I’m $15,000 in Debt (Again)

debt again

Well this year hasn’t gone exactly as planned as far as debt goes. In December of last year I was expecting to be consumer debt free by June of this year.  Instead, I totaled up my debt last week and I’m back up to $15,000. I was actually kind of surprised. I knew I had brought on some more debt this year, and I could tell you the exact amount of each, but I hadn’t thought about them combined. Here’s a break out of what it looks like:

Motorcycle: $6,000 at 8% for 5 years. Payment is $122/month

Engagement Ring: $3,500 at 10% for 5 years. Payment is $225/month.

Couch: $3,200 at 0% for 5 years.  Payment is $62/month.

Student Loan: $1,150 at 3.5% for 7 years.  Payment is $50/month.

Credit card: $1,200 at 0% for 15 months.  Payment is undetermined.

You may be thinking, “Student loan? I thought she paid off all her student loans a couple years ago!” I did… kind of. I paid off all the Parent Plus loans my dad took out. They were a much larger amount and much higher interest than what’s left.  When I finished paying off the parent plus loans I had wanted to pay off this one too, but I was close to burning out, and I also wanted to move the money toward the wedding fund. After the wedding, I justified it by saying the payment wasn’t very much and it’s also my oldest line of credit so it helps my credit score quite a bit.

Your other thought might be, “OMG, credit card debt!” Or at least that’s what I think when I see that. Credit card debt is terrifying to me. They charge crazy interest rates that people can never get out from under.  The amount that’s on this card is what we paid for home gym. When I signed up for the card, they gave me 15 months interest free. We decided to quit our expensive gym and use that money to pay off the card. My 15 month period will be over October of next year.

Part of me is disappointed in myself. I was hoping to be debt free this year. The other part of me is indifferent. The debt that I incurred this year was to buy things that make me happy. The couch has made it where my husband, both dogs, and I can all fit on the same couch. The motorcycle has been a lot of fun and makes me feel much cooler than I am. And the home gym helps my sanity.

Still the current plan is to pay off the ring either in either September or October depending on what my September paycheck looks like. I’m also planning on pulling money out of my savings account to get it done. Then my student loan should be paid off by November at the latest. Right now I don’t plan on paying off the couch this year or next. At 0% interest and $62/month, it’s just not high up on my list. On that same note, I do plan on paying off the bike before 5 years, but it won’t be this year and it might not be next year either.

Why? Well, it appears as though our old house has foundation problems. We’ve noticed a lot of cracks in the drywall and some cracked tiles downstairs. I am going to spend the majority of next year saving up for a foundation repair because our house needs to take priority. I’m expecting it to take at least until August to save up the money I need. I want to save $12,000 which will be $5,000 to beef up  my emergency fund and $7,000 to do the repair. I will keep you all posted on the progress!

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