Money Talks: Yearend Payoff Update [$11K and On The Way]



Whew, we made it through the year 2020! It's been a tough year for everyone, but we were able to stay relatively close to our target pace. As you remember from our first update blog, we need to average $1,666 per month to meet our overall payoff goal in 60 months. We switched to a modified payoff plan in November and ended the year with a 7-month average of $1,556 in principal debt paid each month. While we slightly missed the mark on paper, we fully expect to get more bang for our buck in January.

Yearend Recap


Month 5 - October 2020


If you remember from the first four month recap, the grocery bill was our biggest challenge. We continued to work on planning out meals and exploring cheaper options, and it paid off! We hit our goal this month, which was the encouragement we needed to stay motivated. Check out these links to see all the fun arts and crafts and holiday projects we were able to do for Halloween while still hitting our budget goal!


Sugar and [pumpkin] Spice and All Things Nice

Halloween Activities at Home: All The Tricks and Treats

Halloween: The Candy Corn Chronicles

Halloween 2020: Trick-or-Treating Alternative


Debt Paid: $1,665.39

Total Progress: $8,210.47

Month 6 - November 2020


This was a very interesting and challenging month. We switched to a modified payoff strategy, combining the Snowball Method and Free Cash Flow Method. (Look back at Debt: Finding your number, then finding your way out! and Free Cash Flow Method in The Game of [real] Life.)


My husband worked a small amount of overtime, received part of his contract sign-on bonus, and, on top of that, an unexpected bonus at his hospital for essential workers pushing through the pandemic. As for expenses, we had a small medical bill pop up and the heater decided not to work on the first freezing day of the year. We layered on the winter socks and bundled up in fuzzy blankets, which wasn't so bad! After a few frustrating days, we got it fixed without having to replace the entire unit like the first service company told us. A real silver lining! The Thanksgiving grocery budget also crept up a little higher than intended, but it was worth every extra penny for those extra plates and leftovers. Sorry, not sorry!


These little hiccups resulted in an extra $450 of unexpected expenses that cut into our newly acquired surplus. Bummer! Instead of throwing all of our extra cash at the Snowball Method, we decided to stock it away until after the holidays to pay off a large bill in January using the Free Cash Flow Method. We came up slightly short of our monthly goal, but we consider this a huge success considering the challenges.


Debt Paid: $1,554.48

Total Progress: $9,764.95

Month 7 - December 2020


We already budgeted for Christmas starting back in August and had actually finished our entire Christmas shopping by the end of October. Trust me, the procrastinator in me is just as shocked as you are! We were actually able to save a significant amount by shopping early and taking advantage of cyber deals in October. My husband and I also chose to forego exchanging presents and focus all of our resources on our kids. Even then, we still managed to go over budget by adding in a few holiday activities. Check out the link to see how our extra festivities were well worth a little additional spending:


[there's no place like] Home for the Holidays


Groceries were higher this month, too. Side note: Why can't my favorite snacks just be cheaper? That sure would help your girl out over here. All together, our average was down for this month. We tucked away my holiday bonus for next year, and we have big plans for the coming months.


Debt Paid: $1,128.19

Total Progress: $10,893.14

Key Takeaways & Lessons Learned

  • Budgeting is hard, but we can do this! Staying disciplined and keeping a positive attitude are crucial for long term success.

  • We didn't have to sacrifice happiness for less spending! We had the best, most magical holiday season (Halloween, Thanksgiving and Christmas) we've ever had while also spending less than ever before.

  • The grocery budget continues to be our biggest challenge, and I'm still grouchy about it. Some things in life just aren't fair!

  • We will tweak our budget to start earlier and allocate a little more for the holidays next year. It was definitely worth every penny spent for the memories made with our kids!

  • We are going to try adding in monthly financial challenges to keep us involved and excited. Hopefully, this will prevent any potential burnout as we approach our one-year mark.

With the first seven months and all of 2020 behind us, we are ready to kick the new year off right with major progress in January. If there's only one thing we take away from this year, it's that our payoff plan is working. You can take that to the bank!


Happy New Year, friends, and we hope you will continue to follow our progress in 2021.