Important information about the data: prior to mid 2010, money that went on the credit card never got classified in any category other than credit card. That skews the data for everything from eating out, allowance, pets, house, and misc.

 

I have data going back to 2005, but for now, we’re sticking with what our financial life has looked like since 2008. Why 2008? That was the year I graduated with my MBA, the last year that C and I both had jobs the whole time, the year we had the largest combined income we’ve ever had, and honestly, the last year we went the whole year with our old “everyone has debt” attitude.

You’ll notice, that even though we made more money that year than we have since then, we also spent more. In fact, we spent more than we made, and we pulled a significant amount of money out of savings to help fund that.

Yeah, things weren’t working in 2008, and we didn’t even realize it.

 

Some things to know about 2009- my MIL lived with us that whole year. We ate out a lot. (Sadly, you might also notice that we spent the same amount eating out in 2008.) It also accounts for the spike in groceries. Our bills were also higher, as the MIL doesn’t know how to turn anything off.

But, good things about 2009, we didn’t pay as much to the credit cards, and we were paying them off. And, we paid a lot extra on the car, making it possible to pay it off in early 2010.

However, I was stressed beyond belief about our finances. C lost his job in May, and that was before anyone knew that unemployment was going to last as long as it did. If unemployment for C had ended before we paid off the car the following March, we wouldn’t have made it.

At the end of 2009 (December 30), I joined the Women in Red Racers to help get the support I needed for paying down debt. On that day, we had over $71,750 if non-mortgage debt.

 

2010 was a win, on so many levels. We paid off the car and the credit cards. In fact, we paid off almost $24,500 in debt AND saved about $5,300 in an emergency fund and to pay for C to go back to school.

 

That brings us to 2011. We only paid off $12,775 in debt. We only saved an additional $1,875. We added $4,775 to our debt. It seems like 2011 was a worse year for us.

But I have to call it a bigger win than 2010. Unemployment ended for C in the middle of the year, causing a drop in income of $6,600. We paid for all of C’s college expenses, over $7,800, in cash. On top of that, our pet expenses were 6 times what they had been in 2010, and those were also paid without debt. And while we added debt, the basement hasn’t flooded a single time this winter.

 

Today, we have reduced our non-house debt to less than $40,000. I finally owe less on my undergrad student loans than I borrowed. I’ve paid off over half of what I borrowed on my graduate student loans. In April, when we pay off the basement work, our non-mortgage debt will be half of what it was at the end of 2009.

 

So yeah, I’m calling 2011 a big win. I hope 2012 will be just as successful.