June was a great month for our debt crushing goals. Although there are no new intricacies to report for June, we continued to make excellent progress toward a zero-debt dream. I love watching the debt come down every single month.
If you’re just now following my debt payoff journey, you can catch up by reviewing my April and May debt reports. These reports are a transparent view into my journey for debt payoff, which is part of a larger goal of hitting financial freedom. I’m loosely following Dave Ramsey’s method, where I already have a fully-stocked emergency fund and am on Baby Step 2.
I’m a more fearful person than Dave Ramsey counted on and so my emergency fund sits at about $4,000 today, whereas Ramsey suggests $1,000.
Without further ado, here are June’s numbers.
June Debt Ledger
After accounting for interest this month, the total headway made against our debt was $1,600, which is pretty good.
As the total principal of the debt comes down, we can expect that more of our consistent payments of close to $2,000 will be applied to the debt and less to interest every month, which will snowball our efforts as we go.
If you’ve been paying attention month to month, our first joint credit card is the most obnoxious one. Our minimum payment on that card runs about $120, and even though we are paying $150 on that card every month, the interest rate is staying approximately the same every single month, and we are making little headway. This is a good illustration of how just paying the minimums can keep you in debt forever.
We are, however, closing in on finishing up our second joint card, which I am paying off myself. Currently, all of my debt payoff dollars are going to Joint Card 2, which is why it’s diminishing the fastest. As soon as it’s paid off I will be throwing all of those dollars on Joint Card 1, in addition to my husband’s $150 monthly payment, which means we should be able to knock out that debt relatively quickly at over $1,000 per month dedicated just to that card.
And good riddance to it.
Kyle has decided that once he’s done with his PayPal line of credit—which is where he decided to focus first—he’ll be tackling his personal loan. He came to this decision because the personal loan has the biggest minimum monthly payment at $268. We are big believers in planning for rainy days, and in addition to our savings, being able to fall back on minimum payments in event of a loss of income is a favorite safety net of ours.
His thinking is that if he can eliminate our biggest monthly minimum, we are in a safer place in event of an emergency. He’s not wrong.
I like it when we break thousands, such as going from above $5,000 to below $5,000 on a single card. Those small wins keep me motivated for the next month, and so does looking forward to future months where we expect to break thousands.
In June, we enjoyed breaking thousands in Joint Card 2, Kyle’s personal loan, and our grand total broke two thousands, down to $19,000 from $21,000.
All in all, from the beginning of our journey in March, we have paid off $6,423 in debt after making payments totaling $8,206.
Ouch, interest really does hurt.
Almost Time to Get Nerdy
Next month I think we’ll have enough interest to start looking at the general trend, which means I get to include some fun graphs a la Excel. I’ll be looking at the downward trend of interest paid in relation to the amount of debt being paid off. We should see the downward trends accelerate as time goes by and more debt is paid to the principal and less to interest as the interest cost goes down.
The numbers nerd in me is quivering in excitement!
Tracking to Goals
I don’t want to forget overall goal tracking! If this is the first blog you’re reading about my journey, don’t forget to check out my overall goals for this year. To recap:
- Pay down $17,000 in debt in the first year (for debt phase 1).
- Write 24 quality pieces of content for my blog.
- Figure out how I want to monetize my blog.
Pay Down $17,000 in Debt
We made a total of about $1,900 in payments to debt in June. If we adjust for interest and project a similar rate of debt payment for the remainder of the goal year (though March 2020), that means I’m on target to pay off over $19,000 in debt, even after adjusting for interest. I anticipate that this number will continue to climb as debt is paid down and we chip away at the interest rate for each loan or card.
Write 24 Quality Pieces of Content for My Blog
I’ve been slowing down on this front. As with most projects, I realized that I was on fire at first and now I’m having to push myself to continue to write content—even these reports, which I’m excited to document.
Because I’m not a personal finance expert and this is more a documentation of my journey toward financial freedom, I find that I need to search hard for new content to write about. I am still on target to hit my goal of 24 pieces of quality content, but where I originally thought I’d blow that number out of the water, now I’m thinking 24 is just right. If I continue to let this part of my goal slide, that number will start to get away from me.
A big part of my problem is feeling that I don’t have information to share to be useful. I realized, though, that this isn’t true. Yes, I’m in the grinding part of my journey for debt payoff (and ultimately financial freedom), but I’m also continuing to learn along the way. Right now I’m learning about house flipping and rental empire building, which are two things I’m extremely interested in doing, and so in the future I’ll be sharing the books I’m reading and the key takeaways from each book, along with whether or not I recommend the books for beginners like me.
After some deliberation, I’ve decided to focus my blog on the things I think will be most beneficial to my readers and that also fall within my abilities and interests:
- I love the idea of offering informational products such as training courses, books, and worksheets that will help others get to their goals of financial freedom faster than I’m capable of doing it. As I learn on my own path, I’ll develop insight that I can pass along to others.
- Partnering with products and services I learn about and use as I go along my own path naturally complements informational products, and so I love the idea of sponsored posts and affiliate sales.
If I’ve learned anything about blog monetization, I’ve learned that it’s important to understand sales funnels and marketing. So I’ll be adding books that cover those topics to my stack of reading initiatives this year and making that the next step in my blog monetization goals. This way, when my content is ready, I’ll be ready to start marketing and SEO’ing my blog.
That’s it for June. Keep crushing your goals, and I’ll be back with July’s report at the beginning of August!
View the May 2020 report.
View the July 2020 report.