Dealing with Setbacks When Paying Off Debt
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The road to becoming debt-free isn’t always smooth. See how we dealt with setbacks when paying off our student loans.
Last month, I shared our goal for 2014 – getting rid of the student loan by the end of the year. I explained why we wanted to do it and mentioned that I'd be doing monthly updates, so here I am sharing our progress for last month.
Funny thing about monthly updates is that when things go well, monthly updates are fun and you're just excited to share the news, but when it doesn't go as planned or intended it isn't nearly as enjoyable.
Guess which happened in January? Yeah…..*coughs* ..last month wasn't so great.
Hiccups on the Road to Being Debt Free with Student Loans
When I mentioned the plan last month, I said that we'd need to throw a little more than $1,100/month at the student loan to get rid of it in time.
Even then I knew that was a huge number and it meant making big changes. The numbers are in and this is what we did:
- Current Balance: $13, 674.43
- Amount Paid in January: $198.18
Hmm, seems like we missed a number (like the one in the front). To make this easier to track, I'm using Mint to review our transactions:
- Family Emergency: A loved one had a financial/medical emergency and I offered to help. Not a huge amount, but something to merely note since I'm looking at all the numbers.
- Vet Visit: Two problems this month with our cats – blood in the urine and some diagnostic testing for a heart murmur they discovered. While both cats seem to be on the mend, our wallet is certainly lighter to get them there.
- Business Income Slowed: While work kept me busy last month, payments have been a little slower. While I should see some income come in this week for last month, it still isn't enough to get us to our target. There's some cause for hope as I have some meetings scheduled this week that I hope will lead to more income. However there is no guarantee, so until it is in our bank account, I can't count on it.
- Utilities: Big surprise, the heating bill went up, albeit slightly.
So basically a few problems and mini – emergencies added up to a chunk of money (the cats alone set us back around $300) being redirected.
I'm hoping next month will be much less stressful.
Taxes to the Rescue?
We may be able to get some relief from our taxes (though not by much).
We'll have to wait until everything is filed to get a closer approximation, but right now we're looking at getting a refund.
A chunk of our refund will be directed towards finishing off our financial cushion. We had depleted it when we had to replace my husband's car this summer.
With that out of the way, we hope to be able to tackle the student loan.
Your Progress
I shared my progress; I'd love to hear about your progress – good or bad last year? Has this started off well for your family?
Photo by Liza Summer
So far this year I’ve stayed on track. But last year vet bills really took a chunk out of meeting our goals. One of our cats is pushing 16-years-old and had bills that were close to $3K! I never purchased vet insurance because my cats were always healthy, but not that they’re “elderly” (and don’t qualify for insurance!) I’m starting to rethink that strategy!
Wow, that’s a lot of money! I understand, though, we grow attached to our furry friends, don’t we? 😉 Pet insurance is something I think about, but we may simply increase our pet fund.
Our older cat (~12 yrs) has thyroid problems. Our younger cat has a heart murmur which was an unpleasant surprise.
So far this year we are on track. But, it’s only been a month and I’m sure there will be some hiccups along the way. The key is to stay on track for the months when things go right and do our best in the months of difficulty. That and the outlook that things will work out in the end help a lot.
Glad January worked out well. Best wishes on the rest of the year!