Debt $ense

I’ve increased my net worth by $5,300 since I started tracking it six months ago, and I’m now at -$1,750. My best estimate has me breaking into positive territory by Nov. 1, which would rock!

Part of that is because I’ve increased my emergency fund and 401(k) by about $2,200, and part is because I’ve cut my debt by about $3,500. I’m on track to pay off my CC by late February if an opportunity I’m pursuing pans out, or mid-March if it doesn’t. That’s much better than my original target of August 2007!

Now that I’ve got a few hundred dollars stashed in my ING Direct account, I decided it was time to reduce the amount I put into my pinch-point savings from $50 a week to $25 a week. $15 of the difference is going toward my CC payment; the other $10 is going to ING Direct.

I also set up three subaccounts with ING: House, vacation and car. The house account gets $5 a week, the vacation account gets $15 a week and the car account gets $50 a week. That leaves $5 a week from my deposit to stay in the main account. Once my CC is paid off (February is my best guess), I’ll adjust the amounts as I start putting the bulk of that money into savings.

My plan this month is to give my CC balance a big hit because I get an “extra” paycheck in September. So I’ll be able to put an extra three weeks worth of money toward knocking down that debt.

My initial ING Direct deposit cleared, and my first weekly payment goes in tomorrow. (Yay!) I’ll move a chunk over to my CC shortly before the low interest rate goes away so I get as much interest from ING Direct as possible, then knock the CC balance down as low as possible before the rate goes up.

(For anyone interested in opening an ING Direct account, clicking on a link below will get you a $25 bonus when you deposit at least $250. I’ll get a $10 for referring you.)

Open!

Open!

Open!

If the links are either used or expired, e-mail me at colorguard@mac.com and I’ll post more.

I’m also starting to plan for Christmas and birthdays. (My immediate family’s birthdays are ALL in December and January.) Of the 11 family presents I have to buy, four are purchased. I have a price estimate for the three others selected - $55. That leaves four presents for two people. I suspect my post-Thanksgiving shopping trip will take care of the remaining four. But I’m in good shape for me, both progress-wise and budget-wise.

Also in good news, my electric bill will go down below its current $25/month now that the weather’s cooler, and gas prices are dropping dramatically, so that should allow me to stash some extra money during the next few months.

I don’t have enough in savings to take advantage of the ING Direct referral bonus yet, but I will before Labor Day. *cheers*

I did head over to their site yesterday to familiarize myself with the process to open an account. I also went into my bank account site and adjusted my CC payment and arranged to transfer the difference into savings - out of sight, out of mind, as far as I’m concerned.

I’ll still keep my pinch-point account active - the one with my bank - but once I build the balance up, I’ll start adding an extra CC payment using some of that money. That might take a month or two, since I still have Root Canal No. 2 and the associated crown to pay for. (And schedule: note to self - call dentist after vacation to schedule appointment.)

Alas, this likely means my early goal payoff date of April 2007 is more realistic than year-end. But having the money available should my car become terminal is more important to me right now. I figure I’ll stop diverting money to that account once it hits $1,500, so at that point the CC repayment picks up again.

Plus, the income picture is looking considerably brighter for a few months down the road. As things becomes clearer there, I can adjust my plans again. I’m not expecting any actual impact until January, but there’s a slight possibility dominoes could tumble sooner…

I sorted/counted coins last night, and was able to roll one of each type, giving me $17.50. Adding that to the other money I have stashed for this month’s extra payment puts me in good shape to make a nice dent in my CC balance. It will definitely cover the dental bills, which gives me more a cushion in my savings.

I also recalulated my monthly expenses and realized I could increase my weekly CC payments by $5 more than I thought when my raise kicks in.

The combination of the two news bits means I have a little more breathing room to hit my year-end target. If I stick to my plan of paying $100 extra each month, I’ll make it with a couple of weeks to spare.

My earlier post about the specific benefit I’m taking advantage of reminded me that those can be a good way to save money. If you aren’t sure what benefits your employer offers, check with the HR person for an updated list.

Some companies offer tuition reimbursement, some have discounts on gym memberships, others might offer good deals on computer supplies, cell phone plans or other consumer items. Mine even has a special deal with my bank, which means I get a much better checking account than I normally would for somebody with my balance.

Just be careful that you don’t sign up for stuff you normally wouldn’t just because it’s a “good deal.” As an example, I can get about 40 percent of a YMCA membership reimbursed through work. But since I run in the park near my house, I can get by without it. (I do miss lifting weights, so when my debt’s paid off, I hope to rejoin the Y for that, as well as the indoor track for bad weather.) But I digress.

A good deal’s only a good deal if you save money from what you would be spending normally. Buying something you wouldn’t normally buy or don’t need just because it’s a good deal is usually a waste of money.

