Archive for the ‘new beginnings’ Category

A person’s lifetime is filled with memorable dates: birthdays, first dates, anniversaries, etc. I am happy to announce that March 4, 2010 is added to my list of significant dates in my life.

Today is the day I become Debt Free!


This post may be slightly dramatic recapping my quest towards debt-freedom… but some day I will grow accustomed to having a positive balance in my financial life and slowly I’ll forget the significance of today. So before moving on, I kind of want to be sentimental and inadequately describe the fantastic feeling of freedom I have at this moment. I owe nothing! Not even a tiny balance on a credit card! When I look at my money, it is all mine.  My next paycheck won’t have to be divided to debt, but will be 100% mine to spend, save, give!

Why, do you ask, am I so sentimental and weird about debt? I don’t talk about it often, but for years my parents lived a middle-to-high class lifestyle—a facade that was built by thousands of dollars in credit card debt. I was devastated to find out the truth, mostly because of my parents’ shame and guilt on merely wanting to give their kids a great life. Our lives changed dramatically after that and we became almost slaves to lenders, altering our lives out of desperation. Through that experience, something in me sparked and I took on the rest of my college education and vowed to start my adult life differently by paying off my debt as soon as possible.

So three years and $13,800 later, I am finally debt free! Here’s the final recap of my payments:

Thank you to anyone who has encouraged me during this last year! To anyone who is in debt… you CAN do it! It takes a lot of hard work and perseverance, but I promise the end result is worth it. I’m done! I’m done! I’m done!!!!

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Back to Reality

Happy new year my dear friends!

Last night I entered my cold apartment with conflicting emotions: very sad to say goodbye to my vacation paradise, and so eager to start a routine again and tackle the bazillion things that piled up in my absence. I really don’t have time to share the details of my delightful vacation just yet, but just wanted to pop over here to tell you:

1. I’m back!

2. I hope your holiday was fantastic. I’ll catch up on my blog subscriptions soon.

3. I stayed under budget during my vacay with even a little to spare.

4. I am so so excited about 2010.

I promise to have a little thicker post next time. ;) Hope everyone has a great day back to reality!

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2010 Goals

Financial Goals
Become debt free

At the beginning of 2010, I will have $2500 left to pay on my debt. I should be able to pay this off in March with extra income plus any tax refunds I receive.

Save $10,000 in an Emergency Fund
Honestly, I will evaluate my saving goals once I am debt-free. Right now my plan is to save, save, save like it’s job. Sure I’d love to contribute it to retirement, but right now I’m a little nervous with so little savings and a 1994 car and a wedding that may happen in the next two years. So if I can get as close to $10,000 in savings then I will feel more comfortable.

Continue to give 10% of my income
I got a little slack on this near the end of 2009 but I want to make giving a priority. I also want to find unconventional ways of giving to others.

Earn $5000 in extra income
Last year I made over $5000 in extra income. I think I’ll be able to continue that if I work hard and get creative.

Figure out Retirement Goals once I’m Debt-Free
I will reevaluate this after my debt is paid off. I am nervous and feel that saving for the 24 to 30-year old Me is more important than saving for the 65-year old Me.

Reach $20,000 in net worth
I will have to increase my net worth by $15,000 in 2010 in order to reach this goal. Yipes! That seems like a lot… but with investments, extra income, and hard-core savings, I think I can reach it.

Health Goals
Workout 3 times a week for the entire year/Attend the gym 156 times.

I don’t want to set a health goal like “lose 5 pounds” because once I lose it, I’m done?  I’m tired of having specific goals like that. So this year I give myself the goal of going to the gym 3 times a week minimum. I want working out to be a part of my routine and need to figure out a schedule that works–probably early in the morning. This doesn’t count on vacations since I may not be accessible to a gym.

Cook one new recipe per month and blog about it.
The real goal is to become a better cook, but that’s too vague, so I’m challenging myself to learn 12 new recipes. Also part of the goal: Blog about each of the meals. :)

Get to 115-120 pounds
If I make fitness a part of my regular routine, then surely this will happen. Right now I weigh about 130 pounds at 5’3”.

