In 2012, I had a lot of adventures- trips to Napa Valley, New Orleans, and Florida, which made great memories. The Lady has also racked up some medical bills while waiting out a settlement from a car accident that could take years to complete. Because I hadn’t saved up for most of them ahead of time (not a smart plan, for future reference), they also added to the bills piling up in 2013. I admit, I am no whiz with money. I have what I call “poor people skills” from years in underpaid theatre gigs and school and law school- I can make do with just a bit and survive. But, I’d rather not have to use those skills. I’d rather spend this year learning how to be an adult about the money that I have.
First step- open the mail. The Lady and I both have some bills that we know will have to wait while we pay for the must-haves (rent, electricity, gas, food, etc.). I bought a cute little table to pile the mail by the front door, with an idea that one day a giant ship full of money would come in and we could open everything and pay it. Instead, the mail overflowed the table. It got tucked into a giant fruit bowl. It wound up in tote bags stuffed in the spare bedroom- aka, The Land That Time Forgot. It took two actual important pieces of mail that we missed to change our strategy- both of which ended up costing us even more money because we didn’t read them when they arrived. In a flurry of oh-my-god-what-have-I-done, I gathered all the mail in a giant pile on the dining room floor, along with a marker and a pile of file folders. We still don’t have that ship full of money, but the new rule is that mail gets opened at least once per week and placed in its folder. Whether we have the money to pay it or not, we have to look at it.
Next, I needed to get an idea of where the money needs to go. I downloaded this free Excel debt spreadsheet and entered in everything (including the old bills that we don’t have the money to attack yet). It gave us a big picture number. And to be honest, we owe a LOT less than I thought that we would. Then, I tracked down the interest rates and payment amounts for each bill. The spreadsheet lets you decide whether to use the popular “debt snowball” method or pay off the highest interest rates first or even set your own order. Then, it tells you when you’ll have the debt paid off, assuming that you keep paying at the same rate. Minus our student loans (which we will be paying for decades), it turns out that we can pay off everything else (including The Lady’s car!) in under 2 years. Whew. I feel so much better knowing that I haven’t buried us that deep. We decided to hold a weekly “team meeting” on Sunday nights to go over the mail, any bills that we paid off, and any new ones that we see coming down the road so that neither of us have to stress about it during the rest of the week and so that we can stay on the same page about planning.
Finally, after looking at how close we are to getting rid of some of the more tedious bills, I decided to try to bring in a few more bucks to get ahead of this even faster. Even ten hours a week at a part-time nights/ weekends gig will bump up our paid-in-full date by almost six months. I hit the CraigsList part-time ads, sent out a round of resumes on Friday and by Monday I had two interviews lined up. I accepted the first job I was offered and I’ll start training this Monday night! Progress! I accepted a temporary gig through April, just to give myself an escape date if I start to feel overwhelmed, schedule-wise. Besides, it’s miserably cold outside and I might as well have a little more cash on hand when the weather warms up.
We’re a year away from being in a really great place, even with a newly reduced paycheck from the latest Social Security increases, and a slightly higher health insurance premium. And for once, I don’t feel panicked about where our money is going. I’m counting on you to keep me honest this year. I’ll check in and let you know how this new system is working (or not working) as time goes by.