August 2020 Debt Snowball Update
Did we make progress on our August 2020 Debt Snowball?
I got so much positive feedback on our debt-free journey post that I decided to do monthly updates on our debt snowball.
So, let’s get started with the first Well-Balanced Wallet Debt Snowball update.
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Our current budget
I shared in the debt-free journey post that we live on last month’s income. This means the money that we made in July was the money that we spent in August for our Debt Snowball.
July happened to be a three-paycheck month for myself and my husband so we did have a little bit of extra money to go towards our debt snowball this month. It won’t always look like this.
Just to give you an update on what we’re paying. We have a medical bill for a bit over $800 and we have a car loan for about $5,000.
There are also medical bills in collections for around $6,000. In May, we purchased a home and we owe around $180,000.
We also have student loans, but I’m not including them in our debt snowball just yet. I do have a blog post coming up soon to let you guys know why.
Our number one goal for this year is to pay off the medical bill and the car loan by December 31st 2020.
The worksheets in this post are from the Well Balanced Wallet Debt Snowball Toolkit. Download your copy for free to follow along.
Debt snowball update
So, first up is the medical bill. Since we did have a little bit of extra money this month being that we have the three paychecks in July, I was able to pay the medical bill off completely.
Next, we have our car loan. For the month of August, this is where the remaining amount of our extra money went.
We were able to pay the minimum payment, which is $260 plus all the extra money that we had. So, in total, we paid $1,316 and some change for our car loan, which left us with a balance of $4,480.92.
We didn’t pay anything on the collections just because we’re not there yet and I don’t want to open that up until we’re actually ready to pay it.
Lastly, our home loan. We’re only going to pay our mortgage (nothing extra) for now because we’re trying to get the car loan paid off.
The home loan is going to be the same every month. It will be $1265.64, which leaves us with a remaining balance of $188,799.26.
In August, we paid off $3,410 of our debt, and we are super excited about it because we have one less debt so we’re that much closer to our goal to pay off the medical bill and car loan by December.
The bottom line
The reason why we were able to pay so much is because we didn’t have much going on in August. And then also we had those three paychecks in July, which helped out a lot.
Our debt free journey is all about balance. So, while we were able to pay off that much this month, we were still able to add money to a few of our sinking funds and add money to our savings account just to stay on track with our savings goals as well.
I want to hear from you. Are you making progress on your debt free journey? Let us know so that we can all motivate each other and get this debt paid off.
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