The Big Raise Pays Off!

Well, several weeks ago I posted about my husband's great promotion and raise. Well, we just found out that he's getting a $22,000 bump in his base pay! This is sooo great! The major portion of his salary is still commission, but now we can count on an extra $1,000 in his monthly take home pay! (Now there is the chance that the commissions could plummet and we'll end up taking home less than before, but that is unlikely.)

So, I have already done a revised Debt Snowball where we throw $2,100 per month at the debts (instead of the current $1,100) and if we really can keep up with that kind of a snowball - we'll be debt free in March 2009!! (This is sooo much better than the original debt payoff date of August 2010!)

Obviously, I am happy about the possibility of us getting out of debt sooner rather than later. But there are two specific reasons that this is making me sooo happy!

The first is our car situation. In the near future, we are going to need to replace our minivan. It is very old and is starting to have problems. I am willing to drive it as long as possible (eventhough it has a big rust spot on the front of the hood of the car!), but chances are we will need to replace it sometime over the next 3 years. This has always been in the back of my mind, nagging at me, because if we took 3 years to pay off all of our debts, how could we possibly save up to buy another car? (This is a point my husband would point out to me every time I mentioned how well we have been doing paying off our debts!)

Now, if we can become debt free in 17 months, that should give us enough time to save up and pay cash for our next car. And now that we'll have $2,100 instead of $1,100 each month, we'll be able to save up enough that much faster!

The second reason that I am very happy is - at the beginning of the summer, I spent some time plotting out the probable dates of some future large expenses. (I didn't even put new cars into these equations.) I plotted out start of college for Daughter #1, Daughter #2, and Daughter #3, as well as possible wedding dates (age 28?) for each of my 3 Daughters. Then the possible retirement date for my husband (age 64?). Next to each expense, I put an estimate of the amount of money that would be needed.

I also put the date when we would possibly have the mortgage paid off, and added the monthly mortgage payment towards our available income. I assumed that our money was invested with a return of 8% (actually 12% adjusted for 4% inflation).

I tried and tried but couldn't get close to having the appropriate amounts by the appropriate dates. Even when I assumed that we started saving $1,500 per month immediately (which was quite a stretch given that we only had $1,100 and it was earmarked for debts for 3 more years, and the fact that this didn't take into consideration the need for car replacement, home repairs, or other sinking fund type expenses) - and even with these stretches we still came up a little short for each of the expenses.

I haven't redone all of the math, but I think we are a lot closer to being able to achieve our goals with $2,100 a month!

I really can't wait to tell my husband "I told you so" when we pay cash for our next car! :)

10/11/07 - Daily Progress Report

Well, including today's earnings I am up to $196.16 so far this month. Appears I am on target to earn around $600 this month - not the $1,000 I am aiming for. But there's still time. My performance in getting things on ebay and writing for Associated Content has been lacking. If I get my act together, I could still manage to make $1,000 but it will be tough.

I did apply for another credit card (I know, I know, totally against the Dave Ramsey way!) - but I can't resist those free bonus points! This card from citibank will get me $150 in free gift cards, which I will use towards gifts, both Christmas and upcoming birthdays. This money added to the $250 in gift cards I got from American Express will put a huge dent in my gift expenses. And I will put the funds I would have spent on these gifts towards the debt snowball! So, if I get approved for this new card I will add $150 to this month's earnings.

Today's Earnings: $103.06
Ad Revenue: $100.11
Associated Content Performance Bonus: $3.06

Credit Cards Tempting Offers - Update

A couple of month's ago Five Cent Nickel posted about some Great Credit Card Offers. I was reluctant and skeptical to apply for a card to take advantage of the bonus rewards points being offered. But after some thought and several phone calls to verify the details of the offer, I went ahead and applied for an American Express Card (business card, but anyone can get it as a "sole proprietor"). The $40 membership is waived for the first year (and I plan to cancel before the next), and I was supposed to receive 25,000 membership rewards after making my first purchase (of any amount, even $1). These membership rewards can be cashed in for a free airline ticket or for gift cards.

Well . . . I am very happy to report that I just received my free $250 in gift cards in the mail!!!
Yup! $250 in free gift cards!! There are lots of stores to choose from. I decided to get $150 for The Gap, $50 for Bath & Body Works, and $50 for Crate & Barrell. I plan to use these to buy Christmas gifts for my family.

So, if you're interested, it's not too late to sign up!

I'm even considering applying for another!

10/09/07 - Daily Progress Report

Deposited a couple of checks today that came to almost $50.00 (one from Mystery Shopping and one from Cash Crate). Also transferred $50.00 from Paypal into our checking account (from ebay sales and Associated Content payments). So, I paid an extra $100 to Chase Visa - which is the debt currently under attack by the Debt Snowball. So, paid $1,000 on this debt instead of $900 as budgeted. Very happy about this. I plan to throw every extra cent at this debt and have it gone asap! Then we'll be down to just the HELOQ! Can't wait to be debt free!

