A while ago, I wrote about my fear of being laid off. I've talked to a few people at work about this, and they all think I'm insane. Regardless, I still have the fear in the back of my mind, and (goal alert!) I plan to overhaul my resume by the end of the month just in case.
Because I'm a chronic worrier, I've spent a significant amount of time thinking about what I'd do if If I did lose my job. Like many people in this situation, I briefly thought about going to graduate school. However, I refuse to take any more standardized tests because I strongly believe the assessment industry is a total racket that doesn't prove anything about a person's intelligence and ability, so I can't apply to any program that requires a GRE score. Besides that, I have no idea what I would want to do with my life (other than travel around the world learning different languages and seeing new places, which I'm pretty sure isn't a job so much as a hobby for the independently wealthy). And I definitely do NOT want to take on anymore student loan debt, so grad school is out. After reading this list of reasons why you shouldn't try to dodge a recession with grad school, I feel validated in my decision. I'm not saying that grad school isn't a good choice for people with a definite career in mind that requires an advanced degree, but it definitely isn't for me at the moment.
Showing posts with label goals. Show all posts
Showing posts with label goals. Show all posts
Friday, February 6, 2009
Friday, January 2, 2009
Goals for 2009
Earlier today, I wrote about some of my accomplishments from 2008. Here are my goals for 2009.
Financial
~I started repaying my student loans in November, 2006. Since then, I've paid off $12,000 of the combined $77,000 principal, reducing my total debt by over 15%. My goal is match this 15% reduction in 2009, so that my total debt at the end of the year is $55k or less. That's still an outrageous amount of debt, to be sure, but if I can do it (and I know I can), I'll have paid off 30% of my total debt (about $22,000) in just three years.
This will mean that I'll have just 45% of my federal student loan debt left to pay at the end of the year. I'll still have about 87% of my private student loan debt, and about 58% of my Perkins loan remaining at the end of 2009. Currently, those loans have much lower rates (3.5% for my private loan, and 5% for the Perkins loan), vs. a 6.6% rate for my federal loan, so this makes the most sense right now. However, my federal loan rate will drop to 5.6% next December, and the adjustable rate on my private loan is sure to go up this year, so this may change slightly. However the rates adjust, I'll be throwing the same amount at my loans each month, so I should be able to meet my goal.
~Get a promotion at work, and at least a 5% raise. I'd really love to get a 7% raise, and I think I deserve it, but the economic crisis is the perfect excuse for companies to screw their employees out of raises, and I'm sure mine will be no exception. I'm going to work on my self-evaluation today and try to make the case for the promotion/raise, based on all of the extra work and responsibility I've had this year. Cross your fingers for me.
~Fully fund Roth IRA for 2009. I've got the full amount in CDs right now, and I'll start contributing to my Roth in February or March.
~Fully fund Roth 2010 fund by the end of the year. My parents gave me $1,000 at Christmas for my Roth, which was wonderful. I'm now well on my way toward getting this funded for the year. The rest of the money (a little over $3,000) will come from small amounts each month and/or my annual bonus, depending on how that plays out.
~With the economy the way it is, and my job in an unstable industry (publishing), I'm increasing my emergency fund to $11,000. I will fully fund this by the end of the year.
~I will fully fund my fun fund by the end of the year. The money in there now will remain in there until the next gift-buying occasion pops up. I've already bought my brother's birthday gift and allotted money for my dad's birthday gift (both birthdays are this month), and C and I typically exchange small inexpensive gifts for Valentine's day, so I think I can do this pretty easily within a few months. After this is funded, I'll throw the extra money each month at my 2010 Roth fund.
~I'll contribute another $5,000 to my downpayment fund. At this rate, I should be close to $19,000 at the end of the year.
~Begin seriously looking at condos/extremely cheap houses. The market's only going to go down for so long, and I'd like to buy while things are still within my (extremely low) price range. I can afford to buy now, but only in less than desirable areas. Even so, I'd like to go see some of these places in person to get an idea of what my tiny fistful of dollars can buy.
