A Christmas Miracle! And then some...

Much has happened since my last post, some good, some bad, but overall I think we have reason to celebrate.

On December, 4th our car broke down again. Of course, we had just poured $2500 into the car back in September, so to have it break again so soon was disheartening. We basically had three weeks to get it fixed before Christmas and I had to be back at work. After several attempts to fix it ourselves, we found that we still couldn't get it running, and if we took it to a shop it would take several days before we got it back. Plus, we hadn't had the cash in hand to take it to a shop previously anyways. We were out of time, and since my job is finally picking up again, I knew I needed a reliable car to get me to work. We made the decision to buy a new car.

Up until now, I have been vehemently against buying a new car because I didn't want to add any payments to our budget, and I definitely did not want to see our insurance go up. However, after getting a few quotes on insurance, pricing out cars and doing a lot of research, we managed to find something that would not put us too far off budget. I worked strictly on what our maximum payment could be each month, and arranged everything else around that number. So, in the end we took on a fairly large new debt that we will be making payments on for the next 5 years.

On the other hand, when I  took this job I planned on only making $4-600/month. Instead, I have been consistently making twice that amount. I took this job with the intention of applying my entire income to paying off our student loans. So, being that I am making roughly $1000-1200/month (except for the down time in December), I am able to make the car payment and make up the difference in insurance, and still apply the same amount to our student loans. Naturally, I would have loved to use the entire thing for debt instead of only half, but the point is that I even with this purchase, my original plan has not been affected. Plus, I am moving up in my company again starting next week, so I may still be able to apply even more to the student loans than I had planned for. The downside is that we will have to wait a minimum of six months before applying for the mortgage on the house, but as long as we are paying rent on time my mother doesn't seem too bothered by when we decide to actually buy the house from her.

I will also note that our Explorer is getting very close to 200k miles, and it is starting to show it's age. We have been a single car family for 5 years now, and it has had its ups and downs. After checking the price of insurance with and without the Explorer on there, it turns out that the Explorer will only change the insurance rate by $24/month, so we have decided to keep it. There are no payments on the Explorer, and it will be nice to have a backup vehicle, or just a second vehicle for Jason on his days off since I am never home on those days. However, the Explorer still isn't running, so we will eventually have to take it to a shop to get it going again, but at least now the pressure is off, and we have some time to get it done.

Now for the biggest news of all!!! I have known for several years that we owed Jason's parents quite a large sum of money. Most of this was accrued while Jason was in school the first time, before we started dating. However, we also owed them a little bit from Jason's court fees and for helping us buy the Explorer in the first place. The total amount of that debt was just over $16000. We had arranged to make payments to them for $300 a month, for the next few years to get it paid down, and those payments were scheduled to start January 1st of 2013. (This is partially why I had such a set budget for buying the car, because I knew the credit report would not show this debt and the payments we are making on it, and I didn't want to get pushed into something more expensive.)

At any rate, after all of the Christmas festivities were over, Jason's dad informed us that they went through all of the debt we owed and forgave anything that was a result of Jason going to school, and called it an investment in his future. The end result is that we now owe roughly $11000 less in debt all in one big act of kindness. So, we are on a new payment plan with them, and the first payment has been made. We are facing a debt of only $5250 now instead of $16000. This pushes our debt payoff date forward substantially!!!!

I have been reading all about the huge parties that people are throwing to celebrate being debt free after years of making payments. I think we are going to have to plan for something similar when we are through with this all because I am ready to celebrate!!!

A Christmas Revelation

When I set out on this mission I had certain expectations. When I read other people's blogs about getting out of debt and extreme frugality it seemed that they all reached some sort of revelation about money that improved their lives. Many of them came to realize that they were just as happy with less stuff as they had been with more, or that the sense of security they got from being out of debt outweighed the good feelings of having a brand new car or a great big house. On the other hand, I felt like I had already reached some of those revelations on my own before starting this blog, so I wasn't sure I would find many posts to make about changing your attitude towards money or possessions. Nevertheless, here I am today...

