Why missing your monthly payments is a spiral of doom

1105-725497-mI’m like obsessive about my bills. I know when exactly they are due, I know which ones are ACH withdrawals and which ones are debit card. I know exactly how long it takes for the ACH ones to go through and exactly how much each month I have in bills.  Its borderline OCD. I have lists upon lists of bills scribbled everywhere on top of my budget apps, and my budget spreadsheets.

My monthly bills fall all over the place with due dates, its really quite annoying. Some are due on the 7th and others due on the 17th (trust me, I’ve called to have them change them and its a big pain in my ass, so I deal with it). But KNOWING when they are due allows me to PREPARE for when they are due. I know that on the 12th of every month, no later than the 14th I HAVE to have the money in my account for my car insurance to come out. (takes 2 days to go through with this particular ACH withdrawal) I have to watch what I spend over the course of those two weeks after I get paid to ensure I have that money in my account.

Paying your bills on time is incredibly important. It seems pretty obvious right? To pay them on time is just what you’re supposed to do. But WHY is it so important!?

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Well first off, depending on the bill, it can dramatically affect your credit score. For example, my payment history for my car is 99% perfect. There was ONE payment back in 2012 that was 30 days late. Just one, and it affected my credit score.  It sucks a big one, there’s also 3 missed payments on a student loan (it was inbetween the grace period and starting school again) which drops my payment history to less than perfect on those as well.

Missing payments hurts your credit. Its one of the main reasons why you should be striving to get your bills paid on time. If you want to buy a house or maybe get a new car or maybe you want to take out a business loan, having good payment history and a good credit score is key.

Missing payments is a total snowball affect, a spiral of doom if you may. Once you miss one, well now the next payment you’ve got two to pay. If you can’t afford to pay two, then you’re going to have 3 due the following month. It just builds and builds and takes much longer to fix the problem.

It also costs you more than the monthly payment to miss one. I’ve yet to come across a company that DOESNT charge a late fee, and if you miss your credit card payment your slammed with a crazy late fee (hello, mine is like $40!) PLUS interest! Depending on your interest rate, it can add up quick. For example, when I had a credit card balance of $950 (I paid it off last month, woot woot!) I was paying $20-22 a month in interest. if I were to miss my payment, I would pay a $40 late fee plus the $20 in interest, so $60 all together. The following month, I’d now be paying interest on that $60 as well!  If you are trying to pay things down quickly like I was/am, I have a strategy for you, it works well for me!

This is what I did:

My minimum payment for my card was $25, but I wanted to pay it down faster by paying $200 a month. My payment is due on the 10th of every month. But after my first paycheck, and paying my rent, plus my car insurance I didn’t always have that $200 to pay by the 10th. So I’d pay the $25 minimum before the due date to avoid the late fees and then once I got my 2nd paycheck I’d pay the remaining $175. It kept me on time with my payment and I’m still paying the amount I wanted each month. It also occassionally paid my bill for the next month as well. Like for January, since I paid off my entire balance at the end of December, it counted towards my February’s bill. So I technically had a $0 payment due for January. I still paid of course for January, just as I normally would. But I didn’t need to if I needed to place that cash elsewhere. (I still use my credit card monthly, but never charge more than 15% of the credit limit, and try to pay off the balance in full every month) 

My sister gave me a great strategy, which would work well for a mortgage, or a car payment, or even student loans! Make payments every other week. For example (we’re going to use February & March 2015 as the months in this example):

Say you have a $400 car payment that is due on the 10th of every month. Obviously you need to have your Feb payment made in full the $400. So you pay that by the 10th. If you can manage (this requires you to have a little extra cash to start out) on the 24th of February you pay $200 towards your car payment. On the 10th of March you pay the remaining $200. Then on the 24th of March you pay another $200, so on and so forth. You’re breaking your payment down into smaller chunks, which usually allows you to spread things out a little bit and gives you a little extra padding throughout the month. If your paycheck is say $1000, and you pay your $400 out of that check you’ve gotta make that $600 remaining last, rather than say $800.

So what does this do, besides give you a little extra cushion, and ensure that your full payment is on time each month?

It adds an extra payment. Yep, a whole extra payment. Paying your loan down even faster. If you pay your payment monthly you pay 12 total payments. But every other week? There are 52 weeks, divided by 2 = 26, divide that by 2 =13. One whole payment. If you have a loan that lasts 5 years and you pay every other week, that is an extra 5 months of payments, paying your loan off 5 months earlier! 

