I called this a small victory on my social media last week – and a dear friend corrected me saying this was a BIG victory. Last Friday I paid off the remainder of my PayPal Credit account! Sent $589 to the creditors and said good riddance to PayPal Credit forever. In addition I was able to put $200 into savings, finally hit my goal of 5K. Word of advice, never fall victim to a store card (PayPal credit in this case) – they often have the highest interest rates and their “Special Financing” or promotional rates are a joke with deferred interest instead of waived interest (The Broke Millenial by Erin Lowry).
Waived interest means you are not required to pay interest once the promotional rate for a purchase has expired and the purchase hasn’t been paid in full. Deferred interest means you must pay the full interest if the promotional balance for a purchase hasn’t been paid in full by the expiration. Took me a few times to read that one over and understand, then it dawned on me that PayPal Credit follows a deferred interest model. No thanks, goodbye.
I’ve been following a mix of the ‘Debt Avalanche’ and ‘Debt Snowball’ methods (Broke Millenial by Erin Lowry) to pay off my debts. The Debt Avalanche method has you pay off your debts according to interest: highest interest rates first whereas Debt Snowball has you pay your smallest balance to to highest balance. With both of these you’ll pay the minimum on your other payments and pay everything extra to the balance you’re targeting first. I’m paying my highest interest rate credit cards first, which coincidentally are my low to high balances – meaning my highest balance is also my lowest interest rate.
Next on the list of credit cards to pay: Nordstrom. Thankfully my balance is under 1K – I fell sucker to the promotional Nordstrom credit when you sign up for their credit card. If there’s anything I’ve learned from my former shopping addiction, it’s that promotions and sales come and go quite frequently – you’re not missing out on anything. Once Nordstrom is paid off, I’m going to balance transfer my highest credit card – giving me 15 solid months with zero interest to annihilate my credit card debt in full.
Gotta say, I’m addicted to spending less, saving more and throwing it all at my debt. I also have two vacations to keep in mind. Early March I’ll be going to San Diego for CRSSD festival – tickets are paid, AirBnB is paid for but still need to purchase flights. In December Jordan and I will be travelling to Patagonia, Argentina for the solar eclipse at Symbiosis festival – a much larger scale event to save and plan for. I feel confident that both trips will be completely debt free, I’ve already made huge progress in such a short amount of time. Not just watching my credit card balance decrease, but feeling more aligned with my goals and the way I want to live. I never want to be burdened by the anxiety that debt ensures again. I never want to come home and feel overwhelmed by my things. After doing a small winter purge during Christmas break (following Marie Kondo’s methods) – I feel so much lighter and relaxed. There’s less to clean and be a busy body over, everything is in its place, even laundry is easier and less daunting. I have more time to read, journal, blog, dance, and create.
14 days in 2020 and I’m already seeing positive changes. Can’t wait to see where I’m at December 31st, 2020. Excited for the journey through its many challenges ahead.