My Confessions Part I


Okay, much like the weaker first Usher track (I said what I said), the confession in this post is a warm-up to a bigger confession. And we’ll get to that later, but for now…

In my recent return to the bloggerwebs, I shared that I had bought a new iPhone 14. I know that seems like a fairly banal purchase for many but for someone with an iPhone 8, almost $68,000.00 of student loan debt, who is not employed full time, it’s a big deal. While I was contemplating a new phone purchase, I was also reevaluating other monthly payments. I have had T-Mobile since I left my parents’ family plan and I had it prior to my stint abroad. Back then, it was $55.00 for unlimited everything with no contract and no one else was really offering that deal. However, fast forward several years and my monthly unlimited plan with T-Mobile is $70.00/month with auto-pay; which still isn’t terrible, but there are now quite a few other players on the scene. In addition to low-cost carriers who operate on larger service networks, even titans like Verizon now offer low-cost plans. After a bit of research, and a holiday deal, I decided to switch from T-Mobile to Mint.

Through the end of the year, Mint is essentially offering a buy-one, get-one on its service when you bring your own number. All Mint plans are prepaid, so if you buy 3 months of service, you get 3 months free, or 6 months of service, you get 6 months free. While my phone was old and freezing badly, it technically still worked, and I could have probably kept it for almost another year before Apple stops providing updates for iPhone 8s in 2023. The financial calculation broke down as follows:

1) Keep iPhone 8. Stay with T-Mobile. – Phone cost: $0.00. Service Cost: $840.00 for 12 months. Total Cost: $840.00.
2) Keep iPhone 8. Switch to Mint: – Phone cost: $0.00. Service Cost: $180.00 for 12 months. Total Cost: $180.00.
3) Purchase iPhone 14. Switch to Mint: Phone cost: $929.00. Service Cost: $180.00 for 12 months. Total Cost: $1109.00.

First, I decided to get a new phone. Even if my old phone wasn’t dead, it was on its last leg, Apple will no longer provide updates at some point in 2023, and I kept reading about production delays that will lead to an iPhone shortage soon due to supply chain problems. Yes, I could have bought a cheaper, non-Apple phone. I could have done that. Second, I decided to switch to Mint because the difference between choices one and three was so small, and would entirely be made up if I keep Mint, or another low-cost carrier, for a second year.

I know what you’re thinking. “Ummm, AP, this just sounds like a person reasoning through a financial choice that while not wildly frugal, isn’t wildly spendthrift either. How is this a confession?” The financing, my blogger friend, the financing.

A couple of months ago, it would have been nothing to drop a little more than $1,000.00 on a new phone. Nothing. However, times have certainly changed for your old pal AP and this choice was much more significant than I care to admit. First, I was not prepared to dip into my $5,000.00 emergency fund for this phone purchase. I was not. Not dipping into my $5,000.00 emergency fund is my only point of financial pride at this point. I also wasn’t prepared to finance the phone using Affirm as the interest rates were close to 8%. So then I wondered if there was a way to “self-finance” it. First, I checked to see which of my credit cards was offering a balance transfer. Discover had the best rate at a 2% transfer fee for 0% interest for 12 months. However, I currently bill several recurring bills (insurance, etc.) to my Discover card and was worried about mixing payments. Next, Chase was offering 3% balance transfer fee for 0% interest for 18 months. Not terrible but definitely more than I ever want to pay in interest on commercial debt. Then I remembered that Chase would allow me to balance transfer through a deposit to my checking account. Which meant I could pay for the phone/service with a cashback card like Citi Double Cash, which offers 2% cashback, and then immediately pay off the Citi card with the Chase balance transfer, creating an effective transfer fee of 1%. This is what I did.

So, my confession is that I am now carrying $1,145.20 in credit card debt. My current plan is to just pay this off over the next 12 months, much like I would a monthly phone payment unless I have a lump of cash I can devote to it sooner.

Why was this important enough to blog about it? First, I think it’s important for me to be transparent about what I am doing with my finances. I don’t want anyone to ever read this blog in the future and think that it was smooth sailing 100% of the time, or as though I didn’t have to get creative. Second, I think I have felt like I have regressed in my career at several points over the past few months, in different ways. This has been tough even if it was largely a choice of my own making (I still don’t regret leaving Organization C). The only thing I have been clinging onto is the fact that I am still in a better position financially than I was a few years ago, in terms of both my actual finances and my mindset, and I am desperate not to lose either of those…

8 thoughts on “My Confessions Part I

  1. This is my warning that I’ll be asking for an update on how you like Mint in a couple months. I’ve heard great things about it and may consider it in the future.