So we know WHY its so important to get your bills paid on time. Hurts your credit, can cost you more and it can spiral out of control. So what are some good ways of keeping track?

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Keep a spreadsheet or word document of your bills and when they’re due. That way you always have a list and you can update as needed.

Place the due dates on a calendar. I ALWAYS do this. I’m a very visual person, I like to see when things are due. I color code my Google Calendar when things are due.

Set up reminders. Not for the DAY that they are due, but for a few days before. Mint.com can send you reminders of bills that are due! Or you can set up reminders through your phone’s calendar. Its important to set them up either for a few days before or the day before, because some places (like credit card companies) have a time deadline. So any payments marked for a date after say 8pm will show as paid the following day, making it late)

Always pay your bills FIRST, before you spend on luxury items or extra expenses.  When I get paid, the first thing I do is pay my bills. Before I spend any money on anything else, even groceries.  My first paycheck typically goes towards rent and my car insurance, the extra is for groceries and luxuries. My second paycheck pays the rest of my bills, (including my auto transfer into savings) the remaining goes towards the other things in my budget.

Once you figure out a system that works best for you its much easier to keep track of when things are due and keeping things paid on time. One thing I’d love to eventually do is live off of last month’s paychecks, however it requires me to do a lot of additional saving on top of the saving I’m already doing in preparation for a move. Right now, it doesn’t work for me. Eventually I’d love to make it work!

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Figuring Out Your Life Can Take Time and That’s OK.

Some people are born knowing what they want to do with their lives. They find their passion early on, stick to it and find success in following their dreams and goals. Then there are others (like me!) who spend many years trying to find the right fit, figuring out where I belong and what works and what doesn’t, for me. My dream job? It changes, constantly. As I get older, my priorities change and my dreams change.

When I was a teenager, I thought 100% that I would be living in LA, traveling the world as an actress. Acting was my escape from my shy natured self. It let me be someone else, even for just a few hours a day. By the time I graduated high school, I decided the way for me to get out of where I was to go to school. I decided one way or another I’d be working in film. Whether it be in front of the camera, or behind. That fell through pretty quickly, after about a year and a half of film school I got so overwhelmed and underwhelmed by the industry that I realized I needed to be back where my heart (at the time) belonged. Theater. I graduated with a degree in theater after an extra year of school, but I found myself more facinated with the behind the scenes, the makeup, the directing and producing. But by the time I actually graduated, I was so burned out I couldn’t even muster the motivation to work in makeup for money. I was 23 at the time and had to step back and re-evaluate.

I’ve re-evaluated my life like 15 times over the course of the last 12 years. 

I decided perhaps the things I enjoyed while I was in school, the history of theater, the background, the teaching was where I belonged. I went back to school for a 2nd bachelors degree in the hopes I could work as a professor teaching theater history. The pathway to working as a professor is long and hard and is still something I would love to do, but that long path was not going to pay my bills quite yet.

The last few years I’ve taken some time, found a job that I enjoy and figured out what I don’t like. I thought being a therapist would be a great option for me because everyone comes to me for advice. But then I realized, that the hardknocks of others lives can be really hard to deal with personally. I’m an optimistic person, I live in optimism, but hearing sad stories over and over again wears you down. Therapy was not for me. I’m glad I realized it fairly quickly because it would have been another MASSIVE amount of student loans for me to pay off. (I just did some exit counseling for my student loans and according to the government, in order for me to maintain my current expenses AND pay my student loans, I need to make an income of $141,500 a year! I mean hey! Government! If you’ve got a job that will pay me that, please let me know! because I’ll take it!)

Here’s the thing. I’m still figuring it out. And that’s OK!

I have an idea of where I want to go and what I want to do. I decided a masters in a more broad area (think strategic marketing) will open up a whole bunch of doors for me, from running my own business, helping others run theirs and working with non-profits.

So why all this back story? 

Part of my journey to figuring out what I want to do is embracing the fact that I have no freaking clue. I take each day and I go forward with the idea that I’ll figure it out, but I’m going to live in the moment, and for the NOW.

I want to share that sentiment with people! I want you to know that it is TOTALLY ok if you don’t have it figured out. Its ok to try new things, realize that they aren’t going to work for you and start something new. Its ok to have a million different ideas and to let some fizzle and some soar (like me, and this blog) The biggest thing you have to remember?

You have to try.

