About the Author

Honey's main interests are online dating, long distance dating, and long term relationships. She met her boyfriend on MySpace and they have been exclusive since their first date over three years ago. Currently they live in Tempe, Arizona. Honey graduated with her PhD in Composition and Rhetoric in May 2009. You can contact Honey via email here or online here.

Recent (and Future) Windfalls

As I’ve mentioned before, Jake and I have quite a bit of student loan and credit card debt. I have less debt than he does overall, but proportionally to each of our incomes we owe about the same.

One of the things that sucks the most about paying off debt is that once you’ve done all the big stuff you can (for example, in February we moved into a house a little more than half the size of our previous place, and we also shuffled around our credit cards so he could get better interest rates – my rates were already pretty awesome) then it’s just a whole lot of sitting and waiting for the paying it off part to be done. Which, in our case, means years. Sucky. However, we have made a bit of progress in this area lately due to some windfalls.

My windfall was a little more minor – my dad put $500 into my bank account for my birthday. Now, he has always done this, but given that he sells RVs on commission and had to downgrade the amount he gave my sister and I last Christmas, I really wasn’t expecting anything. In fact, I suspect he can’t afford what he did do, but I think it would hurt his feelings terribly if I were to turn down the money. I ended up using the money to buy a plane ticket to Illinois (Jake and I are going to visit his grandmother for Thanksgiving) and to repay the $200 I charged to join the yoga and group exercise portions of the fitness center on my campus. So my “windfall” is really breaking even (which I think is still awesome).

However, my freelance work is coming to a close so that means that sometime in the next month and a half I’ll be receiving a check for $2500. I’m going to set aside some for Christmas gifts, make a big payment towards my credit card debt, and probably save some of the rest.

Jake’s windfall came from selling his Jeep Grand Cherokee, which is the car he was driving before buying the new car in June. Despite its mechanical problems and age, he got $3K for it, which is exactly the price he was hoping to sell it for. Actually, sold so fast – in a day and a half – that we are thinking we probably could have squeaked $500 more out of it if we’d been a little more mercenary, but in the end getting rid of it fast was a big plus.

Most of that amount is going to repay his savings account what he’d saved for the down payment on his new car and also give him a little wiggle room in his monthly budget, which is currently spoken for down to the penny. Also, now that he got rid of the old car he can switch auto insurance companies and save several hundred dollars every six months. Hooray!

He decided that in addition to saving some of the money from his car sale, he is also going to pay off one of his credit cards completely (it has a balance of just under $1K). This is the card that had the suckiest interest rate out of all his cards, so it is a big relief. Now he can start transferring money off the credit card that I lent him (which has about $7K on it). He’s planning on transferring chunks of $1500-2000 at a time off my card so that he can pay off each of those chunks before the promotional rate expires.

In addition to my 30-year consolidated student loan (that I’m currently paying $358/month on), I do have another student loan that I took out in January to pay off some of my credit card debt. That loan will start having payments due around November of this year. It’s at 6.8% which is pretty terrible, so it’ll be my next big focus. The current plan is to be as aggressive as humanly possible in paying off my credit cards (my goal date

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for this is April, though I think I will be able to do it at least a couple of months sooner).

Then I’m going to do the minimums on my student loans and save like a maniac until I have $10K, which will be 5-6 months’ worth of expenses for me. Then I’m going to get really aggressive about the loan at 6.8% until that’s paid off, at which point I’ll probably change the payment schedule on my consolidated loan so that I can shorten the repayment period. There is light at the end of the tunnel…

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  • http://www.mezzi.com/ Metal Briefcases

    Well it sounds like you are getting your debts under control. I highly recommend trying to get more freelance work or make money online in other ways. A side income really helps pay off debts. That is crazy that you have a 30 year student loan. That sounds more like a mortgage. Good luck paying off the rest of the debts. As you eat away at it, it just gets easier, especially if you can reduce the amount you pay in interest on those loans.

  • http://honeyandlance.com Honey

    Yeah, I’d like to get my 30-year consolidated (over $90K of loans for my 8 years of graduate education) into a better repayment plan (it might be interest only right now, it’s definitely a graduated plan). But the interest rate on that is about 4% so it’s lowest on the totem pole.

    We realize that we each paid WAY more for our educations than most folks, but since we’re not going to have kids it’s not as big of a deal to us. Personally, graduate school was the most fun I ever had in my entire life, so I don’t mind at all that I’m paying off almost a decade of living the dream :-)
    .-= Honey´s last blog …He Got Hard As Soon As He Looked At Me =-.