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Goals Review – October

November 9th, 2009 at 06:56 am

I was thinking about an incidence that occurred a few years back. I was at a kind of holiday type party at one of my wife's friend's house. We are both about the same age and same stage in life. At the time, our finances were interchangeable. Be both had credit card debt, mortgage, car payments, school payments, etc.

We were both probably had the same stresses. The balance between work, friends, and family. Never enough money to pay for everything. Always wondering how the neighbors paid for that.

Up until this point, I was always able to out earn my bills but that was coming to an end fast and I didn't even know it as circumstances outside my control would force my hand.

In any case, at that party, we were talking and he said to me "Welcome to the crunch years." What he meant by this was for the next 15-20 years, the job was to survive. There was no way to get ahead. Just survive and then after college expenses, we could prosper. Then, there wouldn't be mortgage and school expenses, just the car loan.

And at the time, I agreed completely. It summed up how I felt to a T – just survive.

Fast forward today. At one point in my life, I thought him and I would be good friends with our families hanging out together on the weekends. In the few years, he has continued down the path that he was on. Mine has taken a different turn.

I may have been forced to alter my path, and in hindsight, I do find it to be a blessing.

In December, it will be a year since I paid off my last consumer debt. Looking back, I am in a place were I see a bright future as oppose to "just surviving". I am no longer waiting for that next promotion or raise.

It’s an interesting place to be.

By the by, don't forget to get your holiday budgets together. Christmas is less then 2 months away.

Goals Review - September

October 6th, 2009 at 06:47 am

It's been awhile since I last updated in August. I am still updating my sidebar. I have maxed my 401 (k) contributions for the year.

I also rebalanced by portfolio. I do this twice a year (March and September). The theory is that I sell my winning sectors and asset class and purchase my under performing sectors. So in March, I reweighted my portfolio where I sold some bond funds and bought stock funds. In September, I sold some of the stock funds and bought some bond funds.

The easy way to achieve this is to buy a target fund that is close to the allocation you want.

I now used to my higher mortgage payments. It's nice to see over $1,300 going to mortgage as oppose to less then $500. I can see the balance going down and can envision it being paid off.

In February, I was asked (as well as all the consultants) to reduce my billable hours. It was a 20% decrease and I opted to take Mondays off. I was still living below my paycheck, but I knew that the larger financial goals were not going to be tackled. So, I have been generally in a holding pattern, taking a break, and enjoying the family.

Two weeks ago, we received word that we could go back to charging our normal hours. I actually increase my hours by 37%. So that coupled with the 401 (k) deductions being maxed, I have received a little boost in income.

Needless to say, it will all be going to furniture this month. But no new debt.

Also with this, I have found a new fire to start reviewing my other financial goals and start attacking them.

Mid June Update

June 16th, 2009 at 11:10 am

July 1st is the first payment to my new mortgage. And for once, I am excited. It seems kind of weird. Some of you may be dreading pay your bills because you don't have a budget (or one that works) or you and your spouse aren't functioning as a team.

I like getting my paycheck every week and allocating my pay to expenses and other savings. I like tracking the spending and making sure the budget is working.

But most of all, I like updating progress towards my goals. I like updating my 401(k) savings and trying to determine when that will be maxed; and most of all, I like updating the principal on the mortgage and watching that go down.

Sure I like having a plan and executing on that plan. But even more, I like watching goals being achieved, perhaps even more then the achievement itself.

As for my goals, I'm moving forward. The 401(k) will be finished around the end of August, then I'll be able to achieve more of my goals. One of the big goals I am looking to start is to start saving for college for my kids. I have a lot of time (14 years before the oldest hits college), but why wait and make excuses.

Mid May Update

May 13th, 2009 at 10:40 am

Wow!!! What a month so far. Things are finally calming down. I had a few interviews in New York and California. At the end of the day, I like where I am currently and where I am heading at the moment.

By paying off all my consumer debt and medical and having an emergency fund, I have this sense of content in my life. I no longer feel like a hamster on a wheel, trying to out earn my spending. For those of you where I was, it is worth the struggle and sacrifice to be debt free.

The way I would explain it is you are at the bottom of a hill and there is a path going up the hill. It is heavily wooded, sometimes you can get a glimpse of the sky but the view is obscured. Its buggy at times and dark, sometimes you slip on the loose gravel. When you get to end, you see this spectacular scenic view and for that moment you feel in awe of what you have accomplished. That's what getting out of debt felt like to me.

Now, I am back at the bottom of that hill and looking at a much steeper longer journey – paying off the mortgage. At first like the last hill, it looks daunting. I can't even see the top. I am standing at the bottom in the shadows and am in awe, is it too high, am I ready for this, maybe I can just rest a little more?

Then my inner voice speaks up, "What are you waiting for? There aren't any escalators here."

And with that I continue my journey.

(My refinance went through. My mortgage will be 353,000 at 4.5% for 15 years. I have shaved off 11 years and around $267,000 in interest.)

Goals Review – April

April 30th, 2009 at 07:20 am

It has been a busy first third of the year.

So, basically, I have completed my emergency fund for the moment. It is currently 4-5 months in size. My wife had competing goals furniture and an emergency fund of eight months. The compromise was that we would bring it up to 4-5 months and if I were to lose my job, she could work full time and we would be able to stretch the EF to probably at least a year.

My retirement savings is just chugging along. I am at 50% of my 401(k) being funded. I'll probably have this finished at end of September. After this and the furniture, we will probably start move to college savings and reevaluating if we want more money in the EF.

Next week, I will close on my refinance for my mortgage - 4.5% for 15 years. I know there is disagreement on the best type. Maybe I should have gotten a 30 year and paid it off like a 15 year. This would have given me more flexibility and I could have bought points to have the same interest rate as my 15 year.

I think the real reason is that I got a taste of being out of debt and I like it. I dream of my life without a house payment and think of all the things I could do with that extra money. I also think of how much freedom I can have. I would no longer need a job to pay the mortgage. I could pursue my interests and be less worried about compensation.

Also, I really do want to get into real estate and charity without a risk to my family. And I really believe that pursuing some of these endeavors really means having no house payments.

Just the risk to family of having a house payment plus some mortgage payments on investments properties seems more of a risk them I am willing to take. I do fully understand leverage and good versus bad debt. I also believe you don't get involved with something unless you're in for the long haul

If you didn't have any debt or a house payment, how would that change your life? Your family's?

It's just become a very powerful idea from me.

Long Time

April 10th, 2009 at 07:33 am


Well, it's been a long time since I wrote on this blog. At work, I am still at 80% of the hours I was working last year. I am currently debt free except for the house and am still tracking and updating my goals.

For those of you struggling with debt trying to get out, remember the best things in life are never easy. We all lose hope and focus. It's what you do after you lose focus and get knocked down. Remember perseverance is the secret to success. As Yoda said “Do or do not... there is no try.”