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Via Pinterest

 

But here’s my one note of caution. Before you invest a ton of money into a new business venture, and I’m not talking a few hundred dollars, I’m talking lots of time and lots of money. Be a little more sure. Find opportunities to test the waters, try internships, try shadowing and spend sometime trying your position before you jump into a new business. I’ve been there, invested thousands of dollars in a starting a freelance makeup business only to find it wasn’t for me. I’ve started and stopped many a direct sales companies and was left with a lot of money spent and not a lot of money gained. You have to try, but don’t dive before you have a good understanding of the work it takes.

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Via Pinterest

 

If you haven’t had a chance, check out my About Me page. Through my life experience and my kick ass advice giving (according to friends and family) I’m going to be offering some life coaching through the blog. If you are trying to figure out what you want to do with your career, or maybe you’re just trying to figure out relationships, finances, health or having a hard time accomplishing the tasks you need to accomplish, I want to help!

I’m going to be offering TWO FREE month long one on one coaching sessions for the month of February. If you are interested, shoot me an email! It’s going to be first come first serve so email me! If you’re still interested I’ll be developing a price list for One Month, 3 month and 6 month coaching sessions!

I’m super excited about it! I want to help you be the best that you can be, in every aspect of your life!

 

January Goals & Plans + 2014 in Review!

Can you believe that we just absolutely flew through 2014. It seemed like the longest and shortest year all at the same time.  My 2014 was challenging to say the least. But I’m CRAZY optimistic for 2015! Its gonna be gooooooood. I gotta feeling.

But before I get on to my 2015 Goals ( I don’t do resolutions, I never stick to them) I’m going to fill ya in what I’ve got planned for January! I’m hoping to start the year off just right!

For the Blog! 

My sister is still working on my blog design (while you’re at it, you can check out her blog Hopeful Tides) but I’m hoping that we can get it all launched and live by January 15 😉 😉 Heather! I’m super excited about it, because she gave me a little sneak preview of what my new logo is going to look like with the AWESOME blog planner she made me for Christmas! Its perfect and just what I want.

Once it goes live, I’ll finally be able to start advertising, sponsoring ads and working with affiliates. It will also allow me to utilize some plugins that can help optimize the site and hopefully help me generate more traffic! Its been slow going over here on The O Guide!

I also got the camera I wanted for christmas! Yay me! So now I can really work on my photography! I got the tools, now I just need to beef up my skills and my styling. My styling is beyond pathetic.

So now that I have my camera, I can play around with outfit photos. I have a photoshoot scheduled on the books with Walking Dot Photography at the end of the month and I’m really looking forward to working with Giedre! I’ll have some awesome shots to share for sure! Hopefully the shoot will get me extra motivated to do some more outfit posts. For now I’ve gotta plan that outfit….decisions decisions.

Health and Home Goals

Pepper Pico de gallo peppers

For January I’m doing my Cleaning Challenge and really going through everything. Its amazing what you find and how much you realize you’re kinda a packrat. I cleaned out my medicine cabinet on Tuesday night as part of Day 2 of my challenge and had to toss about 95% of it because it was expired. And to think…I moved that stuff with me when I moved into my place. Its refreshing to go through and toss stuff. Things you don’t need, are expired or haven’t touched in years. Really simplify things, it makes life easier for sure. I can’t wait for the Giant Purge of 2015. Coming to my Chicago Apartment soon.

Healthwise, I really want to get back into my clean eating routine that I was in before. I really did feel great when I was doing it. I’m not the “woo-woo” medicine type, but I do think that eating overly-processed foods with lots of extra stuff in them can affect your body negatively. When I stopped eating the overly processed stuff, and started making everything from scratch, I lost weight, had more energy and noticed a difference in my general health. My skin looked better and I didn’t feel sluggish. And when I did eat something processed I noticed a difference right away, mostly I felt super tired. When I’m eating clean, I don’t do a full 100% its really challenging to do so, especially if you eat out. So I aim for a 85-90% range of clean eating. So for January I really want to get back to it. See if will finally help me kick that last 10lbs out the door.

I try as much as possible to seek out alternative methods to solving health problems before I just jump to drugging myself up. Yes, when its too bad for alternative methods to help, I seek out traditional medications. But I’ve found that acupuncture, chirocpractic treatments and herbal remedies have helped me stay healthy this year, without having to go to the doctor for antibiotics. I want to try to start taking more preventative measures to avoid getting sick. My allergist has recommended that I use a sinus rinse daily, I haven’t done it at all but I want to start. Plus I still want to get those morning yoga routines in there.

