First month of 2016 is almost done! Have you stuck to your resolutions? If not, you can always start again! I planned on making some goals (outside of Financial Goals) for the year, but still haven’t gotten around to writing them on paper. However, I do have our Financial Goals for this year ready to go!
First, lets reiterate the overall financial goal
Pay off $145,811.88 in debt in 3.5 years. One year down, two and a half to go!
Alright, now for the 2016 goals.
- Pay off my federal loan ($22,115 @ a 6.75% interest rate) by the end of May.
- Pay off my Bank of the North Dakota loan ($20,601 @ a 2.01% interest rate) by the end of October.
- Reduce the Parent Plus loan from $69,838 (@ a 6.75% interest rate) to under $60,000
Sidenote real quick. I typically have been paying off the loan with the lowest dollar amount first. That way, I can pay it off quicker and in return have more money to put towards the next debt. I made the executive decision to pay off the federal loan first though. It just makes the most sense because the amount is so close to the BND loan but the interest rate is much higher on the federal loan. If you remember, last year I applied for loan consolidation on the BND loans and received a variable rate of 1.74%. It has since gone up to 2.01%, not a big deal though since it will be paid off this year!
So, there ya have it. Those are the main goals. To hit those, we are going to have to put over $50,000 towards debt in 2016. Last year we were $250 shy of putting $40,000 towards debt. This year I am hoping to put ten grand more towards debt! Woofta…I feel like I have set some high goals for us. However, we have a pretty nice increase in income this year so I think we can do it!
In order to reach those goals, we need to have some mini goals/guidelines to reach/follow. In 2015, we came up with the term Frugal Fifteen. We tried to not buy anything that wasn’t necessary. I stopped shopping. I didn’t get my hair and nails done. We stopped purchasing anything for Cory’s hobbies. We had a limited entertainment fund. Well this year we are in ITALY! This may be our only chance to live in Europe, so I am not going to let our silly debt ruin that. We just really need to be smart with our spending. Therefore, this year is S.M.A.R.T Sixteen: Spending Money Adventurously, Responsibly and Thiftily. Boom! We have a reason to spend money, but we have guidance on how to spend it 🙂
Here are our mini goals/guidelines
- Sell household goods that we don’t use for extra money
- Research and find deals for our travels
- Budget for trips
- Allow for “wants” in the budget but be sure to stick to the budget
- Track where our money goes each month and continually try to improve
- Find other ways to earn extra cash
The biggest issue we are going to run into is traveling. As long as we stick to the budget I think we will be ok. You will find out later how I am budgeting our trips. For now though, get ready to find out how much DEBT we paid off in January
. The month is almost over and I think it is going to end well!