QUICK UPDATE: Murphy’s law strikes again

Murphy’s law appeared the other day: my entire hard wood floor flooded so , as you can imagine, some parts of the floor just pulled up.

If I call a professional I know is going to cost at least half of my moving  out fund savings, but my main concern is that in order to fix that, they have to  laminate the entire floor and for that,  me and my cat would have to leave the apartment for 2 whole days. Since the product they use is toxic and it takes a couple of days to dry out. 

I can still go over to a friend’s house, but for my cat that would be a huge stress that could impact on his health, so I am trying to avoid that.

I am so tired of living in this apartment, and now, this huge set back on my savings.

At the moment I have an Airbnb guest, so I can’t do nothing until she leaves, which is in 4 days.

So I guess I have that time to decide if I want to call a professional to fix it and immediately go back to renting the room and get that money back as  quickly as possible , or, work this next 2 weeks on getting my 2nd stream of income set up and use that to move out quickly.

Because I was planning on redoing the floors, but once I moved. 

Now the whole plan shifted. 

But this is what financial freedom is for, to be able to have choices and deal with this unexpected problems without stressing.

So I believe I am going to get an estimate on the floor, just to see how much money it costs.

And then talk to the owner of the apartment.

Las time we re do the floors, he took care of it and I didn’t have to put money. 

So maybe, if the universe doesn’t hate me, this time will be the same.

Worst case scenario, I do have the money to pay for that, without taking it from my emergency fund.

So I should be fine. I know I should feel blessed and calm, but I can’t stop thinking on how long it took for me to have this little moving out fund.

Trying not to get depressed here.

And also, now I have another reason to work my ass off towards my 2nd stream of income.

Wish me luck.

thanks for reading.

Bel.-

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3RD POST: MY MOVING OUT + DOWNSIZING PLANS AND HOW I INTEND TO PAY FOR THAT

Ok, so this is my update so far.

I have around 24000ARS/533USD in my moving out fund.

This is not enough to cover 2 months worth of rent in a new apartment. So for the moment I am not even looking for apartments. Also, I am kind of done with the Airbnb side hustle because it takes up a lot of energy out of me and the money that I get from it is just not worth it. 

Which means, this month (June 2019), I will be living off of my main salary only. 

That is enough to cover my monthly expenses but it doesn’t leave much room for savings.

After crunching the numbers, there is only 1000ARS/22USD left to put into my debt and moving out fund. Which, as you can see, is almost nothing.

I have a few ideas to downsizing and start working on other side hustles and 2nd income ideas:

Downsizing plans:

After I got rid of half of my stuff last year, I continued to downsize the items that I have.

I realise there is a lot of stuff that I think I needed back then, but after a year of the first decluttering, I found out I have not use or missed that stuff, so I am selling it/donating it.

For the things that I am selling, I will get a couple thousand pesos, that will go directly into my moving out fund.

Also, I am planning on digitalise some of my design and pattern books and then sell them.

I do get about 100ARS per day in a savings account, which is where I keep all of my short term sinking funds (birthday, christmas, moving out fund, etc). So for this month I will get 2000ARS. I will use half of it and put it into my moving fund.

Investments:

I do get about 100ARS per day in a savings account, which is where I keep all of my short term sinking funds (birthday, christmas, moving out fund, etc). So for this month I will get 2000ARS. I will use half of it and put it into my moving fund.

2nd Income ideas:

I decided to list these ideas in term length, the ones that I will be able to implement in a shorter period of time first:

Since I’ve put together my baby emergency fund I’ve been trying to come up with a 2nd and even 3rd income.

I clicked in every side hustle link I could find on the internet and landed in a sort of useful thing which is transcribing. 

Most of the pages are US based only, and others they ask you to work for free before you can even start making money. So I got response from only one of them. 

After making a trial I got to actual transcribe for money. But even doing it fast it takes up to 1 hour per 1 minute of audio transcribe. 

I’ve done the numbers and the money that you make per hour is not even minimum wage (and in Argentina minimum wage is 12500ARS = 277USD). So I am not sure, maybe if I gain practice I can do it faster and justify  the amount of time it takes me to transcribe a single audio of 1 minute. So for the moment I am going to try to make one or two of these a week.

(UPDATE: I as write this, once month went by, and this option is not longer viable)

Sewing: As I mentioned before, I am a fashion and textile desginer, and also own a sewing machine. 

