Introduction

Solvent: Adjective; having assets in excess of liabilities; able to pay one’s debts.
Synonyms: financially sound, debt-free, in the black, in credit, creditworthy, solid, secure, profit-making;

What do I owe?

Student Loans:  $14,434.11
Interest Rate: 5.50%

My student loans have been stopped for about a year now as I transitioned myself into freelance work. I justified putting a stop to them instead of working them into the budget by thinking that I would eventually get them back into the mix. Thus far I have not done that and it’s been over a year since that happened. Instead of actively paying down my student loans during that time they have been sitting around doing nothing. I’ve avoided the National Student Loans Services so well that I don’t have my Username and Password for my account in a ready place for me to find it. For the purposes of this post I have now hunted down my username and password, and I’ve written it down on a piece of paper that will be filed away with the rest of my student loan files.

VISA: $8.025.34
Interest Rate (Purchases): 19.99%
Interest Rate (Cash Advances): 21.99%

This is the first month that my VISA has gone over its limit. When I did my six month evaluation of my budget, I realized that I’ve been spending roughly $1000 more than I’ve been making, so it’s not a surprise that my VISA has taken the brunt of that extra cash and now I’m up shit’s creek without a paddle. The main culprit of this is cash advances. While I’m fully aware that you should never take cash advances out because the interest rate is much higher AND it begins as soon as the cash advance is taken out, I have been using them anyway to cover my rent in case my pay cheque comes in late.

In the future, I would like to use a buffer of $1,000 in my bank account to do that instead. I’ve begun saving for this emergency fund with $1 a day. It’s not much, but it’s all I can afford right now.

My other goal is to eventually close this account and pay off my debts with my low-interest MBNA credit card. I have a card with a 6.99% interest rate. I will use that card to pay down my debts and once the VISA is completely wiped I will close the account because I do not need it. The MBNA card is with another bank and it has a much better interest rate. There is no reasonable excuse for holding a credit card with such a high interest rate when I have one with a better rate.

HBC Mastercard: $42.10
Interest Rate: ???

It’s not much. I don’t spend a lot on this card. Once, maybe twice a year. But I’ve missed one payment waiting for the money to come in and I know that it affects my credit rating. I have no reason to own this card other than the occasional trip to Hudson’s Bay Company. I convinced myself that it’s a good idea to get it one Christmas and I’ve held it for sometime without having any problems with it, but even $40 can cause a problem with your credit rating when you don’t pay it off right away.

Also, I’m aware that a department store card holds a much higher interest rate than a regular VISA or Mastercard. I’m unaware of the interest rate on this card. My online account does not say and when I tried calling to update my mailing address, which is missing the apartment number(!), I couldn’t get through to a human being and I lost my patience. The lack of an apartment number on my mailing address is the reason why I haven’t received my bill in the mail yet either. I was aware that the bill was missing, but it took me this long to track down the reason. Once I pay off this card I’m going to close the account and I won’t need to worry about it any longer.

Savings

Emergency Fund: $3

The goal is to build this to $1000 so I have a good buffer in my bank account for occasions such as the one I mentioned above.

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