The Official 2020 Debt Smackdown

Welcome to the Official* 2020 Debt Smackdown! 


Happy new year everyone! 

That's right, we're back for 2020. Last year we saw about 310 of us brutally destroy  about $3 million in debt. Wow. Right. Massive achievement. Can anyone say 'YNAB blog post'?

But there are plenty of us with still some debt to go. And as much as I hate debt, I do love a good spreadsheet, so here we go. A few of us have come into 2020 with some debt remaining. Maybe over spent at Christmas. Either way, this challenge is open to anyone who wants to eradicate that debt from your life. 

So what's this about? If you are holding onto some debt as you enter 2020 - and would like to get rid of it - this challenge is for you.

To the participants from last year, welcome back! For some of us, our total debts are too large to smack down completely in one calendar year, so if you're here from last year, congratulations on your progress and let's keep on doing this! In 2019, we collectively paid down over $2,800,000 in debt! An increase of OVER $1,300,000 than in 2018!

For all new participants, we are happy to have you join in this year! New blood is always welcome. Let's all motivate each other to pay off those debts and continue moving forward to financial freedom.
 

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 2020 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. Check in monthly in this thread and report on how your debt smackdown is going. (This part is required.)

4. Post monthly on the 2020 Google Sheet to track your progress. (This part is 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!

If you come across this challenge later in the year, no worries, you can still 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. 
 

Last year, we collectively paid off $2,800,000. Let's smash that number again in 2020!

Please let me know any issues with the sheet - sometimes things are a bit wonky when making new ones!

*Official in the sense that there's a spreadsheet. Not official in the sense that it's made by YNAB. I'm just following naming conventions here :)

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  • March check in - $2244 - with my tax return I paid this much into my line of credit, and topped up my $1000 emergency fund.  April so far is going well, as an RN I'm still getting paid my full salary while at the same time enjoying some Covid benefits from the Canadian government.  I'm using this money to further pay down my debt.  Car battery died yesterday so will have to budget for a new one this month. Momentum remains strong.....according to the debt thermometer I have paid of 47% of my debt!

    Like 9
    • GroceryAddict I can't say thank you enough for being on the front lines - you are truly appreciated! I'm glad to hear you've made so much progress and are still chipping away at your debt.

      Stay safe and healthy! :)

      Like 3
  • April Check-In:  Paid $600 to debt bringing total to almost$18,000 paid or 55%!! of goal.  Also added $1000 to emergency fund and $1200 to a buffer fund (used for unexpected but anticipated expenses).  

    1) $500 to 2 credit cards (0% interest)-on track to pay off both  in July

    2) $100 to Parent Plus Loan (now not accruing interest due to Cares Act).  I've only paid $675 of $11,000 planned for this loan, however I have paid all interest accrued and plan to ramp this up considerably in the last half of year.

    In addition to Debt Smackdown, other goals will be $6000 to emergency fund this year, some extra money set aside for daughter's senior year college, and a small (but meaningful!) buffer fund for Christmas Holiday.

     

    Stay safe everyone!  May check-in should see us all a little closer to #flattenthecurve (which is the most important thing right now)!  

    Like 6
  • April progress report on my battle against the student loan beast.

    As of March 6, 2020: $212,955.93

    As of April 9, 2020: $210,940.23

    Notes: Regular monthly payment resulted in principal reduction of $1,215.70. Made extra principal payment of $800.00. Total reduction of principal in April: $2,015.70.

    Year-end goal is to get the balance down $44,934.56 (from $224,934.56 starting place on January 1, 2020) to $180,000.00. With a $13,994.33 reduction so far this year, I'm now about 31.14% there. 

    Like 8
  • April check in #1 of 2...

    Paid $375 on the bank loan, plus $720.

    Paid $275 to the CC. Total paid this month so far is $1,370.

    Like 5
  • I have been absent mostly for the last couple of months, and that is likely to continue a while longer. I missed two updates, so here are the figures now:

     

    Feb:

    Personal Loan - Start $1000, payment $55, Balance $945 (WooHoo - I broke the 1K mark!)

    CC (actual debt portion) - Start $320.37, payments $119.03, Balance $201.34 (I included the cashback payment to reduce the debt too!)

