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Wednesday’s Debt Free Days: Using Unexpected Money to Pay Down Our 6 Figure Debt

Hey folks!  So this past week has been quite the interesting ride.  I spent almost 3 hours going over our budget for the month of August.  Just when I thought I had everything budgeted down to the penny, we received notice that one of our recurring income streams was coming to an end!  Can you imagine our surprise?  Turns out the notice was sent in error. Whew!  So we remain on track for this month’s budget and ultimately paying off 100% off our debt in the next 7 years.  Check out my last blog post on our 7 year plan.

Pinterest has become on of my go to resources for inspiration on just about everything.  I searched for user friendly budget sheets, and found some wonderful options.  After careful consideration of what I needed to keep my household budget organized, I decided on these by ThirtyHandMadeDays.com.  The breakdown is highly inclusive of everything you could possibly spend money on during the month, and gives additional sheets for savings and grocery lists.  Do head on over and check it out.

ultimatebudgetbinderprintables

So onto the nitty gritty, the unexpected money windfall.  Ok, it wasn’t a huge windfall.  I can feel you all getting excited!  It was $161.50.  Yep, that’s it.  But check it.  That money came unexpectedly, after the budget was all figured out.  Now I could have taken that extra money to buy paint for our bonus room and bathrooms, or shoes for the littles, or even threw it into savings.  While all of those options were very appealing, I decided to put it directly onto one of our credit cards.  I wasn’t expecting it so to get rid of it as soon as it came wasn’t as hard as I thought it would be.  For the month of August that credit card received its minimum payment + the unexpected $161.50.  That extra payment will save us a bunch in finance and interest charges, making our end goal of paying off all of our debt that much closer.

How does that work?  Well the extra payment was made towards the balance which lowered it.  So when the interest charges are calculated during the next billing cycle (if we haven’t paid that card off yet), there will be a lower balance on which to calculate those charges.  My goal with this card is to have it paid off by the end of the month.  I’ll keep you all posted on how we progress.

One change that I’ve been working on this week is how I spend my money.  It’s been so easy to use my debit card or credit cards for everything in the past.  The thing with that is, I would tend to overspend.  Let’s say I went to the store with a mindset to buy milk, bread, juice, fruit, and veggies.  That might have cost me an easy $40 depending on how much fruit and veggies were purchased and if they were organic.  The issue would come in when I would see the coloring books for the babies – it’s only $1 each, right.  Or the plastic picnic cups and plates on sale that just scream my name.  Or here is the kicker, my fav fast food restaurant on the way to the store.  So that $40 has now easily turned into $65.  Do you see the problem.  As long as there is money available to spend on debit or credit it makes it very easy to overspend.

This week, I’ve tasked myself with using cash to make purchases. Can you believe it?  It gives me a set amount that I can’t go over, and eliminates my ability to overspend on stuff that isn’t necessary.  It works!  I also have mailed all of my credit cards to my mother who lives in another state.  The only debit card I carry is for one bank account, my spending account.  The other’s are at home in the safe.

I’m proud of myself!  This journey hasn’t been easy but I am determined to make it work in the best way possible while moving towards becoming 100% debt free.

I’ll see you all next week for an update.

P.S.  If you’re looking for some inspiration for ridding yourself of debt, come on over to Pinterest and follow my Debt Free Days board.

The life and times of one Black mama who conquered the world through adoption. This is my story.

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