Start a Me Fund
Read here to see why it was started. I plan to buy a Tiffany’s piece of jewelry to celebrate being debt-free.

Get a raise or promotion at work
Because my company is operated on contracted clients, the ebb and flow of work varies. There is a chance I could get a promotion if we get more clients. As for a raise, I have a review in January but don’t anticipate a raise since I received one August 2009.

Switch the blog to self-hosted with own URL
I am Miss Illiterate when it comes to techy blog things. Nevertheless, I really want to have a self-hosted, uniquely branded blog. Anyone want to volunteer their expertise services? My email is myprettypennies[at]hotmail.com. :)

Read 12 books
I love reading but rarely give myself time to finish a book before it’s due at the library. If I read one book a month then this should be accomplish. Also part of this goal: NO LIBRARY LATE FEES!

Live in the same town as J
I am 100% confident that J and I can stay together and remain long distance for another year… but it would be nice to live closer than 5 hours. *Sigh* I am hopeful!

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Readers! PF Bloggers! I’m pretty terrible at making a decision by myself and I’d love your help and opinions. You all helped me decide whether to buy shoes and how to allocate raises, and even extra roommate rent. As I begin to make my 2010 goals, I’m faced with a few option for the Savings/Debt money I have each month. I will do my best to explain the status of it all.

Top Priority in 2010:

My #1 top priority for the year will be to pay off my debt, which should be done April 2010.

January to April 2010:

  • $700 to Debt
  • $25 to Car Repair Fund (I’ll probably continue this throughout the year)
  • $100 to Roth IRA
  • =$825 per month

Next Priorities:

After I pay off my debt, the focus changes a little bit. Here are the three things I’m debating about right now: Emergency Fund, Wedding Fund, or Max out the Roth IRA. Right now with $825 flexibility each month, I don’t have enough money to fund all three goals in addition to my debt.

Here’s the status of each:

  1. Emergency Fund at $6,000
    I’d have to add $3,600 to reach this goal since the account already has $2,400. That would mean approximately 5 months of $700 savings. If I start in May, then I could be done with that in September, or $450 each month until December.
  2. Roth IRA at $5,000
    I will continue with $100 per month January to April. If I want to max out the Roth next year, I’d have $400 and would have to contribute $575 each month for the rest of the year to reach my max.
  3. Future [Wedding] Fund at $5,000
    I want to have at least $5,000 to pay all (or most) of my wedding whenever the time comes. Read more about this account here. I already have $1,000 in this account and would need to save $4,000 in order to reach my goal in 2010. To be honest, I don’t expect to get engaged in 2010 but it certainly could happen if J moves here in the next few months. This may seem like a silly or premature goal, but it’s really important to me. Hmm perhaps I could reevaluate this once J and I live in the same town? I’m hoping that happens in 2010 also.

Other Factors to consider:
–Tax Refund: I got $1400 this year and that money could be used for some of these.

–Extra income: I could designate all extra income to go towards a specific goal in addition to what my top priorities are.

What do you guys think?
The Roth IRA is what is getting to me. I know I should max it out, but if I didn’t have that there, then I could easily save the entire amounts for the Emergency Fund and the Future Fund.

I know that in the scheme of things this is really not a big deal and I can always reevaluate things in the future, but I’d like to get my 2010 financial goals ironed out before the year so I can plan accordingly.

Pay debt, then…. Roth IRA, Emergency Fund, or Future Fund?

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Today is a happy, happy day for me. I have finally reached the tipping point where the things I own are more than the things I owe. If I died today I would leave my family with a total of $168 as opposed to the -$13,850 I was worth this time last year. Excellent feeling. (Actually, that’s not entirely true since the retirement accounts would have to be taxed properly… but that’s something my loved ones can figure out. ;))

Here’s a nice little diagram of my net worth journey since I started actually tracking. When I first began it was -$13,850, but this is how far I’ve come since November.

