Tuesday, September 30, 2014

Month in Review- September

September has hit and the crisp air is starting to settle us into fall. Nick and I have had a great month and had an opportunity to really test our financial goals. We have had multiple opportunities to give up and a few moments of excitement when we realize we are making really good progress. 

We are now Seven months into this debt elimination quest and we had a fairly good month staying in budget and even pre-planning for our spending splurges. We are getting to see where we fall short when it comes to budgeting and how to help each other stay focused, while still not giving up living life :) 

Unexpected Costs: 
Gas :) We spent like double this month on gas. Oh well! The car adventures were worth the extra money. We just had to dip into our AirBnB money to help cover the extra trips.

Unexpected Income: 
We had signed up for the Dogfish Head Dash a few months back, and so we put our apartment up on AirBnB for the weekend of the race. We ended up getting renters and had extra income to use toward food and a place to stay for the race.
We also worked a beer fest and were paid for our time! Nick also got a tip, so yay for Nick :) 

September Splurges:
Nick's Birthday is in September, so his mom came down and joined us for a long birthday weekend. We planned a good number of our meals in, but we also went out to dinner and I would consider this our monthly splurge. A huge thanks to Olga for covering a fabulous meal at Le Diplomate :)  

Funniest Moment: 
Calling Nick at work and telling him that we could pay off loan #34. He was having a kinda crappy day and being able to tell him that we had made it 3 months early was really AWESOME :) Loan #35 was one of my loans and so this is Nick's first loan we've paid off.

Yay US :) 

Lessons Learned
We are doing well with our short-term savings! Each month we put a good chunk of change away in our short-term savings. These amounts are pre-determined based on when they will be needed, but saved in smaller chunks. 

For example, we need an oil change every three months and that cost $30, we save $10 a month and at the three month mark we have $30 ready to go and have no excuse not to get our oil changed. This has worked great for haircuts, "get away fund", holidays, and medicine. 

This month we had our race in Delaware and I was excited to see that we had been contributing to our "get away" category, so magically we had money to help cover a AirBnB and gas money! This also came in handy when Nick went to get his hair cut. Sometimes it is the little things, but it feels great to know that pre-planning comes through :) 

Total Payment to Debt: $366.04*
*This amount is in addition to our minimum payments

12.5 % Interest GONE!!

Current Debt: $173,746.44
This amount does not go down no matter how much we pay :( Nick's Federal loans are on a income-based repayment plan, so we continue to make monthly payments but they are not as high as the interest, so it just keeps going up, 'Tis our financial life! 

We started with a total of 35 Student Loans. This month we eliminated #34 and now we are on to our 33rd Student Loan.
#33 is currently at  $1,737.79 with an interest rate of 11.5% . 

We  anticipate this loan taking us  7 months to pay off- April 2015. 

Thursday, September 25, 2014

AirBnB- Financial Breakdown

I've mentioned our successful summer with AirBnB enough times now that I think it is worth sharing with you the overall financial impact of our experience.

Nick and I moved out of our apartment on July 3rd and didn't move back-in until August 17th. In that time, Nick and I have hosted 11 groups through AirBnB.

We divided our income into four categories:
  • Set-Up/Management Expenses
  • Taxes
  • Summer Vacation
  • Student Loans 
Set-Up and Management of the AirBnB had various small expenses that I am glad we used income to help offset,; otherwise we would have been dipping into grocery money. These expenses ended up equalling 12% of our overall earnings. They included things like new bed sheets, cleaning supplies, and breakfast treats for our guests. We also set a little money aside for gas, as our commute to and from the apartment became a business expense.

We decided that it would be best to save 30% of our earnings for Taxes. Come March, I think we will both be happy to have this money on hand rather then be surprised by an impending amount owed. If we don't owe it all then we can put it toward a student loan payment, but we'd rather be safe and have it sit in our savings account until we complete our taxes.

One of the reasons we originally decided to put our apartment up on AirBnB was to earn money to stay a few nights in Vermont on our Vacation. We made that money, and then Nick and I did not stay on budget for our vacation at all :( It was a very Bad frugal vacation. So we used 28% of our income to offset the money we had saved to cover our expenses. We came back from vacation without anything on our credit cards- first time I can say that in like 7 years!!

