FREE $15 credit + “Kitchen Must-Have” Sale up to 56% off {prices start at $8}!

5 piece utensil set

This weekend  is having a  sale with LOTS of kitchen items on sale up to 56% off! Prices start at $8! This sale features some of the best accessories for the kitchen! Find , ,  and so much more! Be sure to check it out today while supplies last and best of all, if you 

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Daily Grommet: Amazing Products & Offers You’ve Never Seen!

Daily GrommetDaily Grommet: Amazing Products & Offers You’ve Never Seen! There’s a cool new site I just learned about! It’s FREE to sign up! They feature HOT new offers each day with “Amazing Products You’ve Never Seen”! Hurry & sign up here: Daily Grommet

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The easy way to get out of debt!

The easy way to get out of debt! Is there any easy way to get out of debt? Well, not really! But I bet I have your attention! 🙂 Gtting out of debt takes a lot of determination and hard work! Engineer has written some great articles about how to get out of debt, based on our own personal experiences! Did you know we used to have over $200K in debt and have paid off about $150K in just 5 years? Here on CAFM we are committed to helping you save money and make extra money online so you can get out of debt, or hopefully never have go into debt in the first place! 🙂 Read Engineer’s 6 part series on .

easy way to get out of debt

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2009: The plan of action: Debt mitigation and more!

By no means do I mean to offend anyone trying to diet on a new years resolution or whatever resolution you chose to do, nor do I mean to offend anyone with lofty goals. If this method works for you, you are a better man/woman than I am.

It seems like everyone is talking about new years resolutions and goals these days. I guess it got me thinking since we are changing our course in debt repayment right that I need to contemplate what we want to accomplish this next year.

First of all I don’t believe in new years resolutions. Here’s why: you resolve to make some change in your life (usually far to drastic to stick to) and for the next 3-6 weeks you suffer trying to attain this unreachable ideal. Then you fail miserably and end up in worse shape than before. Be it personal finances or dieting, it never works. The reason it never works is these major changes aren’t just a change that you make to do something different, they are complete lifestyle changes and take commitment beyond just saying your are going to loose 50 pounds and throwing away potato chips and buying carrot sticks. You have to devote your life to this change and change your whole fundamental thought process to make it work. To do this you have to make all facets of your life conform to this and this takes time, not just deciding that starting Jan. 1st you are going to diet.

The other thing that gets my goat is the notion of goals. I see people set goals all the time, usually lofty goals stating that this year they will do this and that. They always put some time frame in, but the problem is that most people make their goals so lofty and ambitious that they aren’t actually realistic. While it works for some people, the concept of goals has never worked for me.

Instead I prefer to set a plan of action. I use logical figures and facts and estimate where things are going to end up on a time line, so that at any given moment I know what my progress is and how far off I am from my estimate. I guess what I am saying is that to me it makes more sense to plot an expected target and realistically (with rough numbers to back it up) make out a plan to follow. Sort of my brain’s roadmap or instruction set of how to accomplish the task it set out to do. Maybe it’s just my engineering background or project management, but I like to have a course of action and be able to know where I am at any given time.

So with that said, 2008 came to a close just as we got the truck paid off. So in 2008 we paid off the last of the sallie mae private student loan, paid off the siding loan from the house and paid off the pickup.

The 2009 Plan of action:
  • Item 1: Continued Debt Reduction:

For 2009 it will be a short list for debt reduction as the house is the next target. The mortgage is currently at just over 33K right now.

Our plan is to add the $800 a month we were putting on the truck and put that on top of the mortgage payment, making it out to a nice even $1200/month starting in February.

So taking out the interest, taxes and insurances… it should track as follows:

January – $33,300 starting balance
====Start $1200/month payments
February – $32,400
March – $31,500
====Call and remove PMI, saves us another $20/month
April – $30,580
May – $29,660
June – $28,740
July – $27,820
August – $26,900
September – $25,980
October – $25,060
November – $24,140
December – $23,220

Now these are just rough numbers, but planning things out, we should at around a $23k balance by the end of the year. That’s motivating. Hopefully we can keep this up, if so we should have the house paid off around the fall of 2011.

  • Item 2: Start a savings account:

In the past we were also adding snowflakes on top of the debt snowball. We will not be doing this from now on as dealing with the mortgage company is a PITA. Instead, since we do not have any savings other than the extra $1000 we have in the checking account for emergencies, we are going to put any extra money from and our free money endeavors, selling stuff on ebay/half, birthday money and overtime money into a savings account. While we don’t plan to religiously add to this, we will periodically re-balance the checking account and transfer the excess over the basic $1000 dollar float into that new savings account.