~Continue to pull in an extra $7 - $10k from part time jobs. This year I made about $9k from my part time jobs, before taxes. I'd love to keep this going, as it provides a great cushion for my savings as I use my primary job to pay down my student loan debt.
Non-financial
~My number one goal is to be more comfortable with my myself, in general. I often feel uneasy in my own skin, which makes me want to hide from the world. Sometimes when I'm out, I'll suddenly, out of nowhere, feel so uncomfortable and gross that I'm forced to go home. I have no idea where this comes from, but it needs to stop because it's ruined too many days for me. This might the hardest of my goals, but I think it's probably the most important to my happiness and well-being.
~Continue to be physically active and stay in shape. I'm currently at my ideal weight, and I would love to maintain it by continuing to do all of my spring/summer/fall commuting by foot and eating healthfully. It's tough to get exercise in during the winter, since I don't belong to a gym, but I know I'll be right back on track by March (I hope it's warm enough to walk to/from work by then!).
~Finish at least one song. C and I have been doing some Sunday afternoon songwriting, which is a lot of fun. I'm not particularly musically inclined, but it's still a lot of fun to write lyrics/melodies/sing/etc. Most of what we've written so far are short snippets of incomplete songs – I'd love to get a few completed works under our belts!
~Successfully learn to knit, and complete at least three projects. It would be great to be able to give some of these as gifts next year and save some money on Christmas.
~Read 40 books. I think I can do this, provided I don't get stuck on the same book for weeks like I did a few times this year (I'm looking at you, Tom Friedman...).
~Go to more concerts of bands I like while they're still playing small clubs. I always talk myself out of doing this for one reason or another (no one to go with, don't want to spend the money, too tired in the middle of the week, etc.), but it seriously sucks to miss out an opportunity to see a band you like in a small venue, only to have them return a few months later playing a giant show that you can't afford. This is not happening to me anymore!
I think I can achieve all of these goals, with a lot of hard work and energy. Wish me luck!
Financial
~I started repaying my student loans in November, 2006. Since then, I've paid off $12,000 of the combined $77,000 principal, reducing my total debt by over 15%. My goal is match this 15% reduction in 2009, so that my total debt at the end of the year is $55k or less. That's still an outrageous amount of debt, to be sure, but if I can do it (and I know I can), I'll have paid off 30% of my total debt (about $22,000) in just three years.
This will mean that I'll have just 45% of my federal student loan debt left to pay at the end of the year. I'll still have about 87% of my private student loan debt, and about 58% of my Perkins loan remaining at the end of 2009. Currently, those loans have much lower rates (3.5% for my private loan, and 5% for the Perkins loan), vs. a 6.6% rate for my federal loan, so this makes the most sense right now. However, my federal loan rate will drop to 5.6% next December, and the adjustable rate on my private loan is sure to go up this year, so this may change slightly. However the rates adjust, I'll be throwing the same amount at my loans each month, so I should be able to meet my goal.
~Get a promotion at work, and at least a 5% raise. I'd really love to get a 7% raise, and I think I deserve it, but the economic crisis is the perfect excuse for companies to screw their employees out of raises, and I'm sure mine will be no exception. I'm going to work on my self-evaluation today and try to make the case for the promotion/raise, based on all of the extra work and responsibility I've had this year. Cross your fingers for me.
~Fully fund Roth IRA for 2009. I've got the full amount in CDs right now, and I'll start contributing to my Roth in February or March.
~Fully fund Roth 2010 fund by the end of the year. My parents gave me $1,000 at Christmas for my Roth, which was wonderful. I'm now well on my way toward getting this funded for the year. The rest of the money (a little over $3,000) will come from small amounts each month and/or my annual bonus, depending on how that plays out.
~With the economy the way it is, and my job in an unstable industry (publishing), I'm increasing my emergency fund to $11,000. I will fully fund this by the end of the year.
