Archives for March 2020

The Manscape – March 2020

March 31, 2020 by tanya

March was – let’s say – a very slow month.

Adjusting to the COVID-19 pandemic has made this month unlike any other in my life – and the lives of most Americans.

I went on one date early in the month. Thereafter, things started shifting as I learned more about the spread of COVID-19 and the necessity of social distancing.

Jameson

Jameson reached out to me every day. At a minimum, he sends me a “Good Morning” text and a “Good Night” text. Throughout the day, he usually calls to check on me. At one point during the month, he brought me a flashlight because I didn’t have one. This was at the point that the American public was being told not to touch anyone and to stay away from others, but before I learned that even breathing in the same air as someone in a closed space could be a problem.

I didn’t really need a flashlight. He uses any reason he can come up with to see me. It’s sweet that he likes to do things for me. He’s said that he likes to take whatever opportunity he can to see and/or speak. The flashlight was that reason earlier in the month. At one other point in the month, the reason was to possibly bring a mask and gloves (which he had not yet obtained). I haven’t seen him since he brought the flashlight. We’re both now clear that I won’t be seeing him or in any close contact with him for a while.

Whole Foods

This was the one date that I went on earlier this month. It was a very nice lunch date and we got the chance to catch up. Though our conversations are nice and cordial, we just don’t really have any chemistry – at least not on my end.

We’ve spoken a couple of times since, but that’s about it.

The Original Whole Foods

I wrote about the immature dumb shit he did last month in the February Manscape report. I still haven’t heard from him.

Cigar Bar

Ahhhh. I did hear from this one in the middle of the month. Like The Original Whole Foods, he did a disappearing act last month as well. I hadn’t heard from him since mid-February – the week of Valentine’s Day until . . . March 17. Then . . .

His text: Hey, how are you? Are you staying clear of the coronavirus?

My response: [Crickets].

And that’s the end of that story.

Mr. All Black

This one reached out as well. What I appreciated is that his text led with an acknowledgement that he went “MIA”. Because I respect that he started off with that, I was willing to converse with him. I knew, after how he had acted, that I wasn’t willing to deal with him in any significant way, but I was willing to talk to him.

I was curious about why he went ghost. He started off by saying something about a car accident (even though it became apparent that the accident wasn’t on the day of our scheduled date). Eventually, he admitted that he didn’t think he had an obligation to communicate with me because we “weren’t that invested.”

Cool. You’re right. We weren’t invested. But, we had a date scheduled for a specific day and time. The fact that we hadn’t spoken much before then doesn’t matter. What matters is that you said you were going to do something (which let me know the location of our date) and, instead of calling or texting to cancel the date, you disappeared for 4 weeks. That’s stupid and immature.

When I was talking with him, I told him exactly how I felt about it. He apologized and admitted that he should have taken a different approach. I don’t expect to speak with him anymore.

Self-Isolation

The rest of the month was pretty quiet, like I said. I’ve texted and done some phone and video talking and flirting with a couple of guys I know, but that’s about it. I don’t intend to see any guy in person for a number of months. I’ve wrapped my mind around the likelihood of me being holed up in my condo until at least August.

Choose Wisely – Side Hustle Edition

March 26, 2020 by tanya

When the status quo gets interrupted, one is forced to pay attention and make an assessment. I’m referring to a true, honest assessment. No delusion. No excuses. No fiending ignorant. Right now, one can either act like a deer in headlights, or recognize what’s happening and take action.

We’re in the midst of a pandemic. The novel coronavirus, COVID-19, has upended life in the United States and other parts of the world. Local governments are minimally operative, restaurants and many other businesses are closed (with restaurants being allowed to provide food via take out and delivery). Individuals are being asked (or in some cases, being mandated) to stay at home. Many hospitality and retail workers have lost their jobs. Others are working from home. When outdoors, many of us are practicing social distancing by staying at least 6 feet away from other people. If you’re living in the United States, you know that life is very different right now. People’s lives are at stake. So are people’s livelihoods.