    Joint Account - Start $962.51, change ^^ $484.14 :( , Balance $1446.65 (boo)

     

    March: 

    Personal Loan - start $945, payment $55, Balance $890 (woohoo, I broke the $900 mark)

    CC (actual debt portion) - start $201.34, payments $16.13, Balance $185.21 (again, used the cashback to reduce in addition to the $10 I committed to)

    Joint Account - start $1446.65, payments $236.22, Balance $1210.43

    Essentially, although I've reduced two of my debts, the one that went up means that at the end of this period I actually owe $2.76 more than I did at the start *sigh* 

    Like 3
    • WairereRose I just entered my numbers in the spreadsheet and realised that I didn't put the joint account debt in there! Woohoo - that means I'm moving ahead and am at 8.64% of my debt payoff (not even a quarter...)

      There will be some changes to my income soon, a slight increase, and I'm hoping that I can shuffle some of that money towards debt. 

      Like 4
    • WairereRose Ugh - I just realised that in the spreadsheet for Feb I put my planned payments, not my actual payments - so yay, I'm at 17.05% which is waaaaaay closer to a quarter!

      Like 2
    • WairereRose I'm happy you're still with us in the challenge - I read this as a tri-level of good news! Your "actual payments" reminded me a lot of the feeling I get when I "find" money in my categories. ;)

      Like 3
    • Faness I will definitely be here, till I can graduate debt free. I still have WINZ debt, student loans, the debt to the joint account, and two mortgages, so it will likely be a while, especially since my budget doesn’t usually extend to lottery tickets...

      Like 2
  • Late March update - We had to cancel our trip so we redirected some of that money to debt repayment knowing we have a year to save again.  So March total payment was $1742.31.

    April check in - $113.44 total payments (minimum payments only)

    We have decided to reduce payments to minimum payments only for now. Both debts are at 0% interest promotions until August and October so there is no interest cost to this decision. But because I don't know what is going to happen to husband's situation (it keeps changing as the government changes the rules and the support), we are piling up cash until then. But in YNAB we are budgeting the normal extra payments to a separate category called Extra debt payment and then if we don't have to touch it, we can throw it at the debt later. 

    Like 6
  • In April we paid $1252 to principal. We reached an arbitrary milestone this month, getting our total credit card debt under $40,000. Still a lot but just 3+ months into using YNAB we've paid more than $8k to debt and it actually now seems possible to pay it off. Yay! 

    Like 10
    • Turquoise Vacuum That's the best feeling in the world! Congrats!!

      Like
  • Late March update - Credit card is COMPLETELY paid off but I am still using it for my purchases. I've put $1000 towards my personal loan so now it's at $9926.08.  I've also managed to build up a small emergency fund of $1000 which gives me a moral boost to continue to tackle the remaining debt despite the whole pandemic we are facing. 

    Like 8
    • Pink Song wahoo! Way to go!

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  • April Check-in

    Truck and Car payments were made as planned (minimums, until camper is paid).   Camper was minimum + 800.  New camper balance:  $20.376.52.  True expenses are still being funded.

    Work update:  Due to Covid-19, we've shifted from hauling retail freight to hauling essential freight for 3rd party shippers.  Our social isolation takes place at home as well as in the truck.  Our manager and dispatcher are both aware of our mileage goal for each week, and cooperation has happened all month.

    MILESTONE CELEBRATION:  The total of our balances has dropped from the $90,000-99,999 range to the $80,000-89,999 range.  Woo HOO!!!

    Prayers that the virus will be stopped soon & forever.

    Like 6
      • MXMOM
      • MXMOM
      • 7 mths ago
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      Coral Mare on a completely separate topic, I am interested in the camper story. Is it a vacation item? Or are you living in it? Maybe you wrote about this somewhere else. Interested because the 10 year plan involves possibly spending time traveling North America in a camper (although after spending just one week with DH in self isolation, I don't know that I could stand him for that long, especially if you add driving "discussions" to the mix).

      Like 2
      • Coral Mare
      • Rolling Along on this Debt-Free Journey
      • Coral_Mare.6
      • 7 mths ago
      • 5
      • Reported - view

      MXMOM  Initially the camper was an upgrade from a one-A/C camper to a two-A/C camper that we used for vacations.  A year ago, it was my "home away from home" while I completed a four week job training program in Oregon.  We sandwiched the class with a week of vacation to Oregon and another week of vacation on the way back home.  

      In the spirit of giving a mouse a cookie, the newer (heavier) camper required a newer (heavier) pickup truck to tow it.  The camper is the current focus debt; the truck is also on the list.  Our upcoming trips are on hold until the pandemic subsides.  Until we retire, camping trips are limited to weekends.  Based on our love of shiny objects, retirement might look more like part-time work with longer weekends for camping.  Time will tell.

