Blogging Away Debt

Reporting on 2023 Financial Goals

Before the start of 2023, I set financial goals belonging to 4 broad categories: short-term savings, investments, debt, and travel. With the end of the year rapidly approaching, I want to report back on the progress I’ve made on my goals. If you’d like, you can refer back to my 2023 Financial Goals post.

Short-Term Savings:

I hit most of these goals and modified one. I brought my Emergency Fund up to $5,000, my car repair fund up to $3,000, and my semi-annual fee fund is fully funded at $1,000. At the start of 2023, I was also planning to pay off one of my student loans (approx. $4700). I instead diverted that money when I needed to buy a new computer, and also raided that fund to pay for some legal fees. My student loans are supposed to be in repayment status now, so I’m not actively saving toward them at this time (but…see my last post about issues with my student loan service provider, MOHELA).

Investments:

I’m continuing to save toward traditional retirement, 403(b), an HAS, an FSA, and a 529, and taking advantage of Arizona’s tax credit by donating to my kids’ school in exchange for a dollar-for-dollar credit toward AZ state taxes. The other investment is in relation to our house.

Historically, we’ve paid double payments twice/year. In November, I wrote a post about weighing options between continuing to pay aggressively toward our house versus using that same money to invest elsewhere. The overwhelming majority of commenters were in favor of investing the money elsewhere. It’s hard to argue with numbers. By paying off the house early, we are only saving the APR (2.625%). Or, we could invest the money and stand to make 10% or more in ROI.

That said, my husband is very fond of the idea of having a paid-off home when he retires. The security of that feels good to him. I mentioned what some commenters had pointed out – that we could invest the money and use it when he retires to pay off the house at that time. He’s still not crazy about it.

At this moment in time, we’re continuing to make double house payments. As we’ve been blessed with a series of raises over time, we may try to re-do our budget to invest some additional funds (over and above the double house payment 2/year). We’re still talking about 2024 financial goals, so I’ll report more soon.

Debt:

I’m officially consumer debt-free, as of October when I paid off my car! Although that was a big win, I also made the decision to pull back on aggressively paying off my student loans. Instead, I’m riding them out until they are forgiven through PSLF (approx. 2 years to go). That leaves me with only student loans and a mortgage as my remaining debts.

Travel:

I hit my two travel goals for 2023 (Disney with our immediate family; and a summer cruise with my extended family). In addition, I mentioned that one of my 2023 goals was to save for another big vacation on the horizon. In the summer of 2024, my husband and I will be going to Italy (as a couple/no kids). We’ve been planning this out and saving for it for over a year. My original budget was $6,000, but as we’ve been booking flights and such it’s looking like it’ll be closer to $7500. It’s okay – like I said, we’ve been planning and saving for over a year already!

I know this is a HUGE expense. I don’t take it lightly. This is a once-in-a-lifetime type of trip for us (literally, I don’t expect that we’ll ever return to Italy). I know this is a bit sideways for a get-out-of-debt blog, but I’ve been pretty transparent about my goals and the need to find balance in my life. This is happening. We’re doing it. But we’re doing it responsibly. It has not been a spur-of-the-moment decision. We’ve spent tons of time doing research and finding deals and figuring out how to make this work. And we’ve been savings all along so we have the funds to pay in cash and not take on any debt for the trip.

Overall Outlook:

Overall, I’m quite pleased with the way 2023 has shaped up! I hit the vast majority of my goals and, for those where I didn’t, it was more of a conscious decision to re-allocate funds and shift priorities versus a complete failure to hit a goal. I have lots of thoughts and plans for 2024, too, so stay tuned for a forthcoming post with 2024 financial goals.

Do you set and evaluate annual financial goals for yourself or your family?

Feeling Like We’ve Figured Out Our Priorities

by Vicky Monroe

A few months ago a reader commented that my partner and I should set a deadline for making some big decisions in our life, such as deciding if we should move. That comment really stuck with me and was something I worked on in therapy and with my spouse. That’s part of why we were able to come to the decision that moving doesn’t make sense to us—we’ve actively been having conversations to figure out what our priorities are. Of course, life can throw curveballs, but we feel pretty confident about the direction that we’ve decided to steer ourselves in.