Now, I have thought of making clothes for people, but that would also take time an dealing with a bunch of indesicive clients. So I thought maybe for now I should stick to just making small fixes in clothes.

We are in an economic crisis right now and so, people are no buying that much clothes, rather they are drifting or fixing what they already have. So I can offer the service for small clothes repairs, like fixing zippers, put buttons, sew hems, etc. I figured I can dedicate every friday afternoon to this. This week I am making flyers and posting it all over my building and in my block.

(UPDATE: I as write this, once month went by, and this option is not longer viable)

UI developer: I already do this as my main job from 9 to 6 . But I am still learning so I need all the practice I can get. Currently I am in the process of master my CSS and HTML skills and also learning javascript. So I am working on a little portfolio to show the things that I know how to do and start sending emails and applying to freelance jobs everywhere. Since I speak english fluently and have the time I can do this from home in my spare time. This is a more long term thing because it takes time to build a portfolio and also land on my first gig. I am planing on start looking for jobs in 1 month.

Selling printables on etsy: I´ve always wanted to have an etsy shop. But in Argentina, international mail works really bad and also is quite expensive. So that was never an option for me. But with virtual items I could do. 

Since I started my debt free journey I came across a bunch of phrases and words that I would say to myself or that I would read in books that really motivated me to keep going when I feel like I can’t take it anymore. 

So I write these on a piece of paper and live it near my desk, where I can see it for a while.

I imagined I can do this look prettier, in a good font designed by me and sell it as a hanging wall printable.

This is relatively easy to do, but I need to make a little research on the files sizes and the formats you should deliver the printables. So is still a work in progress. Once I have my etsy shop set up I will put the link on this blog.

Selling patterns on etsy: I am eager to make my own clothes and that is what I am planning to do this upcoming summer to renew my wardrobe a little bit. (It is currently awtum in Buenos Aires, so I have a little time). 

Hopefully I will be able to sell the patterns I make for those pieces of clothing, I will post the pictures in my instagram account when I finish them.

This is of course kind of long term plan because making patters takes a little time and now I am focus on learning more about programming and code.

So far those are the kind of short term ideas that I have for these upcoming months. I have some others but those are quite long term and I dont want to stress about it since I need to focus on getting my 2nd income really quick. 

It took me some thinking and planning and A LOT of list making to come up with these ideas, and they might not be the best but is what I have so far.

I would love to read your ideas on how to come up with a 2nd income. 

Leave it in the comments  , if you will.

Thanks for reading.

Bel.-

SO, WHERE AM I AT?

I should start with the basics and give you the whole debt snowball detail and where I’m at.

I officially started my debt snowball on October 2018. I spent most of 2018 saving my baby emergency found.

It was very difficult at first because I had a very small salary and was paying part of the programming course I took in 2017, which eventually led me to get the job that I currently have. Is sort of a scholarship system that you have to pay back, I will explain that in more detail in a future post.

The thing is , as I write this, it is April 2019 and I’ve been in my debt free journey for about 6 months now.

My original debt was 19957.18 USD. 

Now my total debt ascends to 17473.52USD. 

Which essentially means that I have paid  about 2400USD during this time.

Now, here is the catch. 

As you know, I live in Argentina, where the economy is bound to the US dollar currency, so back in October, US dollar was much cheap, now it has increased by 30%.

That means, as long as the US dollar keep going up, so is my debt.

I am desperate to pay this US dollar part of my debt because I know US dollar will just keep getting up in value and my salary does not cope with that as fast. Which is why as I write this, I am trying and searching for different ways to get a 2nd and 3rd stream of income.

So this is where I am at:

17473USD total debt (the US dollars part is only 11469, the rest of it is in Argentinian pesos and though, that keeps pilling interest, is not going up as fast and as unpredictably as the dollar is. That is why I am not paying my debt smallest to largest).

This is my shovel so far:

My main source of income is my full-time job which gives me these earnings:

28000 ARGENTINIAN pesos /month = 636USD/ month (as I write this)

You can see, with this income, it will take me more than a decade to pay off my debt.

I need this to go faster.

Currently I am renting my room through Airbnb, I live in a 1 bedroom apartment, which means, when guests arrive I would sleep in the couch.

Airbnb let me charge 10USD/night for the room. But the Airbnb commission is 1USD. So I get 9USD per night for the room, and is not booked every single night of the month. 