      Like 5
    • Coral Mare That's all really good news!! Congrats!!

      Like
  • So I’m at 80% of paying off credit cards and furnace. I originally had car payoff in total but removed it because it was unrealistic. On Thursday I traded it in for a new car at zero percent interest. Car deals are pretty good right now. All done over the phone and then signing face to face with distancing and masks/gloves. Also refinanced my mortgage (down 1.2%). I’m feeling pretty good at hitting my goal right now. 

    Like 5
    • Slate Blue Network Congrats!!!
      We're looking at replacing a vehicle, too, and with the extra stimulus payment that is just hitting our accounts that boosts the amount of down payment we have, and the zero percent interest loans are looking pretty dang good!!

      Like
  • Still paying my maximum minimum on my HELOC: $26K at 2.74% (no snowball on principal yet this year). It has been a tough on surviving a strike but I made it through without touching my EF and now I'm using this quarantine as an opportunity to save more money. Only groceries & wine. No gas, takeout, or online shopping. My paycheque is back to normal thankfully & I'm blessed to have a job when so many people are getting laid off. It's not easy working from home & a massive headache inducing learning curve.

    Thoughts: use extra money to snowball my debt or add to my investments since equities are at the lowest they have been? I wasn't thinking a lot. I currently contribute $100/month to my RRSP but was thinking of also adding $100/month to my TFSA investments. I know the rule is to pay debt first, but these are unprecedented times and I'm ok with my budget. Ideally, I'd like to be a month ahead. :)

    Like 4
      • Orange Sun
      • Orange_Sun.8
      • 7 mths ago
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      Purple Foal I'm a financial adviser, and obviously without doing proper client fact finding I can't give you a definite answer.  I'm also not licensed in your jurisdiction (RRSP is Canada isn't it?).  But now I've finished the disclaimers I can say in general that now is a good time to buy equities.  We may not have hit the bottom yet, that is really hard to pick.  But everything is at a 20-30% discount to what it was two months ago ... so if you are sure you don't need the money any time soon it doesn't matter if it falls a bit further in the short term, in the long term you will have paid a good price assuming you buy quality assets.  We're helping a lot of clients invest at the moment if they have cash to do so.  But the key is being sure you don't need that money back in case it does fall further.  You don't want an unexpected bill to come in the next couple of months and have to sell getting back only part of what you have today ... Yay for YNAB helping us with that one!

      And yes, I'm a financial adviser and still in a group to help me pay down debt.  Just because you know what you should be doing doesn't make it easy!  I know the theory, but the tools to help it actually happen on a day to day basis are crucial.  This is my third crack at getting my budget sorted out, and I think this time I might really have done it for good.  Largely thanks to the discussions in this forum.  It's good to be reminded on a daily basis about the importance of saving for true expenses and building your emergency funds as well paying down the debt.  And sharing our trials and victories makes you feel part of something.  The training YNAB provides is amazing, but after a month the memory of the session fades, so it's great to be here reinforcing every day.  Thanks everyone for sharing your experiences.

      Like 4
      • MXMOM
      • MXMOM
      • 7 mths ago
      • Reported - view

      Purple Foal aren’t you in education? Teacher?

      Like
      • Purple Foal
      • Purple_Foal.3
      • 7 mths ago
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      Orange Sun Thank you for your suggestions. I want to be sensible but also stock up on sale prices. While living on a very tight budget since July 2019 & joining YNAB, I have learned a lot, cut a lot of expenses, and most specifically learned how to really budget on food. I was able to stock up my cellar & freezer when things were on sale, clearance, and by price matching. I bought more of course during the apocalyptic shopping before we were officially self-isolated. My food budget has been high for March & April (I just filled up the cart the two times I went out) but they were good wholesome purchases. I've learned to be frugal & to ration.

      Kudos to you for admitting you're are a financial advisor and in debt. It's like my family doctor who preaches exercise & diet but looks 10 months pregnant. It's the action that counts. You're in good hands with YNAB and the forums are definitely the game changer to staying focused.