I have been debt free now for 3 months. During this time, I have replenished my emergency fund and have continued to increase my retirement. For those following Dave Ramsey's baby steps, that puts me on step 4. I am also in the process of refinancing my mortgage to 4.5% from 5.5% and from 30 years to 15 years.

But how does it feel to be where I am? Out of debt with and emergency fund, saving for the future?

I think the biggest thing is my attitude is more positive and losing those negative emotions. When I was living paycheck to paycheck with CC debt, 2 car payments, medical debt, etc.; I was jealous of what people had and I didn't. I was angry I wasn't making more money. I doubted myself and it wore on my relationship with my wife.

The process of getting out of debt caused my wife and I to have truly honest communication and set goals. Sure, at the beginning, I was embarrassed trying to keep up the illusion of a successful life. We had to look beyond the material things and during the journey the jealousy, anger, and doubt melted away to be truly successful. The journey of getting out of debt really caused me to focus on what I do have and prioritize what was really important to me (sounds so cliché).

Now getting back to the biggest change I see in my life over the past year and a half. I have started noticing that differences in a lot of aspects of my life and there seems to be a snowball affect. The positive attitude has led to a better relationship with my family, it has allowed me to operate with more integrity at work (I don't fear losing my job), and able to take criticisms a lot better which causes me to continually think about what I need to do better.

So for those of you in the middle of the process and doubt is starting to creep in because Murphy came for a visit, just remember this is part of the process. Look back to where you were and look forward to where you are going. Persistence is the only way to achieve your goals and the struggles and fight WILL make you a better person.

Mid February Update

February 17th, 2009 at 01:38 pm

Wow. I have been away form the site for the last few weeks. My hours have been cut here at work so I have been putting the resume and cover letter together. I have also been doing a lot of networking.

More just setting myself up for Q3 or Q4. I have a non-compete that ends June 1st so I can compete directly with my old employer. So now is the time to just start reaching out and networking with some recruiting firms.

There is an old saying "Never burn your bridges." At one time, I had over 35 people reporting into me and most were consultants. I would often deal with recruiters via hiring and firing people. I always tried to be fair and honest with all parties involved.

Now that I am on the other side of the fence, a lot of the firms see my resume and remember how I treated them (even if I don't know who they are). My advice to people especially just starting their careers is to remember always treat people fairly and honestly and you will be remembered. You will stand out from other people.

Anyway back to the update.

My hours have been cut by over 25% and logically my paycheck too. The good news is that I am still living below my means,. I am still on track to max the 401(k). I am also able to save a little.

None of this would have been possible if I wasn't out of debt.

My current goals are to max the 401 (k) and put an additional $30k in my EF. So far I have $3,600 in the 401 (k) which is a great start. I also have almost $6,000 of the $30,000 for the EF saved.

I have also been looking at refinancing my mortgage. I currently have a 30 year at 5.5%. This weekend I just received paperwork for a 15 year at 4.5% with 0 points. My mortgage broker wants to wait because the market is going in our favor. So, I wait.

Goals Review - January

February 4th, 2009 at 10:11 am

So at work, they brought all of the consultants into a room. I was thinking "this ain't going to be good." I hear from my friends who got laid off from State Street, Lehman, Fidelity, etc. So I figured they were going to prep us with the first round of layoffs.

I actually wasn't too worried. I had figured I could last through at least 3 rounds. They decided to do a more socialist move that results in my billable hours being cut by 20%. So in essence, I am done to a 4 day work week.

Surprisingly, I was quite calm. I mean I had to tell my wife that it may mean we have to cut new furniture out of the budget. But since I have been on a budget and paying off debt, we can cover all the expenses and still max my 401(k) and save a little. All and all, not bad in my industry.

I think the real thing that since I paid of all my debt, right now, this is an inconvenience and not a disaster. I think this just further demonstrates the risk that debt can have in your life.

As for my goals, I am pretty happy that I have saved $4,204 in January for the emergency fund. I am 14% towards my goal of adding $30,000.

I have also socked away $2,529 towards my 401(k). Or about 15% done with that goal.

So all and all – things could me worse. But if this is as worse as 2009 gets, it won't be that bad.

Mid January Update

January 12th, 2009 at 07:28 am

First mid month update for 2009.

I have a lot of goals on the left and there are 2 basic approaches I could take – the shot gun approach or the laser approach. Most of us don't have enough financial leeway to accomplish all of our goals at the same time. The shotgun approach is trying to hit all the goals at the same time with little progress being made on any. I don't know about you, but I get a little frustrated seeing my goals progress at a snail's pace.

I prefer the laser approach. I like the idea of focusing my resources, hit the goal, and saying "what's next".

Last year, when I was setting up the goals, I was inclined to but a little money on each. But now I decided to hit a few and try to quickly progress through them.

Why the change? Well, it really worked well for my wife and me in 2008. Also, my contract has been extended to end of March, so prioritizing the EF seems like a great idea.

So right now, I am focusing my resources on the EF and maxing the 401 (k). All other ones are secondary at this point.

So far, I have saved $3,319 out of a total of $30,000 to top of the EF. I divided in to smaller increments so that the wife and I can feel we are accomplishing things. Most of the $3,300 was saved in December. I was debt free in mid December and started throwing everything extra at the EF.

The second thing I am currently funding is the 401 (k). I currently have $769 saved out of $16,500. Seems like so little, almost not worth mentioning. LOL.

The last thing I am working on is refinancing my mortgage. I currently have a 30 year at 5.5%. I am looking at switching to a 15 year at 4.75%. Will see how that goes. Rates spiked up a little at the end of last week, so I am just waiting for them to go down.

Since I am hourly paid, my paycheck has been less over the holidays due to less hours. I am bringing home about 70% of what I normally do. Also with FICA and 401 (k) contributions coming out of the paycheck again, I have had to redo the budget a few times. By end of February, the budget should once be stable again and I should be able to project better when goals will be hit.

And for those keeping score at home, I am starting to budget for new furniture and rugs and stuff. So, yes the wife won.

2008 Year in Review

December 29th, 2008 at 08:31 am

This may be a little early but I just got my last paycheck for 2008. It's been a little over a year that I have been on this site. The thing I find most interesting about this site is the helpful comments, the encouragement, and thoughtful alternative. Even if you disagree with people, their views, etc, this site continues to offers disagreement in a respectful way.

You also have a community here where people try to elevate themselves above petty jealousy and try to be truly happy for you and what you accomplished.

Enough of that and on to the review.

My original goals for 2008 were:

1) Pay of $6,000 in CC by May 1st
2) Pay of one car by August 1st (currently $5,700 is owed and last payment is 2/09)
3) Invest $10,000 by year end in Taxable assets
4) Invest $15,500 in 401(k)
5) Review and reallocate (if necessary) retirement funds by end of Q1

They quickly mushroomed to these:

1) Pay off debt (except mortgage) by October 1st
. a) Pay off CC
. b) Pay off Car
. c) Pay off Car 2
. d) Pay off wife's braces
. e) Pay off son's medical
3) Invest $15,500 in 401(k)
4) Review and reallocate retirement funds by end of Q1
5) Will by end of Q2
6) Life Insurance by end of Q2

MOVED TO 2009
2) Invest $15,000 by year end
7) Save $4,000 for college

Could I have done more in 2008? Probably. But as people here point out, you have to find a balance in your life with your family.

