Wednesday, January 4, 2012

Knock Knock...Is There Anyone Here?

Hi! *waving enthusiastically*

Remember me?

You know, the girl who, just under a year ago, started this blog as a tool to keep her accountable on her journey toward debt elimination? You know, the girl who, after 9 posts and one month, stopped blogging about her finances?

Well, I'm back. Surprise! [cue fireworks and confetti]

Photo from Morgue File
Honestly, when I started this blog and registered the domain, I had the best of intentions. No really! I did! Why else would I embarrass myself so thoroughly by announcing loudly - in comic sans - the dollar amount at which I was starting? Just in case you've forgotten, which is likely, that number was:

I am overjoyed to report I am starting 2012, nearly a year later, with a significantly lower number.

Now, I'll get to the actual number in a moment but, first, I wanted to talk a bit about how 2011 played out, where I stumbled, where I succeeded, and tell you some of the lessons I've learned since last we spoke about dollars and sense.

If you'll recall, this particular iteration of the "Pay Off Debt" game - a game I've been playing with myself for much of the last decade - began because of a #reverb10 writing prompt:

December 13, 2010: Action. When it comes to aspirations, it's not about ideas. It's about making ideas happen. What's your next step?
I was feeling like this prompt was particularly onerous because I had just examined my budget and debt load in the anticipation and planning of Great Vacation Adventure 2011 when it hit me...I wasn't in trouble with my finances - yet - but, if I didn't start addressing it soon, I could be - especially if an emergency arose.

In response to the prompt, I wrote:
...So I had to make a decision about 2011 and the aspirations for 2011. And, trust me, it was not a decision I particularly appreciated. But it's a fact of grown up life. There are a few things - and by things I mean bills - that need to be paid off before I think about grand adventures and tattoo removals and picking up the check time and again.

While I don't worry about money most of the time - and I know that's a big shocker because I worry about everything else down to the nub - this is ridiculous. I've been talking about getting myself entirely out of debt for, like, I don't even know how long (although if I went back and looked at the beginning of my budgetary spreadsheet, I'd know for certain which is a terrifying prospect) and yet...YET! I'm still not out of it?

I call bullshit on myself.
And I did call bullshit on myself then and again and again as 2011 flowed through toward 2012. Here's why:

The first few months of 2011 were rough, y'all, for many reasons having little to do with my own personal finances. In January, I realized I'd been unceremoniously dumped without actually being told and my birthday, January 20, was less than mediocre. My feelings were terribly hurt and, even though I was attempting to keep a positive outlook, it became harder and harder to do.


Because, in part, when Jane hurts, she spends money to make herself feel better and Jane didn't have any extra money to spend. I don't know very many people - women especially - who don't like to engage in a little "retail therapy" when they are feeling bad about themselves or their circumstances.

In February though, my situation seemed to be taking a turn for the better. I met a boy who seemed to like me. I certainly liked him. We began to see each other regularly and I was happy...when I wasn't angsty and miserable, exacerbated, in large part, by his chronic depression and his unemployed situation *sigh*. How I hate to admit it when I recognize I've fallen back into an unhealthy pattern.

Let me remind you about how I got this far in debt to begin with:
And then I acquired a live in boyfriend and I thought we would be together forever.


I got an even better job. We upsized to a bigger apartment. We bought his and hers computers. We bought him a car. We bought me a new car. We had cable television and high speed internet and cell phones. We ate out. A lot. We could afford it. We were a two-income household! Right?

Slowly but surely, the debt began to pile back on. As the relationship began to disintegrate, I began to spend recklessly attempting to, what? Buy his love back? Make us both happy? I can't answer that beyond saying the spending was most certainly psychologically driven.
From that same entry, let me also remind you of how I spend my discretionary income even now:
But what I do have a taste for is taking care of others. I donate a lot of my money to people who need it. I've also treated many a friend to suppers out, drinks, late night breakfast foods. I bake out of love. A lot. I (used to) entertain a lot. We've always had an open bar policy at The Grotto. I've also developed a taste for new and different dining experiences, fine wines, top shelf gin, and travel. Mostly though, my "discretionary income" has been used to cultivate and nurture my relationships.
I suppose what I was really saying (but didn't want to) is that my money goes toward buying love...even now.

Through the first 4 months of 2011, I, miraculously, was able to maintain my budgetary sanity. I didn't overspend. I paid down my debt as I'd anticipated. But, as it became clear the relationship was rapidly approaching bottom, I pulled out all the monetary stops and tried one last-ditch attempt to hold onto his affection...

And it backfired.


Not because I'd done anything wrong, per se. It was all just...wrong.

For awhile, I didn't care about anything. Not myself, not money, not debt. I stumbled over a broken heart and tried to soothe it by spending a bit recklessly, once again, on people and nurturing my relationships.

And then, Memorial Day weekend turned into a medical bad dream. Lex, non-husband extraordinaire, uninsured, suffered a serious back injury and was forced to take several weeks off work. Suddenly, I was struck by the knowledge that, if anything should happen to him or his job, we were 100% dependent upon me and my income to support us. I was in no position to support two people on my income with my then debt load.

Luckily, it didn't come to that but he never did go back to work full time. Shortly after he suffered his injury, he was told his position was turning into an independent contractor, as-needed, position. Which, it turns out, means, on average, 10-15 hours a week.

