The Official 2021 Debt Smackdown
Welcome to YNAB's 2021 Debt Smackdown!
Happy New Year! 2021 is going to be a good one, I can just tell - or we can will it to happen 😉
With over 500 participants and more than $4.2 million in debt payoff, 2020 was absolutely incredible for the debt smackdown group! I know some of us are still left with debt to knock out in the new year or you're joining in for the very first time. Either way, you've come to the right place. We'll use this group for accountability and support as we crush some (or all!) of our debt in 2021!
First, a quick shoutout to BritishMuseum - they have hosted our debt smackdown for the last few years and became DEBT FREE at the beginning of 2020! What an impact their work has made on this community!
If you want to pay off some debt this year, here's how it works:
1. List the amount of total debt that you owe.
This step is to give you an awareness of your current debt situation. Feel free to share, this forum is a safe and nonjudgmental place. You can also decide to keep this information private, you don't have to post your total here if you are not comfortable doing so.
2. Post in this thread the total amount of debt you would like to pay off during the 2021 calendar year. (This part is required.)
Feel free to break down the amounts by credit card/type of debt. Also, if you have a specific plan or some ideas on how you plan to pay down the debt, you can post that too. Maybe your plan will spark some ideas for others on how to tackle their own debts!
3. Post monthly on the 2021 Debt Smackdown Sheet to track your progress. (required)
Claim a line on the spreadsheet, and post your total debt to be paid off, and the monthly amount that you send off towards it. Some people track their total payments and don't account for interest, some people account for principal only. The method you choose is up to you!
4. Check in monthly in this thread and report on how your debt smackdown is going. (required)
We'll be testing out some reminders this year when the month rolls over because we want to hear everyone's progress! Bookmark this thread and sheet so you can find it quickly at the beginning of the month!
If you come across this challenge later in the year, no worries, you can always jump right in. Just put zeroes in the months where you had not joined the challenge yet, and start in the month you join in.
Pro-tip: You can use ctrl+F (or command+F on a Mac) to search the spreadsheet for your name when the sheet gets filled up.
Last year, we paid off over $4million! Let's make 2021 even stronger!
In the event you have any issues with the sheet - please tag or DM Veronica
April check-in: $1,961.95 paid toward debt (includes P&I)
Re: debt paydown, my main focus is to reduce my cc debt as much as possible this year, balancing that priority with funding my True Expenses. My two cc's with larger balances are at 0% for the next 16 months. The third cc with the smaller balance should be running out of the 0% promo it had within the next month or two. Thankfully the interest rate on that one isn't too terrible. Last I checked the rate was around 8%.
Part of me feels frustrated and like it's TAKING FOREVER to pay off my credit card debt. Then I look back over the past few years, and in March 2018 when I started getting serious about stopping accruing cc debt and paying it off my high balance was $26k+. Woof. And I need to remind myself that while I'm still working on paying it off, I'm thankful that in addition to reducing the cc balance by $10k I also paid off my car loan early, bought my first place, and made good progress on saving for true expenses and created a income replacement fund (in case of job loss) that has about 1.5 months of pay in it.
On a lighter note, I do like when the debt moves into the next thousand down. Looking forward to seeing a total cc balance outstanding of $14k after making May's payments.
~April Check In~
2021 Debt Smackdown Goal: $16,487.60
Jan: $ 456.25
Feb: $ 0.00
Mar: $ 0.00
Apr: $ 647.60
$1,103.85/$16,487.60 = 6.7%
Back on the board! Feels good to get some momentum going again.
I overspent a fair bit in my "just for fun" categories this month, so this still isn't as high as it should be, but I'm going to try and avoid using credit cards altogether this month to try and keep that overspending in check. I have been able to pay off my credit cards in full each month so far, but it's a big drag to have to cover spending retroactively when I get paid (and not in the spirit of YNAB).
On another note, I am also further ahead in funding May than I ever have been starting the month! It feels amazing. I have also been able to continue funding my true expenses, including saving for a LOT of education-related purchases in the next few months. And lastly, because my debt is very low interest, I've been investing a little in my TFSA every paycheque, which I hope will build healthy habits going forward.
🐣☂️ April Check-In ☂️🐣
After doing our taxes, we ended up with a refund, so the chunk of change I'd set aside to pay my self-employment taxes on my side hustle went straight to debt this month. I'm now 59.4% of the way to my goal for 2021 and we are only 1/3 of the way through the year!