All and all, I experienced huge changes this year. I am out of debt (except for the mortgage), living below my income, living on a budget, have great communication with my wife, and truly feel as a team.

For people starting this journey, I think the biggest two things to start is to be honest and non-judgmental. What does this mean? You have to be honest with yourself and spouse about how much debt, expenses, and income you have. That second thing is not to blame each other for the problem. The truth is the both of you are to blame and you both have to work together to get out of this mess.

If you can do those 2 steps, the rest are easy.

The next step for me and my wife were setting up goals and the budget. We also set up some ground rules for the budget. Any changes to the budget after it was set, we would both have to agree. If one of us didn't agree, the budget didn't get changed. The first few months were tough on the budget. We forgot this expense or another. I actually had a line item called "Things I forgot to put on the budget" and I would fund this with a couple hundred bucks.

Once the budget started settling down, we could really start tracking our goals and looking at the progress. At this time, our relationship started to really change from the universe revolves around me to us. We were both making sacrifices for our common goals.

We still have a couple of common goals left, but soon we will be prioritizing are own goals into the mix. She wants new furniture and I want a riding lawn mower and shed. 2009 should be interesting as our individual goals come into the mix.

And thanks again everyone for your encouragement, thoughts, and advice. The journey hasn't ended. It's just starting.

Freedom - Oh Freedom!!!

December 19th, 2008 at 06:05 am

Mirror: People walkin' around everyday
Playin' games and takin' scores
Tryin' to make other people lose their minds
Well be careful you don't lose yours!

Me: Huh?!?

Mirror: Oh freedom (freedom)
freedom (freedom)
Oh freedom
Yeah freedom (yeah)

Oh freedom (freedom)
freedom (freedom) freedom
Oh freedom
Yeah freedom (yeah) freedom!!
Hey - think about it
You! think about it

Me: One more time!!!!!

Mirror: Oh freedom (freedom)
freedom (freedom)
Oh freedom
Yeah freedom (yeah)

Oh freedom (freedom)
freedom (freedom) freedom
Oh freedom
Yeah freedom (yeah) freedom!!
Hey - think about it
You! think about it


And with that, I am debt free except for my mortgage.

Source: http://uk.youtube.com/watch?v=qE41YPdPuis or

http://uk.youtube.com/watch?v=J0y2dDlFmLg&feature=related

Mid December Update

December 15th, 2008 at 07:03 am

Just a couple weeks left before we close out 2008. So this quarter was to concentrate on three things: 401(k) maxed – DONE, Pay off all consumer debt – almost done, and no new holiday debt – so far so good.

The medical debt keeps shrinking. I have $768 left to fund before I send in the check to Amex. I'll probably have it all funded this Friday and will send the check this weekend.

The closer we get to the end of the debt, the more excited my wife gets. For most of this journey this year, she was happy to just review the monthly summary reports, ask for slight adjustments, and manage a few of the categories (groceries, household items, and clothes).

Now, she wants to know what day everything is going to be paid off. She is telling all her friends and family. She's ready to really start attacking other goals next year like the EF and college accounts.

The real part of the journey I enjoyed this year is the honest and open communication with my wife. When we started last year, our marriage was very strained. I would yell at her about how much she spent on groceries and she would yell at me about how much I spent for lunch and breakfast every day.

Once we came together about the budget and started to respect each other and really listen to what is important to each other, the financial sacrifices didn't seem like a big deal.

So right now I am looking at the close of 2008 meeting most of my goals. I have our goals for 2009 set and approved by my wife. I am looking forward to spending the holidays with by family (not worrying about if I have enough money in January to pay for this month) and continuing this journey next year (getting closer to my wife and accomplishing more of our goals together).

As an aside, I blogged about having long term 5 year goals and all my short term goals move towards these goals. With that in mind, I have added two other goals. These goals are really to start preparing me for 2010. In 2010, I would like to start saving up to invest in real estate and start a foundation.

So, 2 new 2009 goals are to educate myself and start preparing for this. I would like to put 10% of my salary (right now, I don't know gross or net) into a foundation for charitable giving.

This really came about in a couple of places. Having two sons, I want to instill onto them an idea of charity. I also want it to be something they can be a part of – contribute to, chose the charity, and help with the investments.

At this point, I don't know enough about foundations to know if it is even feasible to start a foundation with less then $10,000.

In any case, I'll probably be asking for some thoughts on this in 2009 as I prepare for 2010.

Is that the finish line up ahead?

December 5th, 2008 at 11:11 am

A few days I posted that my wife was going to call the hospital and just put the balance on the credit card. The hosipital told my wife it would take a couple of days for the charge to go through.

Before we charged the amount I knew 2 things would go through our minds– a) we have charged more then we currently have saved (I am currently about $1,800 short) b) we have $10,600 sitting in a bank account that's will soon be gone.

The little bit of fear was just our subconscious self saying "are you sure you want to do this?" In other words, a gut check. So I took my wife aside, we looked at each other and asked "do we really want to do this?"

Well, the charge hit today. $12,398.26!!! Wow!!! I have a little anxiety over this, but I know that this should be paid off with my pay check on 12/19. Until then, I got a big charge out there and am $1,800 short.

At this point my emotions are out weighing my logic, slightly. I am using this to intensify my focus on the budget and get this last debt paid off.

Much like the end of a marathon, I can see the finish line and I got nothing left. This journey has been both draining and joyous; but at this point, I am not concentrating on that. All I hear is the man in the mirror. "Let's go!!! One foot in front of the other!!! FOCUS ON THE TASK AT HAND!!!"

And that's what I am doing. Blinders on.

Goals Review - November

December 1st, 2008 at 10:12 am

I hope everyone had a great turkey day. Since I only worked 3 days last week, I will only get paid 60% of what I usually make this week. Oh well, such is life as a consultant.

So I have been talking about 3 goals this quarter: Max 401(k) – done, pay off all medical bills, and not take on new debt – so far so good.

With the medical bill, I entered November with $5,909 and leave owing only $1,853. I paid off another $4,056. When I say I have paid off $4,056, I mean I have it in account to be shipped out. .So I told my wife to call the hospital this week and charge the balance on a credit card (somewhere around $12k).

Why am I charging before I have only the money set aside? It really has to do with taxes. After a certain amount, I can write off a certain amount or something like that. My CPA knows. In any case I want to maximize that deductable if I can. Other wise, I would have probably sent the check after Christmas. In any case, I'll have the money before the credit card statement comes. More of a timing with when the cash will be available and when I can cut a check, just want to make sure everything clears in 2008.

