So I have a problem. A problem I had created but now it haunts me and it truly is embarrassing. I did not manage my finances well. I know where I had made mistakes and I have a idea to get them in order but its so much easier said than done.
I wish I could afford a financial advisor or someone to take control and tell me what to do. I grew up in a household where money was short and getting things you wanted, or even things you needed, was difficult. So when I started working during high school, I didn't save as much as I should have. I spent it, I got the things I wanted, things the other classmates were given by their parents. I had wanted new shoes, being mine were all second hand and used. I wanted to know what a good quality sweater was, one that wasn't used and donated to goodwill. I wanted to have the pretty things and relate to my classmates. This continued into college.
I did save, just not enough to help me now. I knew I wouldn't be handed anything so I saved to buy a car, the insurance, the title, the gas to get to college. I saved for everything I would need for college and my first computer. I payed my bills before spending my money and I worked two jobs at all times to make sure I had the money to support my needs and wants. I didn't build the best financial habits though.
I was doing great for years and never got a credit card till I was 23 and about to get married. I used it to pay for the wedding. This is where my first mistake started, paying for a wedding that never should have happened to begin with (but that's a different story). I didn't have a high balance, just used it to build credit and get what was needed (aka, wanted). The average balance on it stayed around the 1k mark. I paid and spend and kept it going. I thought this was smarter to build credit. I was also working extra shift and saving money. I had a few thousand saved when my ex-husband stated I needed to give him the money so he could pay off his high credit balances. I let him take my money which he then spent on a new weight set. He then began requesting I pay his half of the rent since I was making more than him and wanted to focus on paying his debts so we could start saving together. So I worked more to pay the extra amounts and to build my savings again.
Then came the divorce, there is far more to the story but that's not why we are here. It takes money to leave a home, pay for a divorce, a new apartment, furniture, a new car, etc. That credit card balance grew, the savings was gone, the bills were higher, and I was starting all over again at 25. Then I had the bright idea to go back to school. Moving forward, there was a car wreck and I did not have gap insurance. This led to my car payment doubling. Then there was a student loan which is not bad but it adds to the mix. There were new credit cards and some family problems with my sisters and mom that led to me giving them money a few times.
Then the greatest financial burden of all, I got pregnant. A typical knock-up story where girl meets a military guy, sees each other for a few weeks, girl decides he is not the guy for her and ends things. And to be fair, I had cervical cancer at the time and partial removal of my reproductive system several months prior. I was also told I could not have children. Well, surprised us all, I got pregnant. And not a high risk, many complications, almost didn't have him kind of pregnant. I had an easy, no complications, painless birthing with no hick-ups kind of pregnant. He was meant to be and the miracle I would never trade in. With that being said, that kid eats. From day one, he eats. I couldn't produce enough breastfeeding to keep up so I had to supplement with formula. The father, we call him Donor, moved to Germany to be with his wife (met her while I was pregnant) and sends money for some of daycare at his leisure. I tried to file for child support but it wouldn't go through with him over there. I also make too much for any assistance. None. None for daycare, formula, food, or diapers because I make more than $37,000 a year.
Yesterday brought me to tears. Due to high credit balances, I will never get a good interest rate on a car loan for a used vehicle and new vehicles are insane. My car was on its last leg and finally gave out. I had bought it used years ago. I have a one year old, no car is not an option so I bought a new car. In the end, with the interest rate being higher for a used one vs a new one, the monthly payment was going to be the same no mater which one I got therefore I got the new one. I wouldn't have ever gotten a better deal anywhere else since I still owed on the old car. The remainder of that loan had to be added into the new loan.
The cost of living in my county is averaging $75,000 - $90,000. I make $60,000. And if there is anything better then what I am currently doing then I would love the advise but I also know if I break it down and make a plan, I may be better at sticking to it. So lets break down my finances.
Income | Expenses | Balance |
|---|---|---|
1930 (Bi-Weekly Check) - $3,860 | $3,860 | |
Rent - 850 | 3010 | |
Autograph Credit Card - 150 | 2860 | |
Daycare 1300 | 1560 | |
Medical Bills - 40 | 1520 | |
Amazon Prime - 8 | 1512 | |
Phone - 190 | 1322 | |
Student Loan - 237 | 1085 | |
Water bill - 60 | 1020 | |
Power Bill - 150 | 875 | |
Internet - 110 | 765 | |
Car Insurance - 120 | 645 | |
Chase Credit Card - 180 | 465 | |
Citi Credit Card - 50 | 415 | |
Netflix - 18 | 397 | |
Lawn Maintenance - 50 | 347 | |
Walmart Credit Card - 50 | 297 | |
Donor - 600 (If he feels like it) | 897 | |
Car Loan - 580 | $317 |
At the end of the 28 day cycle, I am left with $317. This is used for groceries, diapers, gas, household items, and unexpected purchases. What this leads to is I end up needing to use a credit card to pay for things I need. And when I say need, I mean need. I don't get what I want anymore. No more nice and pretty things. No more brand new clothes. I couldn't tell you the last time I got a professional hair cut or gone to a nail salon. What I have done is learn to do those things for myself. I can do my own nails, cut my own hair (not great but passable). But because I don't want that for my son, he gets everything he needs and wants. New clothes, new shoes, new toys. And maybe that's a poor choice and I am not above thrifting and buying used but I want him to have the best.
Now this is why every time I try to get ahead of the credit card debt, it goes no where. Lets break down my debts;
Debt | Balance |
Walmart Credit Card | $1,406.76 |
Citi Credit Card | $500 |
Autograph Credit Card | $5,172.09 |
WF Credit Card (Used for Daycare) | $10,132 |
Amazon Credit Card | $5,493.16 |
Student Loan | $6,843.78 |
Car Loan | Approximately $38,000 |
Total | $67,547.79 |
Total (Without Car Loan) | $29,547.79 |
So this is my dirty little secret. I have more debt and hardly any way to pay it off. When I pick up extra shifts, I have to pay someone to watch my kid. I don't have family I trust with him and Daycare is only open during normal business hours. So here I am in a round-&-around game with my debt. I am doing the best I can but It will take a miracle to pay this off. My way of doing so is the domino technique.
Any extra funds I gather get split in two, half in savings (which is $0 now because of the new car) and the other half gets put to this debt. With the domino technique, I would put those extra funds towards the lowest balance. Once that balance is paid then I add the payment for that account to the next lowest. So for example, extra funds get paid to the Citi Card account and once its paid off I will add the $50 normal Citi payment to the $50 payment for Walmart Credit Card, Making its normal payment $100. After Walmart is paid off then the $100 gets added to the Autograph account payment.
I hope in the future I can post an update and it be better. I know I will be working hard to create a better future for me and my son.
-Rose-
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