Happy Independence Day!
Over a year ago we bought our daughter a used Subaru to drive. She had her license two years prior, but never had a need for her own vehicle. The purchase price was around $11K and it has a been a really great car so far. We put $3K down and she used the proceeds from a UTMA account she had which was maybe $3400. I'm being lazy, I don't remember all the exact numbers.
We did take out a small loan ($5,700 at 5.75%!) because we did end up buying a more expensive vehicle than we originally planned. The cars we found we could buy for cash, were just not good to buy for a young person living across the country from parents, at least in our minds. The loan was to help bridge the gap so that she could take over payments when she got a job, and at the same time get some credit in her name. She is still looking for a full time job in her field, but has an internship that increased her hours recently.
We are pondering paying off the balance of the car which is owned jointly between her and my husband. The balance is $4,293, with three years left. We have so much cash and now earning very low interest rates. We would then have her pay us back with interest. I'm thinking 3% interest, and we are open to a longer payment term if she wants. A lesson in how that changes the payment and the total interest she pays would be good I think. The vehicle would be owned jointly until the loan is paid back.
I will be running the numbers and offering her a proposal. I think she can start making the payments even on her low income since she is currently staying with my parents. Such an interesting time we are in.
Viewing the 'Debt' Category
Happy Independence Day!
I know many of you reading are regulars and for the most part I think you are all still employed. However, if there is anyone out there who has lost their employment, or has reduced hours I want you to know about the four walls that can keep you fed and in your home for as long as possible.
The Four Walls is part of Dave Ramsey's Financial Peace University. There are six additional baby steps, but first you must take care of your four walls before you pay anyone else.
Our oldest daughter received her housing refund of $963.79. It seems lower than expected and I haven't yet had the motivation to investigate and do the math. I don't see other parents complaining about wrong amounts, so I expect it is probably right.
My hope is that she will ultimately put this amount on her student loan debt, which she only had to take out this final year (her fifth year, two degrees). The total debt she took out was $5,500. Maybe she can round up and make $1000 her first payment!
Now she just needs to finish up these classes, graduation (ceremony cancelled, but can walk in future ceremonies) and find a job!
We are paying ourselves back for money we put down on our daughter's car in May 2019. I am putting all sources of extra funds towards that goal. Here's what I found in March:
US Bank $12.33
Chase Rewards $9.92
Amex Rewards $45.03
Swagbucks (Paypal) $25
Ebay Sales $22.28
USAA Rebate $3.00
Army Travel Excess $119.42
Prior Payback Balance: $254.69
New Payback Balance: $14.71
Well isn't that interesting! So close to payoff. I think it is time to call it paid back though. I'm pretty sure I sold at least two items locally for $5 each this past month...a bit of a blur, but I know I didn't allocate those funds to any pot of money. And I know we added money to our emergency fund far in excess of $4.71, so....
it's paid off!! Happy, happy dancing'!!
New Payback Balance: $0.00
All of these types of funds will go towards the BIg Goal starting this month.
We are paying ourselves back for money we put down on our daughter's car in May 2019. I am putting all sources of extra funds towards that goal. Here's what I found in February:
US Bank $12.33
Chase Rewards $7.10
Amex Rewards $46.06
Swagbucks (Paypal) $25
Ebay Sales $30.81
Army Travel Excess $122.15
Prior Payback Balance: $498.14
New Payback Balance: $254.69
So tempting to just throw some extra funds we had at the end of the month on it, but I also know that we have another round of airline tickets needing to be purchased, possibly this week, so I'm just going to do the same as February and know that our rewards, sales and military travel payments will likely have this paid back this month!!
Looking forward to the debt payoff happy dance! Yes, I considered this a debt, even if it was to ourselves. 😀
I've been watching a couple that's on YouTube work on getting out of a lot of debt. They were behind on their mortgage and didn't know until people started commenting that they needed to get current first!! When you are behind on payments that IS a debt and one that can get bad very fast, potentially losing a home or a car.
They have been gazelle intense on selling lots of things and their house is on the market to sell. They are finding cash in their home, including redeeming Ibotta rewards and credit card rewards for cash and gift cards, things that just weren't on their radar.
They are creating budgets, using cash envelopes, stopping monthly subscriptions and eating out. They shopped at Aldi for the first time. The skipped buying each other Valentine's gifts this year. They are rocking it!! And it's very inspiring. If you are in major debt, or looking to figure out what to do, find those that are making it work and follow their example for inspiration. There are lots of people who live debt free, and are climbing out of debt.
Yes, it's overwhelming to be in debt, but it's freedom to make the changes and strive to live a debt free life! Now go find yourself someone to inspire you if you have lost your way.
We are paying ourselves back for money we put down on our daughter's car in May 2019. I am putting all sources of extra funds towards that goal. Here's what I found in January:
US Bank $13.00
Chase Rewards $3.82
Amex Rewards $67.30
Utility Rebates (2) $59.91
USAA Rewards $3.12
Pinecone Surveys $3
Ibotta Rewards $22.09
Swagbucks (Paypal) $25
Ebay Sale $5.37
Extra Funds $175
Prior Payback Balance: $875.75
New Payback Balance: $498.14
I have extra funds that I could just call this done, so it's likely I will just call it done pretty soon. The extra funds listed seem to be an extra payment I added in YNAB to no detriment to the budget...so I'm leaving it. We did a very good job of keeping to a pretty frugal budget this month!
I'll attempt to include a screenshot of myDecember 2009 post, but the run down I posted then was that we contributed $14,147 to retirement, our retirement accounts had increased by $33,219, and the value had exceed $100K for the first time.
We had paid over $10K on a home equity loan, with total debt decreasing by $17K. Not sure our total debt amount, but we may have had a loan on my van and home debt. If I had to guess $160K to $175K in debt.
I also reported paying our daughter's braces in cash along with a trip to Disney World. We were also getting ready for my husband to deploy to the Middle East for the second time.
Ten years later:
Husband is cosigner on a car loan for our daughter which had a balance of $4,959 at the end of December 2019. Otherwise we have zero debt.
We do not own a home and live on a military installation. We pay rent equal to our housing allowance. At this point we have rented since June of 2015.
We have $95,327 in cash (most of it invested in high interest rate CDs.) Part of that, $72,083.93, is cash towards our Big Savings Goal of $200,000.
We saved $21,627.56 in 2019 towards retirement. Our retirement accounts increased $172,287.30 in one year, with an ending balance of $660,822.27.
In 2019 both of our daughters were in college full time for the first time. Tuition bills were paid in full, with our oldest daughter taking out her first loan in the fall for $2,750. No parent loans thus far!
Our 2007 Honda vehicles are still paid off. While they have lots of miles they still run and look fantastic.
In ten years there has been significant progress in retirement and we have mostly stayed out of debt (just a little help for our daughter).
It's fun to look back and I look forward to another ten years of financial progress. It should make for an interesting story!