We were also able to put 30% of our income toward our Student Loans. This allowed us to pay down our highest interest rate loan (12.5%) down in 5 months, versus the 8 months we thought it was going to take us. This was a huge accomplishment :)

Nick and I will be hosting our 12th group this upcoming weekend, who are helping us pay for our weekend in Delaware for the Dogfish Head Dash. AirBnB has been a great way for us to make money while we aren't at home and keep us off our credit cards.

This post would not be complete without a HUGE thank you to Rob and Sally for their over the top generosity. Over the summer, they allowed Nick and I to stay in the guest room, while making money on our own place. We truly appreciate the support :) 

Wednesday, September 24, 2014

Month in Review- August

Hey Everyone! This has been a crazy summer filled with some great opportunities to make extra income through AirBnB, but it has also been a summer filled with trips and the first crazy work season at my new job. Now that we get into Fall, I think it is about time I got back on this writing horse and get you some new posts. 

Month Six provided an opportunity to evaluate where we stand financially and determine if we are on the right path toward financial security. 

Unexpected Costs: 
Nothing unexpected. We were living in three different places for three weeks and stayed in budget, but as soon as we got home from the gypsy lifestyle we were living, we realized we needed to bulk up on staples, so we went a bit over budget on groceries. Thanks Costco :) 

Unexpected Income: 
I get paid bi-monthly and Nick gets paid every two weeks. We always budget for a 4 paycheck month, so when Nick (twice a year) gets a third paycheck in one month it is always a happy surprise!! August happened to be a three paycheck month, which helped us cover overspending in our grocery line and put a dent in our student loan payments. 

August Splurges:
We bought a membership to a program called Fill A Seat. It provides tickets to theater and art events around the DC Area. We found a Living Social coupon for 45% off and have already been to one event. 

Basically, they give away seats to productions on days that they aren't selling enough tickets. We go and "fill a seat" with our membership and don't need to pay anything extra. Nick and I give up a lot of opportunities to go out, for the sake of saving money, so this provides us a great chance to actually keep exploring the city we live in for the next year without paying anything more then our membership fee.

We already went to a Shakespeare play and we are headed to another play on Thursday :) Fun little date nights! 

Funniest Moment: 
We got to dog sit for TWO dogs in August, Beth and Chopper. Now we both can't stop talking about dogs :) Seriously people, we ended up calling my uncle a few weekends ago and asking if we could pick-up the dog and take it on a hike. We just missed her :) 

Yup, getting a dog would not be frugal of us and not really fit into our work schedules so it is probably not happening, but I do think that a dog walking volunteer gig is in our future. Or perhaps more of our friends should get dogs so that we can dog sit!! 

Lessons Learned
We have a breaking point!! As a couple, Nick and I have been pretty flexible for two months, but we both came to a point roughly two days before we got home that we knew we needed to just STOP. 

We have been out of a normal routine, normal commute, and normal cooking habits for 2 months. We were ready for home base. I had two work trips and Nick had been over the top fantastic about dog sitting alone for a few days and managing the AirBnB. 

When we finally got back to our apartment mid-August I think it took us a week just to run the dishwasher. We wanted to do nothing but SIT and watch TV, hence my lack of posts for the past month :) 

We both agree that our crazy summer  was worth a great vacation and the extra payments to our student loans, but we also learned how to work as a better team which was even more important. 

Total Payment to Debt: $1,386.65 , on top of our minimum payments for August

AWESOME month for us with an extra paycheck and AirBnB income :) 

Current Debt: $166,777.53 This amount is out of date, but I'll have an updated amount for you next week in the September run down! 

We started with a total of 35 Student Loans.
We are currently at 34 Student Loans and we need to pay $358.06 more in order to reach #33 :)

Student loan #34 has our highest interest rate at 12.5% ! We originally anticipated this taking us a total of 8 months, this being month 4, but I think we may be able to get rid of this one in 1 more months, cutting off 3 months from our initial plan!!