I've never really explained much about what/where this blog stems from. To be completely honest, very penny really does count in my situation.
I may have mentioned my ridiculous debt that I have acquired at the age of 24, but I'm sure I never really explained it. So I decided it's time I open up a bit.
My days with debt aa began back in 2000 when I was 18 years old. I was offered my very first credit card. While at first this was a great and positive thing for me. I was able to keep little to no balance on my card for a while as I was so afraid of the thing. My nervousness subsided and I maxed that thing out in minutes. It didn't take long, really.
I wish I had been more educated in the debt and credit card world back then.
Since, I've nearly paid my credit cards (I now have 2, both acquired in college) off at times, and without haste racked them back up. Actually I lie, I have 3. I have a store credit card as well. With a smaller limit but has since increased as I use this credit card as I should. The store card has absolutely no balance on it currently, if I use it, I pay it off immediately.
Currently, my interest rates are ridiculously high and I haven't used them in at least two years or so. One of them may even be closed to be honest with you. While my credit cards are not currently maxed out, they certainly aren't below the suggested 30% of limit (I read that somewhere?).
I checked out this nifty
debt calculator that helps determine how long it will take to pay off your credit card debt. I'm sure there are millions of other ones out there, but I use this one because I find it the easiest to understand.
My credit card debt as of today is as follows:
- Credit Card #1: $2107.69 with an APR of 28.99%
- Credit Card #2: $2365.35 with an APR of 19.15%
- Credit Card #3: $0 with an APR of 24.99%
For a grand total of $4473.04 in credit card debt.Now, credit card debt is not my only debt.
Next comes my car. A used 2005 car that I do love. It was my first big purchase made on my own, all by myself independently (meaning no co-signer). I bought the car a little over 3 years ago. I still have 23 more payments to make on it. Yep I was super smart and financed for 72 months with a 9.99% APR. Bad idea Ash! I'm calling the credit union tomorrow to find out what my pay-off is as I paid a little extra some months (well maybe more like once). I'll update you with that number once I have it.
But for the point of this post, if I were to continue to pay the minimum monthly payment for the rest of the term of my loan my costs would be $6013.81.Up next is my biggest, most scariest, with-me-for-life type debt. My student loans. I have Private Student Loans with the oh so lovely Sallie Mae & I have federal loans with Direct Loans. My Sallie Mae debt is crazy and almost unmanageable. My Direct Loans don't make me as anxious.
Mind you I financed my ENTIRE 4 year Bachelors Degree education (including cost of living expenses). Another GREAT idea I had. NOT!
My student loan debt as of today is as follows:
- Sallie Mae: Total Amount Outstanding (5 private loans): $61,061.14 APRs between 3-5%.
- Direct Loans (4 loans): $7,617.16 APRs (2) at 2.48% and the other (2) at 6.8%
My Sallie Mae monthly payment is approximately $486.00 & my Direct Loan monthly payment is about $83.00 or
$569.00 a month!For a grand total of $68,678.30 in student loan debt as of today. My student loan debt is ridiculous because to be honest with you, my yearly salary (which requires my college degree) is not even half of my student loan debt. GRR!
But you live and you learn. This is my debt, I created it and I will fix it. It will be a challenge but I am determined!
So, in total, my debt is approximately $79,165.15 at 24 years of age.
Let me add that I am not currently paying $0 in rent. I did have an apartment, but when I started to pay back student loans and realized I could not afford my life I move into the in-law apartment at my parents house. Without this, I don't really know what I would do.
My Plan:As of July 1st, I have a new (and strict) budget in place. ( I have this nifty budget application on my Mac that I adore). I have decided to first attack my Auto Loan debt. According to a lot of people this is probably the totally wrong decision. But for me I think it is best. I just (days ago) placed my Sallie Mae loans into a voluntary forbearance. BUT in my budget I do plan on paying AT LEAST the interest (in the past has been about $220.00 applied to interest). This way once they come out of forbearance my monthly payment will be about the same it use to be. I will continue to pay minimum monthly payments on my credit cards and Direct Loans. I will be paying 2x the monthly payment on my car.
I know it will be tough and things may not go exactly as planned...but I am determined to make this work. If you have any suggestions please don't hesitate to chime in!
