Debt Free Journey | January 2020 Update

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In January we did our first ever no spend month.

Our goal with the no spend month, was basically to “reset” our budget and bank accounts after all of the crazy December spending.

Even though we did a great job of sticking to our December budget, our spending was definitely increased due to Christmas and other holiday expenses.

A no spend month is a great way to identify problem areas in your budget, catch up if you’re behind on bills, or put extra cash toward a financial goal.

We paid all of our regular bills and necessary expenses, but we eliminated our “fun money” budget, and avoided unnecessary activities.

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    The only time we “cheated” on our no spend month was when a close friend made a surprise visit.

    We rearranged our grocery budget so we could join him for dinner and a night out, without busting our budget! It was worth it, in my opinion!

    Even though we did a no spend month, we still didn’t have a huge debt payment this month.

    We brought home less income from the office, and used the extra cash flow to catch up on some bills at our practice.

    Want to know more about our debt free journey progress? Check out my Financial Peace University Review here.

    Keep reading for all the numbers for our January 2020 Debt Free Journey update.

    Want to go back to the beginningStart here.

    Don’t forget to check out our debt free journey on YouTube as well.  I’d love to see you over there!

    How much debt did we pay off in January?

    Debt Payoff Total for January:  $4,968.43

    Total Debt Paid to Date:  $56,965.07

    The past couple of months have been smaller debt payments, but we just have to remember that progress is progress!

    Here is how we were able to pay off $56,965.07 in 7 months.

    After cutting out our car payments, downsizing our home, and getting on a super tight budget, we are able to live on well under $4,000/month.

    More on our Debt Free Journey:

    These are our basic “necessary” expenses that do not change (much) each month:

    Rent:  $1,328

    Water: $107.12

    Electricity: $140.84 (Christmas lights, bumped up our bill!)

    Home Security:  $43.29

    Internet: $67.86

    TV:  $0 Playstation Vue ended their service, so we are switching to YouTube TV.

    Netflix:  $14 (haha, it’s necessary!)

    Groceries:  $600 (This includes one large Costco trip, cleaning supplies, hair products, deodorant, etc)

    Gym: $22 (we use it!)

    Giving:  $200

    Dan Fun Money:  $0 (No spend month!)

    Shannon Fun Money:  $0 (No spend month!)

    Child Care:  $420 (Extra this month due to new semester “supply fee”)

    Contact Subscription (Hubble Free Trial):  $36

    Health Care: (Health Sharing Ministry) $135

    Auto Insurance: $82

    Renter’s Insurance:  $17

    Identity Theft Protection: $13

    Total “Bare Bones” Monthly Expenses:  $3226.11

    (Almost $500 less than usual thanks to our no spend month!)

    The ability to live on less than $50,000/year gives me security, knowing that even if our medical practice closed tomorrow, we could quickly find work to support our family.

    Where does the money to Pay Debt come from?!

    We own our own business and pay ourselves an income from the monthly business budget.

    After taxes we bring home about $6000/month (but this month we brought home less in order to catch up on some office bills), leaving us almost $3,000 each month to use for whatever other miscellaneous expenses we might have that month.

    We try to keep our miscellaneous expenses low, in order to pay more debt!

    We always plan how we spend extra money…EXACTLY…down to the penny.

    RelatedHow to do a Zero Based Budget

    For example, in January we set aside money in our budget for things like:

    • Since we did a “no spend month” the only miscellaneous expense we had was a couple of annual subscription renewals and an oil change.

    And of course….anything extra goes to debt!

    Paying ourselves a simple set salary each month from our business, helps us to control our spending at home.

    We also keep our office on a tight budget.

    I’m currently learning a new way of budgeting for the office called the “Profit First” method, and can’t wait to share once I become an “expert”.

    Since it’s a medical practice, the expenses are very high, and we struggle to figure out the best way to budget the super inconsistent income.

    The plus side, is that we have a 4 year history of practice financials to go by, so I look at our worst income month, and have reduced our office spending to be about equal to that.

    This means that if we have a great month, ALL of that extra money is available to go to debt!

    We do one giant debt snowball, that includes our home and business debt all together.

    January Debt Pay Off

    Total minimum debt payments January:  $4286.67

    Total extra debt paid January:  $681.76

    Debt Payoff Total for January:  $4968.43

    Total Debt Paid to Date:  $56,965.07

    January milestone: We paid off our smallest student loan!

    February Goals:

    • Start attacking next smallest student loan

    New this month: I had my best blogging income month! I’m hoping to continue this increase and use my blog income to pay off more debt!

    Our next debts on our debt snowball are:

    • Student Loan 2: $2060.33

    Changes to our Debt Payoff Plan for next month

    My blog is making money! You can read more about that here.

    After working for almost 3 years on building my online business, it’s finally starting to make a profit!

    I’m hoping to start investing half of my blogging income back into the business, and the other half will start going to debt (and taxes).

    Check out my first blogging income report here, if that’s something that interest you!

    I have a lot of ideas to grow my blog, and help others pay off debt! I’m so excited to see what God has in store for my blog and our finances in 2020!

    Related: How to start a blog, How to Make Money Blogging

    Are we on track with our Debt Payoff Goals?!

    This might seem like a lot of debt to pay off in such a short time, but don’t forget how much we started with.

    Our plan is to be debt free in by Summer 2022, which means we will need to pay off closer to $17,000/month!

    In February, we will continue to work on getting new patients in the office, and I will keep working hard to grow my blog as a source of side hustle income.

    With the combination of controlling our spending, and increasing our income I am still confident we will do this faster than three years.

    See you next month!

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    hi! I'm shannon

    I’m a wife, mom of three, doctor, and blogger! In 2018, I decided to turn my mom blog, into a personal finance blog so others could follow along on our journey to pay off over HALF a MILLION dollars in student loan and practice start up debt. I hope you enjoy following along, and maybe even find some inspiration along the way.