Debt Repayment
During April, we put $2,352 toward our student loans! Our debt payments this month went toward the 0% APR balance transfer that we’re using to save money on interest. On Income Based Repayment with our current income and family size, we don’t have any payments due, so we can focus all our attention on the balance transfer. We also got a deposit from SmarterBucks, which is a cash back program where the money goes directly to your student loans.
It’s kind of exciting to be at the half way point. From now on, our debt remaining will be smaller than the amount we’ve already put toward debt! And next month we’ll be in the sixties for our remaining debt.
Income
Our total net income for April was $4,991. Since we live on last month’s income, this is income that we haven’t touched yet. We will budget and spend it in May.
Regular Income– $2,972 This is Mr. SixFiguresUnder’s current take-home pay. For more details on his income, see here or here.
IRS Reimbursement– $1,045– This is not our tax refund. This is a reimbursement from the past two years when the IRS shorted us $500 each year. I won’t bore you with the details, but it has to do with the first time home buyers credit in 2008. I was glad to see that they included a bit of interest, though it’s a lot less than what we would “make” if we had received the money on time and put it toward our student loans.
Blog Income– $974 This is the income I actually received this month (minus my blogging expenses), which means I earned it a month or two ago (payments always lag a month or two). Taxes are not taken out yet.
Etsy Income– $0 I had my Etsy shop on vacation mode this month, since I knew that life would be pretty crazy welcoming our newest little one (turns out it was even crazier than expected).
Spending
Each month we budget down to zero using last month’s income. Our spending in April came from the income we earned in March. In addition to the debt payment above, here’s how we spent money in April:
Tithing– $441 At the beginning of April, we paid a 10% tithe on the money we earned in March. You can read all about why we pay tithing even though we’re in debt.
Other Giving– $20 Other charitable donations we made.
Mortgage/Rent– $0 We don’t pay any rent living in my in-laws unfinished basement, but we still keep this category here so that you know we aren’t leaving anything out. Our alternative living arrangement not only frees up money in the budget to put toward debt, but it provides a constant reminder of our goal to get this debt paid off as fast as possible.
Internet– $70 Hooray for getting new internet! Oh I am loving not having to budget my bandwidth anymore! My in-laws pay for all the other utilities, so we decided to take care of the internet costs ourselves.
Republic Wireless Cell Phones– $22 We both have smartphones through Republic Wireless (you can read my review here). With tax, each phone (with unlimited talk, text and WiFi data) is around $11. You really can’t beat the price and service they offer.
Health Insurance– $156 We think having health insurance is pretty important. Ours is an ACA plan.
Car Insurance– $97 We have auto insurance through USAA for our two older vehicles (both 1997) with a $250 deductible.
Renters Insurance– $14 We also have our renters insurance through USAA. It doesn’t cost much and it’s really great to have when you need it.
Food– $277 We had a pretty normal food month.
Gas– $367 It’s sad to see gas prices going up again.
Fun– $71 Our kids have wanted a pet for ages. We tell them that we will consider getting a dog (or whatever the current favorite is) when we are done paying for daddy’s law school and when we have our own house. In the back of my mind, though, I’ve had the idea of getting them a “functional” pet that’s not too expensive or high maintenance. I thought Easter would be a good occasion to surprise the kids with ducks. I bought four ducks and a 50 lb bag of feed. Hopefully they’re girls and will be laying eggs in a few months.
We also had two dates to In-n-Out (well once my husband brought it to me in the hospital) and went out for ice cream (the day we got out of the hospital the second time).
Household– $36 This month’s household purchase included normal toiletries as well as some motor oil.
Gifts– $8 I sent some photos of my kids (and some of the new baby, of course) to my grandpa who is on hospice right now. I also got a few books and things for future birthday or Christmas gifts for my kiddos.
Clothing– $25 I found out that one of the thrift stores we go to puts out a huge bin of kids clothes and one of women’s clothes where you can stuff a bag for $4. They have the deal every Friday! We bought a few other clothing items at other thrift stores and bought some new dress socks for my husband.
Medical– $106 We made the last co-pay that should cover my OB for the pregnancy and delivery. The hospital bill has yet to arrive. My new little one and I have also been fighting thrush (ouch!), so we got a nystatin prescription and some acidophilus.
