Once the bad debt’s gone, then what? May 12, 2006
Posted by irishmadness in Debt, Saving.trackback
With all my scrimping here and saving there, I’m going to be putting aside close to half my take-home pay each month by the time I pay off my debt. While there are a couple things I’m cutting that will go back in once I’m paid off (internet!), I’ve been starting to think more about what I’ll do with the bulk of it.
I was skimming Suze Orman’s “The Courage to be Rich” book at the library today, and I liked the part where she talks about redirecting your money, rather than letting it flow back into the pool. That’s what I want to do, is redirect my money so I can have the life I want.
For me, that means upping my 401(k) contribution and starting an IRA so I don’t have to worry about retirement. It means socking away a huge chunk of that money into a new(er) car fund. It means beginning to save for a house. And, most importantly, it means putting aside $25 a week to fund a nice vacation every year or two.
I have a friend who likes to travel to Europe, and last weekend we were brainstorming vacation spots. I want to take the cross-country train trip. She wants to go to Russia (once she’s spent enough time on her Russian lessons to be able to speak the language). We both like the idea of Romania. I want to see Ireland; she has no interest. She just got back from Amsterdam, which isn’t high on my list. We also talked about trying a cruise.
I had a similar discussion with my sweetie, though we didn’t have quite as much agreement. (He loves beaches; I sunburn easily. I want to travel outside the country; he thinks that’s too much hassle in this day and age.) But he does have a few favorites that are on my list (Hawaii, Vegas), and there were several places we both agreed were not even in the picture.
In the long-term, nuts and bolts, “how will I pay for retirement” future, that $1,200 a year would go toward something more practical. But what’s the use of having money if you don’t enjoy it? (in moderation, of course)
When I look at the tiny amount of cash in my wallet, and notice how often it’s gone less than a week into the two-week period between paychecks, it can get discouraging. But then I think about watching the Rocky Mountains out the train window and seeing Eastern Europe up close and personal. The sooner the debt’s gone, the sooner I can start living that kind of life. Suddenly the wallet doesn’t seem quite so flat any more.
What dream keeps you going when the debt payments seem to suck up all your money?
At the moment, I have a slightly different view. What keeps me going through online classes, and grading, and plagiarism, and whining … is the plan I have for the money I’m earning. It’s the same idea; the dream of getting what I want WITHOUT going into debt to get it is what sustains me.
I haven’t gotten there yet, but I am much closer now than just a few years ago. For years, I have lived with not replacing the old TV until it actually broke, having furnature that is showing its age, etc. For me, its about having money that isn’t already earmarked to pay off debts, or this month’s living expenses. It’s about knowing that I can take a vacation and not worry whether I can pay for it.
It’s also about buying things that I’ll actually use for things I want to do. I’ve wanted to start blogging about personal finance myself. To that end, I decided that my next computer is going to be a laptop so that I have a little more freedom in when and where I write. True to my frugal nature, I wasn’t going to replace my previous computer until it actually started to break down. Having reduced my debts sufficiently, I was able to free up a few hundred dollars extra to buy a laptop instead of a cheaper desktop.
[...] Savvy Saver hosted Carnival of Debt Reduction #35, and this week’s flashback comes from Debt Sense: Once the bad debt’s gone, then what? [...]