The Kick in the Butt You Need

I read this post at The Simple Dollar today and all I could do was nod my head at my computer screen and mutter something about been there, done that. In January of 2006, I started tracking my debts. See the pretty charts?



(The reason you see March 2008 on those charts is because I project what my closing balances will be based on how much I have paid to the debts throughout the month. I've paid a bunch already this month as you can see and it's only the 5th! I should be sending another large chunk early next week too!)

At the time I had credit card debt and student loans. In May of that year we opened our HELOC (to transfer our house building expenses - appliances, laminate and ceramic tile flooring materials, etc.) and in June of that year I paid off my student loans. It wasn't until June of last year - 18 months later - that I woke up and started actually doing something to get rid of our debt. I was so sick of seeing my total debt number creep up and up. And when I added Chuck's debts (credit card and student loans) into the mix, the numbers looked even worse of course.

So why did the tide turn last June? I'm not sure. I know one thing definitely helped - I created a budget for us for the very first time. I now knew exactly how much I could throw at debt and how much I needed to keep for our family expenses. And since I was now tracking our expenditures so closely, our discretionary spending went way down. And more than anything - I was now paying attention to our finances as a whole rather than just the credit card, HELOC and student loan balances. Or maybe I just woke up, grew up and started taking full responsibility for the debt mess I found myself in. Maybe America as a whole needs to do the same thing.

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