Overcoming My Struggle With Decision-Making

I think a lot of you could tell that I’ve struggled with decision-making, but over the past few months of therapy I’ve had some “aha” moments. The big one is that you need to have good reasons for everything that you do. Especially when it comes to major decisions that can alter the course of your life and cost you a lot of money, such as moving or having kids.

I’m kind of ashamed to admit that I didn’t know that intuitively! But I think I was letting anxiety and outside expectations from various influences like society and family drive my decision-making. My emotions were determining the direction I decided to head in instead of logic and sound reasoning. I’ve also realized that my family has a pretty impulsive decision-making style, which may be part of why I’ve struggled in this area.

Although not everyone has to agree with your decisions, it’s probably a red flag if lots of people in your life tell you something is a bad idea. I’m trying to listen to this feedback more and hold myself to higher decision-making standards.

Holding Myself to Higher Decision-Making Standards

After this “aha” moment, I resolved to hold myself to higher decision-making standards, which has helped me sort out my goals and priorities. During this process my partner and I have been discussing what our shared goals are. And we’ve realized that having children actually isn’t as high up on our list as we thought.

Don’t Feel Enough of a Pull to Have Kids

As of yet, we haven’t felt a strong enough pull to have children. It doesn’t seem like either of us would regret not expanding our family. And if you’re going to take on the $250,000+ expense of having a child, you need to feel a deep longing for family life to justify going down that path.

Through therapy I realized that I might have been planning for kids because it’s the next step on the “traditional” life path. I’m not sure why I’ve clung so tightly to the traditional path, but it’s something that came up over and over again in therapy. Holding ourselves to higher decision-making standards is helping my partner and I understand what we really want versus what we were taught to want, or “supposed” to want.

Barriers to Having Kids

There are also many barriers in the way of having kids. Every doctor I’ve spoken to said I would have trouble conceiving due to my medical history. Fertility treatments would greatly add to the already high cost of having a child. And after watching videos of IVF journeys on YouTube, I don’t think that’s something I’m interested in pursuing.

Plus, I’m not sure what caused my various medical issues. One of my specialists thought I may have some kind of genetic abnormality that led to all my health problems, and I would absolutely hate to pass that on to a child knowing how much I’ve struggled.

If we ever feel the pull to have children, we haven’t completely ruled out the idea of fostering kids someday, although we’re still leaning no on that. We’ve also discussed other ways to help the next generation besides raising new humans. We’re both interested in the idea of being a Big Sibling through the Boys and Girls Club in our area.

If Not Kids, What Are Our Goals?

Paying off our home is still one of our life goals, which we’re going to continue to do. But we’ve also realized we want to save and invest more heavily and make that a bigger chunk of our financial pie. That’s caused us to reroute some of our mortgage overpayments to savings in the past couple of months, as I mentioned in the last post. Then after we feel like we’ve gotten a handle on liquid savings, we’re going to shift those funds to investing, probably in a Roth IRA.

We’re both homebodies who don’t enjoy traveling in the traditional sense. But during our conversations we’ve realized how much we both value nature. Someday we’d love to see natural sights that are a bit further away from us, such as the Grand Canyon and the Badlands. But right now we want to explore our own area more and maybe try our hand at camping this year as an affordable way to vacation and enjoy nature.

Trying to Apply Better Decision-Making Every Day

I’m also trying to apply better decision-making to everyday situations and purchases. If I don’t have a good enough reason for buying something, it needs to go back on the shelf. Small, habitual purchases can add up to be bigger expenses. Left unchecked, little budget leaks can derail you.

I’m not perfect, but I can definitely see now that every time I buy something not strictly necessary, it’s a detour that distracts from the main goals I’m trying to pursue. So I need to have a very good reason for deviating from the budget I’ve set in service of the goals my spouse and I have agreed upon. And most of the justifications my brain comes up with to try and get me to buy something are BS! I’m getting better at identifying good reasons versus BS justifications and am going to keep working on it.

How do you go about making good decisions and setting goals and priorities in your life? I’d love to hear your tips.

Read More

Life Insurance Decisions

Large Purchase Decisions

Travel Decisions