      My investments are with TD (Canada) and both my TFSA & RRSP are set up as TD eSeries index funds: 40% Cdn bonds, 20% Cdn equity, 20% US equity, 20% Global equity. I also have $500 each in the Tangerine Growth & Balanced Growth investments to compare. I started a spreadsheet to track my investments growth, and since covid, have been also tracking the share price. I rebalanced my percentages when the equities went right down so that felt good. I'm currently investing only $100/month to my RRSP at $25 each category since my focus has been paying off my HELOC. My accountant suggested to invest in my TFSA instead since my tax bracket will be similar when I retire & I'll get hit with the taxes when I withdrawal my RRSPs. So from your advice, I will invest in my TFSAs now, within reason, and let them grow. Thanks :)

      Like 4
      • Purple Foal
      • Purple_Foal.3
      • 7 mths ago
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      MXMOM Yes & thankfully a settlement has been reached. Now time to rebuild after bracing the storm. :)

      Like 1
      • Orange Sun
      • Orange_Sun.8
      • 7 mths ago
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      • Reported - view

      Purple Foal I will totally admit I don't understand anything you said in that last paragraph apart from the asset classes!  It's truly irritating to me that my skills are not transferrable as I would love to live overseas sometime.  I guess I'll have to stick to that being a retirement goal 😊  I've only heard of RRSPs because I have one client who lives over there at the moment temporarily and has one.

      Definitely good to track your asset classes towards your target and be disciplined about it.  Towards the end of last year we did that a lot for clients on the other side 'taking the cream' off the top of the outperforming assets and moving them more conservative.  Boy are they happy with me now!  And doing the opposite can be the hardest thing.  A lot of clients don't want to invest now because I can't promise them there isn't further down to go.  We're doing a lot similar to what you're planning (the technical term is Dollar Cost Averaging), splitting up what they want to invest into 6 chunks to invest over the next 6 months (or 3 months or 10 months, whatever they are comfortable with).  At least they are starting now rather than continuing to wait until after the recovery, and it's a more palatable ride if it does continue to go down and they are only partly exposed.

      I actually do Salary Sacrifice $100pf to my super.  I know I could take this as pay and use it for debt repayment, but I'd get a lot less in hand after tax, and I know in 20 years time when I can access it I won't regret investing it now.  One of my goals for getting rid of my credit cards is to be able to increase that.  Between the investment return and the tax breaks it will really make a difference to my retirement.

      Like 2
    • Orange Sun No worries, it was just the acronyms. RRSP are like the Roth IRA I think. They are tax sheltered investments: invest now, get a bigger tax return now, but at the end I will pay tax on them. Basically locked investments that are tax referred. TFSA, or tax free savings account, are investments to a max of $6000 after tax dollars per year, but they can grow tax free & can take from them at any time. These are better later on since I won't be taxed on them when I use them in retirement. I think both are good. At least the RRSP you can't touch now. 

      I agree with the Dollar cost averaging...just invest monthly & don't try to time the market. I read about the Couch Potato Investment strategy...just decide on your asset allocations, and then let them build. Rebalance once or twice a year when the % are 2% difference or more from what you set. So I had my equities set at 60%. When they each went well below 20% to 16%, I took money from my bonds & balanced them. Overall I was $$$$ of down, but the balance was the same. When it recovers, I will have made money by buying more stocks when they were on sale. 

      I've read a lot about investments as with personal finance. Just want the most bang for you buck. Something I did hear on a podcast is that if you can't make more money, then educate yourself. So that is what I have been doing. I realized that my $$$$ in retirement was not doing me any favours in a high MER Mutual Fund, so I switched them to low MER index funds & can already see the money that was just sitting there growing. I haven't been contributing more, but by finding a better place to park my money, it has grown. Like you, I want to get rid of debt so that I can invest more. And by getting rid of debt, I am doing the best thing to save for the future. :)

      Like
      • Orange Sun
      • Orange_Sun.8
      • 7 mths ago
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      Purple Foal I'm sure if I ever studied in other jurisdictions it would be easy to pick up.  The underlying assets are the same, it's just the tax that's different depending on local legislation.  The main tax beneficial structure in Australia is superannuation.  We get tax concessions to put the money in now (to a certain point) and it's tax free if we access it after age 60.  But it's really difficult to access it before then.  You have to be in some pretty serious dire straits.  So any money you put in now you need to be pretty sure you don't need until retirement.

      I'm glad you found some podcasts that resonate with you.  What works for me both personally and professionally is to expose myself to the most amount of ideas and methods and then choose was works for me and I can deliver genuinely.  Means I'm more likely to stick with it too!

      Like 1
  • I refinanced my student loan to get a better interest rate and new payment isn't due until May 3. I paid $500 in March even though nothing was "due." Would have done more but I'd also just quit my job so I decided I should be prudent in case I didn't find anything new. Luckily I did find something and I start today (after 3 weeks off). 

