Friday, January 27, 2012

No Wonder I Was Broke!

I was going through a box of stuff last night and came across the notebook I used to write my monthly bills in.  The notebook covered the years from 2002 to 2008.  Looking back through those list of bills was a startling trip down memory lane.  What was I thinking?  Each month I was burying myself in more and more debt and I didn't notice anything wrong with that??  My today self should have slapped my then self upside the head--at least then I may not have kept adding "small monthly payments" that eventually added up to nearly overwhelming debt. Here's what one of the biggest months looked like:
  • Mortgage $1500
  • Second mortgage $325
  • Car payment $595
  • Car insurance $195 (we had five cars at the time)
  • Water/sewer $40
  • Gas $90 (it was winter)
  • Electricity $75 (ditto)
  • Cable/internet $195 (apparently we needed every station known to man)
  • Garbage $15
  • Health insurance $35
  • Cell phones $250 (we must have still had some kids on our plan)
  • Son's family in the Philippines $150
  • Tithe $100
  • Newspaper $10
  • Macys $50
  • Sears $75
  • J C Penny $60
  • Chevron $250
  • Visa $125
  • Mastercard $100
  • Other visa $90
  • Discover $100
The list didn't include all of the cash we paid out each month for restaurants (daily), clothing (stuff we didn't put on the credit cards), money we would give to the kids, etc.

Just looking at that list made me cringe.  We were paying almost $800 a month just on credit cards!!!! (sadly most of that money went to interest, over limit fees and late fees).  I was such an idiot.

Fortunately we (eventually) got our act together and got out of debt and our monthly bill list now looks much more reasonable:
  • Rent $600
  • Electricity $112 (but going down next month!)
  • Cell phones $80
  • Health insurance $35
  • Car insurance $33 (liability only for one--paid for--car)
  • Son's family in the Philippines $95
  • Tithe $50
Basically it was a three step process to go from over-the-top bills to spending a fraction of the cost to keep us fed, sheltered, and entertained each month.  The first step was paying off debt as quickly as possible and not using credit cards any more.  The second step was cutting down on the cost of things we can't do without (ie: we don't need a big house but we do need shelter so a small, one bedroom condo works very well for us and, fortunately the rental fee covers water, sewer, and garbage).  The third step was doing without things that don't impact us too greatly (ie: no cable, liability only car insurance, cheaper cell phone plans, no newspaper since I now read this online, etc).

Now that the trip down memory lane is done, I never want to go back there!  I'm debating whether to burn the notebook or keep it as a reminder in case I ever edge toward debt again...


  1. I would keep it as a reminder if I were you.

    Gill in Canada

  2. Its amazing when you look back! You have certainly reduce everything. How are your friends who just move out to join you adjusting?

  3. lol!! Yup... I never used to even budget, and we were ALWAYS running out of stuff & never had more than $5 in the bank! Sad!! :(

  4. Wow that month had a lot of bills in it!

  5. It's so interesting, isn't it? I think about what I used to spend and do and I have to facepalm. There are still places where I can cut, and I will, but I'm spending much less than I used to.

  6. Michelle--That was a *typical* month. (yikes)
    Pamela--I agree...facepalm!
    Carla--I'm glad I wasn't the only budget, no stuff we really needed, no money...
    Gil-I think I will do that.
    Judy--they are doing ok (aside from a string of bad luck ranging from an inhabitable apartment to a run to the ER for stiches!). We are putting a business together for them since it is so hard for them to find a job here.
    Thanks for the comments everyone!

  7. I think its very intresting. i never used to even budget. i had never more then 10$ in my own account.