Debt pay down progress in 2021:
- April: $5207.18
- March: $3038.60
- February: $3094.69
- January: $3923.86
- Credit card debt remaining: $10,392.62
- Student loans: $20,121.18 (in covid forbearance)
Total progress in 2021: $15,264.33 paid off
Total debt paid off since starting YNAB (11/2019): $39,325.46!!
May Update: Paid $750 towards debt.
So this month we ended up trading in our small car and our near-death truck and buying one new truck (I work from home and other family live with us and it was frankly silly having so many cars). So that changed the equation on our debts, and for the moment I've removed the car loan from the debt goal list and will be focusing on paying off my old student loans instead. Once those are paid off (which will feel like a Christmas miracle all on its own), then we'll reassess the car loan and probably finish paying that off then. It was a good decision for us (and a good trade deal - it completely paid off the remaining debt on the car and allowed us to only need to make a very small down payment) and of course wouldn't really have been possible without the budget...buying a new truck is not something we would have considered in our wildest dreams even a few years ago. So despite adding to the overall debt load somewhat, I feel good about it!
I'm so excited to report we're 43% of the way toward our original goal (on track for April would be 33% of goal). More on my personal thread here: https://support.youneedabudget.com/t/p8htam6?r=x2hflhz
April check-in - paid $1082.01 towards my personal loan. 40% of the way to my goal! Even though I planned to have it paid off by end of year, I'm hoping to have it gone by the end of September - right before student loan payments kick-in again. Then I'll be able to utilize my debt snowball to tackle those even faster than planned.
Happy May Ynab's. This month is both my daughter's birthdays so it tends to be a high spend month but I will not use credit cards this year and have enough budgeted to get them the gifts they want.
I was able to pay $800 towards the debt. The Fed refund is still pending but when that comes I will have a good amount to pay towards the debt. Like last year, my goal is to keep ahead of the debt and not create more. Business is picking up so that will be a blessing for 2022. :-)
March & April Update
It's been a topsy turvy few months and I realized I had forgotten to update in March. So I'll cover both here.
March Debt Payment - $118 (Just the minimums)
April Debt Payment - $2038
Total Debt Payed in 2021 - $3396
Remaining Debt - $6375
Work has been quite busy and I got a raise in April that kicks in at the end of this month.
Unfortunately, my living situation has taken a turn and I'll be moving at the end of the month. Thankfully, I have a friend who needs a sub-letter through September but it's hard going into living situation knowing it's only temporary. I am weighing my options as to if I should buy or continue to rent once my sublet is over.
For that reason and because my two CC i'm paying down are at 0% interest, I am going to stick to paying the minimums until I know what my plan is. If I do end up buying, I'm still going to try to pay the cards off by the end of the year, I just want to keep as much liquid capital on hand for the lender to see. If I decide to rent for another year. I will use what I've saved up to pay the whole thing off in one go.
We'll see how this goes. Trying to be prepared for anything to happen at this point. 🤷♀️
May- $750 to federal student loan for total of almost 58% toward goal! May has been real "spendy" for me, and I've WAM more times than I can count, but no new debt and I've still been able to send some funds to true expenses, but not as much as I'd like. In June, I'm going to focus on cushioning that up a bit more. Happy summer....hope all are well ;)
Catching up again… March was a big month, then things slowed down in April and May. I’ve started a new job, and school has been kicking my butt. I will be taking two whole weeks off to visit with some family, and then back to school and work again. My progress on debt paydown has slowed significantly, and I think it will continue to stay slow through the rest of the year. I am prioritizing saving money to pay cash for school (no more loans 😫) so that I’ve been socking away most of my “extra” money for that. I paid my summer and fall tuitions in full (yay!)… So there’s progress there at least, even if debt paydown feels like a standstill.
2021 Starting Debt: $67,989.14
March Debt Paid: $2,034.97
April Debt Paid: $643.27
May Debt Paid: $401.79
Current Debt: $61,015.79
Debt Smackdown: $6,973.35 / $17,000 (41.02%)
Belated April progress report on my battle against the student loan beast:
As of March 31, 2021: $182,753.71
As of April 30, 2021: $181,438.59
Notes: Regular monthly payment resulted in principal reduction of $1,315.12. Wasn't able to make any extra payments. Total reduction of principal in April: $1,315.12.
Year-end goal is to get the balance down $41,000.00 (from $190,958.60 starting place on January 1, 2021) to just below $150,000.00. With a $9,520.01 reduction so far this year, I'm now about 23.22% there.