Since Logan's birth, he has managed to collect quite an impressive stash of stuff. Mainly toys and clothes, of course. I will admit that for Logan's first Christmas all he got from us was a stuffed dinosaur. For his first birthday he got a box of diapers. Jason and I have always shared a bit of guilt over the fact that we could never afford to get Logan the kinds of toys and clothes that everyone else was buying him for his birthday and Christmas. (Of course, it seems that the grandparents just can't help themselves.) In any case, he does have quite a few clothes and a lot of toys that he received from the family, and he is more than happy to play with just the boxes and completely ignore the toys themselves. And every night when I tuck him in I cross through a veritable maze of this stuff just trying to reach his bed. 

Alas, with Christmas approaching, and Logan's birthday just behind us, he has a whole bunch more stuff in his room. He went with my mom again for a couple weeks for some more Granny Time, and in the mean time I decided to go through his room and find the toys and clothes that he doesn't use and give them away. The end result is a giant pile of toys and clothes in the middle of my living room. However, our car broke down again last week so I have no way to transport these toys to Goodwill or anywhere else at this point. Instead, I decided to just post them for free on craigslist and see if any other families were in need of some help this time of year. 

And now it strikes me. Logan is privileged. Logan has more toys and clothes than he knows what to do with. But he isn't privileged because of us, as we have struggled for most of his life just to stay above water. He is privileged because of his extended family. I have received half a dozen responses to my craigslist ad, and then I pulled it down so that those few families would actually have a chance to see if there is anything they want or need before I have 50 more responses in my inbox. They are trying to save Christmas for their kids, and are praying for someone to come along who just has enough extra to spare them a bit. 

In the last few weeks things have taken a bizarre turn for us. Jason has been put on mandatory 6 days a week at work. It is inconvenient and sort of frustrating that it is happening at Christmas time, while I am off of work and ready to spend time with my family watching movies and cuddling on the couch. On the other hand, it has been beneficial financially because the extra income is off-setting my temporary loss of work. I also found out that I am being promoted again starting January 1st, and will be a team leader, which comes with a pay raise. Hooray! And Jason is interviewing for another job with his current company, getting out of the field and back into an office environment. We aren't sure if it will be a pay increase or if he will have to take a pay cut for the position yet, but the job would offer him a much more reliable schedule, and a steady income year round instead of the ups and downs that happen for technicians. Between the two of us, we managed to start our Christmas shopping early and actually get the things we wanted to this year for everyone, and especially Logan (since we owe him for a couple years). 

Naturally, our car broke down just before my birthday, as it does every year. We still don't have it put back together since it has been so cold and we were waiting on parts, but since I haven't been working it isn't hindering me too much yet. It is incredibly frustrating that every time we think about buying a second car, our first car breaks down and we spend all of our spare income on fixing that and are never able to save enough to actually put towards another car. And I have absolutely no intention of taking out a car loan that is going to hang over our heads until after we get more of these student loans paid off and the house is officially in our names. 

So, it may seem anti-climactic, but my big revelation is that we are just average. As a family, we have high points and low points. We still struggle with some expenses, but other times we are able to provide far more than other families can afford. We have a ton of debt, but we aren't sinking. We have a car that breaks down from time to time and ruins our day. We have toddler that throws our cell phones in the toilet, and has a knack for destroying furniture. 

This revelation is not particularly earth shattering. It doesn't change my belief that we need to focus on getting rid of our debt. It doesn't change my goal of getting the mortgage on this house. Instead it is a sort of affirmation for me. That the work is starting to pay off. That we are able to finally buy Christmas and birthday presents for Logan. That this house is just the right size, and even if we could afford a bigger or nicer house, we don't need to because this is within our reach. That someday, we may buy a second car, and our first car may be reliable too, but it will probably still break down from time to time and make me want to scream. And most of all that there are going to be low points where we struggle, but that we always make it through, and that each day we go to work and bring home a paycheck we are using it to improve our situation.