Wednesday, March 6, 2013

Credit Card Debt Free!

I was going to wait to post this until I was officially credit card debt free. I was waiting for the checks to be cashed, but they're in the mail and will be cashed within the next day or two and I'm just way too excited to not post this.

Last month I had some amazing and unexpected financial victories. Both out of my control, but still..

My parents decided to gift my sister and I a portion of our Great Uncle's inheritance. It was such a shock and so greatly appreciated. I immediately knew that I was using a portion of it to pay off my credit cards. I also put a portion towards what I owe Isabel, some went into savings and then I kept some for myself.

The other victory was our tax return. Patrick and I decided to get our taxes done early this year due to some discrepancies that happened last year. Early filing = early return. It was larger than we anticipated and we are so excited to be able to put more toward debt.

Since I had already put money aside to pay my credit cards off using the inheritance I put half of my tax return toward my debt to Isabel. I put a quarter of it into savings and then I kept the rest for me.

I can tell a difference in myself too. I haven't blown through the money like there's no tomorrow. In fact I have only gone shopping with the extra income twice. Once at Kohl's and once at Home Goods, both places spending minimal amounts. Well, and of course buying birthday presents. March is crazy!!

As of right now, Patrick is holding onto my credit cards and I'm holding onto his. I really think this is helping a lot. I don't feel like I need to use them and I'm excited to watch my net worth grow instead of being a very low pathetic number.

Although Patrick isn't as into paying off debt and saving money as much as I am, I do see a difference in him as well. He put a large portion of his tax return toward debt and I truly believe he is happy to watch that number go down, but then again who wouldn't be?

I think we're both growing up a lot. Instead of finding happiness in the things we can buy right now we are learning to be happy watching our house savings grow. We are both getting that itch to start house hunting while the market is still low. I know we're not quite there, but our focus is to start putting more into our house savings so that we can get more serious about buying a house sooner than we  had planned.

The next goal is to finish paying off my debt to Isabel. Over the years I got too comfortable relying on that savings account when money was tight, using the excuse that I had until she turned 18 to pay her back. I'm not proud of it, but I thought that buying things meant more to other people. More gifts meant I loved them more, right?

Well I'm hoping to pay her off as soon as possible and can't wait until I can run a victory lap with excitement for being 100% debt free. Until then, I'm celebrating this victory because it means so much.

I've been here before though, and I've had feedback (mostly from Patrick) about going back to that place of relying on credit cards and retail therapy. Again, this time just feels different. I used to have a hate-hate relationship with money. I hated not having it, but when I did I hated it then too. I always felt like I was working against it, not with it. I was afraid of it. Afraid of having it and something happening where I'd need to spend it and afraid of not having it and needing it.

This time I'm looking at it as a positive thing. As long as I'm smart about how I spend it and how I save it then I have nothing to worry about. For now our savings accounts are set up perfectly for where we're at and in a few months we'll review and increase the amounts we distribute to the kids and other savings. I have a decent percent going toward my 401(k) and we'll need to start thinking about retirement at some point. My savings is growing thanks to the 52 week money challenge as well as just being smart about putting money away.

I'm feeling great and I'm going to go with that for now and not worry about the what if's in life. There's no point to do that. Things are good and I'm happy!

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