Thursday, January 8, 2009

Goals for getting our "Finances in Line in 2009"

MoneySavingMom is hosting a discussion about financial goals for this year (click here to view), and I couldn't help but want to join in!

As my family members know, I've always been the type to budget. My budget is my financial blueprint. It's my boundaries and goals wrapped up in a simple spreadsheet.

I'm a firm believer in boundaries, especially when it comes to money. If I had no boundaries, I would spend with abandon and get nowhere fast! My financial boundaries are not stringent by any means, but at least they give me an idea of how much I'm able to spend and how much to lay aside.

I bought my little starter home (on my own) in 2003. Using a budget and careful planning, I was able to buy a new refrigerator, dishwasher, clothes washer, love seat, and privacy fence without paying a cent of interest. I utilized store credit with 12-months-no-interest programs. I was able to buy a new desktop computer and digital camera in the same way. All this on a very limited salary!

Then I got married. ; )

I've heard that finances are one of the biggest sources of contention in marriages today, and I BELIEVE IT! Lance and I have struggled to reconcile our differences for the last 4 years. It has not been easy. But we're finally working together, and we're excited about the financial freedom in our future!

Our main goal for 2009 is to completely pay off all our debts, with the exception of our mortgage. This covers: my school loan, Lance's school loan, the home equity line (on which we put the majority of our renovation costs from last summer), our Best Buy credit card balance (new stove bought last summer), and Lance's business debt.

Our secondary goal is to put as much into savings as possible. With our focus being on paying off debts, it doesn't make sense to be socking away a large amount into savings while paying interest on remaining balances. But if we pay off the debts earlier than expected, we'll direct the "snowball" of payments towards savings.

We've already taken a major step towards realizing our goals by starting the process of refinancing our mortgage. When the rate hit 4.75%, which is almost 2 whole points lower than our current APR, I jumped at the opportunity! We'll be able to save about $200 a month in interest while still paying extra towards principle every month in order to reach our long-term goal of paying off the mortgage by 2023!

It's also helpful that I started a new job last month with a 12% jump in salary. During this time of economic distress, it's such a blessing to not only have a job, but to have been offered a new job with a higher salary. I'm thanking God for His goodness! And I'm asking for His guidance in being a good steward this year with what He's given us. That's what it all comes down to...being a good steward and GIVING of what we've been given.

2009 should be a very good year.

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