  • Item 3: Funding the HSA medical expense account:

Since my employer has us on this horrible HSA account with an insane $6k deductable, I was putting $240/month into this health savings account just for paying medical bills. We basically broke even in 2008, so I am going to continue to put $240/month in there this year hoping that since the kiddo is at home with momma now he won’t get as sick this year.

  • Item 4: Funding the 401K

It’s really hard to force myself to put money into this knowing that every time I log on nowadays the balance is down about 10% from the last time I looked. However my employer matches 35 cents on the dollar up to 10% so I need to take advantage of that. While I can’t afford to put in 10% right now, I am going to stay the course from last year and continue putting in 4%. After we are debt free in a couple years I am going to make this a priority, but for now paying off the debt is the priority and we are still putting some in there.

Well, that’s the plan. So long as nothing drastic happens financially, I can look back at the plan and know what has to be done.

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Thinking positive: Think about your assets and not just about your debt

I myself have become hung up on this idea that right now debt is the enemy and must die a horrible death. While this is technically true, I had the realization that while I have been blogging about debt in general, I need to remember that there is more to finances than just debt.

Last week I wrote about sending in the last truck payment, paying off our new truck in full in only 2 years. While this was an awesome feeling, I started planning the next stage of the battle… paying off our house. We chose this as the next step as the other major loans we have are school loans with my wife’s being around 4 or 5% interest and mine at 1.75% interest (yes, 1.75%), so it makes more sense to pay off the house at 6.25% interest first. So I mapped out the course, plotted the changes in payments in the checkbook and ran everything out to the end of the year to be sure to include any non-recurring expenses like tags. Everything looks good.

I realized that I have been so focused on eliminating debt and reducing that balanced owed on everything to zero dollars that I completely forgot about looking at our assets as far as evaluating our financial predicament.

So I figured out what our real assets are and their worth and I actually feel a little better. I guess it’s just another way of looking at things so that I can find motivation and positive reinforcement that we are making changes for the better. I am proud to say that for the first time in a long long…long time we actually own stuff free and clear.

Anyway, while debt reduction and elimination still remains the focus, don’t forget to stop and smell the roses every now and then and be thankful for what you have.

Our Assets:
$16,000 -House: Worth 50k – 34k owed
$17,500 -2006 Dodge ram – owned free and clear ( value)
$4000 – 2000 Chevy Blazer – owned free and clear ( value)
$13,000 – 401K – used to be worth a lot more *sigh*
$50,500 – Tangible Assets

Wow, now that is inspiring. Of course you add to that the $105,000 in debt we still have and we are actually worth -$55,000 or so, but some day that will come around too.

My point is this, successful debt reduction is just as much psychological as it is financial. I speak from experience, the right state of mind changed everything for us. So while the staggering numbers of the debt bills are depressing, there is hope. You need to use whatever motivational tools you can. I try to motivate myself as many ways as possible. Realizing that we actually have assets for once in our lives, now that is motivating.

Good luck in finding your own motivational tools.

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Selling old junk on ebay pays off just in time for christmas!

After collecting up all the extra junk I had laying around, mostly from collections of electronics gear I bought back in college, I spent several hours a couple weekends ago writing descriptions and taking accurate pictures of everything. I had tried to list the more expensive items once before but couldn’t get what I thought they were worth. I finally decided that I wasn’t going to use them so I might as well just sell them for what I can.

I am excited that I made enough to put a decent chunk of money towards the truck repayment, however it’s a little saddening that two of the items are worth over $1ooo each (about what I paid for them 5 years ago) but only brought 299 each. I guess I just have to look at it from the standpoint of that was the past back when I racked up credit cards, now that the credit cards are paid off, this is really just some gravy left overs that I don’t need anymore.

Anyway, the tally for all the junk (I say junk, but it’s actually really nice stuff) is about $165o.00, so by the time I take out ebay fees and shipping leaves me about 1500 bucks left over. So I cut a check for 1500 to the bank and will drop it in the mail tomorrow.

Man it feels good to write those checks.

The best part is that our balance remaining on the truck is around $2k right now, so this should only leave about a 500 dollar balance.

We bought the truck new on Dec 23rd, 2006 with a 5 year note. I am so impressed that we have been able to clean up our act this much this fast. Two years ago our finances were a wreck, and now almost 2 years to date after taking on this new truck note at 23,500 our balance is only 500.

Words just cannot explain how good this makes me feel.


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HACK! An update…

Now that I have your attention…

The hack being from the only thing I have really been able to do lately, which is hacking up a lung with this bronchial infection I have had for two weeks now. My chest hurts from coughing so much. I hate being sick.

Anyway, onto better things. Figured I would update the status of things, if nothing more than to help myself remember where we are at with this whole evil debt thing. Since momma is at home now and we are one income only, we can’t make any huge payments anymore even though we are living as frugal as ever. Gone are the days of mailing in an extra grand payment. Now we are lucky to scrape up a snowflake of a hundred or two. In the last two weeks we managed to pool our survey money and extra frugal savings and write a check for 150 bucks towards the truck. Every little bit counts.

