I suppose I should set up some rules, guidelines and goals for this debt-pay-down project. Let’s start with goals, shall we?
I need to pay down $22,779.92 in credit card debt. I would love to do this in two years or less, but I will settle on a two year goal, beginning on January 1st, 2009 (to keep it simple). On a positive note, we’ve apparently been in a recession for a year that will likely last well through 2011. So, I won’t be alone in my lack of spending.
I would like to be very careful about NOT accumulating any additional debt. If this means I can only make a minimum payment one month, so be it. NO ADDITIONAL DEBT.
I have found in the past that depriving myself entirely will not work, much like it never works when someone tries to diet and never allows themselves a donut. After tracking my expenses, I would like to land on a reasonable amount to put away for monthly discretionary spending.
Pay Off Debt In Two Years (By January 2011)
Accumulate No New Debt
Allow Controlled Discretionary Spending
I’m not very good with rules. I tend to be over-ambitious in what I might be able to accomplish, setting myself up for certain failure. I would like to take a more reasonable approach to rules this time around.
Rule No. 1
Track All Spending
I have no desire to do this, but I hear it’s incredibly helpful. So, I am committing to a full three months, beginning December 5th.
Rule No. 2
Cancel All Credit Cards
I have always avoided this in order to maintain my good debt/credit ratio, but no longer. I must cancel all cards by the end of January, 2009.
Rule No. 3
50% Of All Additional Income Goes To Debt
It could be more, but I feel comfortable settling on 50% for the time-being.
Rule No. 4
Contribute To 401K
This seems like a no-brainer, even with the economy in the crapper.
Rule No. 5
No I Give Ups, Fuck Its, I Deserve Its. I always managed to find an excuse, any excuse, to spend money. I can’t do this any longer.
Allow myself some flexibility.
I know I just went on and on about rules and goals and whatnot. But, I must remain flexible – life throws you curve-balls, and all that – and I will have some failures and set-backs. I have to allow for them or I will never succeed in my ultimate goal.