Usually in the best case scenario I have an occupancy rate of 20 nights per month. Which is equal to 180USD, from this, the government takes 23% as a tax. So I am left with about 140USD.

That is in a good month, considering most of the nights are booked and everything goes smoothly. 

For now this is my main source of savings. Since as you will see below, my expenses take most of my take-home pay from my full-time job:

My budget goes something like this:

Take home pay (roughly): 28000ARS/636USD

RENT:           11500ARS / 261.36USD

UTILITIES:      2655.99ARS / 60.34USD 

INTERNET:       1300ARS / 29.54USD

CELLPHONE:      290ARS / 6.59USD

TRANSPORTATION: 500ARS / 11.36USD

GROCERIES:      1500ARS / 34.09 USD

MISCELANEOUS:   1000ARS / 22.72 USD

CAT NEEDS:      500ARS / 11.36USD

CLOTHES:        500ARS / 11.36USD

SINKIN FUNDS:   2700ARS / 61.36USD

Here is a little explanation of what each of these items include:

Rent: Pretty self explanatory but you may have notice the percentage is really high compared with my income. That is because , due to inflation, rent goes up very quickly , especially in Buenos Aires. And the salaries do not keep up with these increases. 

That is why, one of my main goals this year is to move out to a cheaper and better apartment, in order to increase my savings rate.

Utilities: This includes water, electric, heating, telephone(yes, I have a land line that came with the apartment and I can not get rid of it, also most employers will trust more in someone that has a land line, so that is another reason why I keep it). In this category I also include the common expenses for the building . When you live in a building in Argentina, you have to pay a percentage for cleaning, fixing  and maintenance of the common parts of the building: hallways, elevators, and the janitor’s salary as well.

Also in this category there is a city tax, that you also pay for cleaning the streets, taking the garbage and all that.

Internet: Pretty self explanatory as well, the only thing worth mention is that my employer pays for my internet up to a certain amount. They re-inverse you with that amount so I already include that amount on the total of my take home pay of 28000ARS.

Cellphone: I recently move to a cheaper carrier in which I pay a third of what I was paying with my former carrier, so this is a really big saving for me. Will see how it goes.

Transportation: This covers the money that I put on my subway card because I take the subway to go to work and on weekends occasionally if I go out to visit some friends or have some event, which I almost never do because I am broke. 

Also, I work from home 2 days a week. So I was able to keep this very low since I only use it 3 times a week. 

For the most part I try to go by walking to most of the places I frequently go: the pool, friends houses, etc.

Groceries: This amount is also very low because my employer pays for my lunch on the days that I go to the office. 

I get 200ARS/4.44USD per day to spend, so I would usually buy some food and with the change I would buy some snack to have during the week.

Also, I would like to point out that the average Argentinian spends roughly 2000 to 3000 ARS per person,per month.

This does not include restaurant money.

Miscellaneous: In this category is all of the miscellaneous things that I need around the house, cleaning products, personal hygiene products, kitchen ware if I need any, etc.

Cat needs: In this, I included the cat litter, flea control medicine that I put once a month and paying for his nails to get cut. I believe this and doing my hair are the only luxuries that I allow into my budget. 

For the cat’s food, there is a separate sinking fund because I buy Gerard’s food in bulk once every 6 months, as well as his vaccines which he needs once a year.

Clothes: this is a momentary item in my budget, since I’ve been without a job for so long before getting my current job and then I was in a very tight budget just to survive that I didn’t buy anything new for a year and a half. So most of my clothes was really worn out, now little by little I am assembling a minimalistic and simple wardrobe, so for the moment I use this money to buy a couple of items per month. Once I have my wardrobe in place I will be destining less than this into a sinking fund in order to have enough money to replace something if it gets damaged or broken or worn  out.

Sinking funds: There is 7 sinking funds I put money in

Christmas: Self explanatory. I need to travel back home for the holidays, so I put money in here to pay for my bus tickets and for Gerard’s cat sitter. My family is poor so we don’t buy presents for each other, is not a tradition in my family and I am fine with it. 

We just enjoy the little time we have with each other and if I spend any extra money on this will be either on food or experiences that we can share together.

Hair saloon: Ok. This is not a necessity. But in order to feel comfortable with myself, save time, and have one worry less, I splurge and do my hair once every 3 months.I will get more into detail on this in a future post.

Moving: As i said, I am saving to move into a new more lighted and cheaper apartment. 

