My goal for 2020 was to pay off my car but that went out the window when we went into lockdown in March because of the virus. I shifted and decided to put most of my extra money into my savings account to have more money in my emergency fund. I had about $4000 in my emergency fund, about one month of expenses. After lockdown I realized one month of expenses was not enough and started saving what I can. I wasn’t sure what was going to happen with my job but I am lucky to not be laid off.
At the end of this month, I will have 3 months worth of expenses saved which equals $12,000. I would have saved more money but the refrigerator died and needed a new water heater. I am thankful for the money I saved to cover those expenses. Also, I think I spent a little more when I went to the stores since a lot of stores had a change shortage so I had to use my credit card more unless I had exact change. It is so easy to swipe and all the little purchases add up quickly. I didn’t beat myself up but always remember this is a journey and must continue to refocus and remember my goals. Now I go to the store with a list. Also, I make sure I budget my expenses when I go shopping.
In January my car balance was $16,032.97 and as of Dec 14, my balance is $9,949.32. I have been paying the minimum payment and putting about an extra $130 on my payment. At the beginning of the year, I was making larger payments then I slowed down after March.
I decided to save and make extra payments on the car because I still want to pay off debt even though it is taking a little longer. I feel like you can do both.
Also, the other debt that I have is my student loans from my Masters’s Degree, the balance in January for my student loans was $22,588.58 and as of Dec 14, the balance is 20,932.86. I didn’t get any relief from the government because I don’t have federal loans. So I still had to make payments and still was charged interest. I could have deferred my payments but I decided not to because I just want to get rid of them eventually.
So my total debt that I started within 2020 was $38,621.55. As of December 14, my total debt going into 2021 is $30,882.16. I paid off $7,739.39 of my debt. Which is not that bad considering everything going on in the world.
My goal for 2021 will be to continue to save money and see what happens with my contract at work. I am in a union and my contract has to be renewed by January of 2022. If I feel my job is secured I will pay off my car.
How much debt did you pay off in 2020?
Thank you for sharing it’s always good to see how small steps toward paying off debt could work .
My debt this year was mostly in medical bills from 2019. I got most of it paid off about $5000.00.
There are a few lose medical bills under $500.00 that I still owe.
I’m continuing on watching my spending and focusing on savings and spending on the necessities.