Wednesday, January 7, 2009

New Years Resolution: Financial Goals

2008 proved to be a better year than we anticipated. Getting on the same page financially has made a huge difference in our marriage and life.

Accountability - While I was pretty good about tracking our expenses for the entire year of 2008, I feel like I need to do a little more. I need to keep a good account of not only what we spend, but what we save, and how much debt we've paid off. Tracking what we save should make me feel better about the time I spend on such things. My husband laughs at my obsession, but he likes the affect on our bottom line.
Check it twice - For the past year we've used a budget sheet on Excel. While I was getting my feet wet, I was also figuring things out. One of the things I want to work on this year if better categorization. Right now I tend to put things in our grocery or blow fund category when it probably fits better some place else. Some of the things I would like to track better are medicines, cleaning products, gifts, baby products, and clothes. I think one of the reasons I can't get my grocery budget under control is because every trip to Meijer goes under grocery... even if it includes clothes or other general merchandise. What categories do you use?
Putting a Price on it - This one will be hard because it will be very time consuming. I'd like to create a price book so I know when we're getting the best deal. I have a lot of things figured out in my head, but I would like to see some of it on paper a little more. There's some thing about actual proof that makes me feel better.
Refi and Refocus - At the end of last year we started the process to refinance of house (Current rate - 6.625%, Anticipated rate - 4.75%). This would eliminate our second mortgage and leave us just one remaining debt - my school loan. Between the refinance and getting our taxes straightened out in escrow (LONG STORY), we're going to be able to reduce our housing expenses SIGNIFICANTLY! If we refocus this to my school loan, we should be able to make serious progress to becoming debt free.
Attack Debt - Thanks to a couple trips abroad, my school loan is a lot larger than I would like to admit. When I graduated I just assumed it would be a monkey on my back for decades to come. After all, my school loan debt was even bigger than our second mortgage. About six months ago we set a personal goal to have the loan paid off by the time the kids were in school. That idea was exciting. What a relief that would be. Then the snowball started kicking in. Our debts were dropping off and the reality of reaching that goal seemed so attainable. With our refinance on the horizon, we now think we can do even better than that. If I keep working this year at about the same pace as the last 6 months, we should be able to cut my loan about in half. YES, BY 50% before the end of the year. Tim thinks we could do better than that, but since my work is not consistent and I like to plan for unexpecteds... I'm going to leave it to cutting it in half. I want to be realistic.
Cash for Glass - Last year we paid cash for 4 LARGE windows. We were hoping to do more than that, but the windows are over sized and had to be made of tempered glass so they were really expensive. The company we contracted with has what they call a maintenance plan. Supposedly they lock in your rate & price for up to 5 years provided you replace at least 2 windows a year. We had planned on doing about 4 a year, dividing the house in to sections that made sense and would look right aesthetically. I'm going to meet with the sales man and get an estimate for the rest of the house. Tim and I talked about it and, provided we can set the cash aside, we're going to try to actually finish the rest of the house before next winter. Since there was ice forming on the inside and huge drafts, this is really more of a need than a want so we're making this a priority for this year.
Give Back - Growing up I never remember my parents giving holiday gratuities, so it's never really been part of my usual practices. This year, I wanted to, but still didn't know "how". If you never see the person, how do you get it to them. I've been talking to a lot of people and definitely want to start doing this. I've decided that if I simply budget $5 per month for holiday gratuities, it would add up quickly. If I combine that with great sales toward the end of the year, I can actually give them this year! In addition to that, I'm looking in to an organization called The Box Project. I think you can give gently used stuff, so if we get partnered up with a family with young children we should be able to do this pretty easily. I would much prefer to do some thing domestic than over seas and I like that you actually get to know the family. I think by shopping ads, take a realistic look at the stuff we have, and setting aside a little each month we should be able to work this in to our budget and our practices. We've had a good year and I feel the need to give back.
Real it in! - Couponing and bargain shopping is great, but I feel like I get out of control. I really want to stop buying stuff just because it's on sale. I need to take a hard look at what we need and stay a little more focused. Now if it's free, or nearly free, and I can donate it... I'm all for it, but I don't want to end up with a bunch of stuff we just won't use. It sort of defeats the purpose of a lot of my other goals.
Use it up, Wear it out, Make Do, or Do without! -- I'm going to try to keep this in the forefront of my mind. There are a lot of things here that we could reuse or repurpose. Not only will this help reduce clutter and chaos, but it should help the bottom line too. This ties in to a lot of personal goals I'm setting for myself this year - like gradually switching to reusable grocery bags, getting away from plastic containers, etc. We recycle a lot, but I know we can do better. I actually plan on printing this really big and posting it on our fridge as a daily reminder. I'll confess that we aren't likely to completely follow the mantra, but I think we could do a lot better than we have been. You have to start some where, right?

I also need to work on setting some personal goals, and you may see a link soon, but for now this is a good start. Here's hoping for another good year.


Melinda said...

I want to keep track of my groceries/coupons this year.

I am the same way. There are items I could probably think of another use for! One of my goals also.

I enjoyed reading your goals and good luck! :)

TA-TA said...

Yeah - I stole the saying from your post about Christmas Memories. I love that.

I started tracking my savings, but not until late in the year and only half-heartedly tracked at that point. I'd really like to break down my "food" category so I can see what's baby, cleaning, health & beauty, etc. We'll see. That's a lot of work.


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