Today's Earnings: $0

10/08/07 - Daily Progress Report

Well, I have been missing the past several days. Haven't even had a chance to get on line. I'll try to catch up over the next few days.

Today's Earnings:$45.06
Ad Revenue: $ .06
Mystery Shop: $ 10.00
Jewelry Sale: $ 10.00
Returned Items: $25.00

10/02/07 - Daily Progress Report

Today's Earnings: $ 20.04
Ad Revenue: $ .03
Savings Interest: $20.01

October 2007 Budget

Budgeted Income: $7,208
Budgeted Expenses: $6,945
Save for Future Monthly Expenses: $263

* * * * * * * * * * * * * * * * * * * * * * * * * * * *

Budgeted Income: $7,208
Funds Saved from Last Month: $61
Husband's 1st check: $1,593
Husband's 1st commission: $3,754
Husband's 15th check: $1,700
My church check: $100

Budgeted Expenses: $6,945
Home - Mortgage: $2,355
Home - Electric: $190
Home - Oil: $273
Home - Cable, Phone, Internet: $167
Home - Trash: $65 (paid quarterly)
Debt - Chase Visa: $907
Debt - HELOQ: $193
Auto - Gas: $350
Auto - Insurance: $138
Nursery School: $175
Piano: $264 (13 weeks of classes, not paid last month)
Prescriptions: $20
Gifts: $200 (take parents to dinner for babysitting our kids for a week when we went to the Bahamas, and take husband's coworker to dinner for helping him get promotion, gift for neighbor for helping us move a refrigerator, dryer, and china cabinet.)
Misc.: $100
Activity Fees: $420 (budgeted for last month but check's have not yet cleared - $85 each for 2 daughters for basketball fee, plus $225 fee for the travel team, $25 membership for for me for the local MOMS Club where I get free advertising for my jewelry.)
School Photos & Fees: $118 ($24 x 2 for school photos, $35 x 2 for "activity fee" for school)
Husband's New Cell Phone for Work: $200 (his job will now pay the monthly phone charges and we'll get a $150 rebate on the phone)

Cash:
Grocery: $225
Dining Out: $100 (dinner for best friend's 40th birthday, other)
Pizza: $80
Spending: $220
Parties: $100 (2 daughter's birthday parties)
Gifts: $30 (birthday)
School Lunch: $36
Misc.: $10

Save For Future Expenses: $263

Monthly Progress Report - September 2007

Well, September is over. I spent the evening going over our financial records to find out how we did sticking to the budget this month.

The first thing I have to report is that I found a great way to calculate the money we spent. (Most of you probably already know about this!) We have been paying our bills on line for a while now and I check our account almost daily to check our expenses, etc. While I knew that we could export our bank info to software such as Quicken (and I tried this for a brief time a very long time ago, but found it too tedious to hand enter the other entries into Quicken) - what I did not realize is that I could export the bank date to Excel!!!! This was quite a revelation for me and made it sooooo much easier to track our expenses. I simply exported the data to Excel, quickly categorized each transaction and then sorted the data by category (which is also something I learned to do for the first time this evening!).

These great realizations are going to help us quite a bit in finding out how our actual spending compares to our budget!

So, what were our results for September?

Well, at first I was disappointed to find out that we went over budget by $400.76. Then I started to think about how that didn't make sense since we came in under budget in virtually every category. Then it hit me. Our debt payments. We budgeted $1,100.00 for debt payments but actually paid $1,668.84 toward our debts! So, this was a good thing! We went over budget in debt payments!!

I decided to make the extra payments on one of our credit cards because we had some extra income (some money from my previous earnings just rolling in now!) , so we decided to pay off our lowest credit card in full! So, we are down to just 2 debts left (not counting the home mortgage). We have 1 credit card left and our HELOQ.

It feels so good to be down to only 2 debts. Although we still have a hefty balance on those debts, it is so much easier to focus our attention on 2 than on 5!

The budget news wasn't all good though. The other category where we went over budget was grocery. This is especially not good since I allotted a hefty $480 for the month, and we ended up going over by $265.20!! So, I definitely need to pay more attention to this category! (and I used to pride myself on my frugal grocery shopping. Need more focus here!)

But, all in all I am very happy with our progress this month. Not counting the extra money we spent on debts, we came in $170.00 under budget. So pretty good.

Earnings this month were not really so good at only $600.00. That's $400 under my goal of $1,000, but I think we are moving in the right direction.

Haven't finished the October budget yet, but will try to get that posted tomorrow.