Sometimes I wonder how excited my wife is to the fact that we are almost out of debt. Now, my wife is a low key person and plays things very close to the vest about everything. So imagine my surprise when she started to tell her parents that all of our debt but the house was going to be paid off in December. She also retold this to her sister.

She is also really into our goals for next year and when they will be accomplished. I even brought up investing in real estate and she didn't even dismiss it. She just asked a couple of questions. She was neutral about the concept which was far better then where she was when I last brought up the topic.

So, next goal on the horizon is to top of the emergency fund. My wife wants 8 months, my wife will get 8 months. I look at the emergency fund as security and whoever has the most months wins.

As for no new debt – one holiday down and one to go.

Mid November Update

November 17th, 2008 at 01:58 pm

We are half way through the forth quarter. I have 2 goals left for the year. No new debt for the holidays and pay off the last of my non-mortgage debt.

On the debt, $2,028 down $3,881 left. Yep, my snowball is really starting to tear into this debt. It's just amazing to me at this point. True most of this is from cars, credit cards, and braces being paid off. Also, a nice chunk from the IRS. But, some of this came from a mindset change. Me and my wife look at things and go do we really need that? Is that really important to us? And that's what really keeps our spending in check.

The weird thing is everyone talking about how crappy 2008 is. People ask me and I say "I'm having a great year."

Them "Your net worth up?"

Me, "Nope."

Them "Big raise, new job, went to all cash last November?"

Me, "Nope, nope, and definitely no, but I did drink the kool-aid."

That's usually when they step back.

After Thanksgiving, we'll really need to mind the budget. As for the debt, I am looking at another $2,000 by the end of this month and then I'll be left with less then $2,000 for December.

One last thing, for your 2009 goals, I would urge everyone to get a will and term life insurance, especially if you have children. It is the responsible thing to do. So quit whining about your mortality or the cost (I got $1.5 million 20 year for $900 a year and the will cost $650, included health stuff and power of attorneys), just get it done in the first half of 2009 and stop your whining. If you were to die, do you want to be a burden on your family? Your spouse trying to come up with enough to bury you, pay the mortgage, fight with people over your wishes. Really, just get it done.

Enough said.

Is that an elephant in the corner?

November 14th, 2008 at 07:02 am

So yesterday, I had that feeling I had last year. You know the one where you look at your outstanding debt and have that moment – how am I ever going to pay that off?

The day started innocent enough. I was taking a look at how much consumer debt I had left to pay off, rerunning numbers to make sure I could pay it all off this year. I was feeling pretty good.

Then I decided to take a look over at my 2009 spreadsheets and my goals. I basically follow Dave Ramsey's baby steps. 2008 was the first 2 steps. And 2009 are steps 3-5. I do max my 401(k) contributions every year. I know I could be using that towards other goals. But we each have our quirks.

My last goal of 2009 is to start nibbling on the elephant in the corner that no one wants to talk about. Yes, the mortgage.

So, yesterday I sent my mortgage payment in and I decided to take a look at how it's broken down and the balance. And, I got that feeling I had last year when I started this journey - a sense of hopelessness. I mean this mountain is too hard to climb. I am paying $472 in principal on a balance of $341,900. Are you kidding me? I'll never get to the end of this tunnel. It would take you 60 years to pay off $472 in principal every month and I only have a 30 year mortgage. (You can throw up your hands if you want for dramatical effect.)

Then I looked back at how much principal I paid last month - $470. A $2 increase in the principal. Not a big increase that's for sure, but an increase nonetheless. I remember first starting that snowball last year. It was sure small. But then it got pretty big pretty quick.

I am not saying that there is much to snowball. I pretty much at the end of building that snowball. But any new money (raises, bonuses, tax returns, etc.) can go directly towards this. And I remember what I kept telling myself in those early snow ball days – how do you eat an elephant? One bite at a time.

Right now, I'm not sure how I will balance life and paying down the mortgage. But right now, I don't have to worry about that. I have to finish pay of my current debt, top off the emergency fund, save for retirement, and top of the kids college funds. A lot of work to do before I get to the mortgage.

Interesting aside, during this whole journey, my mortgage has/had the highest interest rate at 5.5%.

2009 Goals

November 10th, 2008 at 11:54 am

I was thinking to myself why do I call them 2009 goals? I mean, these goals are just a naturally progression in my financial evolution. Does continuation of goals give it any less weight?

The truth being it is important to me to have concrete goals and ways to measure them. One year is long enough to establish real substantial goals without feeling to far away. For instance, paying of my mortgage is years if not decades away. It would be hard to keep my focus on that goal month in and month out. So I will break it down into a more manageable goal. If I could but $X towards principal this year, it puts me on a path to pay off my mortgage by 20XX.

Also with yearly time frames, it seems natural for us to all take stock of our lives around the holiday seasons. Christmas and Thanksgiving are times to remember the past with family and New Years gives a clean slate, so to speak.

I can look at my financial journey as building a house. In 2008, my objective was to clear the site - remove the boulders and trees, get approval from the wife about the house and where it would be situated, and start putting together a vision of what this house will look like at the end.

In financial terms, 2008 was spent getting on a budget and eliminating all non-mortgage debt. I started the year with over $49k in debt. I also had Murphy visit. In June, I received a medical bill for $4,500. I had to put my debt snowball on hold to attack this which caused some frustration.

Right now, I have less then $5,000 in debt. This is a very strange place to be. From last year to this year, my journey has been the difference between night and day. Last year, I was living (if you can call it that) paycheck to paycheck. This year, I am budgeting paycheck to paycheck. I have also budgeted enough to pay of 90% of my debt year to date.

2009 goals are really to set the foundation that the house will be built on. This has to be done right or else the whole house will eventually fall apart.

With that in mind, my major goals are to fully fund the emergency fund. The wife wants more then 6 months, so it will take me $30k to finish the emergency fund. Since $30k is a big number, I broke it down into months.

My other large goal is to play catch up on the college funds. $18k between my 2 sons will be as if I put $2k away for each, since they were born. I'll automatically contribute something to each 529 a month - $1,000 a month for the oldest and $500 a month for the youngest.

My last new goal is to start paying down the house.

My complete list of goals for 2009 are:
1. Invest $15,500 in 401(k)
2. EF Fully Funded
. a. 1st Month - $5,000
. b. 2nd Month - $5,000
. c. 3rd Month - $5,000
. d. 4th Month - $5,000
. e. 5th Month - $5,000
. f. 6th Month - $5,000
3. Contribute $12,000 to Son 1 529
4. Contribute $6,000 to Son 2 529
5. Extra $36,000 to mortgage
6. Rebalance portfolio

Will I accomplish every goal? Probably not. But by keeping some goals out of reach, it keeps me focused for the year.

Goals Review - October

November 3rd, 2008 at 07:47 am

So 2 of my goals were moved to next year (529s and savings $15k), and I have shorten the 4th quarter goals to 3 (max 401k, pay of all debt (except mortgage), and not add new debt with the holidays).

