Income: $4100 monthly
Expenses:
$1375 Rent
$ 276 Car Payment
$ 88 Car Insurance
$ 170 Cell Phones
$ 60 Internet and home phone
$ 150 NYSEG (utilities)
$ 200 Gas (because family is so far away as is my doctor)
$ 60 Bus Pass (Seth takes the bus to work)
$ 400 Groceries
$ 75 Melaleuca (cleaning products, toiletries, etc.)
$ 17 Hlu/Netflix (we don't have cable tv, and can't get over the air here)
Total: $2871, leaving a net amount of $1229.
The above expenses are every month until June, when we plan to move to a significantly less expensive apartment or house. We love where we live, but can no longer justify the cost. And with a move back closer to where we were before being in the realm of possibility, cutting expenses as much as we can is really important.
Where does the net amount go?
$ 75 Care Credit - we used this card when we needed contacts and glasses.
$ 25 Maurices - will be paid and CLOSED next month.
$ 25 Capital One M - mine
$ 25 HSBC - Seth
$ 50 Eating Out
$ 60 Old Navy - will be paid off and then strictly budgeted
$ 60 Bill Me Later - still paying off last Christmas! Will be paid off and closed
$100 Amazon - mine. Will be paid off and left open but not used (to build credit)
$ 75 Capital One S - Seth. Will be paid off and left open (credit building)
$ 75 Bank of America - Seth Will be paid off and left open (credit building)
So, those are the minimums we pay on those cards right now. That's a total of $970. OUCH!
We're doing a modified snowball for these. Paying them off in order from smallest to largest, then rolling the minimums on the paid off cards into the next biggest. By doing this, we can have all of these cards paid completely off in under a year. We are choosing to leave some open, either based on rewards (Old Navy, my Capital One, etc.), or to build our credit. Quite honestly, our credit isn't so hot, and we'd like to fix that.
Additionally, Seth is taking a promotion at work. Whatever raise that comes with will also be thrown into paying these debts off, and when that is done, it'll be diverted into a separate savings account back home, where we'd physically have to go in to make withdrawals.
So, what's left? $259.
Right now, we don't budget it.
We have a baby on the way that we do need some things for, Liam is growing like a weed, and we're using the money to deal with both of those things. Additionally, Seth and I pull our spending money from that pile. It's not a system for everyone, but it works for us. Any 'extra' money we have left, including bills that were less than expected, goes right to paying down/off a credit card.
So, there you have it. Ad it should be obvious as to WHY I'm working so hard to cut our expenses absolutely as much as I can. I don't want to drown in debt.
Baby budget:
We've scaled this back. I've decided to buy a cheaper version of the bassinet I chose, for a nearly 50% savings.
I will buy the cloth diaper system I want- in pieces. In the meantime, I'll be scooping up what I can from the gently used $1,3,5 bins at our local baby store and making it work. I did prefolds with Liam, so the $1 bin fitteds will be a step up as far as I'm concerned.
We won't be buying a car seat. Liam's convertible is not even 2 years old. So, Haven goes in that. Liam will go into my niece's outgrown car seat, that is actually a better fit for his lanky body. That choice alone saves us well over $100.
I'm recruiting my mom and friends to scour yard sales for newborn and 0-3m footed pajamas and the like. At tax time, we'll worry about the rest. I'm just looking to get through until then. I figure he needs clothes, a bed, diapers, and my breasts to make it through. And a car seat for travel. We'll buy what we need as we need it. :-)
My one splurge has been an ERGObaby carrier with all the attachments and accessories. I literally cannot feel the 30+lbs. of Liam in it!
Here's a photo of my guys at my mom's over last weekend.
I really do think we are living the same lives in different locations. Although you have considerably less debt than I do :) You can do this and once you have eliminated your debt if you truly want to build your credit you need to use those open cards. Do this if an only if you can commit to paying them. If you can use your CC for groceries do so, but then immediately transfer that money to pay the credit card. This will show you using and paying your Credit Card. It is recommended that you carry a small balance on each of your open cards to build credit. Again do this to purchase those items you need but would like to budget out (only if you can actually pay them off). I have given up on my credit and have decided to lead a cash only life. This is possible because we own our home. I am guessing you are hoping to buy a home to cut your expenses in the future.
ReplyDeleteMy plan for the open cards is to allot a budget for Old Navy seasonally to buy clothes for the kids (and hopefully for me if I can lose this weight!). Then just pay it off across a few months.
ReplyDeleteThe major cards, we'll have each one pay a bill. Then the bill pay option with the bank will just pay the bill amount to the credit card instead. I like this idea because it means most of our bills can then be auto paid without me even having to make the transaction. It'll just happen. I think, for me, the best financial transactions are one I have no part of. ;-)
I can't wait to buy a house! I swear to god the moment we buy a house, I'm calling and closing all credit accounts. The plan is to pay as much cash towards a home as we can. I'd like to have $50k in the bank in 6 years. If we move to a cheaper place, it is absolutely doable.
Also, different locations might not be the case in a year or two! We may have an opportunity to move back up that way at some point.
Love your blog!
ReplyDeleteLooks like your doing Dave Ramsey debt snowball plan!
Thank you! And yes, we are. But a slightly different version that fits us better. I can't wait to see where we end up!
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