Thank God Almighty...

I paid off the last of my credit card debt today. Let us all pray that this is the one and only time that I have to deal with such a thing.

In moving out here we both had to put ourselves into some credit card debt. Doing such a crazy thing comes at a price no doubt. And we paid ours. We were able to save up several thousand dollars before moving. But the bills started rolling in. The money did not. First we had to buy a new bed. Then we probably spent some money that we shouldn't have. Then another round of rent and bills were due. Then this. Then that. And it took a while for us to find gainful employment.

Next thing you know we owed a total of nearly $4000.

Fortunately we got proactive on this issue early on. We created an Excel sheet to monitor all of our expenses and incomes and to compare our monthly totals. We have the entire thing itemized so that we know exactly what we are spending each month, what we are spending it on, and how that stacks up with our income. Our categories include: Rent, Utilities, Auto Insurance, Car Loan, Student Loan, Credit Card, Gas, Public Transit, Eating Out, Grocery, Gym and Miscellaneous.

We have been diligent about ensuring that every little things goes in to the Excel Sheet. The purchase of the computer I am now typing, a cup of coffee, a trip to the grocery store, a bottle of wine, it all goes into the sheet. Being able to see exactly what we are spending our money on and how much we are bringing in has been enormously beneficial. There is no way that we would have been able to pay off what was becoming a sizable debt relatively quickly without being aware of our finances.

We have been spending approximately $400/month on our credit card debt. That money can now go in to savings. We plan on moving to a more affordable, if not as nice, apartment in September. Figure that we will save $300/month there. That is $700 that we can put away. That's $8400/year. That's $25,200 over three years. If we get raises or better jobs thats more money. Lets be conservative and say we can stash an additional $6000 away. That's $31,000. The idea here is, in case you have not caught on, that we are saving up to buy a house. There is a program that we intend to sign up for soon that will match our savings up to $6000. That's $37,000. If we insist that folks stop giving us gifts for holidays, birthdays, etc. and instead give us money we could easily have another $3000 between the two of us in 3 years time. That's $40, 000. That is enough to put down on a home even in a big city like Portland, Oregon. We assume that we will pay about $250,000. There is also a program that Oregon has that give poorer to middle income couples a guaranteed interest rate of 5.5% and lets you borrow up to $10,000 for closing costs and home improvements with a 0% interest rate.

This is all going to take alot of sacrifice. We are aware of that. Vacations are virtually out of the question. We hope to visit Pittsfield once. But that will probably be it. We eat out just enough to keep ourselves entertained. No more. Extras like concerts and things can only occur occasionally. We know this.

I would like to highly recommend monitoring your finances to anyone that cares to listen. It ain't no biggy if you don't have Excel. Download Open Office at www.openoffice.org It's the same thing and it is free. If anyone reading this really is interested be sure to contact me. I can give you some pointers and send you a template.