Have had an eventful May, so am doing an early update!
As of April 30, 2021: $181,438.59
As of May 15, 2021: $174,877.15
Notes: Regular monthly payment resulted in principal reduction of $1,319.44. Was able to make extra payments of $5,242.00! Total reduction of principal in May: $6,561.44.
Year-end goal is to get the balance down $41,000.00 (from $190,958.60 starting place on January 1, 2021) to just below $150,000.00. With a $16,081.45 reduction so far this year, I'm now about 39.22% there.
Finally updating again after not really posting for the past few months.
Since I'm only paying for my auto loan and my student loans are still on pause, I've only really been concentrating on consistently paying $500 each month on my auto loan instead of the minimum $318. It's been so constant that I've been paying this off that I almost didn't really feel like updating for the past three months.
On the bright side, I haven't added any new debt and I've been doing a much better job saving these days.
Personal Loan #1 down to $14578.50. $458 paid to the principal this month. My lowest so far this year. Being more cautious with money to the loan as I figure out new expenses.
I've officially moved but have not started to get the new utilities bills to see how much that's going to alter my budget yet. Trying to maintain the cautiousness mentality until a few months in and feeling more secure. Likely only minimum payments for a bit which means I probably won't reach my goal of having personal loan #1 paid off by the end of the year, but still, time to get as close to it as I can while planning for a baby.
I did get a pay bump for my location move but as rent is higher here, it didn't really increase enough to cover that change either so like I said, still figuring out new expenses, trying to be careful with spending as we get used to this.
I had to buy a washer and dryer plus a refrigerator with the move as well. Will need to pay that off in 6 months before I start dealing with interest so have that extra on my plate as well.
May check-in: $915.14 paid towards my personal loan this month which makes it officially more than halfway to my goal for the year! I still have roughly $3200 left to go. I did find out my rent is increasing in July so I'm having to adjust my budget to cover that. I'm hoping I'll still be able to aggressively pay off my loan, but it may not be as fast as I originally hoped.
Almost forgot to update for May!
Loan Balance: $4219.70
May Loan Payment: $322.61
Current Loan Balance: $3917.52
Goal: $1593.86/$3600 -> $2006.14
(If you're paying attention you'll notice that somehow my math was wrong before, so the total left has jumped, but I'm still well on track, so I'm not worried about it, just annoyed at my fat fingers!)
Still chipping away with that wee bit extra. I'm thinking I might just start adding another $25 since the interest is so low at this point it's barely noticeable in my budget. Then there's that part of me that's like hmm, maybe $25 AND the interest... Ehh, it doesn't really matter in the long run I expect. I'm pleased with my progress, and with the fact that I've even got the extra to contemplate! THAT is a good feeling!
April balance: $14673.53
May balance: $14641.08
$1308.98/$2500 = 52.36%
Progress has been slowing down a bit these last few months. Garden season. I really need to be better at planning for that true expense throughout the year so it doesn't hit me "out of nowhere" like it usually does. But still managed a tiny bit of pay down despite it all. And I'm happy enough with the percentage of my pay down vs where we're at in the year. Hoping I'll be able to keep things at the very least at this level, but odds are better I'll be able to start making more progress as we move into summer/fall. I got this. 😎
May check in - a little slower than the other months but I am really trying to concentrate on the true expenses and saving for our November vacation. We also had to buy summer clothes for all the kids and we seemed to eat out a little "too" much this month. Thinking to do the 34 day challenge next month ...
Paid off $308.50 to my credit cards in May. A couple more months and my one credit card will be paid off!!!
May 2021, Line #37
Week 1: Tithe, then June’s 3rd Weekly Chunk. Now June is 75% funded. The rest goes to debt snowball (car).
Week 2: Tithe, then June’s last Weekly Chunk. Now June is 100% funded. $1000 to the debt snowball category, & the rest goes to July underfunded. Since we’re taking some time off in May & June, we’re getting ahead.
Week 3: Tithe. Top off July so it’s 50% funded, & the rest goes to Debt Snowball (car)
Week 4: Tithe. The rest goes to the debt snowball category (car) [smallish checks due to camping last week; used 16 hrs of PTO each].
Hubby’s mom has stayed out of the hospital all month! Treatment is going well.
Total paid in May: Minimums plus $3875.18.
Miles driven for work: 18,543 miles