What’s up good folks of the internet, I’m your host Jonny B, and this is my 6 month plan to pay off my credit card.
My use of credit cards has been a thorn in my side for the past 10 years. A lot of “smart” bloggers and authors always recommend using credit cards for monthly expenses to get the 1% cash back or free flights or what have you. Does it work for them? Yes. Does it work for me? Not at all.
I pay it off and get debt free, then eventually it grows uglier and uglier. And then I pay it off again and the cycle continues.
Well let me tell you, it is a very annoying cycle and I’m done with it.
Now that I’ve moved to Japan, my expenses are much lower because I don’t need a car. I have cured my clown-like car habit. I no longer pay for car maintenance, gas, insurance, or license plate renewal. I’m taking the money that would normally flow to that, and redirecting that river of money to paying down my credit card. I set an automatic payment of $500 to my credit card every two weeks. So with a balance of $6,261 and an interest rate of 14.65%, let’s run a realistic schedule of me paying this bitch off.
Keep in mind, I no longer use my credit card for any regular purchases. But I think my Amazon and Apple are still linked to it, so I check my bank app once or twice a week and overpay on any new charges. For example, if its a charge of $4.99 and two charges of $9.99, I’ll throw $40 at it, to make sure it doesn’t accumulate.
Months
Starting total
Payments
Interest charged
Actual Payment to Principle
Ending Total
1
$6,261
$1000
$76.43
$923.57
$5,337.43
2
$5,337.43
$1000
$65.16
$934.84
$4,402.59
3
$4,402.59
$1000
$53.74
$946.26
$3,456.33
4
$3,456.33
$1000
$42.19
$957.81
$2,498.52
5
$2,498.52
$1000
$30.50
$969.50
$1,529.02
6
$1,529.02
$1000
$18.66
$981.34
$547.68
7
$547.68
$554.36
$6.68
$547.68
Zero!!!
My 6 month plan to pay off credit card.
So, that’s my 6 month plan to pay off my credit card. If I can stick to that plan, which is already automated and well within my budget, I should have this bitch paid off in just over 6 months.
Are you going through the same adventure as me right now? I imagine you are, if you’re reading a website called Late Twenties and Broke.
Until next time, I’m Jonny B and this is Late Twenties and Broke.
Well, it’s been a long process preparing for my move to Japan. I put a lot of stuff in storage, shipped some stuff to Japan, and packed and unpacked my bags quite a few times.
(do I really need this tshirt? how much do these bags weigh??)
But I did it. I made it to all the different hotels, and airports, and terminals, and covid tests. And I did all the paperwork. I mean, there’s still more on my desk to do and more when I go to work in a couple days, but I’ve done everything required for right now.
This post won’t be very polished or concise, I just want to dump all my thoughts right now to keep the habit of blogging. This is my third or fourth website venture, and I’d like one that actually sticks around for once.
Luckily I did my taxes as soon as possible this year, so that is done and something I don’t have to worry about for another year. However, 2022’s taxes will be the first time that I (or many Americans) will pay capital gains on selling their personal vehicle! How crazy is that? For a decade I’ve read in books and articles and heard in podcasts, ad nauseum, that the car you drive is a depreciating liability and not an asset. It takes money out of your pockets. Mr.Money Mustache has beat stables of horses to death on that point.
I bought my car for $8,000 USD back in 2017, and at the start of the umbrella corp disease, it was realistically worth $4,000 to $6,000. However, due to the chip shortage and massive money printing and stimulus cheques and inflation, the US car market went insane. Luckily I had the car for about 4 years, so I will be only be paying long term capital gains and only on the profit. But I ended up selling my (realistically $6,000) car to CarMax for the ridiculous price of $12,500. That’s right, by ripping that car all around California and Nevada putting 30,000 miles on it and that West Coast sunshine abusing the paint and clearcoat, somehow, Iadded value.
I can’t stop using the word ridiculous to describe the situation. Please, do yourself a favour and don’t buy a car in this market. Don’t buy my sun-damaged car from CarMax.
Now that I’ve detailed my surprising cash windfall from CarMax, let’s get into my Net Worth Update for April 2022 from my new HQ in Japan. I’ll lead with my Oct 2021 numbers for reference.
Oct 2021:
PLTR
$5,068 (200 shares)
KO
$1,668 (30 shares)
DOW
$336 (6 shares)
Personal Automobile
$8,000
Silver Coins&Bars
$1,200
Employer 401K
$5,000
RRSPs trapped in Canada
$8,450 CAD ($6,837 USD)
Chequing
$210
Savings
$5,745
Total Assets
$34,064
Credit Card
-$4,187.45
October 2021 Total:
$29,876.55
April 2022:
PLTR
$5,068 (200 shares) (share price plummeted again, market value is $2,760 as of today)
KO
$1,668 (30 shares) $1,895.55 (Also received 0.22 shares as DRIP.)
DOW
$336 (6 shares) $394.47 (also received .14 shares as DRIP)
VZ
$52.04 (1 share)
TM
$360 (2 shares)
Bitcoin
$1792.98
BNB coin
$956.67
Personal Automobile
$8,000. (I don’t have it anymore!)
Silver Coins&Bars
$2,000 (I added $800 to my collection)
Employer 401K
$15,000 (I actually checked the balance, I was way off last update!)
RRSPs trapped in Canada
$8,450 CAD ($6,837 USD)
Chequing
$1,346.61
Savings
$16,838.50 (sold my car, parked the cash in savings for now)
Savings Certificate
$500.53 (new)
Total Assets
$50,734.35 (first time ever over 50K!!!)
Credit Card
-$6,374.19 ($2,186.74 worse)
April 2022 Total:
$29,876.55 $44,360.16
Net worth: ALMOST $50,000 USD. Almost.
So a lot of changes! My PLTR continued to tank, but I added some more dividend stocks like VZ and TM. I also received some DRIP from my initial purchase of Coke and Dow.
Another thing I added was dividend-like crypto, earning 4.5% on my BTC and 8% on my BNB from various exchanges. The math on that is only about $15 so not really worth noting, but the idea is there.
But obviously the big-big numbers were selling my car, and getting a real update on my 401K. I will realistically buy a car when I return to the USA eventually, so I don’t want to put that lump sum anywhere risky. But at the same time, the ROI in the various savings products my bank offers is a joke (0.5% while inflation in the USA is like 3-10%). So that will be on the backburner while I consider my options. If anyone has any ideas for it, go ahead and send me an email! Or reach out on twitch.
While I’m living in Japan, I won’t be buying any precious metals. So my fun investing will just be dividend stocks and crypto. It also lets me focus on paying down my dang credit card!! How it got back up to $6,000 range is so annoying. I hope as I do these updates it will get knocked down lower and lower until I’m debt free. That 50K mark will be a lot sweeter when I have zero debt.