Wednesday, February 20, 2013

Goals for Life Post-Student Loan Debt

Via Student Loan Crisis
A little while ago, I came across another blog that asked the question, “What are your financial goals for when you are debt-free?”

Wow. What a question. I hadn’t even thought about that. I know I have other goals that will need money, such as more traveling, owning a home, having a family, and being able to donate more to charity. But I don’t have any kind of concrete plan. If I start thinking about all the things I WANT to do with my money instead of paying this debt, then I get angry. I think “Ugh, this monthly payment of $500 could get me a plane ticket to California/be contributed to my retirement/donated to a good cause.” Instead, this money is going to the U.S. Department of Education. That’s fine and all, I got a great education out of these loans. But could this just hurry up please? I did really well in 2012, paying off around $19,000 in loans. Just even looking at that number astonishes me. That is an INSANE number!

I’m very proud of myself, obviously. I’ve worked REALLY hard for it. I’ve been working two jobs for a year now and have put every extra penny towards debt repayment. Birthday money, side income, you name it and it has gone towards my debt. So what I’m saying is I’m tired. I’m tired of sending my money to the debtors. I want to “make it rain” as they say. I want my money to work FOR me. Yes, I know I’m getting a great return-on-investment right now. I’m paying off loans and getting closer to being debt-free. But I’m tired.

I’m going to let myself think ahead a bit, to a few years down the road when I am no longer in debt. What would I like to do with my money?

  1. Build my emergency fund. I currently have about two months of expenses saved.I’d like to get that to six months. I’ll feel more comfortable knowing that I could pay six months of rent instead of two if something bad happened, such as illness or job loss. Having a two-month cushion is more than I had a few years ago, so I recognize I’ve taken an important first step to secure myself, but I know I need to do more.
  2. Contribute the maximum to my Roth IRA. I checked my yearly contributions for the past five years and it has been abysmal. At my best I contributed $1,000. At my worst - $550. After building up my emergency fund to six month’s worth of funds, my next goal will be to get this number up to $5,000 a year.
  3. Give myself the freedom to do a few more nice. This means allowing myself to take yoga classes again. I like doing yoga at home, but I love having an instructor. I also want to get more massages. I’ve currently limited myself to no yoga classes and only two massages a year. I’d like to bump that up to one yoga class a week and 4-5 massages a year.
  4. Start saving for a home. I don’t plan on buying any time soon, but I want to buy eventually. If I never marry, I want a modest, two-bedroom bungalow that could accommodate a kid if I decide to have one anyway. If I do end up getting married, then I’ll just be ahead of the game and have a bit saved to contribute to our first home together.

If you have debt, what are your goals for when you are no longer in debt?

1 comment:

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