Friday, April 25, 2014

Debt-free (and broke)

Earlier today I checked my bank account to see that I had been paid. A few clicks and just over half my salary was transferred to my Irish bank account and just like that, I'm debt-free. 

Actually, the money hasn't hit my Irish bank account yet so it's still showing a minus but it'll get there soon enough. When debt-free day was still far off, I often imagined the exhilaration I would feel and how ecstatic I would be to finally have done it. And now that it's here, I have to admit, I don't really feel much of anything. In all honesty I even feel a bit down. I think it'll take a while for the relief to truly kick in. And, it won't really kick in until I've had a month or two to save and won't be on tenterhooks waiting for the next emergency that'll send me reaching for the credit card again. 

I could have split the remaining debt over the next two months but I just wanted it gone. I was down to 2.53 in my current account and 110 spread over my two savings accounts (annual expenses and travel) when I got paid this morning. I've topped those two accounts back up to 100 each and once my rent and all the other bills are paid, I will have just about 100 euro left for the month. That's 20 per week, which is not much less than I've been living on for the last few weeks, in order to make it possible for me to clear my overdraft this month. In a couple of weeks, I'll get my lunch vouchers from work. We get one voucher worth 3.07 for every day that we spend in work. They can be used at some restaurants and cafes, supermarkets, some bakeries and that kind of thing. So long as nothing happens next week, I will have worked the full 20 days in April and so that's another 60 odd euro I can use. I do still have a couple of vouchers left from last month as well. 

My budget each week will be more or less 10 euro cash for the market, 10 euro cash for table quiz (optional obviously, but the social contact and fun is great at the moment so I'm choosing to make it a priority - also, since it's on a Sunday evening, it's a nice reward for getting to the end of the week) and then around 10 euro of vouchers to get some bits and pieces from the supermarket as needed. 

For the one or two other things that I know are going to come up I can use my credit card and then, like a normal person, pay it off in full at the end of the month. But I want to really keep that to a minimum as I don't want to end up in another situation where I'm chasing my tail. I'm glad that Germany is still a country where cash is in common use and it is not unusual for many shops and most restaurants to not accept credit cards. So if it's something I can only pay cash for, I'll pull it from savings. For example, I have an appointment at the gynaecologist in a few weeks, which I had forgotten about. In addition to the standard smear test I'm having ultrasounds done and that isn't covered by the Krankenkasse (health insurance) so I'll take the 70 euro for that out of my annual expenses account. That's what it's for after all, annual expenses. 

Another examples, I'm invited to a birthday party tomorrow so will buy something small for that. Of course, I was thinking I might get a nice plant for my friend's apartment and flower shops are another place that don't take credit cards. I do have a gift card for a bookshop with 20 euro still on it so I might take a look in there tomorrow first and see if anything catches my eye. It's a friend from choir and I know him just well enough to know that I don't know him well enough to choose something he'd really like, which is why I thought a plant might be nice - generic but he just moved into a new place last year so doesn't have much like that yet. And then later in the month I'll have book club - we're going out for Indian food and I'm really looking forward to that. 

I'm flying to Ireland for a friend's wedding in June and want to book a hotel and car for then. I could wait until June itself but I'd like to get that booked and sorted rather than run the risk of prices going up closer to the time. So I will wait until my credit card billing period is up, around the 10th of the month, and book then. Flight is already booked and paid for. 

And so it continues and the journey of learning how to deal properly with money begins in earnest. By August I'd like to be at the stage of saving as close to 50% of my salary as possible. That's the only way I'm going to have enough to fund a potential move, not to mention a potential pay-cut (in order to get a job I can love) next year. But first, let's all have a great weekend!


Anonymous said...

HUGE, HUGE congratulations. I'm so happy for you, and even if you don't feel celebratory and it seems a bit of an anti-climax, someone somewhere (me) is thrilled to bits that you have achieved your ambition. It's been a long time coming and you've never taken your eye off this point. Being debt free gives you a range of choices you haven't had for years. And you're there - and you got there through sheer determination, hard work, self-discipline, making tough choices and working really hard at sticking with them. Well done and please accept my heartiest congratulations.

One of the lovliest things about achieving a goal is realising afterwards that if you can do that, you can, with a bit of application, achieve the next one - the new job, the move - pretty much whatever you set your mind to, once you decide to give it your all. I'm looking forward to hearing about what comes next.

I've also been thinking about your aunt and her passing, and I'm sorry I didn't get in touch to offer you my condolences. I was very touched by your descriptions of her love turned into action with the potatoes and I'll carry that image for a long time. It was so gentle, kind and loving. Long may her memory live on, particularly in those who read your blog who never met her.

Baroness Prudent Spending said...

Congrats Moonwaves! I'm sorry you feel a little down right now but you will so great once you start building up that savings. You are doing really, really well. Keep plugging ahead! ~ Pru

Ron said...

Congrats! Very happy for you. It only seems anti-climatic because culture has accepted debt as the norm. Debt free gives you options, and that will be appreciated when you exercise them.

I'd much rather be broke and own what I have than be in debt, worried about my future ability to repay.

Anonymous said...

Congratulations, you. We are fortunat that we've never had a debt, and we intend to keep it that way. It gives us lots more options even though our society will keep telling us the opposite...

Moonwaves said...

Thanks everyone. Still doesn't feel quite real but I'll get used to it, I'm sure. :-)

Fiona said...

Yes, HUGE congratulations! I think it always does feel a bit anti-climactic when you've worked towards something for a long time, then the day suddenly arrives. But hopefully you'll also have so many days of waking up feeling tickled pink to know that debt is gone.