July 2012 Debt Update: Staying the Course
The goal for July was to be under $2,500 on the Discover card:
Smallest Debt (June 2012): $3,600
Smallest Debt (July 2012): $1,683
My goal is to have the Discover card paid in full by the next update!
Total Debt Update:
July 2012: $28,995
% Change from July: 6.6% Decrease — Nice.
Key Facts to Consider:
- I’m under $30,000 in debt for the first time since April 2008 (when I financed my car)
- I noticed that Discover is offering me a 0% APR balance transfer with a 3% fee for 18 months. The offer is available through 9/11/12, which means I could have the full limit available to transfer minus the 3% fee, around $6,700. When the Discover card is paid, my other credit card has a blended interest rate of 10.48% (majority of the balance is under 9.24% interest, new purchases are 14.24%), so paying the 3% fee and then having 18 months to pay a chunk of debt with no interest is tempting. I will consider it once this account is at a $0 balance.
- I just realized that at some point in the not too distant future, I will have a month where I am not accruing interest charges. Each month I am taking a step back of at least $200 in interest charges. This amount is decreasing, but I just realized how pleased I will be to look at all of my accounts and know I didn’t incur a single fee in a month.
- I have been slacking: not doing any extra work or overtime. I need to get back on that and earn some extra dough.
How did your finances change this month?
My one student loan was put into forberance and I’ve been steadily paying on the other–but as it’s in default still, I’m not making much progress. But at least I’m working on getting it out of default right?
Great work! I would transfer as much as you possibly can to your 0% — I did and had to pay something like $700 for the fee, but in the end, it saved me at least a thousand, if not 1500, in interest. Plus, since you know you can pay off this much every month, for sure you can get it done in 18 months!
@bogofdebt: Yes, slow and steady sometimes is all we can do. You definitely don’t want student loan default- the feds need their money and they’ll get it
@Kathleen: I think I am going to do it. But I will likely focus on paying the balance of the other card first, which would be $11 or $12K. I would pay the minimum on the Discover since I know I am not accruing interest, and this will be the way to pay the least interest in the next 18 months. Even if I only get the one card paid in full, in 18 months, I could do another balance transfer. I want to be totally out of credit card debt by then, but this is my backup plan in case I can’t keep up $1,500-$2,000 in debt repayment.
my finances are a post-apocalyptic mess right now thanks to 3 weeks in Europe + work only paying me half my income this month.
FML
Hey great job! On the transferring cards bit…if one company is offering a 3% fee..i’m sure you could get another co. the phone to get a cheaper % transfer. I’d Shop the rate before transferring.
Congrats on the 6.6% decrease! We’ve been working away at our mortgage, and can’t wait until that is done
I transfered my balance too to a %0 percent interest rate for 18 months. Just gives you a little piece of mind.
My husband hasn’t been picking up on his OT opportunities either – he blames it on the summer! He says there are too many other fun things to do this time of year than work.