Financial Shape in 2008 – Year End Update

by Marcy on November 16, 2008 · 0 comments

Crystal at Money Saving Mom asked us to share our financial goals and successes over the past year as part of her Financial Shape in 2008 series. I did a great job of posting my updates for several months, but then things started to get away from me and I slacked off a bit. That doesn’t mean we weren’t still working toward our goals though!

Earlier in the week Crystal shared her year end report, and I thought I would share what we were able to accomplish this year – our second year of living on one income. I post this info not because I enjoy sharing such personal information on the Internet, but because I always aim to be truthful on this blog. Plus if this information can help others in a similar situation as mine, that makes me happy. So here goes…my family’s less than perfect (but pretty good) year in review!

2008 Successes

What a year 2008 has been! While starting this blog and watching it grow into my own little mini business has been one of the highlights of my year, another was finding out about Dave Ramsey and listening to his Total Money Makeover DVDs. While my husband and I weren’t in a financial crisis, we are always looking for ways to improve upon how we handle our money, and WOW did we learn some things from Dave! I think that the most significant shift in our thinking was that no debt is good debt (except maybe the house), and our main focus this year was to put most of our extra money toward our debt.

In order for us to be debt free except for the house, we had to pay off our van loan and one final student loan. We had already planned on knocking off the van loan this year, but neither of us had ever felt much urgency to chip away at the student loan – mainly because we never really thought of it as “bad” debt. After listening to Dave and realizing that we could realistically have it paid off in 2009, we got the ball rolling and drafted a plan.

Step one was paying off the van, which we were able to accomplish in May. After that loan was gone, we added the money that we were paying for it to our student loan payment. We also made a few choices this year in order to have extra money to pay toward the student loan. We decided to forgo a vacation this year to save money. I made a conscious effort to stay home a little more and to plan my errands so that I could save money on gas. I have learned how to match sales with coupons to get the best deals I can on groceries, toiletries and household items. And we have tried our best to shop less overall…especially for big ticket items. These little things have added up, and while we are going to fall just short of where I’d hoped our loan balance would be by the end of 2008, I’m confident that we can “catch up” in 2009 in order to have it paid off in full.

A few of our additional accomplishments for 2008:

* We are going to finish the year with no new debt (and significantly less that what we started the year with!)

* Our emergency fund has been replenished after dipping into it to pay for a new dishwasher (ours died), vacuum (died) and generator (to save our bulk beef purchase when Hurricane Ike remnants hit Ohio and we lost power). Note: I know Dave wants us to use this fund to pay off our debt but this is one step of his plan I haven’t been able to bring myself to do. I think if the reality of paying off our student loan was way off in the future that I would be more willing to do so, but since we are so close, we are leaving the emergency fund as is.

* I began to track our monthly grocery/household/toiletry & gasoline expenditures which I hadn’t done in the past.

* We developed a 3 year road map which will hopefully result in us moving to the home we want to raise our kids in.

* We drafted a household budget based on Dave Ramsey’s recommendations and determined which areas we need to improve upon.

I am incredibly proud of the fact that we have been able to accomplish these things in the face of the rising cost of what feels like EVERYTHING, when our household income has not increased by much. It feels good to set goals and to work toward achieving them. It is not always easy or fun, but it ends up being so rewarding when we achieve even the smallest of milestones.

Looking Ahead to 2009

While 2008 was an overall great year, there is always room for improvement. Here are a few goals that we have set for 2009.

* Pay off our last student loan (and be debt free except the mortgage)

* Roll our student loan payment into our mortgage payment in an effort to start aggressively paying it down.

* Begin contributing monthly to our daughter’s college fund.

* Begin contributing monthly to our emergency fund in an effort to grow it (rather than leave it “as is” as we have done since I quit my job 2 years ago).

* Add the amount of money we spend eating out to my monthly grocery/household/toiletry & gasoline expenditure tracking.

While some of these goals are likely to be a stretch for us, I am hopeful that we can make it happen. And hopefully we’ll be able to squeeze a vacation in there as well! :-)

All joking aside, I think the most important thing that I have learned this year is that stuff is just stuff. The tanking economy has put that into perspective for me, and at the end of the day I am just thankful to have a roof over my head, food in my pantry, and my family with me. Cheesy, but true.

So there you have it…our 2008 Financial Goals/Updates in a nut shell (or a novel depending on who you ask). It has been quite the journey…and while I have learned a lot this year, there is still much to learn. Who knew what a great resource blogging could be for such things? I am so grateful to have found the wonderful network of money saving bloggers out there and can’t wait to read more in 2009.

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