Family’s Debt – Revised and in planned Phases


I had to revise our budget (again), go over it with a fine-tooth comb & put the debt repaying into phases. I was told that it takes 3-4 months to get the kinks out of a personal budget to make it work. If, I am still revising our family’s budget after that amount of time…then something is wrong. It will be almost a month…month tomorrow, in fact. I am getting better at this debt tracking thing. Condensed tracking in more efficient terms.

Here are problems that arose recently (I think I have ADHD, I’m anxiety ridden, or just plain fidgety because I review things a lot to find nuainces [or change my blog header alot!]). Perhaps, that is why I am good at my job in cancer research.

  • We were ‘choking’ trying to keep within the cash allowance. Taking funds from our FF/EF to cover the negative cash allowance total.
  • My ‘other’ bills did not account for the fact I was putting money into savings or the freedom fund.
  • Essentially I am shorting the financial funds available for my family. Not good. How is that going to work?

So, here is the revisions (w/intentions to increase EF/FF in the near future):

  • I had to cut my freedom fund from $91 per week to $50 per week
  • Reduce the savings Xfer from 10% per week to 5% per week (at least we are still saving)

Here is the Phases of repayment I was talking about:

  • Phase 1: Currently, consists of 10 credit cards to be paid down. I am snowballing these now – paying the monthly payment amount necessary. Will continue to pay that same amount even though the debt amortization decreases the payment. When one CC is PIF, that payment will go to the next card. Thereby, compounding the payment. Till all are PIF (ah, financial freedom – well, closer).
  • Phase 2: There are 3 bills I pay proactively (hence, not requiring payment at this time)
  • These 3 bills are on hold until Phase 1 is PIF. Reason being, we cannot pay all these bills in one consecutive phase. It make take us a bit longer, but we can breath a little and keep our sanity. Plus, these 3 bills hold the lowest interest. So, we are okay.

Now you understand why my percentage (on the left sidebar) decreased, because it is only accounting for the 10 credit cards – roughly $60K. The other 3 proactive, but still owed accounts tally approx. $25K.

By decreasing our freedom fund & emergency fund, we are increasing our cash allowance to $400 a week. This seems to be our average weekly amount spent on groceries, gas for the cars, and minor expenditures. And our Freedom Fund & Emergency Fund will only be used they are meant to be used. We will not need to touch this to use as an overdraft account (smack the hand, shame on us).

I will be starting this all with tomorrow’s budget. So, let’s see how this works for us. ~Cheers!

ps – received my other OT check! Darn taxes again! You get like 60% back and 40% to taxes. Well, I claim 2. So, that might have something to do with it.

How long did it take you to make your budget work for you????

7 thoughts on “Family’s Debt – Revised and in planned Phases

  1. Sharon Rose

    Hi there-Firstly, loving the new look blog and header-I think its soo much better!! I’ve been on a budget for years now, but always tinkering around with it. My main aim is not only to get out of debt (which will be eventually as opposed to immediately or even sometime soon!) but NOT to ADD to it! I’m proud that over the last six years, progress has been slow, but debt has gone down and thankfully we’ve not added to it. I try my best to stick to budget by: bills coming out by direct debit or standing order every month, a static debt repayment program and paying cash for groceries and petrol. My credit card is at a very low limit for short term emergencies.

    Reply
  2. Budget Mama

    I love your new blog layout, very nice.

    I’m in the same boat as you. I’m still tinkering. Since I moved out, now I have to redo it yet again. I hope I’m nearing the final stages.

    Reply
  3. Money Funk

    Sharon rose: yeah, for trying real hard NOT to add to it. I know from experience that is very difficult to do. πŸ˜‰

    Greentreeweb: Thanks for the cheer! I really hope this does work for us. Cuz, I need to see the ball rolling!

    1mansmoney: I think its vital to tweak it as you go. I am learning that this PF journey is definitely not going to follow a straight line! As for spending… I just cannot imagine how I survived thru my 20s with hardly any money or materialistic things!

    budget mama: glad to see you've moved into your new place. I hope your young one is doing well. thank U for the blog compliments. Hopefully, we can get a somewhat solid debt plan outline to guide us to our success.

    Thanks you guys for droppin' in!
    I can't wait to see my debt totals go down! I started cleaning out my clutter & it's true: one man's clutter is another man's treasure. The clutter is selling. πŸ˜‰

    Reply
  4. jpkittie

    that is fantastic!

    I was just thinking about breaking my debt into ‘phases’ as well – it may be easier to see a smaller number at different times. Good luck with that! (and don’t be surprised if you see on my blog that I have done the same with my debt!) You have been a great inspiration – keep up the blogging!

    Reply

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