My 401k is now maxed so no more money going to that.

I have one debt left - my son's medical bill. I entered October owing $12,898. I paid off $6,989 leaving $5,909. How did I do this? I don't even know. I was just really focused this month, my 401k contributions stopped, and there was an extra paycheck. I was so happy earlier this month when I broke $10,000. Now, it seems to be just melting away at a staggering pace.

I'll need to finalize the holiday budget with the wife. We will need to finalize our gift budget for Christmas, wine budget for Thanksgiving and Christmas, decide if we will be hosting a happy hour at our house, and decoration budget (tree, wreaths, etc.).

I can't help but to think where I was last year and my feelings of desperation. Financially, I was just holding things together. How did I get from where I was to where I am now?

I looked at my life with my wife and we said where do we want to be? We wanted to be in a place to not worry about bills and not having enough money at the end of the month.

That's a great goal but what does that mean? How do you achieve that? And that's were the yearly goals come in. What do I need to do this year to get me to that point or closer to that point?

Then I took these goals and broke them down further into manageable pieces. What do I have to do this month or even this week to set me up for success? Each decision brings you closer or further away from your goals.

You have to prioritize your goals too. Most of us don't have enough resources to attack all the goals at the same time. We need to focus and concentrate on one or two at a time and then move on from there. That is why I have had to move two goals to 2009.

Did we fall? Yes. Did we stay down and give up? No. But, we had a shared vision of the future.

Now, you hear people saying that getting on a budget and focusing on what is important frees up money you didn't know you had. Truthfully, at first, I didn't believe this. I got nothing how could I be wasting money?

Well, that's exactly what happened. By budgeting, money was prioritized and went to achieve very focused small goals. Once goals were achieved, more money started freeing up. It started to snowball.

Which brings me to where I am now. My snowball is attacking my last debt with a vengeance. My old car payments, credit card payments, wife's braces, and 401(k) deductions are all focused on the last debt. Really, the debt doesn't have much of a chance and that's what I saw this month.

Some of you are probably struggling right now and just can't see a way out. Basically, where I was last year.

So imagine if you could take all those monthly payments and focus them on whatever financial goal you have. What would you do with that money? How much better off would your family be? How much less stress and anger would you have in your life.

The budget just keeps you in line and the goals just focuses that snowball.

Psychological goals are important too?

October 21st, 2008 at 12:17 pm

$10,000. It's just a number. $9,999 is only $1 less. Right? Or is it more? Is it going from a 5 digit number to a 4 digit number that big of deal? Does it really make sense that it FEELS like such a big deal? Maybe it just signals an end to a long road or a phase?

Does it even make sense? Should I even make a post about such a silly little thing? Is it embarrassing to feel I have to share this and can't keep it in? Does it really matter?

In any case, my total debt is below $10,000 (9,337 to be exact, but who's counting). What makes this number so important to me is that it's an ending of a negative phase and the beginning of a much more positive phase. It's not so much the financial aspects either. It's more of the communication with my wife, realigning our goals, coming together as a team, and really respecting each other's opinion.

Oh yea:

I wanna rock! (Rock)
I wanna rock! (Rock)
I want to rock (Rock)
I wanna rock! (Rock)

Turn it down you say,
Well all I got to say to you is time again I say, "No!"
No! No, No, No, No, No!
Tell me not to play
Well, all I got to say to you when you tell me not to play,
I say, "No!"
No! No, No, No, No, No!
So, if you ask me why I like the way I play it
There's only one thing I can say to you

I wanna rock! (Rock)
I wanna rock! (Rock)
I want to rock (Rock)
I wanna rock! (Rock)

Mid October Update

October 13th, 2008 at 10:43 am

Well, we are almost half way through the first month of the forth quarter. So far so good. I just accomplished another goal. I have added $15,500 to my 401k this year. It is maxed.

I also decided to move goal number 2, saving $15,000, over to next year.

I have so far put $1,533 towards my son's medical bill this month. I would like to put another $4,000 towards it. Again, my focus for this forth quarter is to pay off the medical and not incur any new debt during the holidays.

I have also started road mapping my goals for 2009. To me, this means taking my yearly budgets and breaking them down to quarterly goals and monthly goals. Since the amount of weeks in a month change, the goals for each month are slightly different.

One of the things I am really debating is paying off the house mortgage. I am all for paying down my mortgage aggressively so that it is a 15 year mortgage. The issue I have is above that.

I understand both arguments and they both make sense to me. The argument focuses on leverage. Paying of the mortgage eliminates leverage and reduces risk. Hard to be foreclosed on without a mortgage. The other argument is that leverage is good. If you borrow at 5.5% (my current mortgage rate), I could invest that in a diversified portfolio and make about 8% a year.

So there are two driving factors in my life. One being to reduce risk, and this was way before the stock melt down. The other is to start investing in real estate. And both are pulling me at about the same force.

As a compromise, I am currently looking at aggressively reducing my mortgage from 30 years to 15. At that point, I think I'll reevaluate.

I would love to hear other people's thoughts.

Goals Review - September

October 1st, 2008 at 07:26 am

Another challenging month. I was basically trying to get back in the swing of things but two things happened. We took a vacation in September and the total cost was $850. A great time was had by all and I really can't complain at the end of the day. The second thing is that if I don't work, I don't get paid. So, it was a three paycheck month instead of four.

Good news is that I lived within my means and didn't need to take on any new debt. The bad news is I only paid off $1,000 towards debt.

So let's get started.

My goals for 2008 are:

1) Pay off debt (except mortgage) by October 1st
. DONE a) Pay off CC by April 1st
. DONE b) Pay off Car 1 by June 1st
. DONE c) Pay off Car 2 by Aug 1st
. DONE d) Pay off wife’s braces by June 1st
. e) Pay off son’s medical by October 1st
2) Invest $15,000 by year end
3) Invest $15,500 in 401(k)
DONE 4) Review and reallocate retirement funds by end of Q1
DONE 5) Will by end of Q2
DONE 6) Life Insurance by end of Q2
MOVED TO 2009 7) Save $4,000 for college by end of Q4

1) Pay off all debt but the mortgage by October 1st

Total Debt
09/30/2008 - $12,898 ($1,000 paid)

Son's medical (0% interest rate)
08/31/2008 - $12,898 ($1,000 paid)

This won't be paid off by today or for that mater this month. With only one quarter left, this will be my primary goal for Q4 – Entering 2009 with only mortgage debt.

2) Invest $15,000 by year end

With the holidays coming up, most of this will be pushed to 2009. But, I'll see how much I can accomplish by year end.

3) Invest $15,500 in 401(k)

Invest $15,500 in 401(k)
09/30/2008 - $14,991 invested

Will be done with my 10/10 paycheck.

4) Review and reallocate retirement funds by end of Q1

DONE

5) Will by end of Q2

DONE

6) Life Insurance by end of Q2

DONE.

