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Day 267: How not to pay down your debt

You guys. I've been focusing on my debt now for exactly 267 days and what do I have to show for it? OK, I have lots of new blog friends and a vast reservoir of cute retro images, but that would "paying down the debt" thing... well...

One of the main problems, or I suppose "challenges" that I have is this terrible cycle of good intentions vs. reality. After doing a Gail Vaz-Oxlade style budgeting thing, I figured out how much I can throw onto my debt per month, and automated that payment. And then added some more on top of that, because paying down my debt is the whole point, right? I can do without cute things! I am focusing on paying down my debt! (...I say to myself at the beginning of every month)

I am both virtuous and glamourous. OK, maybe just glamourous.

So, every month this automatic payment goes through and I feel partly like a virtuous and frugal martyr, and partly like, "wait, where did my money all go?" and then I inevitably find some superamazingonceinalifetimesupercute item of clothing or makeup and, like last night at 11pm, decide I can't live without it and then I buy it. Remember when I said fall fashion is my favorite? Suffice it to say, my bank account balance reflects that. As does my closet. And my current outfit. Ahem.

Anyway. So what happens is I put through the high repayment on my debt, then I buy something and my bank account goes into overdraft, and then I transfer money back from my credit card into my bank account and the sum result is that at the end of the month, I've barely paid down my debt at all. I don't know what the answe is. I know I need to get rid of the overdraft, and that would break the cycle. But is that not like canceling food banks in order to make people not rely on them to cure poverty? i.e. A bad idea?

But in the meantime, I can't wait for my cute new dress to arrive from ModCloth! (I am in a love/hate with this website. It's really a dysfunctional, destructive, one-sided relationship. Especially at 11pm. It's like drunk dialing an exboyfriend who you know is bad news, but you can't help yourself and maybe he wasn't so bad after all, maybe he's changed, maybe it will all work out this time...?)

Perfect for fall, no? Back to school chic! Picture it with black tights and motorcycle boots.


Rosie said...

My dear Fashionista! You have to break the cycle or you'll never have a closet full of beautiful dresses that you actually own! I have 42 chic & cute dresses in my wardrobe so I know where you're coming from. But all that shopping is what got me into credit card trouble in the first place too! When I was paying off my debt, I put an automatic amount towards it and then that was it. Gone. Never be touched again. While I cut back significantly on my spending, I never wanted to feel deprived so I budgeted in $80 of Fun Money into my monthly budget. This I could use on anything - dinners out, a bottle of wine, a manicure with a friend and if it spoke to me, a new dress. The point was that I could still go out or go shopping and felt like a driving-down-debt diva too! When it comes to paying off your debt, there is nothing wrong with being realistic (ie: budgeting monthly $500 towards debt, $100 dress) as long as you stick to it (and continue to collect glamourous retro images for your readers to enjoy!).

Bonne chance!

Rosie said...

And just so you don't think I was too strict, I missed a word on the comment above! I budgeted $80 of weekly Fun Money for a $320 each month to treat myself to whatever I desired. It made a world of difference and I'll bet you'll find that at the end of some months, you'll even have Fun Money left over.

diggingoutandup said...

Hun, walk down to the bank and cancel your overdraft. Even if you don't put another single penny on your debt in the next month, you will still be leaps and bounds ahead, because you haven't developed the will power to stop using it yet. You can't compare foodbanks to your overdraft. Foodbanks are for people who NEED it. You WANT that cute dress. There is no comparison. Do what Rosie suggests, give yourself some fun money rather than putting 100% on your debt, but cancel your overdraft.

~Carla~ said...

Hmm... hate to say this to you, but mama Gail would NOT be happy my dear! If you're not paying down your debt, you don't want it bad enough. Are you saving for an emergency fund or already have one in place? I get $50 month for personal spending $$ and I don't have any debt. then the rest goes to my jars & savings. If you REALLY want your debt paid down, you have to be in control & decide what matters more. New make-up & an outfit, or slapping down more $$ on your debt.

Good luck!! I would LOVE to see you succeed! :)

Katy P said...

+1 to what Carla said.

The reasons for being out of debt have to be stronger than the impulse to get in to debt or add more debt to what you already have. And if it was easy to stick to your guns, we wouldn't be in a debt crisis - you gotta decide what's important for you, and stick to it. Will power doesn't suddenly appear one day. You have to fight for it daily. Just like you will have to fight to keep moving if you decide to run a race next year. You don't do it to run like an idiot for 13 or 26 miles. You do it to finish and to say "I did that."

We all want you to succeed. How can we help?

sfbnurse said...

our priorities are what do, not what we say we will do. changing habits and behaviours is the hardest part but it is actually change not just the idea of change.

Katy P said...

PS Gail has something on her blog today just for you:

Kerry said...

I think you need to practice more realistic budgeting. I used to do such budgeting as you describe but all that happened is I got deeper in debt because I neglected to remember upcoming birthdays, planning for the car registration, need for new shoes, etc. What worked for me is to have very few fixed expenses, a larger slush fund for clothes and dinner out, groceries and fun things, and then to throw the left overs on debt.

Quizshow said...

You're my sister from another mister, fo realz. Last week, I had the very same revelation about my debt. And even worse I've been working a part time retail job for the last 10 months that sucks all my time and energy. So here I stand, tired, cranky, still in debt, but with a closet stuffed with shiny new omggottahaveitsupercute goods. I did however call my bank and change my account to no overdraft. See, I was budgeting but conveniently overlooking the fact that I started each pay period down $200. So I say rip the bandaid off and get rid of the overdraft. It will hurt for what, two weeks? But you've already set yourself up for the successful next step towards joyful debt free cute dress shopping.

Annabelle said...

Thanks for the tough love, you guys!

jesspoole said...

Isn't what you are doing in fact MUCH worse than not paying having the automatic transfer to begin with? Because if you are using your overdraft, there is a fee associated with that, and if you take a cash advance from your credit card, you accrue interest from it immediately. If you never transferred the money around to begin with, you wouldn't incur all those extra costs... It sounds to me like you need to get a part time job! I would a full time and a part time job, and I'm doing 3 courses towards my Masters, and IT SUCKS, but I'm able to allocate all my part time job paychecks to paying of my debt! I calculated that I only need to work there for 19 months, and I'll have my line of credit paid off completely!

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