Tuesday, December 30, 2008

New Year, New Post

Well, its been a long time since my last post. For the most part, this is due to the fact that our lives were pretty much turned upside-down with our move. Then, to really complicate matters, we found out that we are going to have a baby in May. This is very exciting news, but it does help to throw one's financial plan into a tailspin.

Anyway, with all of that being said, here is our current status.

As of our next paychecks, we will have paid off a total of 3 credit cards. We had paid off a fourth, but then we decided to buy a new recliner and mattress and this opened the door up to using the card for other things as well. I know, this is terrible and totally counter-productive. Well, we have stopped using the card...again...and I should have it re-paid off by February.

This will leave us with three credit cards. Two of them are our biggest ones, and the other has about $2,500 on it. A while ago, when things were pretty tough, I put this card on a slow-pay plan through a debt management company. This promised a lower interest rate and so on, so it was a good idea at the time. Well, I think we've reached the point now that I am going to take that card back and it should be paid off before the baby arrives.

I do want to add that paying off the cards with the smallest balances first (i.e. the debt snowball) is the method that is working for us. I realize that it may not be the most cost-effective, but we are making progress.

We have paid off my car, which is nice. Now if it will only keep running for a while so I can enjoy it.

Also, the mortgage on our first house is now covered. One of our former neighbors (a realtor) got us in contact with a company that gets homes for families that can't qualify for loans because of the economy. Their monthly payment covers all of our expenses and they are responsible for any repairs to the property. After a certain period of time, the company gets them a mortgage based on their payment history. Not bad. We won't make any money, but we also won't have the headache of landlord-ship either. Hopefully, it will all go smoothly.

The biggest development since my last post is that my wife's student loans are now in repayment status...most of them anyway. She has loans through Sallie Mae and Wells Fargo as well as some other miscellaneous loans that will start repayment next year. We have already signed up for graduated repayment (meaning we pay pretty much just interest in the beginning and then more at the end), and the Wells Fargo payment alone is exactly as much as our now-covered mortgage payment.

It has been nice (really nice) having two paychecks, especially since one them is for a pharmacist. It was nice to sit down and reevaluate our finances for 2009 and see how much we accomplished in a relatively short amount of time.

Debt Freedom is still a far away dream, but we are getting closer.