The economy is in shambles. In addition to worrying about staying healthy, many of us are concerned about how we will continue to earn income and be able to provide for ourselves and our families.

We hear about multiple streams of income. At this point, we’ve heard it enough to know and believe that it is absolutely the way to go to not only increase income, but to hedge against risk. If one source of income disappears or becomes unstable, the other sources of income can take up some of the slack. We get that. It makes perfect sense.

To rely on one source of income is silly.
~ single girl

That’s why we have such a strong side hustle zeitgeist these days. In addition to someone’s day job, they also drive Uber (and Lyft). In addition to working as an employee for one company, people freelance on the evenings and weekends as a contractor.

I, too, totally understand and believe that multiple streams of income are necessary – absolutely necessary. To rely on one source of income is silly. So, like many, I have other hustles. In addition to having licenses to practice law in 2 states, I also have a real estate sales license, and 2 securities sales licenses (see my post https://singlegirlslaysdebt.com/a-14000-windfall/ about a $14,000 commission I made last year). I’ve also done some teaching.

My rationale in choosing these additional income sources was that they could provide me with higher paychecks. With real estate and securities sales, agents (in the case of real estate) and representatives (in the case of securities) get paid commissions. So, what you make is based on a percentage of the deal. If the deal is a small one, the commission will be small. If the deal is a big one, though, the commission will be much larger. Since the amount of work necessary on each deal isn’t always commensurate with the price on the deal, the idea of getting a commission seemed like a really good idea to me. But it wasn’t such a good idea – not when I want my hard work to be smart work.

When I got into my side hustles, I thought they made perfect sense. They relate to what I already do, so I thought I’d be in a good position to utilize the knowledge, network and background I already have. It was a good natural next step. From a short-term perspective, I guess it makes sense. At least, I thought it did.

Here’s where I made a misstep: I chose side hustles that don’t properly leverage my time, even though they’re “professional”. The problem is that my side hustles involve the provision of professional services – and I am the provider of the services. I didn’t use my knowledge and background to create products that could be sold time and time again and that could produce money even when I’m not actively working. Instead of taking the time to create at least one income stream that isn’t directly related to my time, all of my side hustles are based on my individual effort. Not the best idea.

I’m still trading my personal effort for money. He regrets it. I don’t want to be his age and be regretful too.
~ single girl

I recently spoke to a man who has been in the securities industry for over 30 years. I asked him what he would have done differently, knowing what he knows now. He said that he would have built a business that wasn’t so dependent on him – something that could be deemed an asset that could be sold. With the choices I made for side hustles, I am on the same track as this guy. I’m still trading my personal effort for money. He regrets it. I don’t want to be his age and be regretful too.

The good thing is that, with additional licenses and services I provide, there can be more checks and the checks can be bigger. The bad thing is that, if I’m not working, there are no checks. I’ve positioned myself to be able to make more money, but that position is one that ties me to trading hours for dollars. And all of my dollars are tied to me doing the work. None of my side hustles can function in my absence. I haven’t set up streams of income that don’t rely on my continued, individual effort. In the same way that a stock portfolio should not be limited to just one stock or one industry, my income streams shouldn’t all depend only on my individual efforts. This model that I’ve set up is stupid. Really stupid.

Coronavirus Cocoon

March 20, 2020 by tanya

Photo by **Lisa Fotios** from **Pexels**

In my last post, I wrote about seizing this mandated seclusion as an opportunity to get some things done. I’m committed to taking my own advice.

For the last couple of months I’ve been feeling led to “go into the lab.” The lab is where things happen – a place that doesn’t get penetrated by outside influences. It’s a place designed for focus, creativity and innovation. I’m not sure who originated the term, but I’m familiar with it because I’m a hip hop fan (90s and 2000s hip hop, since I can’t even understand what these new hip hoppers are even saying) and I went to college on the East Coast. I heard the term a good bit in my late teens and early 20s.

“The Lab” – The lab is any place where you can go to focus, practice your skills and get work done. Go to the lab when you need to straighten something out.

~ Urbandictionary.com

I’m feeling the need to really buckle down, focus and make significant progress on some things that I need to get done. And I’m feeling like I need to take some extraordinary action in order to get the extraordinary results I’d like to get. Sometimes, that’s necessary – big action for big results.

When I was studying for the bar exam, I was laser focused. In the initial months of my studying I went to work, worked out, cooked, went to church and studied. That was about it. I didn’t go to social events. I didn’t shop (other than for food). In the final 2 weeks of before my exam, all I did was study and exercise. Nothing else mattered to me at that time. I had to pass this exam! I was willing to cut out anything unnecessary in order to do that. I didn’t want to go through the process of studying for months again. So I ate, breathed, and slept the bar exam materials. And I passed.

My bar exam success was based on 3 months of focused time and effort. I’ve learned first-hand what that level of focus can produce. There’s tremendous value in focus – in deciding upon a particular thing and working toward it.

I wish everyone well, but you need to focus on yourself. You need to stop putting your hand out. Everyone wants handouts. Everyone wants things for free. You’ve got to put in the work. You’ve got to grind. You’ve got to go through the struggle, and you’ve got to get it.
~ Conor McGregor

I’ve learned that guys call an extreme version of this isolation and focus “Monk Mode.” I say that it’s an “extreme version” because Monk Mode includes the cessation of indulgences in sex, porn, masterbation, alcohol and some other things in which a true monk wouldn’t engage. I don’t know if I’m committed to giving up aaaaallllllll of that at this time. I’ll marinate on it.

A tip that I’ve come across in learning more about Monk Mode is that it is critical that one have very clear, hopefully quantitative, goals for one’s focused isolation time. In other words, like other goals or processes that involve sacrifice, the “why” must be very clear and motivating.

I’m feeling the need to really buckle down, focus and make significant progress on some things that I need to get done. And I’m feeling like I need to take some extraordinary action in order to get the extraordinary results I’d like to get.
~ single girl

While I’m still in the process of figuring out what my cocoon will look like and what the exact, defined goals would be, I do have some ideas. For example, during this time period, I won’t be going on dates that I don’t really, really want to go on (compare this to being “fine” with going out with that person and seeing what they are like). This will mean that my focus will be on activities that make me and my business better and limiting or diminishing non-productive activities. I’ll be very conscious and conscientious about what I’m consuming (from food and liquids to written and video media). My communication with others will be more controlled and regimented (i.e., I won’t allow for as many random conversations throughout the day). These are just some ideas.

I was feeling this way before the whole coronavirus self-quarantines and social distancing that we’re doing now. Considering what is going on, I’m thinking that now might be a good time for me to get started with this or to, at least, start preparing to do it.

4 Great Things To Do While You’re Coronavirus Cooped Up

March 17, 2020 by tanya

The coronavirus has life around the world in upheaval. The crazy thing is that with me stating that “the world” is in absolute shambles, I’m not exaggerating – at all. Economic markets are volatile, people are staying away from each other in order to help contain the virus, and there is a general, heavy sentiment of uncertainty not just in the United States, but in many other countries.

That said, I understand and support the fact that we really, really need to isolate ourselves to reduce the spread of the virus. I’m all about that #staythefuckhome life.

In addition to the good staying home provides in helping to reduce the spread of the virus, staying home also presents some other great opportunities. While staying healthy (and trying to help keep others healthy), there are several things we can do to make the best of being cooped up in the house.

(1) Clarify and Decide

Are you in the same position now as you were during the 2008 economic downturn? Now is the time to think about and plan for how you will position yourself to be in a better position for the next downturn. It is important to see things for how they really are, then become very clear on what you want them to be.

What’s your current situation? What kind of job do you have? What is the likelihood that your employer will be able to continue to stay in business and pay you if the current circumstances continue for much longer?

What I’m getting at is that this is a chance to start playing chess, instead of playing checkers from a strategic life standpoint.

What you have at your fingertips is justified seclusion. That’s really an opportunity to think. It’s a chance to stop moving through life unintentionally and to devise a plan.

Write a clear vision for where and how you want to live the next time an event of this nature occurs. Economies are cyclical so be assured that another economic downturn will come – whether it’s due to a pandemic or some other reason. Something like this will happen again. Decide what you are willing to do to be in a better position when that happens.

(2) Stop Procrastinating

You know all that stuff you’ve been saying you “need to do” but haven’t? Now would be a good time to start addressing those things. You have nowhere else to be! Since it’s not safe for you to be in these streets like you have been, you can tackle some of the projects that have been on the way back burner in your life for too long.

Procrastination also applies to the other things that you’ve been saying you need to do, but haven’t. Yesterday, for example, I had someone reach out to me saying that he’s been putting off adding his wife to the deed on their property and he doesn’t want to put it off any longer. Since I’m a business and real estate attorney, he reached out to me so that he could get the ball rolling on that process.

Have you been putting off certain other “life stuff” that you need to start handling?

Do you have life insurance?
Do you have a will?
Do you have any of the pictures in your phone printed and hanging in your home? (There are online services that will do this for you.)

Now’s your chance to start getting some of those things off of your to-do list.

(3) Get Your House In Order

This one piggybacks on the previous opportunity. You’re stuck in your home, so get it together. You know all of that stuff you’ve got around the house that you’ve been saying you’ll handle, but haven’t yet? Now would be a good time to start working on them. When was the last time you did a deep, deep cleaning? Are your cupboards organized or in disarray? What about that stack of mail that’s been sitting in a drawer or in a corner somewhere? Aren’t you tired of it?

I’m a firm believer that one’s external environment is reflective of their internal environment – how they are thinking and feeling mentally. When I’ve got stuff all over my countertops and papers strewn all over my desk, know for sure that I’m mentally out of order. Sometimes the first thing I do to pull myself together is to pull my space back together. It makes a huge difference.

I have 3 friends whose homes are in shambles. That’s not judgment – it’s fact. They are embarrassed to have visitors and they, themselves, don’t like their physical environments. Since I know them well, I can say that their minds are often as cluttered as their environments. And their embarrassment about letting others into their living spaces impacts their personal relationships. I think it also impacts how they feel about themselves. They live in a constant reminder that, though they feel they have some areas of their lives together, there’s at least one area where they’re really falling short.

From the moment you start tidying, you will be compelled to reset your life. As a result, your life will start to change. That’s why the task of putting your house in order should be done quickly. It allows you to confront the issues that are really important. Tidying is just a tool, not the final destination. The true goal should be to establish the lifestyle you want most once your house has been put in order.
~ marie kondo

They won’t take the time and energy necessary to organize and to clean their environment. And it really takes time and effort. A significant amount of time and effort. What should you have more of right about now? Time. But cleaning up and organizing is worth every minute. As famous declutter and organizer, Marie Kondo, says, “From the moment you start tidying, you will be compelled to reset your life. As a result, your life will start to change. That’s why the task of putting your house in order should be done quickly. It allows you to confront the issues that are really important. Tidying is just a tool, not the final destination. The true goal should be to establish the lifestyle you want most once your house has been put in order.” So, clean up. Declutter. Get your house in order.

(4) Buy Some Stuff

I’ve been reading and listening to financial and market commentary. Prior to the COVID-19 outbreak, financial experts were predicting an impending recession – a recession that was anticipated by late 2020 or early 2021. Now, financial experts are saying that a recession is almost certain (though one hasn’t yet been officially declared) and will be coming sooner than originally anticipated.

I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful.
~ WARREN BUFFET

If you’re in the position to take advantage of the “on sale” stock market, you have an opportunity. If this continues too much longer, there may be some real estate on sale as well. Remember, some people thrive in economic downturns. Perhaps that can be you.

Instead of considering myself to be “stuck in the house,” I view this as an opportunity to be “in the lab” (that’s a 90s hip-hop term). This is a time to do some evaluating and to get some things done. If you make this a Netflix and super chill situation, I’m pretty sure you’ll regret it later. Be well.