    Like 4
    • Silver Vacuum Congratulations on your new position and on making that extra jump in March to get ahead! I hope your new job is everything you're looking for and more! :)

      Like
      • Purple Foal
      • Purple_Foal.3
      • 7 mths ago
      • 4
      • Reported - view

      Silver Vacuum Congrats! And well done for continuing to pay your loan. It will benefit you in the long run getting rid of the debt. Let's face it, the deferrals that they are offering are still benefitting the lenders, no matter how generous they may seem. :)

      Like 4
  • Haven’t updated in a few months what with personal and then COVID concerns. Overall, I started Jan/Feb aggressively paying down my debt, and then froze all extra payments to keep more in savings due to uncertainty in the economy. Here are the amounts I paid so far: $3,954.75 in Jan, $2,809.00 in Feb, and $464.00 in Mar (minimum payments). 
     

    Stay well, all!

    Like 7
    • NamastScrooge Glad that you checked in! Keeping the cash on hand for now is true for many of us. Stay safe out there! 

      Like 1
    • Nicole thanks, same to you!

      Like
  • Coral Mare said:
    the newer (heavier) camper required a newer (heavier) pickup truck to tow it

     Ya that sounds like this would happen at our house too. 
     

    we are still at least 10 years out from this idea. It’s something we’ll have to research more as we get closer.  Thanks. 

    Like 1
  • Orange Sun said:
    And yes, I'm a financial adviser and still in a group to help me pay down debt.  Just because you know what you should be doing doesn't make it easy!

     I’m an accountant and I hear you. It’s sometimes feels embarrassing but then I think it makes me a better resource because I speak from experience. Yes it’s simple. No it’s not easy. 

    Like 5
    • MXMOM I'm amazed at how many parallels there are between budgeting and losing weight.  I never would have thought it, but it's so true. And likewise- I feel the same way- like I can better give my patients weight loss advice, because I have lost weight.  No one wants to hear a tiny little personal trainer tell them to "just eat less and move more!" hahaha

      Like 6
    • MXMOM  Outside perspective, and camaraderie can really make a difference even—if you know what you "should" do! 

      Like 1
  • Here's the breakdown for April:

    MC -       $534.46       $61.00          $473.46

    Total -   $534.46        $61.00         $473.46

    Below $500!!!

    Really excited about that!!!!

    I posted in my journal, but I'll just mention it here, too.

    The stimulus payment just hit my account (looks like it will clear on Wednesday, which is also pay day, too!). I decided that I will move the amount that it takes to pay off my debt (plus my care credit debt, which I really don't consider to be debt since it's always interest free, and I have it every year due to buying a year's worth of contacts all at once), and pre fund those categories to be paid in full. I'll just continue to make the payments each month because they are both zero interest. I'm not going to pay back somebody who has loaned me money for free any faster than absolutely necessary.

    What this DOES do for me is frees up about $110 in my budget every month that I'll get to apply where ever it is needed. That's like giving myself a $100 raise. I think I'm going to apply some of it to my truck loan to start paying that down a little faster, and then use the rest of it to fund things that I need (you know, like shampoo, the basics... 🙄) so that I can work on staying out of debt a little better. Then I'll be able to come back here next year and smackdown the truck loan! I'm going to go play with undebt.it and see what it tells me about applying a bit extra to my loan and see what happens.

    Like 6
      • Purple Foal
      • Purple_Foal.3
      • 7 mths ago
      • 2
      • Reported - view

      farfromtheusual Excellent! Those are exciting numbers! Keep going! :)

      Like 2
    • Purple Foal thanks!! I'm going to contact the bank this week and see how I can make the extra payment to the principle on my car loan. It makes me nervous to put that money towards the truck right now, but I think I'll do better if I do that than sit on it. I'd rather end the loan early (which is always good for the credit score!), and even if I do put the $50 to the truck, I still have $58 "extra" that would have gone towards the other debt, so it's still a win.

      Like 3
  • I paid off the second of my two credit cards today. I hit 100% of my targeted debt goal for the spreadsheet.

    Yet for some reason, I don't feel much better about the state of my finances. I got ahead in AOM to 32 and then replenishing what I needed to hunker at home sent me back to 21. I've been struggling with my food budget big time and I feel very YNAB poor - all my priorities are covered but I don't have a cent left to try and stretch things to get a full month ahead. 

