After having had my debt spike back up to the low 6 figures after my 7 month period of unemployment back in 2014, I am pleased to announce that I am finally back down to 5-figure debt ($99,195). This includes my mortgage.
For part of the time that my debt spiked, I was moving things around from 0% balance transfer credit card to new 0% balance credit card when the old term expired. Then a year ago, I decided that the debt would be easier to get rid of--at least psychologically--if I had a steady schedule of debt repayments which I then could try to exceed. So one year ago next week, I took out a 20K personal loan from Discover Bank, technically at 10.99%.
I paid it off yesterday and today, the account has even disappeared from my login page. Over the year, I ended up paying a total of $21,757.04 on the loan, making the effective rate actually 8.79% because of early and extra payments.
Some of that amount is a real decrease in my loan balance, but the rest has been transfered to lower rate loans collateralized in part by my house and by another financial account, so at lower rates (3.67% and 4.44%).
I prefer loans to zero percent credit card balance transfers because there is a predictable schedule to the loan payoff, which I can make a game of beating. Currently, I believe that can have the non-mortgage debt ($32,045) paid off by the end of 2019, and the mortgage ($67,150) paid off by the end of 2024. Technically, I could take longer to pay off the non-mortgage debt, but there's no point to that. My required minimum payments are now lower, giving me a bit more liquidity in the case of short term needs.
Down to 5 figures debt
May 18th, 2016 at 08:44 pm
May 19th, 2016 at 12:06 pm 1463659568
May 19th, 2016 at 12:27 pm 1463660848
May 19th, 2016 at 02:55 pm 1463669758
May 21st, 2016 at 11:47 am 1463831248