Borrowing Costs: February 2008 ($4,131.84)
This is my third post in this series detailing exactly how much my wife and I spend each month financing our family. When I made the list I was surprised by the variety of different ways we spent our hard earned dollars financing the modern banking system.
At this point, I am almost appalled by how large the numbers are getting and we are only 2 months into the year.
Here are the results from February:
A quick summary of the results:
Banking Expenses/Fees For the average American, the banking system has a number of products out there to help you avoid banking fees IF you are willing to jump through a number of hoops. To keep our fees down we use direct deposit and rarely use ATMs. If we are traveling and need cash we just use cash back from our debit card and use credit for everything else.
Credit Card Expenses It is no surprise that we have some charges here. Although we carry a large credit card balance, it is financed through 0% balance transfers. The majority of the $225 we have spent in this category is for annual fee’s on a couple of our Airline Cards and a premium card. I think over the next 12 months we will have to decide if these cards are really worth their yearly fee.
Investment Expenses/fees This is one category that still looks good but I have the feeling that I really need to do some better detective work. Most investment fees are buried in the investment so that it is difficult to discover just how much it is costing you. My contributions to my IRA last month were to an existing no-load fund. In theory there should not be any additional fees other than the yearly operating expenses.
Student Loan Expenses/fees The number that jumps off the table above is the extra $4000 in student loan interest accumulation. I realized last month that I was not accounting for the interest accumulating on my $100,000+ of student loans still in forebearance. Although the total for 2007 was reported last month, it was accumulating at the rate of about $335/month for the past year. Since I only get the bill quarterly at best, I’ll only report the change in balances at that time.
The interest alone on our student loans is greater than all of our monthly expenses except rent and food.
All of a sudden that $100,000 education isn’t looking to cheap.
