Hello all.
I've been reading Mr. Money Mustache for a couple of weeks and finally finished every blog posted today. I've been playing the credit card game for years now and I think I've finally seen the light. I read Ramit Sethi's book "I Will Teach You To Be Rich", I've browsed blogs such as getrichslowly.org and recently finished NoMoreHarvardDebt. But I think this one actually speaks to me the most. I want to be financially independent. Not that I don't mind working, I actually love my job and enjoy going to work each day.
While I thrive to be a mini-mustachian, my history is making it incredibly difficult. So I'm looking for advice on what to do.
My situation:
Single, 29 year old woman, 5 year old daughter that I retain primary custody of. (Before anyone asks, custody/child support is not available to be revised.)
Annual INCOME: $45k roughly
Monthly take home: $2,850
EXPENSES:
Mortgage: $890 (includes taxes/insurance) (I tried to sell the house but after 8 months on the market, no bites. Also should note that with my custody arrangements, I'm not allowed to move out of state (Vermont).)
Heating oil: $150
Internet: $55 (required as I'm finishing up my bachelor's degree online, this is the cheapest option available in my town)
Car payment: $320 (I know, I know… and I'm underwater in the car too. I have purchased bicycles for my daughter and I, and only put about 5000 miles on a year, but CANNOT bike to work as it entails a freeway with a NO PEDESTRIANS/BICYCLES sign)
Food: $325
Gas: $100 +/-
Daycare: $130 (this will go down this fall to $55 when my child is in school fulltime, as part of the custody arrangement, I pay one week, he pays three a month)
Electricity: $65
Water/Sewer: $50
Cell phone: $67 (locked into new contract and checked out Republic Wireless, it’s roaming at my house)
Netflix: $8
Insurance: $140 (car with full coverage, life/disability)
Credit Card Debts: $300
Personal Loan: (I tried to consolidate credit cards last year and then subsequently lost my job) $207
TOTAL: $2,600
ASSETS:
Bought a home in 2008 at 6.5%, financed 100%. Refinanced through FHA streamline in 2011 at 4.75%
Currently owe $102k, house worth probably about the same (HUGE downturn in the market right after I bought it, starting to come back)
DEBT:
Credit card 1: $1500
Credit card 2: $3500
Credit card 3: $150
Credit card 4: $450
Credit card 5: $1000
Credit card 6: $300
Personal Loan: $7100
Car Loan: $12000 (car worth about $9000)
Student loans: $30000 (not currently paying and will finish with just over $35000 next year)
I have taken these credit cards out of my wallet and locked away and am no longer accruing more debt. I picked up a second job for a short period of time, but my custody arrangements changed making me unable to work it. I'm expecting an increase in my salary at the end of this year (sooner hopefully). And I typically receive $3000-4000 in tax refunds come the beginning of the year because of education credits, itemized deductions, child tax blah blah blah.
I'm slowly making progress and have cut out cable and pared down my insurance and food as much as I have been able to. I'm worried that I'll be on this cycle forever. I would like to get my ridiculous debt taken care of before I am required to start paying on the student loans (around Sept 2015).
What should I do?
Sincerely,
A Mustachian Want-a-be