End of year stuff. Been working on my financial fitness…

I have two credit cards and one loan (the loan for my iBook — yeah, it’s still not paid off). I compared the balances on each of them from the start of the year to now, and I found that my total indebtedness actually increased by $0.50. Depressing, huh? In other words, I managed to essentially pay off only the interest for the year.

What’s a little more interesting is the amount of cash that flowed through each account, because I’d pay them down a bit, then I’d use them back up to the limit, then down again. I made $3840.95 worth of payments against the three accounts! Wow. That’s a lot of money. Since the in-flow was almost exactly the out-go, it’s apparent that I didn’t actually need to use my credit cards and loans and cash advances…

And when you look at what the money cost me, in terms of interest, overlimit fees, draw fees, etc., those total up to $963.83. So I managed to turn $3840.95 into $2877.12 worth of goods and services. Obviously not a wise decision, since it’s apparent that (since the payments were made) I had the money to use, and therefore didn’t have to incur the extra fees associated with the cards and loan.

That’s not even looking at the actual purchases I made. I’m not going there. For the most part those purchases were two trips I made during the year, and the occassional cash advance.

(What’s even scarier is when I add in all the ATM fees, overdraft fees, and associated charges in my checking account. Those are also things that I could avoid paying entirely, simply with better planning. Including the above $963.83, that brings the total “fees I could avoid” up to $1586.87. Yeah, I bounce checks quite a bit… owie.)

So, for next year, this is my goal: I’m going to pay them all off. I’ve got the money to do it, and once they’re paid off completely I can still get the benefit of using them (for instance, the miles on my Alaska Airlines Visa for purchases) without incurring the penalties (interest and etc.)

I’ve got a plan and I’m going to stick with it. I should have them paid off by summer. I think I can also stick some money in savings. I’m expecting a modest tax refund this year, maybe $600 dollars between the Feds and Oregon. Well, at least $500 from Feds, I can’t estimate the state refund yet. That will help quite a bit.

My end of 2005 goal is: no outstanding debt and at least one month’s salary in savings. To that end, my Christmas gift to myself was an actual savings account, which currently holds the princely sum of $300.

Grow, little savings account… grooooooooooow…