Getting Debt Free: June 2013
Another month, another monthly recap. Our June recap is a bit different than last month. Every month we make progress towards becoming debt free and quitting the American Dream. Every month we get closer to leaving to go see the world. Some months the progress we make feels much bigger, even though it’s pretty close to the same amount we pay off each month.Other months it feels like we haven’t done much. Let’s see how we did towards getting debt free June 2013.
Each month our credit card utilization goes down a bit more. While our credit scores go up. It’s good to no longer feel stressed out over balances and to know you have a handle on your finances, again. Not to mention, that whole not running out of money before you run out of month thing.
This month didn’t result in a bill being paid off in full. But, we are so close to paying off the next one! It will for sure happen this month. Could even have two paid off this month.
Start with the Smallest Debt First
When we first started paying off our debt, we started with the smallest debt first and have been working our way up the list. That means, every time we pay off a debt the next debt to pay off is larger than the last. With bigger debts to pay off, it will take longer to pay them off. Sadly, we probably won’t be seeing a debt being paid off every month, anymore.
I don’t like this. Not one bit. I like paying off a debt every month. We both do. We get though that this isn’t always going to be possible since we can only pay off as much as we have available in funds. With that in mind and knowing we like to mark off a debt paid in full each month, I made us a new goal to complete by the end of 2013.
Selling More to Get Out of Debt
By the end of the year, I want us to have fully paid off 5 more of our debts. That gives us a little less than 6 months to do it. That means we have to get TIGHT with our funds and bring in more additional funds each month. If we fully stick to our budget and bring in around $250 more each month, we will reach the goal of having all 5 of these debts paid off in full!
How do we plan on making these additional funds? We are going to have another garage sale in August. This weekend we are starting to list bigger items on Craigslist. I’ve landed a monthly freelance article with an on-line magazine and Drew continues to work construction on the side. We will also start listing other items on-line to sell.
All of these things should bring us in the additional funds each month and more. Hopefully, the more will be enough to pay off 6 debts instead of our goal of 5 by the end of 2013. It’s my own additional goal to pay off one more debt before the year ends.
In June, we also looked into refinancing our home loan and getting a home equity loan. We decided that both of these were not for us. Yes, there is the potential to pay back less money, but for us it wasn’t the best idea. We already have a good home loan interest rate and we don’t want to tap out our home equity. Instead, we will get a nice chunk when we sell our house that will go towards our world travels.
Now to figure out the best way to utilize those funds the once we receive them and to not get taxed like crazy on them. Sounds like we’ve got some more financial research ahead of us! And more goals to make.
As of the end of June 2013, we have 4 debts paid off in full and 13 more to go. We went up one debt this month when we had to get some things repaired on our vehicle. We started working towards becoming debt free in January 2013.
What type of progress did you make towards getting debt free June 2013?