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So apparently, unbeknownst to me I had one last Student Loan check coming to me for $2205.00. I thought that I rec’d all money loaned to me and I was to start my journey in repaying the student loan. What I didn’t see was the second 1/2 of the disbursement was to be mailed December 17th equalling… you guessed it, $2205.00.

To Cancel or Not to Cancel is the question.

Well, I didn’t cancel and I will tell you why.

The $2205.00 was previously totalled on my spreadsheet for ‘Student Loan Debt’ (approx. $32,000 owed). So, it made more sense to me in using a lower APR student loan to counter act with the higher interest Credit Card bills. Now, because I already accounted for this money in my Track My Progress, it does bring the graph down a significant amount. I do enjoy watching the graph go down (as you will see on the 7th of January). 😉

What did I do with this money? I definitely calculated my move before paying things off.

Initially I thought of just paying down the 6th card, as it is naturally the current one on my list. But, in the end this would only free up $219 a month ($37 normal cc payment + $182 rollover cc payments) to rollover to the next card (7th card).

I wanted to make a larger move. Especially, because my husband and I have been considering buying a rental property. But realize that we need to pay off more debt quickly. Even though our credit scores are pretty good, our Bad-Debt-to-Income-Ratio (BD2IR) is much too big. If we are going to buy a rental property, we want to do it right.

original payment plan*

Anyhow, back to the story. I wanted to make a larger move. And here is how I did it:

updated payment plan*

I paid a last payment of $203.51 to my Ortho bill = PIF ($2205 – $231.05 = $2001.49)

This freed up $100 per month. This bill is not part of my CC repayment schedule. And this will go to increase our Weekly Cash Allowance Fund – which we use for groceries, gas, entertainment, and any other little expenses that come up.

I took $100 spending cash. ($2001.49 – $100 = $1901.49 left)
I paid my monthly FFCU visa payment of $65. ($1901.49 – $65 = $1836.49 left)
I paid $1836.49 to my FFCU signature loan that has a monthly payment of $299.
($2858.43 – $1836.49 = FFCU sign. loan new balance $1021.94)

Recap:

FORMER: BofA monthly payment $37 + $187 = $219.00 (once pd, $219 would rollover to the next CC bill)

UPDATED: FFCU signature loan monthly payment $299 + $187 = $486.00 (by paying this card off, I will have $486 to rollover to the next CC bill!!!)

The remainder of the FFCU signature loan will take me roughly 1 1/2 to 2 months to pay off the balance. I will then be able to rollover $267.00 more dollars per month onto the 7th Card using the Updated plan versus the Former plan ($486 – $219 = $267).

I hope this makes sense to you. I have yet to figure how much interest and time I will be saving, but I am sure it is significant enough validate the changes I have made. I will be sure to update you when I do figure it out!

Did everyone have a wonderful Christmas? I know I did. It is one of the two times a year that family members make those delicious, memorable dishes to eat. Since my family is soooo multicultural, I get to experience a lot of variety in our food dishes. It makes that all the more delicious. But, I am also aware that I am seriously going to need to diet after New Year’s Day! 🙂

Make it a great day! MF

*spreadsheet totals are not exact, but used more for reference material.