Life has taken over since March. So much going on. My “financial education” became derailed, and I really think this has so much to do with the fact that I’m not focused. I don’t have clear-cut goals. As a result, I’ve blown some money that could have moved me further along in my financial journey. Instead, it’s gone… poof.
Today I decided to jot down some financial goals I would like to become a reality in my life. I have no idea, at this point, if these things are even within the realm of possibility for me, but I figure if I aim for nothing, I’ll hit it every time.
I’ve gone through Dave Ramsey’s lessons in the past, and even have my kids go through his homeschool curriculum as part of their education. However, today I printed out his seven baby steps for me. They seem so huge, but it’s great to know I have one of them already checked off.
Step One: $1,000 in an Emergency Fund
Yep, I actually have $1,007.80 in my emergency fund. I’ve had that thousand in the account for a while now, which is a big deal. I can’t believe I haven’t touched it. Being able to check that one off is great. Unfortunately, that leaves six big ones on the list.
Which brings me back to the goals I mentioned. Here are the ones I jotted down this morning:
- Pay off my debt (excluding the mortgage… for now).
- Increase my emergency fund to 3 months expenses.
- Retirement investing (shoot for 15%).
- Help my kids (there are 4) with college (I would love to pay for all of it, but I’m not sure that’s realistic at this point since I have a kid graduating high school less than a year from now.)
- Pay off the mortgage.
- Have the option to retire by age 50 (that’s in 10 years – this one will set off a whole new list of goals to accomplish).
For step seven, Dave says, “Build Wealth and Give”. This is great, but I’ll admit, I have no idea how to build wealth. I wrote that I’d like the option to retire by age 50, but I really don’t know how to accomplish that right now. I do know that building wealth will not be a reality until I do at least the first several items on the list.
Let’s start with the first one. Like most Americans, I do have some debt. My unsecured debt is no where near what it once was, but it’s still a pretty big amount. While I’m not adding any new debt, I do use one of my cards for purchases (I pay off the new charges plus extra each month). I’ve had my debit card account wiped once because someone got my card number. We’re guessing through an online source, so I don’t use my debit card online at all anymore. This incident set off a chain reaction of overdraft chaos, and quite frankly, I am not up for going through that again.
My plan is to post each month giving an update on paying down the debt. We recently refinanced our home mortgage for a lower interest rate and have some extra cash to put on the debt payments each month. I know Dave recommends paying off the smallest balance first, but I’ve been getting out of debt for a bit now and I’m going to focus on the largest interest rate. I already eliminated the really high rate cards (there were three others). The last two are at 12.5% and 9.5%.
I’m hopeful that posting this publicly will motivate me to stay the course. Time is going to pass no matter what I do, so I hope to leverage what time I have to my advantage.