7) Save $4,000 for college by end of Q4

Moved to my 2009 goals. The $18k goal will fully catch me up to where I think I need to be with the 529 plans.

Summary

So, yea, life happens. Two goals will need to be moved to 2009 – saving $15,000 to top of the emergency fund and catching up on the kids college (the total goal for 2009 is $18,000).

Am I disappointed? Not at all. This is a journey; and looking back, I am in a lot better position then I was last year at this point. At this point last year, I had a son that was born in August. After being home for a few days, started having seizures. And medical bills were just starting to come in in October. I was living paycheck to paycheck and I knew drastic measures had to be taken.

I entered 2008 with debt of $49,442 and got a bill in June for more medical expenses of $4,498. I am looking to pay off $53,940 in debt this year and save $15,500 for retirement.

I also threw a great party for my wife in August that cost somewhere around $1,500 and went on vacation this last month for $850 and lost a week of pay.
I am not trying to brag or say look at me. I am just trying to point out that you can do this too. If you're in debt and feeling the pressure, perhaps you have small kids and a spouse you have to support, I understand. I have been there. YOU can change your path. YOU can succeed.

And with that, my Q4 goals (yes we are in Q4) are to pay off the remainder of my debt, save $15,500, and not incur new debt.

Remember, that this is the holiday season. I have started setting up a holiday budget. Not only for Christmas presents and wine for holiday parties but budget for tree, decorations, food and liquor for a party, wreaths, etc.

Goals Review - August

September 3rd, 2008 at 09:51 am

Wow, what a month. My wife's birthday in Boston wasn't cheap but worth it and everyone had a great time. Went on a mini vacation to New Hampshire with 2 other families and went Storyland (amusement park for little kids). Greatest part no new debt!!!

So let's get started.

My goals for 2008 are:

1) Pay off debt (except mortgage) by October 1st
. DONE a) Pay off CC by April 1st
. DONE b) Pay off Car 1 by June 1st
. DONE c) Pay off Car 2 by Aug 1st
. DONE d) Pay off wifes braces by June 1st
. e) Pay off sons medical by October 1st
2) Invest $15,000 by year end
3) Invest $15,500 in 401(k)
DONE 4) Review and reallocate retirement funds by end of Q1
DONE 5) Will by end of Q2
DONE 6) Life Insurance by end of Q2
MOVED TO 2009 7) Save $4,000 for college by end of Q4

1) Pay off all debt but the mortgage by October 1st

Total Debt
08/31/2008 - $13,898 ($2,162 paid)

Wife's braces (0% interest rate)
08/31/2008 - $0 ($1,560 paid)

All paid off!!!

Son's medical (0% interest rate)
08/31/2008 - $13,898 ($602 paid)

And then there was one. Only on debt left!!! Not a bad month, I had some extra expenses I need to pay also, like preschool and life insurance policy on top of the fun money a mentioned above.

Next week, I am going to the Cape for vacation. I wouldn't get paid for that week from work. I figure I need to save about $350 from my next paycheck in order to be able to get through the week. I have a budget of about $500. The place is paid for. So, it's pretty much gas to get me there, miniature golf, maybe one a meal out, and some groceries. Maybe I should up it to $750. I'll need to go through the finally budget numbers with the wife.

2) Invest $15,000 by yearend

This goal will be started in Q4, only a month away. This is really just to top off my emergency fund.

3) Invest $15,500 in 401(k)

Invest $15,500 in 401(k)
08/31/2008 - $13,848 invested

I am thinking this goal will be accomplished with my 10/10 paycheck, then I'll go back to goal 2.

4) Review and reallocate retirement funds by end of Q1

DONE

5) Will by end of Q2

DONE

6) Life Insurance by end of Q2

DONE. Bill paid!!!!

7) Save $4,000 for college by end of Q4

I am actually moving this to my 2009 goals. The $18k goal will fully catch me up to where I think I need to be with the 529 plans. Basically, if I started saving $2k a year for each at birth.

Summary

So, this is the last month of the third quarter. I am still on track for the end of the year. I'll take another look this month at my 2009 goals and see what I need to do now to stay on track.

As an aside, you should have a will and life insurance policy. If you haven't done it yet, set it up as a Q4/Q1 goal. Being a man or a woman today means being responsible for your family. If you are gone, what happens to your family? If you and your spouse are gone what happens to your family or pets? Do you have enough money to take care of the house, children, college? Just do the right thing and get it done.

Also, Q4 is less then a month away. I have already started looking at budgeting for the holiday season.

Goals Review - July

July 30th, 2008 at 07:05 am

My boat's capsized
it's gonna sink to the bottom
I can see the lights on the shore
getting farther away

I don't if I'll make it home tonight
but I know I can swim
under the Tahitian moon

Yes my boat did capsize. And as it was sinking, the lights on the debt free shore were getting farther away. So, I don't know when I'll be done, but I know I can swim. And what better place to swim then under a Tahitian moon?

All in all, a good month and looking forward to August. 2 things I have to be aware of in August: My wife's birthday party and saving for vacation in September. The vacation is paid for and all set. But if I don't work, I don't get paid. So I got to save a little to make sure the bills get paid.

So let's get started.

My goals for 2008 are:

1) Pay off debt (except mortgage) by October 1st
. DONE a) Pay off CC by April 1st
. DONE b) Pay off Car 1 by June 1st
. DONE c) Pay off Car 2 by Aug 1st
. d) Pay off wifes braces by June 1st
. e) Pay off sons medical by October 1st
2) Invest $15,000 by year end
3) Invest $15,500 in 401(k)
DONE 4) Review and reallocate retirement funds by end of Q1
DONE 5) Will by end of Q2
DONE 6) Life Insurance by end of Q2
7) Save $4,000 for college by end of Q4

1) Pay off all debt but the mortgage by October 1st

Total Debt
07/30/2008 - $16,060 ($1,585 paid)

Car 2 (3.9% interest rate)
07/30/2008 - $0 ($929 paid)

All paid off!!!

Wife's braces (0% interest rate)
07/30/2008 - $1,560 ($156 paid)

Son's medical (0% interest rate)
07/30/2008 - $14,500 ($500 paid)

Wife's medical (Not included in total)
06/01/2008 - $4,498.52
06/25/2008 - $1,498.52 ($3,000 paid)
07/30/2008 - $0 (1,498.52 paid)

So all I have left is the wife's braces and the son's medical. I paid off the wife's medical form 2007 and the second car (I'll send in the payment next week).

All in all, not bad. I am getting back on track and looking forward to pay off the braces this month.

2) Invest $15,000 by yearend
This will be started in Q4.

3) Invest $15,500 in 401(k)

Invest $15,500 in 401(k)
07/30/2008 - $11,787 invested

Right on target to finish this up in October. Just chugging along.

4) Review and reallocate retirement funds by end of Q1

DONE

5) Will by end of Q2

DONE

6) Life Insurance by end of Q2

DONE. Just received a letter that everything looks good from my physical and I have been approved for a policy. Just waiting for the bill.