    I’ve also been debating about upgrading to iPhone 14. But honestly I don’t have as good as an argument as you for upgrading. My iPhone XS still works fine and the only reason I’d want an upgrade is for the better photo quality. There’s no debate that you needed a new phone so I think this purchase is very justified!

    I know having credit card debt gets such a bad reputation but honestly that only applies to high interest rate debt. In your case this is a very good deal so props to you for thinking up this trick!

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    • Please do! Thus far, it has been smooth sailing, but it’s early days. Folks I know that have Mint, love it but the introduction of “Visible” which runs on Verizon and Verizon’s new lost plan means I will be trying to actively evaluate the experience for when I have to make a renew or dip decision a the end of the year.

      The great thing about iPhones is they don’t really lose that much value…if you want a 14 you could always trade your XS in…okay, exiting my roles a sa bad devil and hopping of your shoulder. And thanks for making me feel better about the purchase. The flat 1% balance transfer is something I realized I was able to live with if it meant holding onto my cash. All other cards wil continue to be paid in full but I just wanted to be honest with folks about my financial picture.

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  2. I love this kind of post that delves deep into financial details. I think it’s fine that you took on a little more debt. As you said, you’re paying it off like a phone bill, and anyway, it sounds like you really needed a new phone. And, like all of us, you’re figuring it out as you go. So, enjoy your new phone!

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    • Awe, thank you Ellen! And I am genuinely happy you enjoyed it. I’ve said this a bunch but even though it’s my blog, I have zero desire to bore folks who read or stumble across it.

      I really needed a new phone, it’s a flat 1% fee, and it will be paid off in 12 months (or sooner). I’ve decided I can live with this, for now, to hold on the cash. I…love my new phone 🙂

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  3. First of all, so great to “hear” from you again.

    I’m having the debate over the phone. But for what it’s worth, every way I looked at it getting the latest just works out better financially. Iphones really don’t go down in value that much, so buying one that’s an older model just doesn’t save much if buying from a regular store or apple. At most, its a few hundred. And for that few hundred, you get a phone that will be supported a couple of years longer and worth more if you try to trade in.

    I just caution about those ads to get a free one with a service provider. I crunched the numbers and free or not (and most of the time it was just free if trading in a much better phone than I have) the monthly payment was more than just buying the phone, financing at 0 percent with Apple card (and a 3 % apple cashback) and sticking with Mint.

    I love Mint. One day my internet went down and it was my first day at a new job working from home. My bandwidth has to handle a big database. I fired up my Mint hotspot, and it ran the whole system for 8 hours without even a hiccup. I’ve never really had reliable hotsot before this. The only caveat is if you go with unlimited, it caps the hotspot. I take the 15G plan and can use it all to hotspot if necessary

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    • Thank you for sticking around, Paula. I really do appreciate it. 🙂

      As always, you hit on ALL of the things that roamed around my mind as I evaluate this…

      “Iphones really don’t go down in value that much, so buying one that’s an older model just doesn’t save much if buying from a regular store or apple.” – THIS. Verizon and T-Mobile were even willing to give me $200.00 on a trade in for my old as dirt iPhone 8. I didn’t take this deal because Mint was still a better deal AND I would have had to get my phone repaired first. Ultimately, I just bought the phone straight out from Mint (For other readers: Mint doesn’t do contracts of payments.). But your suggestion at 0% and 3% cashback would have been an even better deal. I should have posted here first. Ugh. Now I know. Thank you so much for sharing 🙂
      “I love Mint.” – I am so glad to hear this. I am now even more confident in my decision.
      ” only caveat is if you go with unlimited, it caps the hotspot. I take the 15G plan and can use it all to hotspot if necessary” – Hmmm this is good to know and a consideration for next year. I did go with the Unlimited and wasn’t really worried about the cap because I’m either on University B’s campus and have Wifi or at home. But this is really good to know.

      Lol in the future, I will be bringing financial choices here first because you had all the insights lol

      Like

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