Is a $1,000 Baby Emergency Fund Enough?

March 13, 2020 by tanya

Photo by Fusion Medical Animation on Unsplash

It’s crazy out in these streets right now. The President has declared a national emergency and has restricted air travel to and from 26 countries. The Dow Jones Industrial Average posted the largest single-day drop since the 2008 economic downturn. Major events like the SXSW (South by Southwest) concert and Coachella have either been cancelled or postponed several months. The rest of the NBA (National Basketball Association) season has been suspended. Schools are closed. Disneyland, for God’s sakes, is closed! Worst of all, toilet paper on a store shelf is nowhere to be found. You can’t even get it from Amazon.

Though I’m not panicked, I’m now in a state of being reactive. I feel the need to obtain a bunch of household supplies because I’m concerned that they won’t be available in a few days or next week when I need them. I hadn’t planned on doing this, but am doing it now. Why? Well, because everyone else is taking all the stuff.

This comes amid concerns about the spread of the coronavirus in countries around the world, including the United States. It has now, officially, been declared a pandemic. What concerns me about this situation is not the virus itself (except to the extent that it could impact my parents and other elderly loved ones), but how people are responding to it. The level of fear and the corresponding actions that are being taken in response to it are concerning.

Though I’m not panicked, I’m now in a state of being reactive.
~ single girl

Seeing how people are responding and the corresponding changes that are being made in business, and general life in the United States, is making me ask myself, “Is $1,000 enough?” Considering the fact that I work for myself, will I be okay if things continue as they have been?

Anyone familiar with Dave Ramsey’s Total Money Makeover program knows that he advocates a baby emergency fund of $1,000 as the first among several baby steps to financial freedom. The idea is to use the small emergency fund to “cover those unexpected life events you can’t plan for.” In other words, this is supposed to cover those things that you cannot see coming . . . or that surprise you.

Among the exceptions to the $1,000 fund amount are situations in which an emergency is clear and eminent – an emergency for which $1,000 simply would not be sufficient. I’ve heard Dave identify such an emergency situation as one where, for example, someone has a baby coming and doesn’t have insurance coverage or when one knows that they will be losing their job.

(1) Given what is happening now, I’m asking myself some questions.

(2) Is the corona virus and the mayhem it is causing a sufficient emergency to justify saving more?

(3) For those who are self-employed, should one have a higher amount?

(4) Is a $1,000 emergency fund sufficient for someone in extreme debt (over $300,000) like me?

How will this impact my business? Can I turn it into a positive situation? If things continue as they are, will I have enough money? I do not want to borrow. I’ve turned over a new leaf. I. Will. Not. Borrow.

But I only have $1,000 in my savings account. I have a few sinking funds – for car maintenance, home maintenance, personal care and gifts, but those aren’t savings accounts. Those are accounts with funds for expenditures that I know I’ll need to make eventually, even though I don’t know exactly when or how much I’ll be spending. The sinking funds are accounts that allow me to protect my monthly cash flow by having funds already set aside for the handling of certain life things. While I like seeing funds in these accounts, having the money there is a proactive measure, not a safety net.

Since I started my debt free journey last year, I’ve had only the $1,000 baby emergency fund. Though some months have been better than others from an income perspective, I haven’t strongly considered increasing my emergency fund amount until now.

And nnnnoooooowwwwwww . . . I’m thinking that this is a certified emergency situation – one that would warrant me saving a bit more money and putting it to the side. What these circumstances will yield is very uncertain. I’d like to be in a better cash position, even though I hope I won’t need it.

What financial moves are you making in response to this pandemic? How much do you have in savings and are you comfortable with that under the circumstances?

Financial Responsibility Hurts So Good

March 10, 2020 by tanya

I recently paid the $8,600 HOA assessment for which I’ve been saving for months. YAY! YAY! YAY! YAY!

