Long time no post, eh? June was a bit of a rough month for me: nothing terrible, but my job suddenly got more demanding/stressful than it had been previously, and I also managed to catch some sort of virus that hung around in my system for three weeks (or possibly two separate viruses back-to-back?), so I spent much of the month exhausted, coughing, and buried in work.
However, I did hit a goal.
Debt payoff numbers update: I wrote a couple of months ago that I wanted to get my student loan balance under $50,000 by the end of June. It was kind of a stretch goal, and I wasn’t sure if it was actually realistic or not. But…I did it! Well, okay, I did it six days late. But I’m still counting it!
A quick recap: my regular self-imposed monthly goal is to put a minimum of $1000 towards my loans. When I set this goal at the beginning of May, however, my loan balance was around $52,900 and I had two months before the deadline. This meant I needed to come up with $2900 in two months, plus all the interest that would accrue during that time. In May I put $1100 towards my loans. And in June I put…..$1954 towards my loans. A personal best, and quite a lot of money for me and my non-profit salary. (The main reason I was able to pay so much was that I sold a bunch of unused vacation days back to my employer at the end of our fiscal year. Freelance income also helped.)
Even with those payments made, I was still about $350 from my goal at the end of June. However, I got a direct deposit for some more freelance work this morning and immediately made a loan payment, which means that as of today, my total balance is….$49,996. Bam! That’s totally under $50,000!
Debt payoff emotions update: Getting under $50,000 is encouraging. However, I also finally got up the courage to calculate how much interest is accruing on my loans each day, and the answer is: around $9. Yikes. Luckily I’m cutting into the principal balance each month, so the daily interest accrual should decrease (slowly but) steadily. I decided I’m not going to refinance because there are too many risks involved; I’d rather keep my current interest rate of 6.8%.
Extra income update: In June I made $575 from freelancing and $13 from card-playing (ha!), for a total of $588. I’m actually taking July and August off from freelancing, mostly because I have a teaching job lined up for the Fall semester, and I need to spend my time prepping for that.
Emergency fund update: Still at $1000. I want to increase this though.
Retirement fund update: Once again I hit my retirement goal for the month of $500, split between my Roth IRA and my 403(b).
Travel fund update: This is a new update as of this month. My travel fund is not as big of a priority as debt payoff or my emergency or retirement funds, and I don’t have any big trips planned, but I still like the idea of having a little money set aside for travel. My travel fund consists of my Capital One Venture card rewards balance (currently at $269) and my Digit account (currently at $102), for a total of $371. Cool, good start.
By the way, I was scared of Digit for a while because I tend to keep my checking account balance very low, but I finally tried it and I’ve been really happy with it. Basically it’s a free service that connects to your checking account and sneakily transfers little amounts of money into a savings account on an ongoing basis. If you want to try Digit and want me to get $5 for referring you, use this link. (If you want to try Digit but don’t want me to get $5, just type www.digit.co into your browser.)
Extraneous purchase of the month: Okay, here’s what I really want to talk about today. I’ve had this category in my monthly update for a few months and until recently I didn’t think much of it. But it occurred to me a few days ago that “extraneous purchase of the month” implies that I only make one extraneous purchase per month, and this is this is definitely not true. A better name for this category would be “selected extraneous purchase of the month” or “extraneous purchase of the month that I feel like talking about right now”. In actual fact, I make quite a few extraneous, i.e. unnecessary, purchases each month.
Here are some typical examples:
- I go out for meals/drinks with friends about 3-6 times per month (cost: approx. $35-$130 per month).
- I go to yoga and barre classes 1-2 times per week (cost: approx. $50-$100 per month).
- Occasionally I splurge on a laundry service to pick up my laundry, wash it, fold it, and bring it back to me (cost: $35-$45 each time).
- I get an hour-long massage (cost: $110) once every couple of months.
Okay, let’s talk about this.
It is absolutely true, mathematically speaking, that if I stopped going out to eat with friends, stopped going to fitness classes, never outsourced my laundry, and never got massages, I could pay off my loans somewhat earlier.
However, I choose—happily, and with no regrets—to continue making all of the above purchases. At this point in my life, they are simply worth more to me than being debt-free two or three or six months earlier.
I think what I’m trying to clarify here is that this is not really a blog about me trying to be as frugal as possible so I can get rid of my debt as quickly as possible. I definitely track my purchases and try to only spend money on things that are important to me, but “important” does not equal “necessary”–not by a long shot. If being extremely frugal by choice is something you’re into, that’s awesome, but that’s not where I’m personally at right now.
My philosophy of spending and saving and paying off debt has definitely morphed since I started this blog. There was the month when I abstained from all restaurant food to save money, the time when I beat myself up for past purchases, and the time when I pondered the cost of apples. If I had to write a description of this blog right now though, I’d say it’s about trying to find the balance between living my life, being healthy, being happy, and paying off my debt. This is not an easy balance to find, and I definitely haven’t found it yet. Which is why the blog is still ongoing. 🙂
If I’ve learned anything so far, it’s that learning how to balance these things is an extremely personal endeavor. For example, I choose to live with housemates, and for me that feels like a reasonable sacrifice to make in order to save some money, whereas Person X (who lives in the same city as I do and makes the exact same salary and has the same amount of debt) might be willing to pay more for a private apartment. On the other hand, while I’m comfortable dropping $25 on dinner a few times a month and throwing money at my laundry problem once in a while, Person X might consider these expenses absolutely unthinkable. Person Y (also living in the same city with the same salary and same amount of debt) might be willing to pay for all of the above, and Person Z might be willing to pay for none of it. And in my book, these are all valid choices.
I loved what Our Next Life wrote earlier this week in their Independence Day post (and I strongly recommend reading the post in its entirety because it’s very wise):
If we had to boil our life philosophy down to one statement, it would be this. Society places a lot of weird expectations on all of to take certain paths in life, to achieve certain things, or to enjoy certain activities. Those expectations are different for all of us, but following along on exactly the path that others have planned out for us rarely leads to profound, lasting happiness. Instead, we all need to figure out what makes us truly, deeply happy. And that doesn’t have to be anything big or exciting. Your true happiness could be devoting as much of your time as possible to reading the great books in the solitude of your own home. It could be seeing the world. It could be getting married, having 2.5 kids and working until you’re 65. It could even be owning all the things. There’s no right or wrong answer here — there’s just your answer.
I’m still figuring this out, personally. I suspect that paying off my loans will bring me some amount of happiness, or at least some relief and security. But happiness, I think, is a tricky thing. It might be partly about eventually being free from debt, or about eventually having a bunch of money saved up, but for me, right now, it’s also about health and rest and friends and sanity and really delicious food and an occasional respite from weekly trips to the laundromat.
Any comments are welcome, as always.