My 2009 Financial Goals


goal.jpgHappy New Year, Ultimate Money Blog Readers!!

Reading everyone’s 2009 financial goals has been very inspiring but intimidating at the same time. I’ve gone back and forth on how I want to allocate our money. I debate between paying more on my mortgage, paying more on our student loan and car loan, and saving. I think that I’m going to make my 2009 goals simple, because I’m anticipating a semi-large expense next year (if things go the way we would like). It will most likely overlap into 2010, and I want to make sure we’re as prepared financially as we can be.

I love seeing the principal balance on our mortgage go down. I hate seeing how much of our payment goes to interest each month, so every extra little bit I can throw towards our mortgage is a good thing. I’m hoping that I can make one extra monthly payment as a principal only payment for 2009. I can do it one of two ways: at the end of the year, pay $960 in a lump sum on the mortgage, or break it down to a monthly payment of $80 extra on principal. I’ll probably just pay $80 extra a month and forget about it. Our mortgage interest rate is 6.375% and we’ve got about 28 years left.

Second mortgage
Our payment is $172.75. We’ve been paying $200 a month, with $27.25 extra towards principal. This is a 20 year loan at 6.89% and we’ve got 18 years left. We should have it paid off in about 15 years at the rate we’re paying.

I’m going to keep putting 8% of my pay into my ROTH 401K at work. I have some concerns that we’re not saving enough for retirement because Mr. Money’s work does not offer a retirement plan at all. He’s 31 years old and I’m 25 so I feel like we’ve got time on our sides, but it’s still scary to think we don’t have enough money for retirement. We both have ROTH IRAs but we aren’t contributing. I almost want to take some money out of savings and put it in those to reduce the amount of taxes we pay on the interest in our savings account.

Student Loan
My calculations show that by making the minimum payment on the student loan each month we’ll pay down $2160 in principal. That will leave a balance of $3940. I’m hoping we can pay this off in 2009.

Car loan
Making minimum payments, we’ll pay down $3000 in principal in 2009. I would love to pay this loan off too, but it’s not my number one priority because we’re paying 0% interest and we’re trying to get the student loan paid off first.

I’m going to keep putting 25% of my paycheck into savings. From here, we can decide whether we want to send the funds to retirement, pay off more debt, or just keep it in the emergency fund.

What do you think of my 2009 goals? Are they reasonable? Do you think I should focus more on retirement?

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9 thoughts on “My 2009 Financial Goals

  1. momstheword says:

    I wish I knew more and could give you some great advice, but I don’t really know. I do suppose that it’s a good idea to pay down your loans, because you will be paying more in interest the longer you have them.

    You are so smart to be thinking about all this now, when you are young. My oldest is twenty and he is very frugal minded too.

    At least you’re putting some money into savings, that’s a good idea, so you are on the right track. Your parents should be very proud of you!

    I would probably continue to do what you’re doing. Alot of people recommend Dave Ramsey’s book, although I don’t know the name of it. He could probably help!


  2. Momthing1 says:

    I think that instead of trying to pay extra on your first and your second and your car loan and your student loan all at the same time, you should pay the minimum on three and pay the most you can on one. You will eliminate one much more quickly in that manner. And if hard times should hit your family, having one fewer obligation is more beneficial than owing less on 4 different obligations.

    If are you thinking ahead to retirement (and good for you, at 25 I was not) and want to see how you are doing, have you used any monte carlo simulations or financial calculators? With your retirement age 40 years or so away, there are many unknowns, but it is simple enough to assume an average rate of return and annual contribution and then get a rough idea of what you may end up with.


  3. Mrs Money says:

    momstheword- Thanks for your comment! I really appreciate all your kind words. Sometimes it’s nice to hear that from someone on the outside looking in. 🙂

    Momthing1- That is a great point. Thank you for sharing! That is one of my thoughts too, especially if I get pregnant and want to stay at home with the baby. I’d be able to swing it a little better with having one payment gone versus owing less altogether. I need to figure out one of those retirement calculators but I haven’t done it yet. I’ll have to do that next week. Thanks for your comment!


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