7) Save $4,000 for college by end of Q4

Looking for 4th quarter on this.

Summary

So, even though Murphy took the wind out of my sails, I am starting to make progress again. Even though good old Murph threw me off about 5-6 weeks, I didn't change my goals for the year. They were very aggressive before and should be all but impossible now. But, the aggressive goals keep me focused and on point. I feel you need to keep them out of reach but not impossible.

Rough Goals for 2009? Already?

July 28th, 2008 at 10:37 am

At one time in my life, I managed a staff of 35 with a budget of $10 million. This time each year I would start preparing my budget. I would list what I needed to do for the remainder of the year and what big projects I would do in the next year. Some of the stuff that was budgeted was additional phases for existing projects, others were new projects, and some was maintenance.

This caused me to focus and what I really needed to get done in the last 5 months of the year and what I could do now to achieve my goals for 2009. It could be educating myself about some project before it started. It could be altering a current project slightly to make a future project easier.

The point was to line everything up and start removing any roadblocks that I could see in the road. And with that, I am starting to think about my goals for 2009. Some of tmy goals for 2008 may spill over, but hopefully not.

So there are basically two types of goals: tactical and strategic. My strategic goals are my long term goals of financial freedom (not having to work for a living), starting a real estate investment business, and spending more quality time with my family.

Now my tactical goals are what do I need to accomplish to move me towards these goals.

My 2008 goals were to set down a solid foundation (get out of debt, emergency fund, college savings, will, and life insurance) as well as some maintenance goals (max 401(k) contributions and rebalancing portfolio).

So for 2009, the maintenance goals will move forward. (max 401(k) contributions, rebalancing portfolio, and college savings). That's the no brainer as far as goals go.

The next step of goals is to start thinking about the next tactical steps to achieving my long term goals. The first few will be to continue saving.

The first goal will be to fully fund the college account for both kids. I will add $14,000 to their college fund over the year. In other words, I am going to catch up to where the accounts should be if I was contributing $2,000 per kid per year.

The second goal would be to save an additional $15,000 into investment accounts. This I can use for the business eventually or other big ticket items. I am thinking of saving 100k for the business. I want to go in cash heavy to start off cash flow positive with capital left (kind of like a business emergency fund).

The next goal is to continue to pay down debt. In this case, paying down on my mortgage at a rate of $2,000 $3,000 a month. If I do $2,000, it will be paid off on 12/1/2017. If I do $3,000, it will be paid off on 10/1/2015.

So the last goal is to educate myself. This would include personal finance, how to run a business, real estate market, land lording, etc.

That's how my goals for 2009 are shaping up. I'll probably finalize them in Sept/Oct and then post them on the left.

So what are your goals next year and what are you doing today to help you to achieve them? You only have 5 months left.

Mid July Update

July 18th, 2008 at 10:01 am

Well, I have been comparing my journey to get out of debt to the Boston marathon.

I first phase is to find a good pace. You dont want to come out too fast or youll just run out of stem and quit. You dont want to come out too slow because youll never finish. For each of us the journey is different. Some of us will finish in 2 hours and some of us will take 8 hours. And much like the Boston marathon people will be cheering us on regardless. Come on!! Youre almost there!! You can do this!!!

The second phase is when we find that pace. Ah, life is good, things are turning around. I CAN do this. We are cruising along and we can see the road ahead of us. The crowds are cheering and we feel good.

The third phase are the Newton hills. Its really a stretch of 5 miles of four hills. The last hill is .4 miles long and rises 88 feet. This is where I am and am about to crest the hill. Thats right. This weekend I will be putting the last money towards my wifes $4,400 medical expense that we just got billed on from last year.

The last phase of the marathon is 5 miles of little nasty hills, where your body is broken down and it just your mind pushing you on. I can see some of this course coming up. I have to allocate some money for a vacation in September because if I dont work then I dont get paid, by wifes birthday party in Boston in August (I should be able to cash flow it), and my wants.

Yes I said it My wants. I want a riding lawn mower for my acre of yard, I want a shed, I want a sprinkler system, my wife wants new furniture, my wife wants new clothes . We know what we must do, but we still feel the pull and its getting greater the closer we get to the end of this phase.

Getting out of debt may not be rocket science, but it sure aint easy.

Time for team Merch to have a pep talk and keep the focus.

Truckin, like the do-dah man. once told me youve got to play your hand
Sometimes your cards aint worth a dime, if you dont layem down,

Sometimes the lights all shinin on me;
Other times I can barely see.
Lately it occurs to me what a long, strange trip its been.

Whats next?

July 16th, 2008 at 07:39 am

I was reading a few blogs over the last few days and it seems that everyone seems to be hitting one of those patches where life is a little tougher then normal. I dont know whether its the news, the economy, the weather, gas prices, food prices, whatever.

I could say hey, everyones in the same boat. Or Yeah it sucks its _____ fault. Please fill in the blank with president, congress, big oil companies, republicans, democrats, banks, or whatever.

The point is that we all get in these funks and the purpose is not stay in them. I truly believe that in the end, you are the one holding you down. Sure, you may have hit a stretch of bad luck. Sure Murphy is in my house taking up residence.

So how do I usually get out of my funks.

I first throw a pity party for one. I complain how life is not fair. I shouldnt be in this spot. Everyone is out to get me.

Then, I will usually look at my long term goals (5 years out). Is this truly where I want to be? Does my plan still make sense? Are the steps to get there still correct? Do I have to add some steps because of this rough patch?

Whats next?

Work the plan. I need to take my first step. Is it a phone call? Is it a tough conversation in need to have? Is it doing more research on an issue?

Whats next?

I am executing a task list. I am starting to get back on track. Hope is starting to be restored.

This is where I am today. I got derailed with some medical bills of $4,400. It caused me to have a little pity party. Blaming hospitals and the insurance companies for screwing me. Then, I made a plan with a couple of tasks and started executing.

Whats next?

End of this week, Ill be back on track moving towards my goals.

You dont have to live the life you are living. But you do need a plan to turn it around. Never lose focus of your big goals.

And two of my favorite words are Whats next? I find that if I keep asking myself whats next?, it keeps me moving forward, building the momentum.

So, whats next?

Don't call it a comeback

July 10th, 2008 at 09:58 am

So, June turn into July and I still have the blahs. The main reason is my debt snowball has stopped. Why? Well, I got hit with about $4,400 in medical bills from last August. (Just showing up now, come on!!)

I decided to just cashflow rather then add it to my debt snowball. So, it basically took me about a month to pay off, but Ill complete this either this week or next week at the latest. So, logically I understand I am doing what I need to do and realalisticly this will throw me off a month. Whoopie, no big deal.

But my emotional side feels like Ive been sucker punched to the gut. All my breath and forward momentum have been zapped.

I have reached my heartbreak hill.

But, its that guy in the mirror who rides me like a rented mule and keeps me focused and going.