So what I do is this: After my fix expenses, everything extra I divide into 2 equal parts, one part is going towards debt and one is going to this fund. 

Gerard’s food: As I said, I buy this in bulk every 6 months. I found out this is the most efficient an cheapest way to do this. Also, my cat had an urinary infection twice, so he needs to eat a special kind of food that is kind of pricy. Buying in bulk I was able to cut the food costs in half.

Birthday: I put this small amount towards my birthday celebrations, usually I just go to a restaurant with my friends. This year I only had 6 months to save for it, since I started putting money into this in December 2018. But that’s fine.

Dermatologist: I’ve been doing a treatment on my face for a couple of years now and I am almost at the end of it, so I decided to keep this because I am not throwing away all of the effort and money  that I invested these years to keep up with it. 

I only have to go once every 2 or 3 months, so I split the cost of the treatment into that. 

It is a big splurge but also is a treatment on something that has held me back for so long. 

If you want, I can give you more details about this in a future post.

Gerard’s shots: As I said, these are the required shots he has to have every year in order to be protected of rabies disease and other diseases and infections. 

This vaccines became kind of pricy, since the inflation, so I am setting aside a little money every month in order to avoid a big expense in the future.

As you can see, my expenses are pretty basic. No extra stuff. I do not have restaurant money. 

Some months I do have a little going out line in my budget if I know that I have a friend’s birthday or a special event that I have to attend.

I am also not saving for anything specifically. I would love to have a blender or a kindle. But, for the moment, I am focusing on moving to a better place and paying off as much as I can of my dollar debt.

I have a really long way to go and I often get scared and frustrated because of what little money I am putting towards my debt. 

Clearly I have an income problem. Which I am trying to solve.

This blog is keeping me accountable on the times I feel there is no point in doing this, or when I feel tired of budgeting. 

I know this is just temporary, but it is HARD. Just hope i can make it.

Thanks for reading.

Bel.-

My debt story

So I guess this is another personal finances blog.
I’ve had an epiphany in 2017 when I was fired and found myself in a really scary place.
But I wanted to tell it from my perspective.
I am, indeed, a broke designer living in a Third World country. And this is my debt story.

I was laid off of my job in 2017, already in debt.

I have a personal debt that I never really care much about paying, nor even sure how much money it was, throwing whatever money was left after I paid my credit cards and my expenses for the month.

I am a fashion and textile designer, which, it might sound fancy to some of you, but, in Argentina, that would often mean being in charge of the production process at a clothing factory. And, believe me, there is nothing fancy nor glamorous about that. Starting with the income.

So there I was, living the fantasy that I was a sufficient, strong, independent woman. Who, in reality was barely scraping by, month by month, and couldn’t even afford to go on vacation, or to move out to a nicer apartment, or even to move out at all, since I had no savings.

I was broke, and I didn’t know it.

Didn’t realise until I started paying with my credit card a ski trip for me and my 3 siblings (yeah, I’m THAT stupid), only to find out at the middle of those payments that I was being fired. 

I didn’t want to arise worries around my family so I kept the appearances and borrow money to continue paying for the trip and also pay for my living expenses while the compensation check from my former job kicked in.

Guess what.

It never did.

That is another beauty of living in a third world country, laws are blurry, and small companies would often take advantage of employees and not pay their salaries. Then write checks without founds and wait for the law suits. 

Of course by the time that law suit knocks on their doors, the company would probably don’t exist. Actually I recently found out that this particular company that fired me is almost out of business now.

At first I was confident that I would find another job eventually. I also had a side hustle by renting my room trough Airbnb, so that would at least cover my rent expenses.

Little that I knew, Murphy’s law was breathing down my neck and one week after I lost my job, my whole building ran out of gas.

Another third world country perk! In here, is very common to have the stove , heating and hot water trough gas, rather than electric. And when the gas company comes to your building and find even a small leak , they would shut down the service for the entire building for months until a certified gas technician fixes the problem, and the whole bureaucracy for that can take several months.

I was almost a year without gas.

So that meant no more Airbnb income. No income at all. FOR MONTHS.

I started panicking, and I guess had a little of an epiphany right there, so I decided to learn a new skill, something that would get me a job fast no matter what. So I decided to learn how to code.

Somehow the planets where aligned that day because I found this program trough a friend of mine, that teaches women how to code and programming and help them find jobs in the technology field. 