Car Repair– $252 We’re still doing repairs from when Mr. SixFiguresUnder hit a bear last fall. A week after getting the headlight fixed, it was out again. Apparently the housing was broken. I’m glad that he finally has two headlights again!
Law Practice– $44 Monthly subscription for law practice management software.
How did your finances go in April? How are you doing on your 6-month goal?
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[email protected] says
May 1, 2015 at 4:59 amWow, you have been dealing with a LOT. I hope all the health problems clear up soon! Congratulations on making so much progress with the loans; it really is exciting to see you hit the halfway point. As you decrease the principal, the interest should be going down quite a bit as well, right? So your money will make more of a dent each month. So cool.
Stephanie says
May 1, 2015 at 4:35 pmYes! The interest on the loans is going down. Right now we are focusing on the balance transfer from a couple months ago. It doesn’t have any interest, but we want to be sure to knock it out before the promo period is up. Thanks for cheering us on! 🙂
Stacey says
May 1, 2015 at 5:47 amSo exciting to see that you’re amount paid off almost exceeds your debt! Congrats!
And how cute is it that you got ducks for your family pet?!
Stephanie says
May 1, 2015 at 4:36 pmThanks Stacey! I added a picture of the ducks when we first got them. 🙂 They are pretty cute!
[email protected] says
May 1, 2015 at 6:01 amCongrats on hitting the halfway point! I’ve been inspired by your debt repayment and eagerly look forward to your updates each month. Thanks for encouraging others with your honesty!
Stephanie says
May 1, 2015 at 4:37 pmThanks Sarah! It’s exciting to be halfway! It’s all downhill from here (in a good way)!
Susan says
May 1, 2015 at 6:04 amCongratulations on your new baby and being almost half way done with your debt!!
Stephanie says
May 1, 2015 at 4:37 pmThanks Susan! We’re pretty excited!
Blake Cooper says
May 1, 2015 at 6:49 amWay to go, Stephanie!!! You’re at the halfway mark! It’s all downhill from here. Huge milestone. Pat yourself on the back. *puts hand in the air for a high five*
Stephanie says
May 1, 2015 at 4:38 pmThanks Blake! High fives all around!
Judi says
May 1, 2015 at 7:06 amCongratulations those are exciting debt numbers and bunches of exciting family news. I think ducks are a great first pet. They require less medical care, general costs, and attention than dogs, but still teach responsibility and can be very fun. Good luck for your next month!
Stephanie says
May 1, 2015 at 4:42 pmThanks Judi! I added a picture of our ducks when they were brand new. They grow really fast, so they’re much bigger now. I never really had pets growing up, so I’m new to this and learning responsibility right along with the kiddos (thankfully my husband has animal experience).
Kellie says
May 1, 2015 at 7:31 amWay to go! Half way there!
Stephanie says
May 1, 2015 at 4:42 pmThanks Kellie!
Renee says
May 1, 2015 at 8:34 amCONGRATS! 🙂 Getting to the half-way point is so exciting!
I recently stumbled upon your blog and am going to use it to further our debt repayment journey! Thanks so much for sharing! I hope to be as successful as you someday!
Renee
Stephanie says
May 1, 2015 at 4:42 pmThanks Renee! Best of luck on your debt repayment adventure!
Allie says
May 1, 2015 at 1:27 pmSpeaking of birthday gifts, do your kids go to birthday parties of their friends? (You don’t seem to mention ever buying gifts for the friends of the kids.) Do your kid have birthday parties of their own with their friends? Do the kids have playdates with their friends coming over?
Stephanie says
May 1, 2015 at 4:58 pmGood question Allie! My kids do go to birthday parties occasionally. I have a gift stash that has new, giftable things that I’ve gotten over the years for great deals. We either find a gift from there or we make something. I like to sew, so as long as we find out about the party in enough time, I like to sew something. For example, recently I made a cute ruffled apron with the b-day girl’s initial on it.
I like to do friend b-day parties for my kids, but not every year. Some years (like this year) we just do parties with family.
Most often, playdates with school friends are at the park. Our house is pretty far out in the boonies. When we go to town we often get together with friends from church. Cousins come over and play pretty often too. My kids are all pretty close in age and play really well together.
Linda P. says
May 1, 2015 at 4:43 pmI was wondering if you’d be hitting that halfway mark this month. Congratulations! I hope you’re patting each other on the back a bit for your successes!