~I will fully fund my fun fund by the end of the year. The money in there now will remain in there until the next gift-buying occasion pops up. I've already bought my brother's birthday gift and allotted money for my dad's birthday gift (both birthdays are this month), and C and I typically exchange small inexpensive gifts for Valentine's day, so I think I can do this pretty easily within a few months. After this is funded, I'll throw the extra money each month at my 2010 Roth fund.
~I'll contribute another $5,000 to my downpayment fund. At this rate, I should be close to $19,000 at the end of the year.
~Begin seriously looking at condos/extremely cheap houses. The market's only going to go down for so long, and I'd like to buy while things are still within my (extremely low) price range. I can afford to buy now, but only in less than desirable areas. Even so, I'd like to go see some of these places in person to get an idea of what my tiny fistful of dollars can buy.
~Continue to pull in an extra $7 - $10k from part time jobs. This year I made about $9k from my part time jobs, before taxes. I'd love to keep this going, as it provides a great cushion for my savings as I use my primary job to pay down my student loan debt.
Non-financial
~My number one goal is to be more comfortable with my myself, in general. I often feel uneasy in my own skin, which makes me want to hide from the world. Sometimes when I'm out, I'll suddenly, out of nowhere, feel so uncomfortable and gross that I'm forced to go home. I have no idea where this comes from, but it needs to stop because it's ruined too many days for me. This might the hardest of my goals, but I think it's probably the most important to my happiness and well-being.
~Continue to be physically active and stay in shape. I'm currently at my ideal weight, and I would love to maintain it by continuing to do all of my spring/summer/fall commuting by foot and eating healthfully. It's tough to get exercise in during the winter, since I don't belong to a gym, but I know I'll be right back on track by March (I hope it's warm enough to walk to/from work by then!).
~Finish at least one song. C and I have been doing some Sunday afternoon songwriting, which is a lot of fun. I'm not particularly musically inclined, but it's still a lot of fun to write lyrics/melodies/sing/etc. Most of what we've written so far are short snippets of incomplete songs – I'd love to get a few completed works under our belts!
~Successfully learn to knit, and complete at least three projects. It would be great to be able to give some of these as gifts next year and save some money on Christmas.
~Read 40 books. I think I can do this, provided I don't get stuck on the same book for weeks like I did a few times this year (I'm looking at you, Tom Friedman...).
~Go to more concerts of bands I like while they're still playing small clubs. I always talk myself out of doing this for one reason or another (no one to go with, don't want to spend the money, too tired in the middle of the week, etc.), but it seriously sucks to miss out an opportunity to see a band you like in a small venue, only to have them return a few months later playing a giant show that you can't afford. This is not happening to me anymore!
I think I can achieve all of these goals, with a lot of hard work and energy. Wish me luck!
Financial Achievements for 2008
Though I've always cared about saving, 2008 was the first year I truly dedicated myself to personal finance.
In 2008, I:
~Landed into this amazing rent-free opportunity!
~ Began using the debt snowball method to eliminate my student loan debt as quickly as possible. You can find a great debt snowball spreadsheet here; I've come across many of these types of spreadsheets, and this was the most useful one I've encountered.
~ Split my savings account into separate accounts to reflect my savings goals, almost meeting my $7k emergency fund goal, and reaching the halfway points of my down payment and fun funds.
~ Fully funded my Roth IRA for 2008, and saved up the full amount for my 2009 contribution, with a little leftover to go towards the beginning my of my 2010 fund.
~ Continued to put 6% of each paycheck toward my 401k. My company matches 100% of the first 3%, and 50% of the next 3%. Since I'm still relatively broke, and investing in a Roth IRA each year in addition to my 401k, this is as much as I'm willing to put into it at this point.
~ Began investing monthly in company stock and individual stocks of well-established companies that pay dividends in order to capitalize on low stock prices during a down market, and to continue diversifying my overall investment portfolio.