A Huge Payment to Me

Of course, everything is relative. For some people, an $8,600 expenditure is not a big deal – especially an expense related to one’s home. Despite the fact that I’ve owned my condo for a decade, I’ve never made a lump sum expenditure of over $2,000 on it. It wasn’t an intended rehab project, and I haven’t done any major renovations or upgrades on it. When I bought it, it was only 6 years “old” – an authentic loft in an old 19th century industrial building that was renovated and repurposed for residential use in 2000. It already had stainless steel appliances and hardwood floors. The most I’ve ever done at one time with it was getting it painted and getting a new HVAC unit. Fortunately, I didn’t even pay for the HVAC unit (a $5,500 value) because my boyfriend at the time owned a contracting company and he handled everything for me.

I was used to doing things the credit card shortcut way.
~ single girl

When you’re on a deft free journey, you’re watching pennies and not wanting to spend money towards things that may not move you further along the journey. So for me – right now – $8,600 is a lot of money. I saw this beast of an assessment as a significant hurdle. Between the assessment and issues I was having with my HVAC unit and water heater, I felt like my debt snowball was melting before I even got a chance to really get started.

Doing It Without A Shortcut

I was used to doing things the credit card shortcut way. Back in my Pre-Debt Free Journey (PDFJ) days, I would have simply resolved to pay for the assessment on a credit card, and make monthly payments on the card. The credit card would have been a means for me to handle what I needed to handle (which would be getting the assessment paid), but it would be without me having to even consider an alternative approach.

My old way of doing things would have got my HOA assessment paid and a new water heater installed without me worrying about whether or not I would save up enough money to pay what I owed prior to when the assessment was due or prior to the heater dying or flooding my home. But, it also would have cost me in significant interest charges over the long term.

Now that I’ve eliminated credit cards as an option, I’m forced to come up with alternatives that work.
~ single girl

Now that I’ve eliminated credit cards as an option, I’m forced to come up with alternatives that work. With this HOA assessment, it was saving towards it every month and and having the discipline to put the required amount of funds into a separate account. For 4 months, I saved at least $1,000 toward the assessment. The money went into an interest-bearing account. I included the amount to be set-aside in my monthly EveryDollar budget. And, I followed through in transferring the money from my main personal account to the Home Maintenance and Repairs Sinking Fund (the interest-bearing account). With the new water heater that I need, it’s been me completely delaying its replacement and praying that the thing doesn’t fall apart before I can address the issue.

Doing It The Smart Way

Though I’m so not delighted about the fact that I had to come out of pocket with the money, I’m grateful and happy that I was able to do it. I’m proud of the way that I went about getting this done.

As with all habits, self-discipline is a learned art, and to master this art requires two basic steps: First, you must consistently analyze the probable, long-term consequences of your actions. Second, you must be tenacious in acting in accordance with what you have determined to be in your long-term best interests.
~ ROBERT J. RINGER, MILLION DOLLAR HABITS

The payment hurt, though. Really hurt. The tough part was when I would think about what I could have done with that $8,600. I could have paid off the balance of my 2016 Federal taxes, and had some to spare to put toward the 2017 taxes. Clearly, I was trying to torture myself because that was a really futile mental exercise.

Short-term discomfort or pain is usually directly related to long-term gain. Patience. Consistency. Stick-to-it-ness. All of that matters. In order to become debt free, I’ll have to relinquish many of the short-term comforts and pleasures I’d like for the long-term goal of being out of debt. While I’ve gotten better at doing that over the last several months, I still have a way to go before long-term thinking becomes my instinctive default approach.

That said – there’s a lot of positive that has come out of this situation. The primary thing is that I proved to myself that I can save substantial amounts of money, consistently, over a period of months toward a goal. I haven’t done that since I was a tween and was working to save $60 for a Guess jean jacket that I wanted. Another great thing that comes out of this is that I found a way to have that amount of money ($1,500) in my budget. If I was able to reserve that money for an HOA assessment, I can have that amount of money available to add to my debt snowball. That’s huge!

March 2020 Budget Breakdown

March 6, 2020 by tanya

First, let’s do a recap of how things went in February.