    I'm hoping that once I don't have my CC debts to pay down I will find a bit of wiggle room in the next month or so. I still have some debt overall: mortgage, a family loan, and a phone installment plan. I was hoping to tackle the family loan and the phone plan next but as those are 0% interest I think I might just let those play out with the bare minimum payments for a while.

    So to try and focus on a plan instead of my anxiety - next on my list then is to work on AOM, then once I get to around 60 I'll shift to savings. That might take the rest of the year, or longer - who knows.

    Like 6
      • Pink Song
      • Pink_Song.8
      • 7 mths ago
      • 2
      • Reported - view

      Peripherie GREAT JOB! And that is the reason YNAB recommends tackling the lowest balance debt first because that way it gives you extra cash flow to put towards your other priorities. Keep up the good work!

      Like 2
      • MicroSpice
      • Crazy Person
      • Microspice
      • 7 mths ago
      • 5
      • Reported - view

      Peripherie I feel like the AOM metric can be a bit of a red herring. You said you'd get AOM to 60 days, and then focus on savings, but you know something? AOM IS savings! All it means is that you've had money sitting in your accounts for 60 days, waiting to do its job.

      I have been using YNAB since around 2012, and do you know when I finally started getting my AOM to 30 days? Within the last year. Know why? Because I have been focusing on paying off my debt. Because I throw so much money per month at debt, it necessarily brings down my AOM. But I am not stressing about it, because I also have an emergency fund and several categories are green.

      Debt affects your monthly cash flow and hangs over your mental health like a cloud. When that debt is gone, your money will age faster and it won't be such a struggle.

      Just my very humble .02. Keep going, you are doing great! Don't let that AOM get you down.

      Like 5
    • Peripherie Congratulations on paying off your debt!

      Like
    • MicroSpice said it well, Peripherie - AOM IS savings. That just means that you have 30 days of money sitting in the bank - i.e. if you were to not get paid for 30 days, you would have enough money to cover the bills (and if we're really honest, if you found out you were't getting paid for 30 days you could probably make that money stretch longer if you had to... AOM is relative to spending habits). If you take a chunk of that, and apply it to something, then your AOM will go down.

      We pay our car insurance every 6 months (thanks to YNAB planning and a windfall a few years ago), and so I set aside the amount I need to cover it every pay check, and then at the end of the 6 months a big chunk leaves the account all at once. So that drags the AOM down, but ultimately, everything is still covered exactly like it was before that payment was made.
      One of the tricks I used to get my AOM up was to start putting aside half the bill in the beginning of the month when I got paid, and then the other half when I got paid the next time. By splitting the bills is spreads out what I owe over the course of the month, and helps to keep everything a little more level. Then, when you have a little extra, you can toss some more at it, which will help build up the AOM. So my mortgage category ALWAYS has a full payment in it, and at the first of the month, it has 2 payments worth of money sitting in it. We are 1 month ahead on the mortgage. I have done this with a number of bills, and so our AOM is over 30 days, and closer to 2 months most of the time.
      Anyway, focusing on metrics is important, but not getting too caught up in them is also important. Just make a plan and stick with it, and when you fall off, climb back on and before you know it you'll be out of debt on and to bigger and better things!

      Like 3
  • MicroSpice said:
    I feel like the AOM metric can be a bit of a red herring

    Peripherie  I agree with MicroSpice .  AOM is wonky if you are saving for big things. For example, we had about $10K in an account for university. High AOM. But then we paid the school and AOM drops back down. I believe the toolkit uses days buffered (not sure because I don't use the toolkit) that is apparently more of what people are looking for in AOM.

    Like 4
      • Peripherie
      • Tomato_Captain.11
      • 7 mths ago
      • 2
      • Reported - view

      Pink Song - Thank you! I followed that 'lowest balance first' plan to get rid of the credit cards. And it is nice to have them both good and gone. On a side positive benefit - my credit score is now somewhere between 792-798 (depending on what tool I use to check it)! 

      MXMOM   MicroSpice - Thanks for the advice. 🙂 I guess I meant that I want to save up enough of a monthly buffer so that all of one month can but put aside and sent forward in the next month before I move funds to other kinds of savings categories.  Right now I'm consistently 1 paycheck ahead. Most/all of my money from the check I get on the 15th goes to the following month along with that I get on the 1st. I understand the drawbacks of AOM but I think aiming for 60 will help me limit impulse purchases as I want to keep that number rising (and help to build that monthly buffer).