One of the benefits of working for a big company is, well, the list of benefits. I’m sure there are ones I don’t even know about. Several of them provide discounts on goods or services purchased for personal use, which is a nice way to save money.

One that I’ve used before is a discount with Apple. I’ve been debating over what to do about internet at home because a Web site I maintain is done in FrontPage on my PC desktop. Meanwhile, my laptop and other computers I use are all Macs.

It finally occurred to me today to check out pricing on iLife, Apple’s software suite that includes iWeb, its home Web publishing software. (My laptop pre-dates iWeb, so my iLife suite doesn’t include it.) Then I could just transition over to the new program (and do a much-needed redesign of my site).

The price is reasonable - $79. Then I remembered my discount. Turns out I get 17 percent off (the amount varies by product) and it’s only $65. That’s only six weeks of internet service - definitely worth the cost. So I’m going to cancel my broadband and start stashing money for the software so I can buy it by the end of the summer. (I won’t need to update before then, which gives me some flexibility.

I know how much that will let me add to my weekly payments, but I’m still waiting for tomorrow’s paycheck to figure out how much I can adjust with the change in withholding. Check back tomorrow afternoon if you’re curious to see what my new repayment schedule looks like with the adjusted amounts.

I’m getting frustrated looking for tips on reducing car insurance costs. Does anybody know a place that makes recommendations about how much coverage you should have?

I’ve been with the same insurance company for the last four years, and I’ve decided to shop around during the next several weeks to see if I can get a better rate on my insurance. I also want to make sure my renter’s insurance is replacement value, not ACV, which I think is the case now.

I got a quote from AAA today, and I’m going to check at their office next weekend when I’m picking up running sneakers. I also found two independent insurance agencies in the area, so I’m going to check with them this week, then get an estimate from on what it will cost to renew my current policy for another year. I’m hoping that renters and auto combined will cost less than $350. (Yes, my car’s old and beat-up.)

But as I’ve looked, I find the same set of tips on pretty much every site. None of them addresses how much insurance I should have, and what’s overkill. If I could find such a site, it would be a huge help. Any suggestions?

Six weeks ago, when I got serious about attacking my debt, I created an Excel spreadsheet to track my weekly payments, finance charges and running balance.

Originally, I had several sheets to try different scenarios, which let me see which changes made sense and which didn’t. After I had settled on a plan, I deleted those sheets.

Now I’ve got almost as many: my original plan, what’s actually happening, my aggressive scenario, my 401(k) results and predictor of future performance, and now my post-debt savings scenarios. I can easily kill several minutes a day using those to run numbers over and over. *RME* I’m such a geek.

On the plus side, it makes it easy to evaluate possible changes. And the post-debt savings sheet - today’s addition - really highlights how much money I’ll free up once I have this debt killed. That’s a powerful incentive to keep going.

At the same time, I often have to remind myself not to spend too much time playing with the numbers. At the moment I can’t do much to change them, so there’s a limit to how much productive fiddling I can do. About all I can evaluate is how different annual raise results will affect things, and that just makes me think too much about something I can’t really affect at this point. (Too close to the review date - the paperwork likely has already started.)

Too much time with the numbers is almost as bad as too little, I think. After a while, the time I’m spending running scenarios is time that could be better spent finding ways to increase my income. I have two tracks I’m working, but both have a seasonal component and I’m not quite there yet. Summer session at the college won’t start for another few weeks, and craft fairs are several months off. I do need to start creating the stuff I’m going to sell at the fairs, though. Instead, I’m running numbers.

I guess I should set goals for the upcoming week for both tracks. For the paper editing, my goal is to create a flyer to distribute and an e-mail alias on my main account. For the notecards, I need to design six to eight versions and figure out how long it will take to make sets and how I can package them. I also need to price supplies so I know what kind of savings there are from buying in larger quantities.

I stopped by the book fair today and got (in paperback) “Start Late, Finish Rich: for $2 and “It Pays to Talk” by Charles Schwab and his daughter for $3.50. New, not used, but with black marker on the bottom edge to show it’s a damaged book. (It still reads the same, so who cares?)

There were plenty of other PF books, including on of Suze Orman’s, several of Dave Ramsey’s and two of Jean Chatzky’s, but I didn’t want to spend more than $6. The Schwab book is one I’ve been hearing about lately, so I wanted to try that. I also wanted a David Bach book I could write in, but didn’t much care which one since the general principles are the same. (They also had Smart Couples, but that is obviously less applicable since my sweetie and I aren’t that serious.)

I also checked out the consignment store, but didn’t bring clothes up. Good thing, since they’re only buying summer stuff now, and they don’t buy on Saturdays. The next time I’m up there on a Monday for choir I’ll bring summer stuff. The good news is commission is 50 percent, and given the prices I saw marked on clothes, I could do very well on some of my items. But they buy seasonally, so it will take several months to fully convert everything. Still, it’s one source of income.