Balance Transfer Complete!

It's official. I've transferred over $7,500 of my debt to the Citibank card leaving only $1,499 on my previous card. With the transfer, I'll only be paying about $5 per month on interest instead of about $30 and it puts me closer to being able to use my credit line for my devious money making scheme using those 0% interest checks from your credit card.

Here's the plan. Once I have $0 on my credit card with the credit line of $23,700 I can use one of those checks that gives you 0% interest for 6 months to put directly into my savings account. The credit card company will charge $50 max for the balance transfer and that would be the only fee I would have to pay as long as I paid the money back within the 6 months. I would write the check to myself for $23,000 and sit on it for 5 months to give myself a bit of a cushion. Even better, if I deposit the money into my ING Direct account it would earn me 4.75% interest until April 15, 2006 with their promotional Winter Save Up Sale. Assuming that it takes me another month and a half to pay off the remaining $1,500 on my card, the money could be deposited in the ING account in 2 months. Unfortunately, that would only leave me about 15 days to earn at the higher rate, but so be it! Even after that date it would be earning at the regular savings rate of 3.8%. That would earn me over the 5 month period a little over $314 or $63 a month. Not bad for doing nothing at all.

Tomorrow is the first day of classes. I'm nervous to go back but also excited to see what it will be like. Wish me luck!

Debt as a Mental Prison

I'm not sure if you've been able to tell in my tone, but man, this debt has been taking a great toll on my mental stability. I've compared myself to a hermit, in private thought of my life as a hell, then moved on to thinking of it more as a form of purgatory, a limbo stage that I must pass through before I can move on to a brighter future. It got me thinking about the psychology of debt and how it is affecting all of the other areas of my life.

For example, work is the one element in my life that is most directly related to getting out of debt. I loathe going to work everyday because I feel like it is a form of punishment for my debts. I get frustrated with work because it is not helping me get out of debt fast enough and I feel like I am trapped working there because of my debt. No matter how much I don't like going there everyday, I feel like I have to because if I don't, the debt will only get bigger and bigger.

How messed up is that?

Another example. Like I posted before, I feel like my social life is suffering because of the debt. I can't go on vacations. I can't buy new clothes. I can't spend money to go out and do fun things. Any sort of pleasure that involves spending money is laden with guilt.

Realizing all this, I know that I cannot constantly be looking towards my "life without debt" as the oasis on the horizon. I have to stop using my debt as an excuse for why I can't do this or I can't do that. Debt is just one aspect of my life and it shouldn't rule all of the others. So hurrah for me, tomorrow is a new day!

On another note, a while ago, I was selling lots of books and CDs on Half.com and Amazon. I managed to make some extra cash that way and get rid of lots of clutter. I had totally forgotten that I still had stuff listed on Half.com until yesterday when I was checking my online bank statement and noticed a deposit from Half.com. I was confused because it had been months since I sold anything and just assumed that I had forgotten that there was any money in my account and this was just old money. I checked back at half.com's website and saw that there were 4 books that had sold in January. Being the ditz that I can be at times, I thought "Oh January, those must be the old ones and marked them all as shipped". Duh! I guess I have no concept that the month we are in now is January! Maybe this is part of the problem of living in California; every month of the year seems to be exactly the same. I then realized that I would have to go back and issue a refund for each of the books that I sold because I gave all the ones I didn't sell to the Good Will but of course, I had another blond moment and checked on "issue full refund + return shipping" charging my account more than the amount that the buyer had actually paid. Oops. I guess lesson learned; if you're going to sell stuff online you must remember to take it off once you no longer have it!

Back to the Real World

It feels good to be back at home after being at work for a few days straight. The hotel was amazingly nice and being around so many people with so much money was both depressing and inspiring. It was like living in a parallel universe where people go in and fold the toilet paper on the roll into a little tip every hour and where you are rubbing elbows with people who made $7 million dollars in just one year. Its depressing because you know that they could pay your debt and would never notice that the money was ever gone. Inspiring because you see how these are normal people and perhaps you can do it too.

I saw the guy who co-authored the Millionaire Next Door. I was looking forward to hearing him talk but ended up being bored out of my mind. I felt like I was in a college lecture hall as he was talking about his book. If you've already read the book than you pretty much already know what the guy is about (living below your means, love what you do, etc). On the other hand, I was blown away by Nido Quebin who wrote "Stairway to Success". Wow, talk about motivational. He managed to get people pumped up without being cheesy or corny. It makes me want to have him on speed dial every time I get discouraged to remember to keep truckin on.

That is the problem with those motivational speakers. The effects are usually only temporary. But I am still psyched that the debt keeps going down, I'm close to being under $9,000! As soon as I got back I did my taxes and figured out that I paid waaaaay too much on my taxes. I was really trying not to. I used the IRS tax calculator to see if I was overpaying so I could adjust it but it said I would only end up with a $200 refund so I never changed anything. Come to find out that after I did the federal file that I should be getting back $820 and $120 from the state. It will be nice once I get the money to be able to put it all towards my debt but it would have been even nicer to have had that money earlier so it could have already been paid down!