There is some good news… I had my annual review at work this week and netted a 4% raise. Still grossly underpaid for the job and what I do, but at least its a small bump (again, every little bit counts).

And to top it all off I so stupidly logged into my 401K even though I knew it would sting. OUCH, down 15.7% in the last month. I feel like saving for retirement has become a fruitless endeavor these days. I know you are supposed to buy low and since I have a good 35 years till retirement I should look at it as an opportunity, but it’s hard to keep pouring money into it and seeing the value drop by hundreds every day. Lets face it… things are ugly.

Oh well. Overall the ‘ol debt pie chart hasn’t changed much since last time. We are still sitting at around 112,000 dollars left to pay (55% left). *sigh*

As far as the blogging things go, I have to answer a question from a reader. I am blogging because I want to. I blog about what I want to. Mostly I enjoy blogging about our progress into the elimination of debt, ways we have taken to save money and occasionally some helpful links like freebies I find. I am in no way, shape or form trying to be a financial blogger, nor do I have any desire to be.

If you want advice, there are hundreds of other good blogs and sites out there.

If you just want to see how I am getting out of debt or saving money and with any luck become inspired yourself… pull up a chair and sit down, I won’t bite.

Anyway, now that all my thoughts are down on paper so to speak… time to hit the cough syrup and hit the sack.

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WOOHOO! Extra loan payment

In looking at our checkbook again, we realized that our frugal living, the last of our ebay sales and a chunk of overtime added up to an amount that we rounded up to 1300 dollars for a snowflake towards our truck payment. This is on top of the debt snowball we are doing where we are already paying an extra 400 a month to boot.

Sweet, this should bring the balance in around $12,3XX left now (always hard telling the way they take out interest and such).

This has really been invigorating to be chunking down decent size snowflakes. The snowball method has pushed us along nicely, but the extra work, frugal living and selling everything we don’t use and decluttering has really helped make a big difference.

In my last two extra payment posts you will notice that they were for a lot of money. Back when I was in engineering school working on my bachelors I bought thousands of dollars of equipment to support my love of electronics and wanted it to be a fulfilling hobby. But now since I already do this 50 hours a week in my job in which I get paid for and get to buy 20k-50k in cool stuff every year for my job, I really have no desire to do this as a hobby anymore. So rather than sit on all this money which I had put on discover card back when we had credit card debt 5 years ago, I decided to sell it for whatever I could to help our current situation. This has proven itself beneficial in not only cleaning up the house and garage, but also earning some decent cash (never mind the fact that I probably am only recouping 60% of what I paid for the items, they are already paid for).

Anyway, I have been inspired lately and I hope that you have been too.

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w00t ! Made an extra 1400 dollar truck payment

Managed to scrape up an extra 1400 to pay towards the truck loan. We looked at the checkbook last night and after looking at all the frugal choices we have made lately saving us money, some working on the side, overtime and selling a couple things on ebay we have managed to scrape up a decent snowflake to the ol truck loan.

This is great. Hopefully we can continue this, although it may be hard because the more we look at things the more we are looking at momma staying at home instead of working. One less income, but a lot less expenses in that department too. Still haven’t officially done anything there yet, but hopefully in the next week or so we should have that decided on.

In the meantime we just keep doing what we can do.

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Debt snapshot-6-22-08

Well, this last two months (since starting this blog) have certainly been productive, wiping out over 7000 dollars in debt. Mostly due to income tax refund, economic stimulus, eBay sales, overtime and a garage sale. I had made progress on my own but keeping this blog up has been so inspiring to me that it has supercharged my motivation.

The progress thus far:

  • $14,000 in the wife’s student loans (bachelors) => paid off
  • $15,000 in my high interest Sallie Mae loans => paid off
  • $13,000 in Credit card debt => paid off
  • $7400 in high interest siding loan => paid off
  • $13,000 in high interest vehicle loan(SUV) => paid off
  • $6000 in medical bills => balance down to $2400
  • $44,000 in student loans for my BS => down to $38,888
  • $32,000 in student loans for wife’s MS => down to $31,900
  • $23,000 for truck (2006) => down to $17,000
  • $36,000 balance on mortgage => down to $33,975

As you can see, we are making progress. Of the original $203,400 in debt, we are down to only $124,163 left… only… LOL. This makes us 39% paid off… only 61% left to go.

So as you can see the snowflaking has really helped turbocharge the debt snowball. Instead of originally paying off the siding loan in December this year, it’s done now. Now we will apply that $375 monthly payment towards the trucks $457 monthly payments and make a combined effort of $832 monthly plus continued snowflakes from overtime, ebay sales and whatever else I can do to make money at this point.

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