Income and Debt Overview

Day 2| Paid: $0 | Remaining Debt: $63,117.27

Before we look closer at the actual debt I want to give you a brief sense of my average income, just so you have something to compare my debt to and can appreciate the scale. 

My job pays me weekly on Wednesday. After taxes, health insurance, retirement contributions, and automatic deductions, plus my recent annual raise, I ended 2021 with a net pay of $712 a week. That is an annual net salary of $37,024. On a monthly basis that is an net income of $2,848 for most months except those with 5 Wednesday (March, June, August, and November) where I bring home $3,560. 

That means for 2021 I am looking at a base net income of $37,024. 

Now lets take a look at my debts. Here I am listing out my debts in my own ‘priority order’. I listed the balance owed, the interest rate, the minimum monthly payment, and the current payoff date. In the future we will take a closer look at some of them but today I just want to give an overview of where things stand.

Debts As of January 1st 2022

Debt Balance Owed Interest Rate Minimum Monthly Current Payoff Date Notes 
Payday Loan 1 1062.50 651.79 1062.50 1/7/2022 Lump sum  
Payday Loan 2 2511.05 206.48 3247/12/2024  
Payday Loan 3 1798.04159.53 351.44 8/12/2022  
Installment Loan 7807.7435.94 281.52 Unknown  
Affirm 1 160.13 29.99 80.91 2/8/2022  
Affirm 2 251.46 29.98 41.92 6/23/2022  
Afterpay 104.00 104.00 1/26/2022  
Credit Card 3 380.79 29.99 29 5/1/2023 
Credit Card 2 295.70 26.99 25 4/1/2023  
Credit Card 1 501.91 24.74 25 1/1/2024  
Credit Card 4 26.99 N/A  
Orthodontics 1,687.76 7.74 99.54 6/26/2023  
Auto Loan 19,279.80 7.05 389.08 9/19/2026 1 Mo Past Due 
Student Loan 27,074.86 6.8 318.63 Unknown 6 Mo Past Due 
Phone 201.53 18.34 10/22/2022  
Total 63,117.27  2088.38   

So my total balance owed, as of today, is $63,117.27 with a minimum monthly payment of $2088.38 With my annual net income of $37,024 and monthly net income of $2848 that means my total debt is 170.48% of my income, and my monthly minimum is 73.23% of my average monthly take home pay. 

That is utterly ridiculous, and is depressing to see. The hard numbers really put everything into sharp focus and now I can really see how deep the hole I’ve dug myself into is. 

Two quick notes:  

First I did not include the minimum monthly payment for Payday Loan 1 in the total of the monthly minimums. That is because that is an upcoming lump sum payment on January 7th. That is one and done, so it didn’t seem appropriate to include it in the calculation. 

Second thing is you will notice that my auto loan and my student loans are past due. Even though they have a relatively low interest rate, and are generally low on my priority list, getting myself current on those loans is actually a very high priority. That is not as high as taking care of those 3 damn payday loans, but definitely higher than anything else on the list. 

Tomorrow we will take a closer look at some of the loans and I will explain my reasoning for ordering them this way. I will follow that up with a closer look at my monthly and annual expenses, and then look at ways to cut costs and increase income. The fun is just beginning. 

This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply