Thursday, September 13, 2012

Spending vs. Saving

So far, I have touched a little on my spending habits in this blog.  It's kind of ironic because by day, I am an accountant.  When many people find this out, they assume that I have everything figured out money wise, but that is just not the case.  
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When I was in college, I was just about supporting myself on my own and I ended up racking up some credit card debt that I am still paying off {5 years later, you ask?}. Yup, 5 years later.  When I got my first job out of college, I struggled to pay anything more than the minimum payments.  But, I have been aggressively paying my card down and hope to be credit card debt free in 6 months or less. Part of my problem was that I developed a pattern of using my credit card when I would run out of money each month.  So, even though I was actively paying it down, I was still using it and thus, racking up charges.  I have stopped charging new things on my card which broke the psychological cycle that I used to go through.  So, I basically pretend it doesn't exist and it's not an option.  

I am not as worried about my student loans or car loan. I am 5 years into a 15 year repayment plan for my student loans and I feel like the monthly payment is manageable.  I will be happy to pay off my car loan in the next few years because I still really like my car and don't plan on rushing out and getting a new one once it's paid off.  Overall, I feel pretty good about our financial picture.  

The only thing that will make me feel even better is finally paying off my credit card debt and establishing a savings account with a few months of our salary in it.  I have found, for me, that its harder to save when I don't have a specific goal in mind.  Saving for Italy was so easy because (1) we knew how much it would cost from the start and saved each month accordingly and (2) Every time I questioned how much we were saving or if it was worth it, I would just close my eyes and picture myself enjoying Lake Como.  It totally worked! And I will say, for the record -- it was totally worth it! So, saving with a goal in mind is actually very easy for me.  I also saved up my $200 for the new iPhone 5 that I am going to pre-order tomorrow. That was easy too, because # (1)-(2) above applied to it as well.  

I think it will help me be accountable to write out my short term goals below.

My Financial Goals for the next 2 years:

1. Pay off my credit card debt
2. Start a savings account and put money away each month 

What are you waiting for? Let's start saving together!

2 comments:

  1. i just started reading a book you might be interested in called Smart Women Finish Rich. it might give you some other motivation to save.

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  2. Here here sis! Cody and I just sat down and made a plan too, now we just need to stick to it! We paid off our credit cards with our entire tax refund which could have bought me sooooo many clothes! But it was the right thing to do, paying 26% interest is robbing myself! You've inspired me to set goals for myself too:) love ya! Em

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