months ago, I called the same credit card company and asked for a lower, more reasonable interest rate. The answer? No. I even asked to speak with a supervisor and was given the same response. They said there was no better interest rate available. Ha! That's some BULL!

Fast forward a few months to tonight when I called. After explaining to the customer service rep that I wanted to close my card, I was immediately transferred to their version of the customer retention department. The supervisor immediately offered me a 8% interest rate AND 2% cash back on all purchases. It was too little, too late. I'd already paid off the card AND I have a card with a much larger credit limit and a lower rate. He tried to persuade me to keep the card because its been open since 2005. But I have at least two other cards that have been open for longer and frankly, I don't need a card with such limited resources. Besides, if he offered me those benefits on a card with a small credit limit, I can only hope some other credit card companies will offer something even better. Needless to say, I closed the account.

I'm just glad to have those people out of my hair! BTW, I made sure to ask that a note be included on my credit report stating that the account was closed per my request.

Dave Ramsey's Step 2: Debt Snowball

After you save $1000 for an emergency fund, Dave Ramsey advocates paying off your debts using the "debt snowball" method. Basically, you take all of the income you have designated for debt reduction and pay towards your smallest debt. Once that debt is paid off, you roll that minimum payment and the extra payment into your next smallest debt until it's paid off. Keep doing this until all of your debts are paid off.


I've been using a modified debt snowball plan. When I first started, I paid off my smallest credit cards, and it was really exciting to see $0 balances! But after a while, I noticed that my minimum payments on the larger balances weren't making a dent in the balance because the interest rate was so high. I wanted to save some of the money I was paying interest on, so I decided to leave the smaller debts alone and focus on paying off the cards with the HIGHEST INTEREST RATE. This motivated me more because I knew I was not only paying off debt, but also saving money by cutting down the interest payments. Once I got a few balances low enough, I applied for a 0% interest rate card and transferred the balance. I'm not sure Dave Ramsey would advocate this step, but it worked for me. Now I can focus on the low balance cards with higher interest rates.

Since I didn't start this blog until October, it doesn't really show the progress that I've made this year. In January, I decided to get my finances in order. As of January 2008, I had 8 Credit Cards with balances (yeah, crazy right?) for a whopping total of $7,986.22. I'm shaking my head right now at it! I don't know WHERE that debt came from. A lot of eating out and unnecessary expenses. Credit Cards can be dangerous.

Since January, I've paid off 3 cards and consolidated 2 others. I saved $1,000 for my fit fund and paid off $3,729.22 worth of debt! I had some relapses in June and July, so some of my current debt is related to those indiscretions. *Sigh*

Anyways... writing out everything lets me see how far I've come (and how much further I have to go).

My sidebar needs help and progress updates

Can anyone please tell me where I can find a progress bar widget? Obviously, my sidebar needs a lot of help! I'd like to keep track of my progress with a progress bar, but I can't seem to find one!

Anyways... here's my progress for the month:

Credit Cards: $4,257 ($1,030 reduction)
Fit Fund: $1002

I've refunded my fit fund. Now I'm going to focus on paying down the rest of my credit card debt.

I should receive an extra $160.00 from my part-time job. That will go straight to the credit cards. And I'll also receive $300 for an article that I'm submitting. That will also go straight to the credit cards.

Right now I have 4 cards with balances:

Capital One Mastercard (my 0% interest card until 2/09): $2,822.23
Capital One Visa : $151.07
Ann Taylor: $438.35
Citi Student Visa: $844.53

I'll pay off the small Capital One Balance, then the remaining Ann Taylor balance. I'll pay off the Citi balance with my November paycheck and use any remaining funds to pay down the large Capital One Balance. Hopefully, I'll pay the remaining balance with my December paycheck. I don't want to carry any credit card debt into the new year, but as of now, I'll need to pay $2,128.50 over the next two months! Practically impossible. It looks like my plan will have to be revised. Even with my impending pay raise (the State needs to stop playin' and give me my raise!), I won't have enough money after all of my expenses to pay $2,128.50 on the cards. It looks like I'll be credit card debt free at the end of January 2009. YAY!!!!

Not quite the timeline I had in mind, but close enough. I've had a few setbacks along the way and have had to pause the debt reduction goals to replenish my fit fund. This whole process is making me look at money in a NEW light!!!! I can't wait until I can save money and actually see it grow! Woo Hoo!!

Gotta love those 0% balance transfers

I've worked really hard this year to pay off my credit cards and I've made a lot of progress. Despite my progress, I still had three large balances on cards with ridiculously high interest rates. I tried calling the companies to ask for a lower rate but I was told they didn't have a lower rate to offer me. So, you know what I did? I double-timed my payments for one card and lowered the balance from over $1600 to just $200 in a little over a month. I'll pay off the remaining $200 by next week.

As for the other two cards, I took a risk and applied for an 0% interest balance transfer card. I was a little nervous about applying because I wasn't sure if I'd get approved or if would get a high enough line of credit. But things worked out for the best! Once I was approved, I called the companies again to see if they could work with me. My reasoning? I'd been with one company for over 5 years! Surely they could lower the interest rate to something reasonable. I told them about my 0% balance transfer offer (which has a very low APR after the promo period expires). No luck. After ending the call with bad credit card company, I immediately transferred the balance. So much for customer service.

The rest of my credit card debt will be paid off before the 0% interest rate expires. In the meantime, every cent of my payments each month go to lowering the balance. No more ridiculously high interest charges! I'm telling my money what to do!