Wednesday, May 26, 2010

For the win

Victory is sweet.
I actually paid off my credit card in full on April 30 and made a small interest payment in mid-May ($2.40!), but this is the first time I've gotten this email alert with the most beautiful balance in the world: $.00.
I wrote here about my struggle with debt and my plan to get out of it for good. In January, I actually started being smart with my money and wrote a budget, plus a few major goals:

1. Pay off my credit card by my birthday.
2. Pay off my student loan by July 1.
3. Move out of my mom's house by the end of January 2011 with no debt and more than $10,000 in the bank.

It feels so good to cross off my first goal, especially since it means that I have gotten rid of something that has been a drag on my life for four years. After spending carelessly for so long and ignoring the mounting interest each month, I finally woke up and got mad enough to do something about my debt.

I didn't just write a budget. I crafted a plan of attack.

And although I've lived on less these past five months, I can't say that I miss my spendthrift ways. I used to waste tons of money on eating out, going to bars (yay, college!) and buying clothes (with my irresistible employee discount), and then wonder where all my money went. Now I take a small amount of cash from the ATM each payday for fun stuff, and I make it last until the next payday. In fact, oftentimes I have cash to spare when the next payday comes.

(I should note here that it helps to live 30 minutes away from all your friends and to wake up at 5 a.m. five days a week — you won't have much time or energy for expensive fun.)

I've also lost 10 pounds since January. I attribute this to the fact that I have been eating less, eating better, drinking (wayyy) less, getting more sleep and getting more exercise than I ever was during college.

Oh! And I started contributing 6% to my 401(k)! I've got 42 years of compound interest on my side, baby.

Compound interest is so sexy when it's working for you, not against you.

Aaaand I've been reading too many personal finance books. Good night.

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