Saturday, August 20, 2005

Long Term Financial Goals

Now that I have finally gotten up some momentum and am paying off my debt at lightning speed, I feel like I might finally be able to see the light at the end of the credit card debt tunnel. I feel like I have had this burden on my shoulders for as long as I can remember and don't know what I would do without it. So, I started thinking of what my financial goals are for when I have finally defied my debt and decided I should lay out some of my long-term financial goals.

1) Pay off the Student Loans

When I started aggressively paying off my debt, I decided that I would think of my student loans as completely separate from my credit card debt. I pay about the same amount of interest on my student loans as I do on my credit card, but my reasoning was that credit card companies are way less forgiving than the U.S. government if I was late on a payment. Plus, I can use the interest I pay on my student loans as a tax write-off.

But alas, it still needs to be paid off. Write now I have $9,823 in student loans and pay only $106 every month. I hope to be able to pay this off in a year after my credit card is paid off.

After the student loans are paid off, I will be completely debt free!

2) Save up a $10,000 Emergency Fund

After I pay off all my debt, I want to make sure that I never ever have to be in debt again (aside from a home mortage). I think $10,000 would be a good amount of money to have for those emergencies that always tend to pop up (i.e. an appendix bursting...oh wait, I don't have an appendix!). Not only that, but having $10,000 in the bank would mean that I would never have to feel financially insecure again. If for some reason I hate my job and wanted to quit, I would have the power to do that. If I lost my job, it would not be the end of the world because I would have enough of a cushion that I could live comfortably for a few months while looking for a new job.

3) Save up a down payment for a house

This will be a doozy. Housing in California is ridiculously expensive. I was looking at condos thinking maybe I could find something for $300K. The only condos I could find within that price range were ghetto 1 bedrooms. I'm not sure how young people ever buy a home in southern California but I'm hoping in 2-3 years that my boyfriend and I will both be able to save up $25K to buy a condo/home somewhere!

4) Save for retirement & Pay off the mortgage

Once all that is taken care of, its just a matter of making sure that we are set for old age. It would be lovely to be able to retire early, sell the house in so cal, and buy a French Chateau where I can enjoy my time relaxing, drinking wine, having a vegetable garden and tending to my 20 cats. That would be the life!

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4 comments: said...

i like the chataeu idea! lol but for real, these are some awesome goals... looks like you got your ish together :)

Anonymous said...

Do you ever go to the website ? They have message boards about many of the topics you are interested in - lots of good ideas there.

Bailey said...

Good goals.
I would change the $10,000 fund to 3-6 months salary.

Jose Anes said...

Love the ideas you have.
I would work them in parallel to build up the finantial discipline into your life. (we all need more of it) :)

Good luck! Love to see people taking care of their finances.

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