February 2020 Budget Recap

Where I overspent:

Groceries

Budgeted Amount: $200

Actual Spent: $221

Where I spent less than allocated:

Auto Gas	Budgeted Amount: $150	Actual Spent: $0
Dry Cleaning/Shoe Repair	Budgeted Amount: $90	Actual Spent: $60
Pocket Change	Budgeted Amount: $120	Actual Spent: $114
Orthodontist	Budgeted Amount: $425	Actual Spent: $230
Ooma	Budgeted Amount: $17	Actual Spent: $16.55

A couple of notes on where I overspent and spent less than allocated:

Auto Gas: The way I managed to not spend a penny on gas for this month was that: (1) someone filled my tank for me and (2) I haven’t really been going anywhere. I had some gas left over from January, which carried into February. Then, Jameson took me out in February and, without any solicitation on my part, filled up my tank for me. Since I’ve been working from home for the most part, and working with clients who don’t require in-person meetings, the gas that he put in the car for me lasted for the remainder of the month. Nice, right?!
Orthodontist: I hadn’t been to the orthodontist in 5 years. I’ve been using the same retainers I’ve had for all of that time. Recently, my bottom retainer cracked. So, I finally made an appointment to see my orthodontist, have him look at my retainers, and get me a new bottom (and possibly top) retainer. The amount I budgeted contemplated me getting 2 new retainers. At my visit, he said I only needed to replace the bottom one that had split.
Ooma: Yes, I still have a home phone. I don’t trust these cell phones completely. I need back up.

I’ve written here about what I do with what I don’t spend in each budget category. What I plan to do this month, however, is to finally address the water heater issue I discovered months ago. My water heater is on its last leg and has been so for awhile. With the $8,600 HOA assessment I had to pay recently, I decided to wait on getting a new water heater installed until I crossed the bridge of the HOA assessment. With the money that I put into a sinking fund for home repairs (including the HOA assessment), and the excess funds that have been accumulating in my checking account (when I underspend in budget categories), I am able to pay for the water heater this month.

March Budget Breakdown

Like I did with February, I’ve based the March budget on income of $9,000.

I use Dave Ramsey’s EveryDollar software to do my monthly budgeting. Instead of using the premium version (EveryDollar Plus), I use the free version. The free version doesn’t connect with your bank and credit accounts, so this forces me to manually capture every single amount spent each month. I really want to connect with my numbers, instead of being able to simply drag and drop imported expenditures.

According to the summary of spending that appears in EveryDollar, here’s how the percentages of planned spending breaks down for the month:

You’ll see that:

18% of the budget is going toward giving (tithe) and savings
16% is going toward housing
44% is going toward debt

The debt percentage isn’t completely accurate, since my 2 mortgages that appear in the housing category are debt.

In the health, wellness and grooming category, the largest expense is a projected dentist visit. I’m due for my semi-annual cleaning and I also will purchase more whitening solution. My teeth are a big deal to me, so, every 2 years or so, I buy more whitening solution for the whitening trays I bought about 5 years ago.

I just made the second half of the payment due for that beast of an HOA assessment. So, now I’ve got those funds I was saving each month (between $1,000 and $1,500) to apply to my budget. I view this as money that should now go to my debt snowball. If I was able to find that kind of money in the budget in order to pay for the HOA assessment, why can’t I find it in order to “pay myself” in my freedom journey?

This month, I increased the amount I’m saving toward my 2020 taxes. Last month, I allocated $500. For March, I’ve increased that to $700. Again, this is me being proactive in preparing to address the tax bill that I’m likely to have for my 2020 tax liability.

I’ve stated that I pay myself from my business via two different forms of income – W-2 employee income and owner distributions. With the W-2 employee income, taxes are automatically withheld through the payroll system I use (ADP). The distributions, however, don’t include withholding. So, I need to be prepared to pay whatever taxes I owe when it’s tax filing time.

I’m glad to have that HOA assessment out of the way and that I can now allocate more funds to my debt snowball.

How are things looking for you for March?

