Outstanding Debt as of June 2008

How quickly a month passes!

It seems that only a few days ago I was updating you on my outstanding debt for May 2008. And here we are halfway through June.

Last month was a good month. I finally feel that I’ve fully recovered from the last six months of out-of-the-ordinary expenses.

I haven’t made a big push to pay off debt this last month because I’m building up my cash reserves and planning for January 2009 (when my taxes will be due).

Nevertheless, our debt went down by a good chunk. Here are the numbers…

Outstanding Debt as of June 2008

As you can see, we reduced our debt by $1,396.57 last month. Not great, but not bad either.

In other news, my articles were featured in the following Carnivals last month:

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5 thoughts on “Outstanding Debt as of June 2008”

  1. Hmmm… makes me think whether it would better to just spend money set aside for taxes on paying off debt, even if you have to borrow it back in January.

    At least that way you put the money to use deferring debt for six months.

    You’d avoid six months of interest, which would more money put towards paying off debt.

    E.g. Let’s say you have $5000 right now that you’ll owe Uncle Sam in January.

    You put that towards a line of credit (instead of saving it).

    At 20% annual, you’ll save $500 in interest between now and then.

    Even though you’ll have borrow it back, at least you saved $500 in interest. While if you keep it in savings, you’ll just make 2 or 3% interest.

    Not saying that’s what you should do, but just wondering what you thought?

  2. @John – Good points.

    Currently, my highest interest rate is 12.25%. So while I would save some interest, I might save more or less than $500. I’m not sure.

    Lately, I’ve noticed credit card companies are advertising to business owners heavily during tax season. Why? To get them to pay their taxes with a credit card, of course!

    But to do so, the credit card companies are charging pretty hefty fees. (Similar to what a person might pay for a balance transfer, cash advance, etc.)

    I have considered doing it this way, but how much would the fees cut into the amount I saved by paying down debt? And would I be able to secure a low interest rate on the amount I borrow to pay the IRS?

    It’s these unknown factors that make me want to save money now so I don’t wind up in a pickle later.

  3. Ryan

    I applaud you posting your progress for the world. Have you shared you process yet? If you have let me know the link, I’d like to read it. So far my favorite has been Dave Ramsey’s debt snowball effect.

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