Reaching financial milestones is a crucial part of any financial journey, but it’s often easier said than done. When I began this journey, I was ready for a change. I knew I had dug myself into a serious hole, and if I didn’t make some major adjustments, I’d only make my situation worse.
I started my financial journey a few weeks ago with three big goals in mind:
- Pay off $130K in debt: This includes credit cards, car loans, consolidation loans, taxes from my former business, and student loans.
- Build up my wealth in investments.
- Become a millionaire by 40.
In my July 2024 financial journey update, I’ll share the milestones I’ve achieved this month and the steps I took to get there.
Made a filter for all of my bills
My inbox was a hot mess. Even though I had my bills on autopay, I wanted to keep up with what’s happening in my accounts. So, I created a filter for all my bills in my email inbox. It’s also super easy to find a bill if I need to reference it while talking to customer service, especially for situations like getting conned into buying tickets for a wine tour that gets canceled last minute with no refund. 🙃
I opened a checking account just for bills.
I’ve been wanting to get a second checking account for some time now but I just didn’t want to do the math to find out how much I needed from each paycheck. Looking back, I can acknowledge how reckless that was.
Once I was motivated to change my life around, I felt ready to go through all of my fixed expenses and figure out what’s what. After a lil bit of research, I settled on the Discover Cashback Debit account.
This is the first debit card I heard of that gives cash back but there is a caveat – you must spend at least $3000 a month in order to qualify for the 1% cashback. I don’t spend $3000 a month on myself, but my bills are a different story, so why not make some extra cash and utilize my other checking account for my spending money?
I moved my credit card payment date
Credit card companies report your balance to the credit bureaus every month, typically at the end of each billing cycle. If you make your payment shortly before your statement date, it could help reduce your credit utilization, which can help you increase your credit score or maintain good credit.
I Created a Budget
I’ve always hated budgets. I always thought budgets were too restrictive and because I was able to make enough money to pay all my bills, put some in savings, and pay Uncle Sam in full when I was running my business, I thought I had everything under control. And I guess at one point I did but in hindsight, I should’ve been building.
I’ve tried apps and Lord knows I’ve bought several spreadsheets from Etsy but none of them was as effective as I hoped. So I came up with my own digital PDF budget that I can fill out on my iPad or laptop whenever I see fit.
Writing down all of my finances once a week has been a game-changer! Laying everything out, my bills, my variable expenses, and my debts all get taken into consideration whenever I want to splurge on makeup or clothes I don’t need.
Set up savings vaults
I set up a bank account with Sofi after I found out they have early pay with direct deposit, vaults, financial planning, and a high-yield savings AND checking account. I’ve been using it for a couple of months now and I love it!
The vaults are clutch due to the auto draft set up the minute my direct deposit hits my bank account. I set up money to be transferred into a vailt for vacations, car repairs, and my dog. Unfortunately, Sofi doesn’t allow you to open multiple checking accounts but the vaults work pretty much the same!
designed a plan to pay off my credit card debt
I plan to pay off two low-balance credit cards that will give me the boost I need to tackle the bigger cards. Some might call this the Avalanche Method, where you pay off your credit cards with the smallest to largest balance.
I have 3 that are around the same amount but the interest rates for each of them vary. At that point, I plan to switch to the Snowball Method to pay off the one with the highest interest rate. That’s where you pay off the card with the highest interest rate and work your way down.
Each method has its advantages and disadvantages. If you need to pay off credit cards, consider both options depending on your situation.
I’ve learned so much already about my finances and I’m feeling a lot more confident about reaching my goals! If you’re on a similar path, remember: it’s never too late to take control of your finances.
We got this!