The Tsunami Situation – February 2020 Debt Report

March 3, 2020 by tanya

Each month, I record the balances on my debt obligations. The amounts shown in my debt report reflect balances as of the end of the previous month. First you’ll see the Table of Debt Slayed. This displays debts that have been paid off since I began my debt free journey.

Further below you’ll see my active debts in the Debt Report Table.

“How long should you try? Until.”
~ Jim Rohn

A few notes on the Table of Debts Slayed:

(1) The Debt Journey Balance column reflects the balance on the debt as of the date that I started to get serious about my debt-free journey – July, 2019.

(2) I’ve included in the Table of Debts Slayed, the balances I paid off for my 2018 Federal ($3,238) and State ($2,819) taxes, even though I paid them off the month after I learned about the obligation and the debts became due. I’m including them the list because they were significant amounts and were, technically, debts; I just paid them off quickly. I previously had not listed them in my Table of Debts slayed but am do so now.

(3) In November, I applied for and obtained a debt consolidation loan, which allowed for the payoff of all of my credit card debt. The credit cards listed, except for the Chase card, were paid off through the debt consolidation. Effectively, the debt was re-classified (which you’ll see in the table below) and not actually paid off.

See the Debt Report Table below for the figures as of the end of February, 2020. It shows the updated order of debts to be repaid.

The difference between my January and February personal debt balance is $2,166.

A few notes about the Debt Report Table:

The Debt Being Attacked

The debt that is highlighted in green is the debt that I’m currently attacking. Additional funds I have available for debt repayment go toward extra payments on this highlighted debt. The additional amounts appear as my “Debt Snowball” number in my budget every month.

Estimates

An amount that ends in a “0” or “50” may be an estimate. Often times, the IRS website does not show updated figures. It will say that “information is not available,” so I make a guess, based on the typical monthly reduction amount.

Three Payments That (Unfortunately) Go Up Every Month

(1) Internal Revenue Service (2017)

This payment goes up every month because the IRS system will not allow me to make payments on both the 2016 balance and the 2017 balance at the same time. I wanted to make small payments on the 2017 balance so that it wouldn’t go up every month. When I spoke with the IRS, they explained that they don’t allow for that. It requires that all payments be applied to the oldest balance due. That is why the 2016 balance goes down, while the 2017 balance goes up by about $64 per month.

(2 & 3) Navient Student Loans (Yes, Both!)

The balances for both Navient loans go up every month because I’m on an income-based repayment plan. The minimum payments under the program aren’t enough to reduce the monthly balance. Once I take down the two IRS debts, I’ll start making payments on the student loans big enough to, at least, cover the interest.

Business Debt

I’ve included the business credit card balance, even though I don’t pay that bill out of my personal income. Though the money that pays it comes from the business, I am the personal guarantor of it. So, technically, it’s my debt.

The difference between my January and February business debt balance is $621. I made a $1,500 payment toward the business credit card balance in February (which is why the AmEx card shows a a $8,800 balance), but the total balance across the loan and the card didn’t go down as much as I would have liked because of the fees associated with getting the balance transfer done and the new business loan. This I view as a short-term set back because of all of the money that I will be saving in the upcoming months by having the significantly lower interest rates.

Up until recently, I had a business credit card that had an APR of 22.74%. In January, I thought that I had succeeded in obtaining 2 low interest business credit cards so that I could transfer the balance from my high interest business card (see Money Move – A Balance Transfer). What I did, instead, was get 1 card that would allow for a 0% interest balance transfer and another card that was 0% interest, but not on balance transfers.

What I decided to do was get a separate business loan with a low interest rate (well, lower than the 22.74% of the other card). I wrote about that here. Now, I’ve got one credit card and one business loan.

Bigger Numbers Next Month

Yesterday, I paid the second installment of the $8,680 HOA Assessment I needed to pay for repair work that our building requires. I have been saving between $1,000 and $1,500 per month toward the payment of this assessment. With that being paid in full now, I can direct those funds to my debt snowball. That will make for a much larger snowball than I’ve had over the last several months. Next month’s debt reduction amount should be much higher. So excited about that!

How did your debt payoff go for the month of February?