Debt Hermit

I realized something about myself today. I have become a debt hermit. I came upon this realization today when I went to the mall to pick up a pair of pants that had been tailored. While I was there I decided to go into Forever 21 to look around. I told myself that I was just going to look to see if they had a shawl or something to wear with my dress for Saturday night but ended up finding a few casual tops that I wanted to buy. I thought I really needed these tops because during the conference I'll be forced into situations where I will have to wear non-work clothes and wanted to look nice. For any of you that know Forever 21 you will know that everything is inexpensive and cheaply made so a few tops would have probably cost $50 tops. I had everything ready and was walking to the checkout stand when my logical, frugal self took hold.

I realized I didn't really need these clothes but rather that buying the new clothes was part of a coping mechanism that I use for facing social situations. Somehow I feel much better about being social with people when I am wearing new clothes and if I feel that I have nothing to wear, I will avoid the situation at all costs. This is partly how I got into so much debt in the first place. If I had a date I would have to buy a new outfit. If I was going out with friends I felt the need to buy something new. Now, since I can't run out and buy a new outfit on every occasion (nor should I ever even if I didn't have debt) I avoid the situations and stay at home as much as possible.

I know part of my shopping neurosis is imagined whereas part of shopping neurosis is very real. People are judged so often by what they wear, what they drive, what latest gadget they have that I don't wonder why people have so much debt from trying to live up to what people expect them to be. I think I felt this pressure much less when I lived in northern California because people were much more laid back there.

So I wonder, if they had a map showing the areas with the highest concentration of debt-laden individuals, where would they be?

New Credit Card & balance Transfer

Today, I applied for a new credit card. Yikes! O.k. it's really not that bad. I signed up for a Citi Platinum Select MasterCard and was approved for a $7,500 limit. The great thing about this card is that you get 0% APR for 12 months on balance transfers with no balance transfer fees. That means that once I transfer over the $7,500 I will only have $2,293 at 3.99% APR to pay for the rest of my debt-ridden life. Over the long run this will probably only save a little over $100 but any bit helps and it will help me pay it down faster. I have not received the card yet and before I transfer any money I am going to call them to make doubly sure that there are no hidden fees. I will keep you posted.

In other "news", I have been stressing out about my company's upcoming National Conference. This is where all of the nearly 800 people from the company fly out to California to meet, network and get pumped up about the coming year. Of course, being in the real estate industry which is very sales and all about appearance and projecting an image of wealth and prosperity, there is pressure to look your absolute best. The girl in me feels the need to go out and buy a whole new wardrobe so that I feel like I will be suitably dressed but my extreme guilt about spending money on anything but the necessities is holding me back. I think that is part of what got me in this debt in the first place (the feeling that the outfit, the hair, etc will make me feel more confident and more at ease). One thing that I have to buy for sure (theres no getting out of this) is a dress for the black-tie event. Ugh. I hate buying dresses, especially dresses that I will probably never wear again. SIGH.

The one thing about the conference that I am looking forward to is our keynote speaker, William Danko, who is the co-author of The Millionaire Next Door. I really enjoyed the book and I am interested in what he will have to say.

One other good thing about the conference is that it will mean lots of overtime, not nearly enough considering I will be there from Wednesday to Sunday. But any extra money will mean that the debt will go down faster!

Save Karyn

My favorite radio show in the world is To The Best of Our Knowledge. Every week they interview people about a theme. These people can be authors, musicians, artists, or just people with an interesting story to tell. This morning, I was listening to an older program that dealt with shopping. Of course, no discussion about shopping is complete without throwing debt into the equation.

They interviewed someone who was in a similar situation to myself. She was young (in her 20's) and had found herself in over $20,000 in credit card debt after she moved to New York and succumbed to the extravagant lifestyle. After she lost her job and could pay her bills anymore she became determined to pay off her debt and started a website called Save Karyn. She basically asked everyone to donate money to her cause and amazingly enough, people actually gave her money. She is now debt free thanks to her savings effort and through the generous donations of others. She wrote a book that I am tempted to buy all about how she got into debt into the first place and how she got out of it by "internet panhandling".

It's stories like these that give you that "why didn't I think of that feeling". Actually, I did think of it, but my pride wouldn't let me turn this blog into a donation center. It's funny to think that this approach actually worked for someone and now they are debt free and selling books! Maybe I should have been asking for donations all along...

Going back to school

I finally registered for my one and only class for the Spring 2006 semester. I struggled with how many classes to take. I figured I should just stick with one class so that I don't feel overwhelmed and so I can figure out if I am going to like it at all. I was shocked at how expensive it was, $132 for one class at the community college. I didn't apply for financial aid because I figured that I would qualify and that it would only cost about $60. Comparatively, to what I paid at the UC system it doesn't seem like a lot but I can remember when the cost per unit at a community college was only $13 (and this was only about 4 years ago). Now the cost per unit is double that, $26. Yikes!

Hopefully, this new path will steer me towards greater financial independence at a quicker rate. Lords know I'm never going to get there with my current salary. I can't wait!