The course was expensive, but they offered a scholarship program in which you can start paying them after you’ve landed your first job in technology. If you couldn’t land a job in the first 6 months after the course ended, then, you owed them nothing. Sounded really good to me.

So I applied for that program, without any hopes or expectations.

A few days before my ski trip they told me I was pre selected and had to take a test, it was a logic test and it was quite long, again, I went and did the test without ANY hopes because there were like 50 girls there. And I am no genius, so some of the questions in that test I didn’t know how to answer.

Relentless to listen to the Murphy’s law, I went ahead and went on my ski trip like nothing happened.

In the middle of the trip, the people for that program called me and informed that I was selected and that I needed to start right away, I told them I wasn’t even in the city and that I’ll be back in a few days, just one day after the course starts, but I didnt heard back from them so I figured maybe they decided to go with someone else.

We had a really nice time the rest of the trip until on the last day, I fell and broke my wrist.

I had no insurance.

I had to wear a cast for almost 2 months.

When I got back home from the trip I just wanted to sleep for days, I was really depressed and in a lot of pain for my wrist, had a cast on my arm so everything was difficult and uncomfortable, even sleeping.

I was desperate: no income, no savings, piling up debt day by day and now, medical expenses.

I didn’t have a panic attack just because I was too tired and sad to do so.

The next day I opened my email and there it was, the people from the program decided to accept me and I could start right away.

So I got up early and went, not knowing what that really was.

I did the program for 5 months. In the meantime I continued to apply for jobs in my field and I was attending to the classes of this program which was 4 days a week, during the mornings.

In the middle I had my cast taken off, and started to feel not so depressed, cut down on all of my expenses and I was living to the bear minimum. That is when I started listening to Dave Ramsey’s podcast, I was eager to follow his advice but I didn’t even had an income to work with. In that moment I decided I was sick and tired, and that I will never, EVER, be in that position again.

A few weeks before the program ended, I got a job in a big company, a front-end developer job, my first one in the technology field. 

I was so excited. the salary wasn’t much, it isn’t much still, but I can cover my minimum expenses and there is a little spare money to work with. But the most important: stability, being able to save, even a little towards an emergency found.

Just a month after that, the gas service in my building was restored, so , again, I had that extra source of income right back up. Things were finally in motion.

So this is where I am now:

-Already founded my baby emergency fund of a thousand dollars (US dollars that is).

-Already paid my immediate debt which was credit card, city taxes for the apartment, and the scholarship/loan from the program. (I will explain this in another post)

-Started paying the first of the personal debt which is in US dollars, so that will take some time.

-Have my sinking funds set up and growing every month.

Through all 2018 I was trying to get my emergency fund in place, and paying my immediate debt.

The bad news is that in September, the US dollar went up very high so my salary which, at the beginning of the year was equal 800 dollars. Now,was almost 600 dollars. A MONTH.

That’s another  delightful thing about third world countries: salaries are almost nothing, and , in some cases, strongly bound to the US dollar currency, at least in the country that I live in.

So it was a few months until I got my emergency found in place, and I was paying in instalments every month for the program that i mentioned before, which I finished paying in October last year. Also, along with my credit card debt, which I close and destroyed a couple of months ago.

With the  next month’s salary I finished paying a city tax debt that I’ve accumulated for this apartment.

After that. I started attacking my big fat personal debt which is about 18000 dollars total. I know it doesn’t seem that much. But for someone with a monthly salary of 600 dollars, getting to 18000 is A LOT.

So my main goal right now is to get a third source of income and a second job.

It will be hard, and time consuming, but I have an income problem and this is the only way to solve it.

This is my  debt free journey so far and part of opening this blog is to keep me accountable.

So after one year into this journey, my net worth came down from -$18000 to -$16529.29.

Not bad. But I still have a lot to do. I am still looking for a second job that I can do on my weekends and I am planning on offer a sewing service for fixing clothes from people around my building (you know, patch holes, attach zippers, make hems on pants). Also I am working towards building my front-end developer portfolio so I can apply for freelance jobs, but that will take me at least 3 months.

For the moment, this is my status.

I will keep you posted and in a future post I will tell you more in detail about all that was covered in this post.

Thanks for being there, debt free community, I’ve been reading your blogs and watching your youtube videos for more than a year now and let me tell you, I am so glad I discovered you and the Dave Ramsey baby steps. 

Hope this works and I know it does because I’ve follow your stories.

See you in my next post.

Bel.-