~ Finished the year reducing my federal student loan debt at a rate of 3% per month, and my private student loan debt at a rate of 0.3% per month. If I continue at this rate, loans will be completely paid off by the end of 2014. This sounds like a very long time from now, but I will be extremely impressed with myself if I can manage to pay off $77k, plus interest, in less than 10 years.
In non-financial 2008 accomplishments, I also:
~Got a promotion and 5% raise at my full-time job, and a dollar-per-hour raise at my part time job (I guess this one is finance-related, too :)) This was almost a year ago, and I'm hoping to add this to my 2009 accomplishments soon.
~Hung out more with co-workers (from both jobs) and attended more social gatherings. Sounds boring, but I'm a pretty shy person who feels most comfortable alone or one-on-one, so this was a pretty big deal for me. Hopefully I can continue on this path in 2009.
~Went on my first business trip - alone. I was really nervous about having to talk to people I didn't know for five days, but it went surprisingly well, and I even made a few friends out of it. Of course, my company (like most companies) is cutting its travel budget, so who knows when I'll get to go on another business trip, but it was still a good experience.
~Read over 30 books. I hope to increase that number in 2009. In fact, I should have at least one finished by the end of the day.
~Began to learn how to knit. So much fun! I'll be writing a separate post about this soon.
I'll be posting my 2009 goals this afternoon- stay tuned...
In 2008, I:
~Landed into this amazing rent-free opportunity!
~ Began using the debt snowball method to eliminate my student loan debt as quickly as possible. You can find a great debt snowball spreadsheet here; I've come across many of these types of spreadsheets, and this was the most useful one I've encountered.
~ Split my savings account into separate accounts to reflect my savings goals, almost meeting my $7k emergency fund goal, and reaching the halfway points of my down payment and fun funds.
~ Fully funded my Roth IRA for 2008, and saved up the full amount for my 2009 contribution, with a little leftover to go towards the beginning my of my 2010 fund.
~ Continued to put 6% of each paycheck toward my 401k. My company matches 100% of the first 3%, and 50% of the next 3%. Since I'm still relatively broke, and investing in a Roth IRA each year in addition to my 401k, this is as much as I'm willing to put into it at this point.
~ Began investing monthly in company stock and individual stocks of well-established companies that pay dividends in order to capitalize on low stock prices during a down market, and to continue diversifying my overall investment portfolio.
~ Finished the year reducing my federal student loan debt at a rate of 3% per month, and my private student loan debt at a rate of 0.3% per month. If I continue at this rate, loans will be completely paid off by the end of 2014. This sounds like a very long time from now, but I will be extremely impressed with myself if I can manage to pay off $77k, plus interest, in less than 10 years.
In non-financial 2008 accomplishments, I also:
~Got a promotion and 5% raise at my full-time job, and a dollar-per-hour raise at my part time job (I guess this one is finance-related, too :)) This was almost a year ago, and I'm hoping to add this to my 2009 accomplishments soon.
~Hung out more with co-workers (from both jobs) and attended more social gatherings. Sounds boring, but I'm a pretty shy person who feels most comfortable alone or one-on-one, so this was a pretty big deal for me. Hopefully I can continue on this path in 2009.
~Went on my first business trip - alone. I was really nervous about having to talk to people I didn't know for five days, but it went surprisingly well, and I even made a few friends out of it. Of course, my company (like most companies) is cutting its travel budget, so who knows when I'll get to go on another business trip, but it was still a good experience.
~Read over 30 books. I hope to increase that number in 2009. In fact, I should have at least one finished by the end of the day.
~Began to learn how to knit. So much fun! I'll be writing a separate post about this soon.
I'll be posting my 2009 goals this afternoon- stay tuned...
Friday, December 5, 2008
Revisiting November Goals
I wasn't able to save as much money in November as I would have liked. I had to shell out $265 for new glasses (which I deducted from my emergency fund contributions), and I began Christmas shopping, so contributions to the fun fund have also been cut back. On the plus side, I calculated that I'm paying off my Federal Loan at a rate of 3% per month right now; if I keep this up, I can have this loan paid off completely in little more than two years, possibly less since my interest rate will be cut by a point next December due to my consistent payment.