Mirror: Hey! Whats going on?
Me: I dont know. Its been a tough month. I was suppose to have the car paid off and the braces. Sigh, none of that happened.
Mirror: Murphy showed up right?
Me: Yea, the guy just comes around at the worst times.
Mirror: Yea, hes like that. He likes to throw you off your game. Shake you up.
Me: Yea I had a great pace and now I have to stop to clean up this crap that I thought was already taken care of. All my timeframes are shot. I am missing short term goals left and right. AAARRRRGGGGHHHH!!!!
Mirror: Youve lost focus.
Me: What? No, well maybe.
Mirror: Should we scale back the goals?
Me: No, I think I need to just vent and let it out.
Mirror: You set now? Cause, I got work to do!

So as I turned and walked away, I swore I heard:

C'mon man
And with the local DBT news, LL Cool J with a triumphant comeback
[mumbling]
but tonight...
Don't call it a comeback
I been here for years
Rockin my peers and puttin suckas in fear
Makin the tears rain down like a MON-soon
Listen to the bass go BOOM
Explosion, overpowerin
Over the competition, I'm towerin
Wreckin shop, when I drop these lyrics that'll make you call the cops
Don't you dare stare, you betta move
Don't ever compare
Me to the rest that'll all get sliced and diced

And with that Mr. Murphy:

Don't you call this a regular jam
I'm gonna rock this land
I'm gonna take this itty bitty world by storm
And I'm just gettin warm

Goals Review June

June 30th, 2008 at 10:20 am

This month had the good and the bad. I didnt pay much debt back this month, but I did make good progress on life insurance and my will.

My goals for 2008 are:

1) Pay off debt (except mortgage) by October 1st
. DONE a) Pay off CC by April 1st
. DONE b) Pay off Car 1 by June 1st
. c) Pay off Car 2 by Aug 1st
. d) Pay off wifes braces by June 1st
. e) Pay off sons medical by October 1st
2) Invest $15,000 by year end
3) Invest $15,500 in 401(k)
4) Review and reallocate retirement funds by end of Q1
5) Will by end of Q2
6) Life Insurance by end of Q2
7) Save $4,000 for college by end of Q4

1) Pay off all debt but the mortgage by October 1st

Total Debt
06/26/2008 - $17,645 ($656 paid)

Car 2 (3.9% interest rate)
06/30/2008 - $929 ($0 paid)

Wife's braces (0% interest rate)
06/26/2008 - $1,716 ($156 paid)

Son's medical (0% interest rate)
06/09/2008 - $15,000 ($500 paid)

Wife's medical (Not included in total)
06/01/2008 - $4,498.52
06/25/2008 - $1,498.52 ($3,000 paid)

On April 17th, I wrote: Somewhere between now and being debt free, there will be these hills that will test my resolve to the core.

In the first quarter, I was finding my pace. By April and May, I was cruising along. Lets add some more aggressive goals.

And then June hit. I got hit with a 1,500 medical bill, then 1,800, then 500, and finally 600. At the end of the month, I just got hit with 4,400 in medical bills. This is my Heartbreak hill. 4 consecutive hills. Once you get over one, theres another one.

I knew this day would come and I know the next stage Just grind it out. To make my goals, I just need to grind the remaining debt out over the next quarter, after I hit these hills.


2) Invest $15,000 by yearend
This will be started in Q4.

3) Invest $15,500 in 401(k)

Invest $15,500 in 401(k)
06/27/2008 - $10,210 invested

Right on target to finish this up in October.

4) Review and reallocate retirement funds by end of Q1

DONE

5) Will by end of Q2

DONE

6) Life Insurance by end of Q2

Took the physical and handing in my application. Just waiting for it to be reviewed.

7) Save $4,000 for college by end of Q4

Looking for 4th quarter on this.

Summary

Even though I am in the nasty part of my debt marathon (4,400 in new medical expenses and just having to grind it out this quarter), I feel good that I got the will and life insurance done. You see, this year (2008) is really about laying the foundation to my financial house. I feel good, surprisingly. I mean, if I look at 1 year or 6 months ago, I am in a far better place. I have traction and I just need to pull through.

So Murphy may have won this month, but the guy in the mirror is telling me to grind it out. So Murphy, enjoy the spare bedroom while you can. The guy in the mirror has me on point, focused, and fired up. So, Im coming after YOU this quarter.

Do you know what to day is?

June 24th, 2008 at 08:31 am

June 24th. So?

So, in 6 days, the quarter ends. Thats right half the year is over, gone. Next week, you will have less then 6 months to accomplish all of your goals for 2008.

Are you going to make them all? Why? Lack of focus? Lack of commitment?

5 years from, where do you want to be? What are you doing this year to get there? After you accomplish this years goals, whats next? Every step you take, brings you closer or further away from your goals.

5 years from now, I have 2 goals. To be working on what I want to work on and investing in real estate.

My big goals for this year are easy: have a fully funded emergency fund and pay of all consumer and medical debt. I also have some other goals but these would be my 2 primary.

Next year, I will start paying down the mortgage to get it from a 30 year to a 15 year. It will probably take me more then a year to do this but you got to start somewhere. And how do you eat an elephant? One bite at a time.

Year 3 and 4 is to start saving up to buy my first property. And year 5 is to own my first rental property.

Each year builds on the next and each missed goal causes me to take more time to reach what is really important to me. And short term goals that do not support this are given a secondary status.

So 6 months down and 6 months to go. I am still on track for my big goals for the year, which dove tail to my big goal for 2009.

So time to reevaluate our long term goals and make sure all of our goals over the next few years are bringing us towards that master goal.

So lets keep the focus people. No excuses.

Sometimes, it's hard to say goodbye

June 9th, 2008 at 10:24 am

I was reading Mom-senses blog and it struck a chord with me.

So, I owe $929 on my second car. I havent been paying it off. I have been putting the money aside to pay off in one lump sum. Well, I currently have over $12,600 saved and ready to go once I save up the rest.

Unfortunately, I have become quite attached to this $12,600. You see, it was brought a sense of security and safety. I know that the $12,600 well take care of almost any emergency including 3-4 months of being laid off. Especially in these uncertain times.

But alas, this money is not meant for the emergency fund. This money is meant to pay off the second car and help get us out of debt.

Now, the emotions start coming back of a little fear, stress, and anxiety. Ill be back out there with a flimsy safety net. My wife was feeling the same way I was. Maybe we could keep it and just start saving for the car again.

As long as the fear and anxiety doesnt rule you, it is good. The fear has caused to take a step back to re-evaluate where we are, where we are going, and what are priorities are. It also has helped to focus what are next steps are and general timeframes around those steps. And lastly, it has made us aware of some of the risks to our plans.

Re-evaluate and affirm YES!!! Rule us NO!!!

So in the next few weeks, this money plus another $929 will leave our accounts. What we will be left with is the memories of what it will feel like when we have no more debt.

So I thank you dear friend for helping us, but I must bid you ado in the next few weeks.


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