      Like 2
    • Peripherie Congrats on your credit score! That's great!!

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      • MXMOM
      • MXMOM
      • 7 mths ago
      • 3
      • Reported - view

      Peripherie what I have done to achieve is the following.  I have a category called Month Ahead. Currently we are about one paycheque ahead. I did this when I realized we were riding the credit card float because I was budgeting the whole month before the month began ala Dave Ramsey but that meant I was budgeting money I did not actually have yet. This is counter to YNAB philosophy. Since I am only one paycheque ahead, I budget per paycheque rather than the whole month at a time. I don't like budgeting in the actual future month in YNAB because of the issues that can cause (stealing from the future).

       

      farfromtheusual From my understanding the AOM does not correlate to the number of days you can go without getting paid. It is the age of the oldest dollar in your bank account. So an AOM of 45 means I have money in my account(s) that I earned 45 days ago.  That is why the toolkit (which I don't use) uses days of buffering which I believe is more accurate on how many days ahead I could go without earning any more money.  Way too conceptual for me.  That is why I have chosen to go with the separate category which I can see very clearly how much money I have set aside for future expenses. My expenses (and income) are fairly consistent, so for me, a fixed number works great.

      Like 3
    • MXMOM Even if it is totaling the "oldest dollar" in the account, the theory still applies that is roughly how many days you can make it going forward. It means there's that much cash in the bank that you could use it moving forward.
      Either way - I don't put much stock in the number. It's a nice number to have, but when you have larger pay outs that only happen ever so many months, then AOM bounces up and down anyway.

      Like
      • Peripherie
      • Tomato_Captain.11
      • 7 mths ago
      • 3
      • Reported - view

      MXMOM Thanks for the feedback. 😄 That is what I have started doing as well - I made a 'Next Month' category and with the name I put the amount I would need to fully fund the next month. I am not at that $ yet but I can sock money away and see if I can slowly over time get to the point where I am funded a full month again.

      Like 3
  • Well, I did pay down a little more debt in April.  $500 to pay off another credit card.  I am 60% of the way to my goal for the year.  But a big chunk of that was a bonus received in March.  Our income is cut back right now due to Covid-19.  All of the basics are covered, but there is not much else to throw at debt.  At least we are doing fine on all of the basics.

    Like 4
  • Wow!  I was so fortunate to be able to use the stimulus money only for debt pay down.  Two cards down and I cut nearly 6 months off my debt snowball paydown!!!!

    Like 8
      • Purple Foal
      • Purple_Foal.3
      • 7 mths ago
      • 1
      • Reported - view

      Pink Android That is great! Especially since while the banks, student loans, & property taxes might be offering deferrals, and interest rates have dropped for savings & mortgages, credit cards are still charging their high interest fees!! 

      Like 1
    • Pink Android WAHOO!

      Like
  • April Monthly Check In

    • Construction Loan:  Paid $2,550 - Balance $0!
    • Medical Loan: Paid $100 - Balance $1,500
    • #2 Medical Loan: Paid $200 - Balance $6,720

    We received our stimulus check which allowed me to pay off the construction loan. Since we both still have our jobs and have reasonable savings I do not feel like I need to hoard a bunch of money at this time. I preferred getting rid of another monthly payment.

    Total paid this month $2,850.  $7,650 / $8,950 - 85% complete for the year!

    But we added new medical debt. So I am going to go ahead and add that to my spreadsheet.  An additional $6,920. Which brings our new total paid to:

    Total paid this month $2,850.  $7,650 / $15,870 - 48% complete for the year!

    Even with adding the new debt we are still almost half way there and it's only April. That said the rest of the year will probably be slower progress since we put both our stimulus and tax return towards debt which accounted for a large chunk of the pay down. 

    Like 6
  • Peripherie said:
    I've been struggling with my food budget big time and I feel very YNAB poor - all my priorities are covered but I don't have a cent left to try and stretch things to get a full month ahead. 

     It is completely normal to feel YNAB poor! It is because you have given every dollar a job. But remember, you aren't poor. Money is sitting in other categories if you need it. It's just your priorities. I hear you though on the food budget and still wanting to get a month ahead... :)

    Like 3
  • Purple Foal said:
    My accountant suggested to invest in my TFSA instead since my tax bracket will be similar when I retire & I'll get hit with the taxes when I withdrawal my RRSPs

     Ha ha. That’s why I was asking about your job. I was going to give the same suggestion. Although it also depends on your spouse (if you have one-sorry can’t recall)  since income splitting retirement income is allowed. The only downfall of that pls is if you don’t have a spouse before all the RRSPS are depleted. You may want to ask your accountant as I am not allowed to give tax advice. 

