War on Debt: Stop the Bleeding

In January, I declared war on our credit cards.  With over $11,000 dollars in credit card debt, I mapped out a basic plan to accomplish the goal of being free of credit cards by 2012.  And in the spirit of complete honesty, I’m going to share the nitty gritty details with all of you.  (*Names of creditors have been changed to protect the not-so innocent.)

I’ve previously mentioned that I’m feeling a little out of control with our new financial situation

So in March I decided to do something about it.

I scrapped my current system and went old-school with a manual excel spreadsheet.  Admittedly, this was not my preference, but since Microsoft Money is no longer supported by my online banking, it seemed near impossible to find the time to manually enter every transaction.  

This is March’s bottom line. 

                                      Budget $       Actual $

Remaining Funds       $235.22       $(258.32)

Let me explain further…  I entered our expected income and subtracted all of our expenses and got the remaining funds.   As you can see above, all looks great under the budgeted dollars.  However, under actual money spent?  Eek!  We didn’t just go over budget, we spent $258.32 more than we made.  In other words, we were over budget by $493.54.

I’m aware that my manual system leaves many opportunities for errors, but I did try to adjust things to compensate.  For example, the February Dingo payment didn’t actually clear until March 1st, while the March Badger payment was made on the 27th.  Obviously, having two large credit card payments would throw things off, so I pretended that February’s payment was on February’s budget.

The benefit of this system is that we were able to clearly see where we were bleeding money.  We were over budget by $10 in gifts.  Okay, no biggie.  Over by $50 in gas.  Well, gas prices did jump recently.  Over by $149.74 in restaurants!  I know we went out a bit more than usual but jeebus.  That’s a lot.  And what did we buy at QT that equalled $136.97??

So this month we are cracking down.  We’ve agreed upon a cash system for personal expenses.  We’re committed to going out for dinner only once this month.  And no more debiting at QT!!

And the War on Debt?  It’s going famously.  I’ve actually added the monthly credit card payments to our fixed expenses and there’s no negotiating the $1025.48 being applied to our debt repayment every month.  It’s hard to see the numbers dropping so slowly, but I’m looking forward to being down to only two cards in a mere three months.

How do you track your finances?

Next post in the War on Debt: Winning!

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7 Responses to War on Debt: Stop the Bleeding

  1. Ryan and Kim says:

    We "fake" the cash system. We have all our budgeted areas that are not bills listed on a spreadsheet with how much we plan to spend in that area that month. Then we subtract as we spend. When a category is empty, we're done.

  2. Work, Wife, Mom... Life! says:

    we just use an excel sheet. when i get paid, money goes in certain columns for each expense (mortgage, utilities, etc). when a payment goes out, we subtract it.

    easy peasy!!

  3. 1HecticMommy says:

    We don't do much budgeting, but if we had to I am sure we would. We usually do pretty well without one. This is a great post though.

    Just wanted to let you know I am awarding you a blog award tomorrow, be sure to check it out!


  4. Tamika says:

    I’m exploring your blog and I love that you’re putting your debt out there to see! I’m not sure my husband would be able to handle that…he’s such a private person! But it would make us even more ‘accountable’!! Good luck in your journey!

    • Jen says:

      Thanks for hanging out! I have to say that my husband isn’t thrilled with all the information that I put out there, but I feel like I do a pretty good job at keeping things fairly anonymous. And it keeps me accountable, so I’m sure he won’t mind once we get it all paid off!

      My computer is being all weird, so I can’t see your comment link to respond to your posts… It probably has something to do with security, firewalls, or something ITish. Who knows. But I wanted to comment on your budget binder. We just started using an envelope system this month and it really has helped. I’ve tried so many methods of tracking our spending, but honestly, this is by far the easiest and is so far working really well at controlling our spending. Even if it drives my OCD a little crazy not tracking every purchase! So good luck and thanks for adding me to your blogroll!

      • Tamika says:

        It is amazing how using cash and writing everything down helps so much!!! I am very OCD also and I do write down each purchase. I stick the receipt into the pocket and then I can even track what we’re spending on household goods, produce, meat etc off the grocery receipts.
        I think it would be the balances, not so much the actual fact we have debt that would be the issue with my husband, so wtg for your hubby for dealing with it! :)

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