A Light or a Train?
Posted by Lisa | Filed under Lisa
At least I think it’s a light at the end of my financial tunnel. There’s a slight chance that is in fact a train. I’ve been here before – so close to being financially on track (pardon the pun). Let me explain: My husband and I have had trouble with revolving debt. We get to a point that it’s almost paid off, then we get comfortable with the small amount owing and inevitably something happens and we end up going back into debt. And then we are back to revamping our plan to pay down the debt again. I guess we’re slow learners. But we are learning, over the past 10 months we’ve socked away money and paid down our debt. We are 18 weeks away from being consumer debt free. Our emergency fund is healthy and growing and our goal of 6 months of essential expenses is just 16 weeks away. For the first time ever we’ve saved for some small house renovations, and now that the money is in the bank, I wonder if new carpet is the best use of this money we’ve worked so hard to save. Our slush fund will be completely funded by the end of August and we’ve starting saving for a new to us car with the intention that we will be able to buy with cash, as mine will need to be replaced in 2 – 3 years,. And finally, we’ve recently upped our bi-weekly mortgage payments by $100, knocking about 3 years off the amortization.
But here’s the problem, when you get this close to paying off all of your consumer debt a few things happen. The first is impatience: the end is so close you can taste it, but now progress seems slower than ever but the possibilities of the anticipated cash flow are endless. The second thing that happens is setting more goals. In the past this has proved to be a catastrophic bi-product of my impatience. I over plan and completely derail the entire operation by losing focus on the goals that are nearing completion and start putting money towards the ‘new goals’. These new goals stretch the budget and then we are back to using credit cards to make up the difference. And just like that, the light turns out to be a train. As Gail says “you can have it all, you just can’t have it all at the same time.” This is been the hardest lesson I’ve learned on my personal finance journey. But this time we’re staying the course. We haven’t over extended and on November 21, 2013 we will be able to say we are consumer debt free and our emergency fund is fully funded. On November 22, I’ll come up with a new plan.