Its been a while since I posted a debt diary post. Here is number 3. In my last post, I wrote about hitting the 5 figure mark. I struggled with writing another one of these posts because I just felt like I wasn’t reaching any real benchmark that was “post worthy”. However I think it would probably benefit me to do more regular check-ins (perhaps quarterly) but I will think about this more and report back.
In any event, here we are ending 2020 and I am taking this time to reflect on my loan and see how much I was able to pay off this year and whether I was able to meet my objectives.
At the start of the year, my goal was to make $1,000 payments every two weeks so that I would have paid a total of $26,000 (at least) for the year. I just took a look at my budget spreadsheet, I have been able to pay $30,700 so far (I have one more $1,000 payment left for the year as I am writing this which will make the total payments for 2020, $33,300.00).
I was able to throw a bit more money at my loan than originally planned because a got a good tax return this year. Had it not been a pandemic (and if I wasn’t so scared of potentially losing my job), I think I would have probably allocated more towards my debt but I think this is acceptable given what has unfolded this year.
Because I am of course paying interest, the principal has not gone down as much as I would like. The one good thing about the dropping interest rate is that the interest for my loan has also dropped since it is pinned against prime. As I am writing this my interest rate is 2.95% which means prime is currently 2.45%.
In my last post, the principal recorded was $99,192.81, as I am writing this my current balance is $91,641.83. Which is wild given that my payments since that time add up to about $8,500.00 which means about $1,000 was basically interest (yikes).
Anyway the game plan for 2021 is:
I plan on making monthly payments in the amount of $2,200 a month (which is $1,100 per paycheque). This will bring me to $28,600 for the year. If interest remains at 2.95% (unlikely) I will be paying an average of about $236 a month ($2841) for 2021. Therefore my anticipated balance will be (more or less): $65,882. I’m excited for this point because this will mean my balance will be well below my salary. This is of course the baseline and depending on what my 2021 tax return looks like. I am hoping to be able to throw more at this balance hopefully more than the $30,300 I did for 2020.
I am also considering doing a low-buy year in 2021 (post about this to come) which will hopefully allow me to reach this goal comfortably. I am just trying to work out what my rules will be. I know I definitely want to start the year off with a detox: no-buy January. I’ve been inspired by the Youtubers I found online and a facebook group community of like-minded recovering shopaholics that are dedicated to their debt-free journey. I will leave links to these resources below:
YOUTUBERS
Hanna Lousie Poston
I have been following Hanna since 2019 and she is truly an inspiration, she did a low-buy year in 2018 (I believe) and documented her struggles with obsessive shopping. I really love her videos because they have been really helpful for me in investigating my shopping habits. She loves makeup and her no-buy and shopping issues centre around beauty and skincare spending. I love the way she articulates her thoughts and feelings about new makeup releases (although I am not much of a makeup junkie – this is still very enjoyable).
Style Apotheca
This year I discovered Christina who, like Hanna, creates amazing content about conscious spending. I especially love the fact that she is candid about her student debt and is also from Toronto! She is a pharmacist who works full time while running her youtube business (truly admirable). She has tons of videos about her spending on mainly clothing (which is my personal weakness when it comes to spending). I’ve really enjoyed her videos about the proper approach to money and her low-buy check ins.
Aja Dang
Last but not least, there is Aja who I have been following for over a year now. I love Aja’s story because she is quite honest and candid about the amount of student debt she incurred from her studies and documented her repayment journey in a very real way (tears and all). I actually cried when I watched her Dave Ramsey debt-free scream. She is truly an inspiration especially because I am also trying to pay down my student debt while also living my best life.
Miranda
Since I started my blog instagram, I have come across a very supportive community of career-driven working ladies who are new grads (or not) embarking on their own debt free journey. It is truly inspiring to watch these ladies make payments and watch their debt dwindle. Miranda’s instagram account is full of positive vibes and energy. She is a Howard grad speech pathologist and has an ongoing countdown of her payments as she makes them and debt balance which is truly motivating and inspiring.
Nika
Nika is also part of this debt-free journey community instagram. She puts useful and motivating posts that really provides you with valuable information about how to attack your student loans. There is also a mix of motivation quotes (I love these and sometimes you just need to hear/see it in your feed to remind you of your goals).
Please check these resources out, there are tons of other resources out there but these are my favourites.
Let me know what your favourite resources are in the comments and let me know if you are also doing a no-buy or low-buy in 2021.