    Like
    • MXMOM I'm divorced so it's just me & my future. So I should just concentrate on contributing to my TFSAs and let my RRSPs sit. I know it won't lower my tax bracket now, but will help me later on. I'm not contributing a lot though since I'm clearly focusing on paying off my HELOC in this forum. :)

      Like
      • Orange Sun
      • Orange_Sun.8
      • 7 mths ago
      • Reported - view

      MXMOM I'm glad someone knew what all those acronyms meant!

      Actually that's one of the most interesting things about this forum for me as a finance professional.  I'm learning a lot about other countries legislative systems.

      Like
    • Orange Sun I listen to a lot of podcasts so I've learned a lot about the American IRA's, 401ks etc. Once you know the code translations, the theories are the same! lol :)

      Like
  • April Check-In :

    Have the personal loan principal down to $21701 so $529 total paid off to that this month. Credit cards are still at $0. Moving fund (which might just be renamed emergency fund...) I've been able to add $300 to as well.

    I won't be getting the stimulus check. I'm just right over the cap on the amount as someone single. Can't complain though extra money would be nice, other people will need it more than me in these times. I'm still paying down debt, saving, and accounting for my priorities. 

    I'm just super grateful that I'm still working during all this, I'm healthy, and my family has stayed healthy. I'm worried about the toll the isolation is taking on my mom and grandma since people can't visit them really but grateful and blessed that everyone is still okay and able to keep their jobs, even if the environments have changed. That's all I've been focusing on though. I know there's so many people this is causing more disruption too, I can only be grateful for what I have and pray for everyone else affected. 

    This month is tough too because it was going to be my big 30th birthday extravaganza coming up and that's decidedly, completely cancelled. I'm treating myself to fancy yarn instead. I crochet which is an excellent hobby in these times since it is meditative and very inline with quarantine life. So upside, I'm going to get a really posh cardigan out of this. Looking at the silver lining and remembering that this will be over eventually and that trip can happen eventually too. 

    Sending out as many positive thoughts and prays as I can! And trying to keep my eyes on the prize, debt free life is the number one goal in the end for me and I've been sticking to $0 on credit cards and chipping away at the loans.

    Like 8
    • Green Cleric good for you for staying focused on what matters!

      Like
      • MXMOM
      • MXMOM
      • 7 mths ago
      • Reported - view

      Green Cleric happy big 30th birthday!!!!!!!!

      Like
    • farfromtheusual thank you! definitely helps during times like these.

      Like 1
    • MXMOM thank you so much!!!!

      Like
    • Green Cleric And happy birthday!!!!

      Like
    • farfromtheusual Thank you!!! I've always loved birthdays, definitely a different vibe this year, ha.

      Like 1
    • Green Cleric it will be one to remember, for sure!! You'll win the most epic birthday story for sure!

      Like
    • farfromtheusual lol, yeah, that's a fact! 

      Like 1
  • I am slowly paying down my debt (Student LOC and AMEX Loan), I have got about $56,000 left to pay which is not bad since I have almost $100,000 off in debt since I started this journey 6.5 years ago (I can't believe that I had that much student loan debt (about 116,000$)). Over the years I added on a car loan (sold the car at profit when I moved across country to take a job that paid less) and my AMEX Loan. I haven't included my mortgage in this amount since it is something that I can easily afford (~$500/mth accelerated weekly) and will focus on this once my loans are paid off.

    BUT... while I am thankful that I can work from home and still have steady income, it has been over a 5 weeks since I was at my place of work (I was on vacation when this all hit), and I am finding it very hard not to buy things for myself or the house online. I also live by myself and family is not close by, so I am thankful for the time alone but it can also become very lonely too.  So far I have been good and YNAB has been helping since I know if I buy something for the house, it comes off my house siding/window/patio fund..... How is everyone else coping with this crazy time?? 

    Like 6
      • Orange Sun
      • Orange_Sun.8
      • 7 mths ago
      • 4
      • Reported - view

      Ivory Wildebeest I am struggling too.  I also have a secure job working from home, but it kinda means the weekends and work blend together.  I'm already going a bit crazy and my flatmate moves out next week.  I'm scared to be alone, but I'm also looking forward to being able to set my own routines and have more space.  It's a tough call.  These are really unprecedented times.

      Like 4
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