Sticking my head in the sand

Probably the biggest roadblock to getting my finances in order, is my tendency to stick my head in the sand. Much like Scarlett O'hara, I'll worry about it tomorrow.

Last year I went to the emergency room for chest pains. At the time I did not want to go but my daughter was freaking out, so I went.

My insurance had a $2700 deductible, so nothing was covered. I started getting bills and was outraged. I was in the emergency room for exactly 26 minutes and the bills totaled almost $2000. The only thing they did was hook me up to a portable EKG machine for three minutes, say it wasn't a heart attack and then I left.

They wanted to run additional tests but I refused, I knew I could get those tests through my doctor if I needed them. It still cost so much money!

I paid a few of the smaller bills, but in typical fashion, ignored the largest one. Instead of calling and making payment arrangements I ignored it.

Then I got a letter in the mail that the bill has gone to collections. Shit. For a few days, I did what I do best, I ignored it. I finally put some money in an emergency account and with all the weird stuff going on with Covid-19, I didn't want to part with it.

If only I got the letter before I sent my stimulus check to pay off Kohls. Then I realized that if I hadn't paid that bill I would still be paying on it for who knows how long.

So, I took a deep breath and paid the collection account off with my savings. It hurt and shook my stability a bit, but I did it.

I guess that's another habit I need to improve, stop ignoring bills and thinking they will go away. As frustrating as it was to have to part with some of my savings, I know it's my own fault. I will stop sticking my head in the sand.

It does feel good not to have that hanging over my head anymore. Also, I still have a job, so I can build my savings back up.

I paid off my Kohl's card

I did it! I paid off my Kohl's card! It was super stressful. It's so easy to justify that monthly payment. It's easy, doesn't require much effort and really, it's not a lot of money. It would have been very easy to continue making that payment forever. It was much harder to give them $1700 all at once.

Also, department store credit cards are the absolute worst. The interest rate on that was so high that most of my payment just went to interest. I used a repayment calculator to determine my payoff. If I would have made minimum payments it would have take 36 months and I would have paid $855 in interest. If I paid $100 a month, which is what I've been doing, it would have taken 22 months and I would have paid $461 in interest.

I paced the house for about an hour before I was able to push the button to pay off that debt. All the worst case scenarios ran through my head. What if I lost my job? What if I got sick- I just started a new job so I won't have health insurance for two months. What if my car breaks down? A million what if's went through my head.

Ultimately, I knew I needed to get rid of this debt. Eventually I would like to buy a small house in an area with a lower cost of living. In order to do that, I need to improve my credit score. Going from 77% credit utilization ( amount of debt in relation to total credit limit) to 66%, is not a huge leap, but it's a start. Hopefully I'll see a few point increase on my credit score.

Also, every $100 I can remove from my monthly living expenses reduces what I need to have saved for retirement. It's a small win, but at the same time, it's a huge win!

I've never paid off a credit card before. That lovely American dream said Charge It! And I did, over and over again. I'm excited to finally be taking steps towards a debt free life.

My stimulus check

Got my stimulus check today. Oh the things I could buy! I know we are supposed to use that money to stimulate the economy, but I also know, I need to pay off my debt!

As I sit here with an extra $1200 in my checking account, the shiny things beckon. I talked with a friend of mine and she wants me to book a vacation with her after all of this virus mess is over. I tried to be responsible, told her I needed it for retirement. Her response? No one knows what the future holds, or even if we'll   have one so we should enjoy today.

She makes a valid point, none of us know what the future holds and I think many people my age feel the same way. They feel that they should have started saving for retirement thirty years ago, and since they didn't, they should enjoy life while they can.

What happens when you are 65,67 or 70 and have zero savings? My friend has three daughters so maybe she feels a little more secure in their help. I have one child and I don't want to shift my responsibility onto her because I didn't make good choices.

As I talk to more people about retirement, I hear so many things. Many people think that Social Security won't be around for them, but they are still not saving. Some people think they will sell their homes and live off the proceeds. Some people are just flying by the seat of their pants.

I'm going to do my best to be responsible. I will buy an inexpensive gas grill, the grill I have is almost 20 years old and frequently catches on fire, no matter how well I clean it. Other than that, I'm paying towards that Kohl's debt. The interest rate is ridulously high. I'm still trying to decide if I will pull money out of savings to pay it in full or just put the remainder of my stimulus check towards it.

On one hand, it would be so good to finally be free of that debt. On the other hand, we don't know what will happen with the economy. I'm not sure I should take almost half of my savings to pay down debt.

One thing I won't do is spend it on the list of "wants" that lives in my head. I don't need any of those things and I know that buying them would lead to other purchases and the spending would continue.

I just checked my Kohl's account and my balance is $1699.92, I think I'm going to do it. This will only reduce my monthly expenses by $100 but the relief at having that paid off will be worth it. I have been paying a monthly payment on that Kohl's card for over ten years. It's time for it to go!

I'll admit that I'm scared. I finally have some money in savings and a pandemic hits. That little bit of savings gives me a cushion, reduces my stress. What if I need that money? I don't want to add more to my MasterCard because I used my savings to pay off Kohl's.

I'm overthinking it. I'm going to pay off Kohl's. If I need money, I will find a second job, even in this crazy reality we are living in, places are hiring, grocery stores, delivery services, I'd be able to find something. Here goes nothing- or everything, only time will tell!