That was precisely the incentive I needed to get myself back on track.

Once again, I stopped picking up the checks, I stopped socializing so much, I began questing for the cheapest box wine my palate would tolerate (thus far, Fish Eye pinot grigio, retail $15.39). I was still miserable but at least I was making progress after a 2-month hiatus.


After that, I continued to plug away at my debt, paycheck after paycheck until, in August, I paid off a loan - the first of my bills to be 100% paid off. It felt pretty good. Emotionally though, I was still miserable, bitter, hurt, sad, rejected and dejected, with my self-confidence shattered - and there didn't seem to be a salve - a remedy - near at hand. Until...

My BFF (and 2nd non-husband), Acr0nym, and I decided to take a vacation together in September. Could I afford it? No. Not financially. Could I afford not to go? No. Not emotionally. In September, the battle between debt reduction vs. emotional well-being was waged and won by the fact that I had to do something - anything - to improve my mental state, debt reduction be damned.

Thus, he and I set out on a road trip across middle America. You can read it about it here, if you'd like. We were (mostly) frugal. We drove and got good gas mileage. We stayed in motels that never exceeded $80 a night. We brought food and liquor from home, imbibing mostly in our motel rooms. We splurged on only one meal. We were (mostly) careful with our souvenir budgets. The trip, all told, between the two of us, cost less than $1,200 over the course of 5 nights for food, lodging, gas, gifts, entry fees, and entertainment. Not bad.

But it was a setback financially.

Stumble? Yes...and no. Financially, most definitely. Emotionally? It was the best thing I could have possibly done for myself. I call it an emotional win and financial draw.

What was a success financially was that, upon return, I hopped right back on the budget bandwagon and put even more effort into paying off debt.

Since then, I've paid off :the last of my student loans and one credit card. In 10 days, I'll pay off the balance of another card. Once that happens, I'll have 3 remaining cards to pay off. Two are my highest balance cards. One is my lowest balance-lowest interest card. The latter I'm saving for last for several reasons. Most notably because it is tied to my bi-monthly paycheck and I have a specified amount - minimal amount - sent there automatically every time I'm paid.

Regardless, in 2011, I paid off:

*  2 loans
*  1 credit card and
*  came close to paying off a second card.

The snowball effect is fully executed. Having just 3 accounts paid in full has freed up several hundred dollars a month that can now be thrown - larger, faster, harder - at the bulk.

As a consequence, my outstanding debt, as of January 1, is:


I feel great about that! (Notice I didn't even put it in comic sans this time, that's how great I feel about it.)

If you're math-phobic, that means I've paid off $4,806.62 or 27% of my debt.

However, there was another small stumble I haven't mentioned. I had planned to build up emergency reserves at the same time I was paying off accounts. This didn't happen. I started to but stopped. I'm not sure why. I think I just liked having the extra cushion in my pocket and the extra cushion, month after month, got spent along with all the rest of my money.

While I didn't build up my savings as I'd planned though, I did feel triumphant time and again as minor emergencies arose because I found myself able to pay for them with cash - new tires, new brakes, new car battery, the lubrication of my sway bar bushings (that's what she said) - while continuing to pay down debt. I was able to replenish worn out items from my wardrobe - especially a new bathrobe and underpants - without taking away funds designated to debt reduction.

Those are all my stumbles and my successes in a nutshell. So now...

What I've learned:

I am an emotional spender. There is a reason I spend my money on people rather than things. First, I love to take care of people. I love to donate money to people I love who are in need. I love to buy little presents for people I love just because. I love to treat people I love to nice meals and nice things. Some of this - although not all - is because my self-worth is tied to my ability to do just that. When I can't do nice things for nice people, I often feel guilty, unlovable, worthless, selfish.

Because I'm an emotional spender, when I can't socialize - or socialize in the ways I'm used to - I sometimes feel isolated and, at times, forgotten.

I've also learned there are so many people less fortunate than me. I am in a position to pay everything off - relatively easily and in a short amount of time - so that I can live and breathe without much financial care. A good friend, whose income is much less than mine and whose debt load is/was more (in income to debt ratio terms), found herself in dire straights this summer when she needed to replace the engine in her car. While I would have panicked slightly and then been able to re-arrange my budget to accommodate the $1,500 repair, backsliding only a little, it took her months to come up with the money to repair her car and she is still indebted to a handful of people who helped her out as much as they could (yes, Lex and I helped). But for the grace of [insert deity here] go I.

I've learned that philanthropy is in my nature. I found myself donating $20 here and $25 there toward people and projects to which I had little connection. I didn't benefit directly from these donations. I donated because it made me feel good to help someone I didn't know who was in need. Altruism doesn't exist, I don't think, but sometimes we get close to it - what I've heard described as enlightened self-interest - when the only reason we've done a good deed is so that we can feel good about ourselves.

Most importantly, I've learned budgets are not concrete, set in stone, be all and end all, documents. They are fluid, living creatures. They are guidelines. Sometimes, the numbers won't jibe with what we need to do for our emotional selves, for our desperate friends, for our unexpected expenses.

Life happens outside of our spreadsheets.

And sometimes, we have to add extra columns and rows to our spreadsheets to accommodate life.

Because, you know what? Life, not numbers, is what it's all about.