Money Goals

Ooooh I’ve got them. For the whole year obviously but for January I’m really striving to cut back my shopping and eating out. I’ve made it through this week with not eating out for lunch once! New Years Eve is a different beast as you’re bound to spend a little dough. I’m really going to shoot for the 2nd week of January to be the same. And try to fit in a No-Spend week in there too. I always find no-spend weeks kind of funny, because you have to spend a little in order to have one. After cleaning out my fridge, I have to stock up on groceries before I can have a successful no-spend week. I have a bunch of produce frozen in the freezer, but I definitely want to give a little meal planning a shot for that week and see where it gets me and if I can make it work. I really suck at meal planning.

In addition to my goals on not spending money. I also plan on spending a little. I’ve been tossing around the idea of starting an Etsy shop for some jewelry. I made friends and family jewelry for christmas and I really loved doing it! So much so that I decided I really want to give it a shot. So I’m going to throw down some (more) money on jewelry making supplies and try to get my butt into gear and make some necklaces. Hopefully by the end of January I can have an Etsy shop up and running! Once I get things all situated, I’ll be reaching out to some of my fashion blogger friends out there who’d like to collaborate!

2014 in Review!

It was a odd year I feel like. So many things good and bad happened.

Great things! 

One great thing?? I made the switch to lifestyle on The O Guide, it honestly was the best thing I ever did. As much as I love sharing sexual health related topics, I enjoy blogging so much more now. My creative juices are always flowing! I do plan on incorporating more sexual health topics in the future!

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I got to take an AMAZING trip to Argentina to visit my boyfriend. It was beyond amazing and so great to spend nearly a month with him. It really brought us closer, I would have been completely content with relocating to Argentina…I mean there’s so much wine! But I’m insanely excited that he decided to relocate to England instead. Its the one place in the world that I’ve always dreamed of living and next year I’ll get my chance!

Picture From British Council

Picture From British Council

Speaking of London! I got accepted into the University of Greenwich, for their Masters in Strategic Marketing program! One year of a masters program there is cheaper than going to school here. Although I have to save up lots of money for my visa, it will be well worth it in the end.  Ummm…yeah that is the campus. I could DIE!

Like I mentioned in my December Budget Recap, I paid off my car! And my credit card! I’ve really worked hard the last few months to pay down some of my debt and get money into my savings account. Paying off my car was seriously like the BEST. DAY. EVER. I can’t wait to sell it…ha.  So not only have I paid down two decent sized amounts of debt (totally about $3500) I also bought a plane ticket to Argentina and still had money left over in my savings. Overall I feel like I did great moneywise in 2014. And I know 2015 is only going to be better. Although it will hurt when all the money I saved is going to just be dropping like little $1000 flies when I start booking my move…

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On the Downside 😦

Not everything was great in 2014. In September, my grandmother passed away. It was very unexpected as she went in for a routine surgery that she would have been back home shortly after it was complete. It wasn’t the case. Although its always hard to loose someone, we all knew that she ultimately was in a better place. This Christmas was a little less Christmas-y without her.

I’m still apart from my boyfriend. As much as I’d like to jump the pond right this instant and start our lives together now. Its just not possible, 2014 was up and down with his job and location and starting a long distance relationship was challenging. But we keep our eye on the prize and 2015 will hopefully be easier…just a little more waiting to do.

I still haven’t managed to accomplish my goals in regards to my weight. I know, I know, I don’t need to try so hard to loose weight, people say I’m thin as it is. But for me, its important for me to feel confident in my body. I’ve been to a point where I really was super happy with it and I haven’t been there in a few years. I’d like to get back to it!

I had to let a friend down about her wedding. I was asked to stand up in a wedding this summer of one of my closest friends, but in September, my sister got engaged and booked her wedding venue…on the same day. It put me in a difficult spot but I’m grateful that my friend was really understanding about everything. It’s not a fun situation to be in.

I realized I have a serious shopping problem. It was really getting out of control. I’m starting to reign it in, thank goodness. But I realized that a lot of it is a result of a. boredom, b. the people I’m around, and c. having new financial “freedom” (which really wasn’t freedom, because I should have been paying off my debt instead). It really made me take a hard look at my habits, myself and the people I surround myself with. This was a good and bad thing. Bad that I was shopping so much, but good that it made me kick myself in the ass.

Overall, 2014 was a true year of discovery. But 2015 is going to be an adventure.