Remember the letter from the ex-boss man? A couple of weeks ago we were instructed to go ahead and sign it and send it in. So two weekends ago, Steve signed it, had it notarized and sent it in. A few business days later, and he had a couple of checks totalling around $500.

This is good for three reasons:
1.) It’s money! Duh.
2.) We are so much in debt, so we need it.
3.) Last week, there were two days Steve did not work.

Not working is not exactly conductive to getting out of debt, is it? It was so strange. The Friday before, they notified him that he was going to be moving to another work location the following Monday. That’s fine and in fact, it’s a half an hour closer to the house than the location he’d been working at. Sunday rolls around and one of the big dudes calls him and says, “uh, well, it’s supposed to rain, so there’s nothing to do, so don’t bother to come to work.” Ooooookay. That did, however, enable him to get some work done on the room we’re remodeling that’s currently in stale mate mode. However, the next day it was the same: no work.

Now, this isn’t right. Because he’s in the apprentice program, he is supposed to be guaranteed work for four years. We’re down to three and a half years now. So he’s supposed to be working all the time. That Tuesday morning he went out to meet the guys he was working with to show them some pictures he’d promised (my grandfathers’ motorcycles, to one cycle enthusiast for example) and they found out he wasn’t working. The foreman told him that if he wasn’t called and sent to work on Wednesday to come back there. So for a week now, that’s what he’s been doing.

So the point of this was all to say, come tomorrow morning, his automatic deposit will be two days short of normal. We’re “lucky” that work share is over so he gets paid for Thursdays at school, otherwise we’d only have a two day check.

Anyway, back to getting out of debt.

It’s no surprise for me to say that we live paycheck-to-paycheck and it’s always been that way and probably always be that way, I’m cool with it. However, when there’s debt involved, it makes things hard… and debt is SO easy to get into these days.

Now that Steve gets paid more than he did this time last year, we are trying hard to get out of debt. It’s not going to be easy and it’s not going to be quick, but if we ever want to get a bigger place, we’ve got to do it. Our plan is to continue to live like we did with the smaller paychecks and make bigger payments on the credit card and such. Here’s some of the other things we’re trying…

Credit Cards
– We are making it a point to make a weekly payment. This means that in addition to our minimum payment, we’re making $50 weekly payments or more, depending on how the week goes or what other bills are due. Then, of course, if worse comes to worse, when the minimum payment is due, if we absolutely can’t make the full payment, we’ve at least made a dent in it with the weekly payments. With online bill pay, this is so easy.
– Our interest rate is too high. We will not, however, transfer to another card unless I find a really good “deal.” Part of this is because I just plain don’t want to get another credit card, I don’t think we could get a credit card that would give us enough balance right off the bat to transfer over everything (and then we’d have two payments), and from what I understand, transferring balances like that can hurt your credit rating. SO, the plan is to try and get our card company to reduce the interest rate, by threatening to transfer. The problem with that is that the call needs to be made by Steve during regular business hours. So we are still working that one out.

Mortgage
– Did you know that by paying only the minimum payment on your mortgage can, in the long run, cause you to pay more than four times what your original loan was for, depending on your interest rate? I figured this out very quickly with our first mortgage. At the time, we borrowed $30,000 and if we paid the minimum payment (I think it was $289 at that time) until the loan was paid off (30 years), we would have paid something like $130,000. Why? Because in the earlier stages of your loan, you’re not paying back the amount you borrowed, you’re paying on the interest on that amount.
So about three years later (I was pregnant), we refinanced. We borrowed the same amount (see what I mean?) but we reduced not only our interest rate but the time of the loan down to 15 years. Our payment did go up, of course, but with the lower interest rate, it’s not that bad.
– Finally, we try to pay extra on our mortgage every month. Even if it’s just $10. Because, apparently, $10 a month ($120 over a year) extra paid to principle, not the interest, really adds up and can take years off your loan. On our mortgage coupons there is a spot that says “additional principle” where we write the extra amount (typically $12 for us) and then we fill out the total.

So, yes, we are working on getting out of debt. Though all of that sounds like such small stuff, it really adds up over time. And, of course, by remodeling our house we’re working towards making the house worth more than we bought it for, for when we can resell it.

It’s not that I don’t feel that debt is a part of life and I’ll be in debt until the day I die… it’s that I feel we have too much debt.

What about you? Spill your secrets!