Strategies to Pay Off Debt Faster: Accountability and Support

One of the major things that got my butt kicked into making some serious payments on my student loans was meeting my boyfriend.  When we were discussing me possibly taking a new career path last winter, he asked me what was holding me back and I replied that one of the major concerns was my student loans.  He asked me how much I had in student loan debt and I was embarrassed to tell him that I didn't know.

This was in December 2013.  That conversation felt like the kick in the butt I needed to get motivated to find out exactly how much I owed.  I knew it was above $150k but less than $200k, but I knew little else about my student loans.

After I had my "getting to know you" session with my student loans, listing them out on a spreadsheet, complete with interest rates and monthly payment amounts, I realized I had some major work ahead of me.  As my boyfriend and I were talking about a possible future together, I didn't like the feeling of the student loans hovering in the background or coming up in our conversations.  I realized that I needed to do something about it because they weren't going to magically disappear on their own (as much as I fantasized about it...  :).

In addition to crunching the numbers and coming up with ways to pay off more debt, I realized that I needed two other things: accountability and support.  While my boyfriend provides the accountability and support I need to get moving on this goal, I thought starting this blog would add to that, and I would learn some cool things and "get to know" other PF bloggers in the process.  

Accountability to my blog readers has already helped prevent me from making some silly decisions, and support from readers and my boyfriend have been so helpful in moments when I just want to give up altogether and book a one way flight to Mexico.  ;)  

So while I recommend getting started with the logical steps of listing out your debts and coming up with payment plans, I also recommend that you have accountability and support from someone you trust (perhaps also the PF blogging community!) to help you on the emotional side.

As we all know, debt repayment on a huge debt can feel like an emotional roller coaster at times, so having that support really helps.  

What about you?  What strategies do you use to pay off debt faster?

Rethinking Your Money Beliefs

I watched a Marie Forleo video a while back doing an interview with Kate Northrup on changing your money beliefs which I thought was interesting.  Kate talks about the 4 money beliefs that may be holding you back from reaching your financial goals.  Some of these may have been ingrained from your family upbringing.  None of these are excuses for bad finances, but rather provide a means from which to examine our relationships to money and our issues relating to money that we may have internalized from a very young age.

Being mindful about our financial and personal habits can help us reach those seemingly impossible financial goals.  For me, that's paying off my large student loan debt.

Here are the 4 money beliefs Kate talks about:

1. "Someone else should or will do this for me."  People with this money belief do not take responsibility for their actions, if they have the power to do so, and are willing to give up their financial power to someone else.  This includes hoping that Mr. Right or a parent or someone else will save us from our financial troubles.  If you have this money belief, you should remind yourself of your agency - you have what it takes to take control of your finances.
2. "I'm not good with money."  This money belief is one way that some people set themselves up for failure.  By thinking that they're not good with money or numbers, they simply avoid dealing with them, and it becomes a self-fulfilling prophecy.  To counteract this, try checking in daily with your finances through websites like Mint or Personal Capital, and manually inputting transactions in your budgeting software (I recommend YNAB) so you can be aware of what's going on.
3. "People with money are greedy or it's not spiritual to have money."  Judging others for having money or having their finances in control will block you from becoming wealthy or getting things under control.  To counteract this, try to see money as a reflection of the value that you are adding to someone else's life.  
4. "I'm not ________ enough."  Whatever limiting belief you have about yourself or invisible assumptions you make about your abilities will hinder you from achieving your goals.  These beliefs reflect low self confidence, which in turn is perceived by others who will not have as much confidence in you.  Remember, no one will value you more than you value yourself.

What Kate gets at, and what is really consistent with my own personal philosophy, is that having control over our finances allows us the freedom to be fully present to more creative, service oriented purposes.  Whether that be volunteering more of your time, sitting down to write that novel, or giving more time to family and friends, that freedom benefits you and the world around you.

Check out the video here and let me know what you think!

Confession: I Almost Went on a $2500 Shopping Spree

I have to share something with you that I wasn't sure if I wanted to share, because I was embarrassed to admit it, but I thought some of my readers might relate.  I was recently tempted to go shopping to celebrate my progress on debt repayment (I know, classic no-no!).  I started adding ridiculously expensive items to an online shopping cart and before I knew it, the total came out to almost $2500.  One of the biggest factors that stopped me from going on that major splurge shopping spree was thinking of my you, my lovely readers, and that I didn't want to disappoint you (or myself) by doing something so silly!  It also occurred to me that with that purchase my net worth would not increase as much, and my debt payment wouldn't be as high, as I was planning for the following month.  I must say, since starting this blog I've become much more disciplined and conscious of my spending.  Just one of the side benefits of the blogging process.  

So I wanted to thank you for your help and support.  No matter how hard this process is, thinking of my readers is one of the things that helps keep me going on the right path.  

May (Negative) Net Worth Update: -$125,611.13 [Up $7k]

Hello my lovely readers!

For the purposes of consistency, I am starting to think I should start doing my net worth updates on the 1st of each month, as there tend to be monthly variances with when I get my income and when major expenses go out, so starting in June I'll try to post net worth updates on the 1st of the month.

For now, here's my mid-May net worth update.  We're up $7,891.22 since my last update in April.  Not bad!  Here's hoping June will look even better! 

Assets	May	April		Difference
Cash	$11,667.40	$18,677.30		-$7,009.90
Investments	$26,577.43	$25,114.68		$1,462.75
Total Assets	$38,244.83	$43,791.98		-$5,547.15
Liabilities
Student Loans	$162,744.62	$174,219.82		-$11,475.20
Credit Cards	$1,111.34	$3,074.51		-$1,963.17
Total Liabilities	$163,855.96	$177,294.33		-$13,438.37
Total Net Worth	-$125,611.13	-$133,502.35		$7,891.22

Get Rewards for Saving Money and Paying Off Debt with Save Up!

I recently learned about Save Up and wanted to share it with you.

Basically, you enter your account information, as you would on Mint.com, and you earn credits for each dollar you save or use to pay off debt.  With those credits, you can play to win prizes, such as cash, money for paying off student loans, money to pay off credit cards, money for a vacation, etc.  They even have a $2 million jackpot right now and the lucky winner of that contest will be chosen on June 1st.  Here's a write up about the site in the NY Times.

I just signed up for it this past weekend.  It's free to use.  I figured I don't have much to lose.  I received over 1000 credits just by inputting my account information and playing around on the site (your numbers may be different, as I'm still trying to figure out how all those credits accrued!).

Save Up seems like a great way to reward people for being financially responsible by saving money and paying off debt, which I thought would be of interest to my lovely readers.  Check it out and let me know what you think!

{*Disclaimer: If you sign up through the links in this post, I may receive credits/ plays on the site.}

Win 2 Roundtrip Tickets to Hawaii

Ramit Sethi, from www.iwillteachyoutoberich.com, is offering a pair of roundtrip tickets to Hawaii from anywhere in the U.S., plus $500 for your hotel.

More information is available here.
 
Good luck my lovely readers!  Let me know if you win!