Stephanie says
May 1, 2015 at 5:05 pmThanks for cheering us on Linda!
Evelyn says
May 1, 2015 at 9:16 pmYou are doing so well! Congrats on being right near that halfway mark – you are incredible. I’m sorry to hear about the thrush and hospital bills, and I hope you are doing better!
Stephanie says
May 4, 2015 at 6:52 pmThanks Evelyn! 🙂
Libby says
May 2, 2015 at 3:16 pmI echo all of the congrats on the halfway mark!!
So sorry to hear about all of the challenges with your new baby. This one is giving you a run for your money, so to speak.
I’m curious about ducks and not chickens. Also – how did your kids react when you gave them the ducks?
Stephanie says
May 4, 2015 at 6:56 pmYes Libby! We’ve had more drama with this baby girl that the 3 other kiddos combined. She’s worth it though! 🙂
My kids were thrilled with the ducks! We are having so much fun with them. My in-laws (whose basement we live in) have chickens, so they aren’t as much as a novelty. Chickens are great though!
Timmy says
May 3, 2015 at 10:33 amWow. Love the progress. You get an A for tenacity, patience and steadfastness.
I’ve paid off 165k (out of 178k) in student loans (law school and undergrad) in 7 months. God willing, i hope to have the remainder knocked out this June. Sold my precious sports car and cashed in some stock to put a big dent in it. Also threw 95% of my paycheck at it during the last 8 months to make this happen… with all the sacrifices that come with that. Hope we both get to a point where we are free from our indentured servitude, and hope we give more charity at that time. Keep up the good work, and lets commit to avoid usury in the future.
Stephanie says
May 4, 2015 at 6:59 pmWow Timmy! That’s some serious progress in 7 months! Way to go! That’s exciting that you’ll be debt-free in June! We’ll be excited to join you soon!
Melissa says
May 4, 2015 at 3:02 amI love your blog and am so inspired by it. I do have a suggestion that has worked for us. We have a credit card that offers cash rewards. We pay everything including our mortgage with it. We pay the balance in full every month to avoid any interest. We earn points for using it which we can turn in for gift cards, travel or apply to our balance. Just a thought for one more way your money can work for you.
Stephanie says
May 4, 2015 at 7:22 pmHi Melissa! We have a credit card that earns points too. We put most of our purchases on it and pay it off each month. We usually apply the points to the balance, though sometimes we get gift cards too. I talk about how we use credit cards on a zero-based budget in this post: https://www.sixfiguresunder.com/credit-cards-with-ynab/
Candice says
May 8, 2015 at 5:29 pmHi Stephanie, many congratulations on reaching half way with your debt repayment. You must feel amazing to be on the home stretch. Well done you!
I just wanted to let you know that I was completely inspired by the Frugal Fresh Start and, after much consideration and consultation, have used my future home savings to pay off my $34,000+ student debt. Where I live, our higher education debt is managed by the federal government and repayments are taken through taxation system (so you essentially pay in pre-tax dollars). Further, repayments aren’t mandatory until you reach an income threshold. These higher education loans are indexed by the government each year – meaning that you have an effective interest rate of anywhere between 2 – 5% on your loan. In the five years since graduation my debt had grown by over $13,000 (!!!).
Having this outstanding loan was limiting my purchasing power in the housing market so I made the rather unusual (for my peers) decision to pay back my Higher Education Debt. While my savings are markedly smaller and I won’t be purchasing property any time soon – it is more freeing that I ever could have imagined to have this debt paid.
Thank you ever so much for your inspiration!
Kayla says
May 13, 2015 at 6:34 pmHi Stephanie,
I’ve been a fan of your blog for a long time, and have thought about starting my own. I was just wondering what specifically about your blog is helping you reach your goals? I have some pretty heft long term financial goals and was wondering if blogging about it would help me stay on track.
do you have any tips – What has worked for you and what hasn’t?
Thanks!
Stephanie says
May 21, 2015 at 11:54 amHi Kayla! That is a very good question. Since the answer is kind of long (and it’s a question I get pretty frequently) I decided to write a blog post as an answer. If life goes semi-smoothly today (you never know with a newborn), it will be on the blog tomorrow! 🙂
Michelle says
May 22, 2015 at 8:53 pmA HUGE congratulations on hitting this debt repayment milestone. And-your husband hit a bear??!