Picture 1

And here’s how it’s all distributed:

Assets: $6028
Cash: $528
E-Fund: $2130.76
Future Fund: $1000
Christmas Fund: $224.48

401(k): $1750
Roth: $358

Liabilities: $5860
Debt: $5800
Credit Card: $60

Total Net Worth: $168

If I looked at this chart last year I’d probably laugh aloud. It’s been one year since I took charge of my finances and I never want to live a day when I am not conscious of my spending, savings and giving.

More Good News:
This marks my 100th blog post! I cannot believe that way back when I started this blog I’d have enough to talk about for 100 entries. Over the weekend I changed the look a bit, so please tell me what think of it. I have to say this blog has been one of the greatest accountability tools in sticking to my financial goals; so thank you to those who actually read this blog on a semi-regular basis. Your comments, suggestions and cheers have inspired me. Happy, happy day! :)

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I’m back!

What a lovely little vacation I had! I had guests come to visit for the Fourth of July and then traveled for a lovely weekend for my best friend’s wedding. I’m torn between being really sad it’s all over and slightly relieved to be back in my routine and allow for some much-needed R&R. Even though I was on “vacation,” I can’t say I did a lot of relaxing.

One huge challenge of hosting guests and traveling are the unexpected costs that creep up. I need to finish crunching the numbers, but I think considering all that I did, there wasn’t anything I went over on–except for maybe gas. The only thing truly unexpected was to get my car inspected, which I completely forgot about until my dad kindly reminded me. That only cost me $13 though. Cheap!

Right now in my bank account I have $260 left for the rest of this month. I’ve paid all of my bills except for two that come at the end of the month–approximately $70 total which my roommate will split with me. I also have to purchase a birthday present for my mom, travel home the last weekend, mail some packages, and may also sign up for an 8k run to help with my training. I have only one babysitting job and should get about $60 for that.

I feel like this Monday is the first day of a brand new six months. I plan to review my goals, make some new ones, and figure out how exactly to meet them. Time to get to work… literally. ;)

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How I got here.

Well, it all started with my parents.
It was August 2007 and I had just arrived home from a summer abroad in Europe. My parents sat down my sisters and me and told us they were in debt. I knew we always struggled with money, but I had no idea that we were in debt, much less serious debt. Try $300,000 in debt. This included a mortgage, credit card debt, and student loans.

I guess you could say my personal finance fascination (or desperation?) began at that moment. I decided to help pick up my student loans since it was, after all, my education. I withdrew from school for a semester to work full-time. In order not to incur any more debt, I paid for all of my rent, food, tuition and fees. The last semester of classes I needed a little help from my parents, but still maintained at least a 20 hour work week while taking 18 credit hours of classes.

I graduated from college May 2008 and moved June 1st to a new city (in the mid-atlantic region) for a new job (marketing-related), where I currently work today. I had $13,800 in debt, maybe $800 in savings… but as we all know security deposits and moving expenses deplete budgets and left me with nothing. When I finally received my first grown-up, big-girl paycheck in July 2008, I began whacking away debt.

My parents have been a huge inspiration to me in this process. Of course I was very hurt that they hid so many money issues under a facade of a comfortable and luxurious lifestyle, it is amazing where we’ve come today. They sold the home we had been living in for 18 years, moved into a rented home provided by a local church, and both got part-time jobs. A year and a half later, they are down to $20,000 left in debt (this includes $8000 I still owe them) and have moved into a foreclosure home in the country.

My Hope
My hope is to never ever ever feel that hopeless, out-of-control feeling again. I began reading finance books and got entrenched in reading personal finance blogs. All of the other writers seem so natural, down-to-earth, and, well, nice! I figured I could use this blog as an outlet to communicate my personal journey of getting out of debt and on to a secure freedom. So enough about the past. Let’s get started!

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The End.

This is my public farewell to:

  • Overspending
  • Carelessness
  • Credit card balances
  • Bank charges
  • End-of-month nerve-wracking terror
  • Bounced checks
  • Unbalanced checkbooks
  • Overdrafts
  • DEBT.

Adios. Buh-bye. See ya.

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