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Archive for April, 2009

Goals Review – April

April 30th, 2009 at 02:20 pm

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 02:33 pm

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.