It’s the day after Christmas, and after spending way to much money on gifts, I have finally reached the decision that living in debt is not the way to be. I, at the age of 23, have lived my whole life, whether it be my parents (who have themselves gone through 2 bankruptcies), or myself who at the age of 18 got his first credit card and began to rampantly charge everything he could buy, in debt. But today I say enough is enough. After amassing over $6,000 in credit card debt and barely skimming off the interest, today I will implement my plan to be credit card debt free by the end of the year. (I say credit card debt, only because my student loan debt would take me years upon years to pay off and I’m going to try and be realistic with myself). I blog this today, only to try and keep myself honest. I feel that if I can write this down and act like I’m having a dialogue with people (and who knows, maybe some people will actually read this) and it will help me through this.
To get started I need to layout my current debt:
Credit Card 1: $3000, at 12.49% interest rate. This credit card was used to pay for a semesters worth of classes, and books at the local technical college. Lately I’ve used this card (which is now at the max) to pay for prescription meds for my parents, and my Christmas gifts.
Credit Card 2: $967; 18.05% interest rate. This card has a credit limit of $1000. This was actually my first credit card and I’m pretty sure the balance on this card has been this high since I’ve had it.
Credit Card 3: $696; 15% interest rate. This card’s credit limit comes at 750 bucks. This is a more recent card which now carries most of it debt from a balance transfer.
Credit Card 4: $460; 14.99% interest rate. This card’s credit limit is $500. I once just had this card paid off but transfered a balance to it which led it to increase to this.
Credit Card 5: $400; 0.00% interest rate. This card has a credit limit of $500. This is my most recent credit card and has a 0% interest rate until a year from March. This card’s debt comes from a balance transfer.
Credit Card 6: $179; 24% interest rate. This card is a store credit card but it’s a store that I love. The max on this card is a little over $1200. The balance was up to $1100 and then I started transferring balances. This card is considered my number 1 priority.
This alone puts me up to $5702. On top of that I have another $800 in an online account that I owe. But for the sake of this blog, I am going to focus only on the credit card debt.
Now to my numbers…..at my current job I make (conservatively) $1000 a month. I pay $160 to my parents for expenses and also make $130 payment to my student loan. This brings my money down to $710 a month. The minimum payment due on my credit cards equals $194 a month. Bringing my total down to $510. But if I were to only pay that amount a month, I wouldn’t pay of my debt for another 2 years 10 months. Thanks to Mint.com, I can figure out the exact amount of money to pay per month and what cards. In order to pay my debt by December 26th, 2013 I need to pay……(drum roll)…….(suspense is killing me)…..$488 a month. This will technically leave me with roughly $216 a month. I’m hoping to post on this page at least 3 times a week, keeping track of purchases to show myself where I can cut my spending.