My Debt Payoff Plan
If you’re not caught up on my official debt payoff plan, here is the quick summation.
My goal is to have about $3,000 of debt paid off by the end of March. That is 1/3 of my “small” debt (not including my student loans). I planned to do this by cutting a few things in my budget, specifically entertainment, food and transportation. I also planned to snowflake my debt (use gift money and bonuses to pay towards debt).
I came up with a way to track the amount paid vs. the amount owed on all of my accounts in a spreadsheet on my computer. I’ve been tracking everything there since but how much progress have I seen?
The Debt Payoff Progress
Since tracking my debt payoff plan and progress in a spreadsheet I’ve made tremendous progress. After only one month I will have paid $1,800 of my debt. I was able to do this through snowflaking my debt mostly as well as putting a specific amount of my paycheck towards my debt payoff plan. Additionally, I have also been able to stick to my rather strict budget.
This means that I now have two months to pay off $1,200 more. That will be a cake walk (especially after paying so much during the month of January).
At first I was overwhelmed by the thought of paying off $1,000 per month the first three months of the year. However, it was a lot easier than I thought it would be! At the end of March my debt payoff journey won’t be absolutely complete though.
How to Stay Debt Free
Obviously once I pay down 1/3 of my small debts I will still have 2/3 of it left. I will be working to pay that debt down through the rest of the year. After my $9,000 in small debts is paid off I will begin to make higher payments on my student loans to pay that debt off quicker.
Once I’m completely debt free I will stay that way by paying all of my debts off in full each month. If there is an emergency debt I need to take on I will make it a priority to pay it off as soon as possible.
I cannot wait to see what this debt payoff plan does for my credit score, savings and my financial future.
Do you have a good debt payoff plan?
Photo: Images Money
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