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Welcome to my September Debt Payoff Report.
This is a monthly blog series where I’ll document my journey towards becoming debt free! After receiving feedback from some of my subscribers, I decided to change the name from a Debt Progress Report to a Debt Payoff Report.
Why A Debt Payoff Report?
You may be wondering why I would want to publish a payoff report as opposed to an income report. Now don’t get me wrong, I love reading income reports! Reading them gives me a double shot of confidence to work hard. There are a lot of bloggers who have worked hard in their respective niches in order to make ends meet for their families. In fact, they’re able to become their own boss without giving in to the hustle and bustle of your typical 9 to 5 job.
Just like the authors of those famous income reports, I want to be honest and transparent about my journey. Since I am not profiting off of my blog at the moment and I’m drowning in debt, I’m putting a twist on things by publishing a debt payoff report. I want readers to see my struggles with overcoming debt. Hopefully, I’ll come across some who can relate.
I have debated whether or not to publish my debt progress report for the sole reason of being embarrassed. Sharing accomplishments are great, however, it’s equally important to share the struggle and the path taken to get there. As a blogger, I am documenting this journey to see if I’ve made any progress towards my end goal.
The purpose of this debt progress report is to hold myself accountable by showing you how much debt I’ve been able to pay off throughout this journey. If I can do it, believe ME, you can too. I hope that I can encourage someone who can relate to my struggle.
Previous Debt Progress Reports
Debt Progress Report — August 2018
My Credit Card History
I have accumulated almost $9,000 in credit card debt on one credit card! This debt stemmed from my inability to secure full-time employment shortly after I graduated from college. I had bills to pay but I did not have enough money coming in to pay them. I came up with this brilliant idea to pay my bills with a credit card (side note: I’m being facetious). Rather than ask for help, I was paying my phone bill, purchasing food, putting gasoline in my car and occasionally treating myself to mini shopping sprees. As a young adult, my thought process was “if I could afford to pay the minimum payment, I’ll be good”. Seriously, what was I thinking?! If anyone out there is in credit card debt or debt in general and this is your current mindset, you need a wake-up call!!!
So here I am a few years later, correcting the mistakes that I’ve made in the past. It’s embarrassing to share my credit card history because I am afraid of what others would say about me. Here I am with a Bachelor’s Degree in Accounting and MBA in Finance and I’m swimming in credit card debt. Based on my academic credentials, yes I should know better. It’s easier said than done. Yes, I can teach others how to reconcile their bank statements or how to manage their finances, that doesn’t necessarily mean I apply those principles in my everyday life.
Now I am facing my credit card debt head-on. I may not make a lot of money at work but I’m determined to pay off my debt. I want to become debt free and I want financial freedom.
Debt Snowball Method
I am following the debt snowball method in order to pay off my debt.
A few years ago, I enrolled in Dave Ramsey’s Financial Peace University. (Phenomenal Program – I’m thinking about enrolling in a refresher course!) This program teaches you how to manage your money as opposed to letting your money manage you.
According to the Dave Ramsey Website, The debt snowball method is a strategy where you pay off your debts in the order of smallest to largest, gaining momentum as each balance is paid off. When the smallest debt is paid in full, you roll the money you were paying on that debt into the next smallest balance.
The steps are as follows:
- List your debts from smallest to largest.
- Make minimum payments on all your debts except the smallest.
- Pay as much as possible on your smallest debt.
- Repeat until each debt is paid in full.
Credit Card Debt Payoff Breakdown
Two Credit Cards Down – Three More To Go
By applying the Snowball Method, I made the final payment on my second credit card!!!! Woooo-Hooooo!!!
Credit Card #1 – Paid off in August
Credit Card #2 – Paid off in September
Breakdown of Credit Card #2
- Opened August 2016
- Initial Balance: $2,998.08
- Annual Fee: $0
- Annual Percentage Rate (APR): 26.99%
- Card opened under a credit card promotional period – 0% interest for 24 months.
- Minimum Payment: $65.00
- Paid Off One Day Before Promotional Period Expired
Goodbye and good riddance to this credit card! Once again, ladies and gentlemen, this is another impulse buy. A friend of mine recently moved to town. She needed furniture and asked if I would accompany her on this trip. She walked away without buying anything, I walked away with a brand new bedroom set! SMH! The bedroom set was being discontinued and I purchased a King Bed for $799.00 – it was regularly $1499.00. It was a great deal for King Bed but I did not need to make this purchase.
This debt was paid literally one day before the promotional period expired. Initially, I thought that I was not going to make the deadline as my scheduled paydays at work have changed. Fortunately, payday fell the day before and the payment due date! I am thrilled to say has been PAID IN FULL!!! Halllelooooo!!! LOL.
As of today, I have paid off two credit card, and I have three more to go.
The payments that I was putting towards my previous credit cards, will go towards my next credit cards.
What is your debt story? Are you working towards paying your cards off? Have you paid off any credit cards this month? Or perhaps, this year? Comment below – I’d love to hear your story.
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