Tuesday, June 21, 2011

Heading Toward Financial Freedom - Spending Diet Update

News on the Spending Diet - June 2011

I've discovered in the last week just how much freedom it gives you when you pay off your credit card debt.  As I posted earlier, I was finally able to pay off our largest credit card, freeing us from the nightmare of over $200 a month in interest.  Since savings doesn't pay anything these days, we decided our money would be better spent getting rid of that constant, nagging, huge credit card bill.  Now we are broke, but we are free.  Well almost.  There's still one small bill for furniture I bought before I lost my job, but that's interest free, so we decided not to pay that one off early.  We're using their money for 24 months for free.  The furniture may not last as long as the bill (I hope it does), but there's no sense in getting rid of the bill right now.  Aside from fewer bills and more money that can go into savings.

Paying off the big credit card and our two individual cards frees up money to go to savings.  Well, in theory.  Never a month goes by that we don't get hit by something that wasn't in the budget.  Some of these things are things I should be planning for, because they are yearly expenses.  Others come up and should be coming out of that emergency fund you are supposed to build.

One of these annual expenses is the trip to the eye doctor.  All of us need to go, but Ben is insisting his eyes are fine and he can wait.  Likewise, I am waiting for a few months to try to get other things paid for or some money in the bank.  If I start getting headaches from vision changes though, it will have to be done.  And mine are never cheap because I wear progressive lenses. 

All five of us have vision that requires correcting, unfortunately.  And it's not covered by our health insurance plan, for which we pay handsomely before Justin gets his take home pay twice a month.  I caved to Jamie's request for contact lenses this year after he worked his grades up to the acceptable level and took both him and Joey for their annual eye exams.  Long story short - Joey doesn't need new glasses.  Jamie needed new lenses for his glasses and we were getting the contacts.  I ended up spending $300 at the eye doctor that was not in this month's budget because I forgot to budget for it.  But here's the really cool thing.  Because I don't have to pay that massive credit card bill, I was able to pay cash for that visit.

Then, Ben called from work and said the passenger side window on his car would not go up.  Justin went over and swapped cars and brought it home to look at it.  Nope, it had to go to the dealership to get the passenger side door replaced.  I don't know what that will cost yet.  The woman told Justin $500 yesterday, but it turns out that she had ordered the wrong year part and said that because this is an older vehicle, it will be "considerably less" than originally quoted.  I don't know what "considerably less" means.  Again, because we don't have these massive credit card bills, I will be able to pay cash for this expense too.

My only problem, money-wise this month now, is that I was planning on socking a whole bunch of money back into savings.  Now, I have to pay for these things that came up.  But really.  Isn't it great not to have to charge an emergency?  What a fantastic feeling.

Of course, there are now huge, gaping, tempting, expansive credit lines open.  In the past, this would have been an insistent invitation for me to spend money.  Now, I can see the luxury in not using the credit cards just because I can.  I call that progress.  I'm wondering how long I can make my $20 Reebok tennis shoes last before I have to replace them instead of looking for those really cool new walking shoes that cost a fortune.  Who am I???



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