Other goals:
*Open a ShareBuilder account. I signed up for a ShareBuilder account and got the $50 bonus from ING this week. I will be contributing $30/month to purchasing individual stocks that pay dividends and make sense to buy and hold. I'm certainly not going to be doing any selling any time soon. I think this will be fun, since the money I'm investing is pretty minimal.
*Enroll in company stock purchase plan. I enrolled last week. Beginning in January, I'll be contributing $20/month to company stock.
*Start buying Christmas gifts early. So far, I have finished shopping for my brother, both parents, and most of C's gift. I started on my godmother's gift, and I think the rest should be relatively painless.
*Top Chef night! Ongoing. This week I made a butternut squash and sweet potato soup that turned out AMAZING, but took almost three hours to make (that includes the time I spent dealing with the finger I almost chopped off and mopping up the soup that spilled when my blender decided to fall apart midway through the pureeing process). If you want to try it, you can get the recipe here.
*Keep up the workout routine. I did it! I've worked really hard to stay in shape this year, and it's paid off. At a doctor's visit last month, I learned that I lost seven pounds in the past year...! I wasn't trying to lose weight (and I really can't afford to lose anymore), just to get in better shape, and I really think I have. As long as I can keep this up all winter, I will be ready for beaching it up in Fort Myers in March. :)
Other goals:
*Open a ShareBuilder account. I signed up for a ShareBuilder account and got the $50 bonus from ING this week. I will be contributing $30/month to purchasing individual stocks that pay dividends and make sense to buy and hold. I'm certainly not going to be doing any selling any time soon. I think this will be fun, since the money I'm investing is pretty minimal.
*Enroll in company stock purchase plan. I enrolled last week. Beginning in January, I'll be contributing $20/month to company stock.
*Start buying Christmas gifts early. So far, I have finished shopping for my brother, both parents, and most of C's gift. I started on my godmother's gift, and I think the rest should be relatively painless.
*Top Chef night! Ongoing. This week I made a butternut squash and sweet potato soup that turned out AMAZING, but took almost three hours to make (that includes the time I spent dealing with the finger I almost chopped off and mopping up the soup that spilled when my blender decided to fall apart midway through the pureeing process). If you want to try it, you can get the recipe here.
*Keep up the workout routine. I did it! I've worked really hard to stay in shape this year, and it's paid off. At a doctor's visit last month, I learned that I lost seven pounds in the past year...! I wasn't trying to lose weight (and I really can't afford to lose anymore), just to get in better shape, and I really think I have. As long as I can keep this up all winter, I will be ready for beaching it up in Fort Myers in March. :)
Saturday, October 4, 2008
October Goals
Savings goals
*Deposit $1,000 from paychecks
- $425 goes to emergency fund
- $425 goes to downpayment fund
- $150 goes to my "fun fund" (a savings account that I use for things like travel, gifts, etc.)
*Open a new CD for the downpayment fund in the amount of $2,000
Loan payment goals
*Pay minimum on Perkins loan (to be added to the sidebar shortly), Sallie Mae Private loan
*Pay $850 on SM Federal Loan
Retirement goals
*contribute $153 per week to Roth 2008 IRA until the end of the year.
*stop looking at google portfolio! it's just depressing, at this point.
Spending goals
*Stop buying clothes! with the exception of a possible outlet shopping trip with mom sometime in the near future, I am not buying any more clothes. I've been doing way too much end-of-season online shopping. Scoring amazing deals, yes, but I really shouldn't be buying clothes. The only other exception is if I find the perfect pair of boots, which I've been waiting over a year to buy, or if there are excellent sales on sweaters, since my winter wardrobe is sorely lacking.
*Keep dining out to a minimum. I've gone over budget on this for the last two months.
Personal goals
*read at least three books this month. i think i only finished one last month, which is quite lame.
*visit boyfriend's new apartment. he moved in over a month ago and I've only been there once. we mostly hang out at my place, since he has three roommates and i have zero, but still.
*continue walking to/from work as much as possible. it will soon be too cold (and god forbid, snowy) to do this, so i need to get my walks in while i still can. I'm really going to miss this in the winter, particularly when my face is pressed against the glass doors on the train every morning.
*start weight training again. i used to do this a couple of times each week, but I've gotten increasingly lazy since i moved.
*make one new thing for dinner each week. i usually succeed at this particular goal, but I've been really tired lately so i haven't been as creative with food as I'd like.
*Deposit $1,000 from paychecks
- $425 goes to emergency fund
- $425 goes to downpayment fund
- $150 goes to my "fun fund" (a savings account that I use for things like travel, gifts, etc.)
*Open a new CD for the downpayment fund in the amount of $2,000
Loan payment goals
*Pay minimum on Perkins loan (to be added to the sidebar shortly), Sallie Mae Private loan
*Pay $850 on SM Federal Loan
Retirement goals
*contribute $153 per week to Roth 2008 IRA until the end of the year.
*stop looking at google portfolio! it's just depressing, at this point.
Spending goals
*Stop buying clothes! with the exception of a possible outlet shopping trip with mom sometime in the near future, I am not buying any more clothes. I've been doing way too much end-of-season online shopping. Scoring amazing deals, yes, but I really shouldn't be buying clothes. The only other exception is if I find the perfect pair of boots, which I've been waiting over a year to buy, or if there are excellent sales on sweaters, since my winter wardrobe is sorely lacking.
*Keep dining out to a minimum. I've gone over budget on this for the last two months.
Personal goals
*read at least three books this month. i think i only finished one last month, which is quite lame.
*visit boyfriend's new apartment. he moved in over a month ago and I've only been there once. we mostly hang out at my place, since he has three roommates and i have zero, but still.
*continue walking to/from work as much as possible. it will soon be too cold (and god forbid, snowy) to do this, so i need to get my walks in while i still can. I'm really going to miss this in the winter, particularly when my face is pressed against the glass doors on the train every morning.
*start weight training again. i used to do this a couple of times each week, but I've gotten increasingly lazy since i moved.
*make one new thing for dinner each week. i usually succeed at this particular goal, but I've been really tired lately so i haven't been as creative with food as I'd like.
Thursday, September 11, 2008
How I got here
When I graduated college in 2006, I took roughly $75,000 in student loans with me. My starting salary at my first job out of college -- just $31,000 -- was less than half that. I lived in a small studio apartment with living expenses around $1,000 per month. Even with my small salary, I felt comfortable about my finances, and I was able to save a decent amount each month. In addition to my full-time job, I had an ongoing freelancing gig I'd been doing for a year or so that brought in a couple of hundred dollars every other month.
In November 2006, things changed: my student loan payments kicked in. The interest rates were all over the place, and my combined monthly payments were over $1,000. In an effort to exert some minor measure of control over the dozen or so bills that were coming in every month at wildly different interest rates, I consolidated most of my loans, bringing my monthly payments down to about $575. I made the payments on time every month and still had a little leftover to put in savings, but I definitely felt squeezed.
A few months passed, and I got a better job in publishing, my field of choice. Had I accepted the $27,000 starting salary offered, I would've taken a $4,000 pay cut, which I just couldn't afford. Despite being told that the starting salary was non-negotiable, I got them to agree to pay me what I had been making at my previous job. Around the same time, I moved into a larger studio that increased my living expenses by about $100 a month. I panicked and started applying for part-time jobs, and wound up landing a job as an innkeeper at a bed & breakfast just down the street from my new apartment. I worked only one shift per week, and after a probationary period, I was making $12 an hour plus monthly bonuses (between $100 - $150) based on sales, bringing in an additional $400 a month, on average.
This February, at my annual review for the full-time job, I was given a promotion and a 5% raise (the company rarely offers more than 3%, pathetically enough). I also received a performance-based bonus of $4,500 a month later. Meanwhile, my innkeeping hourly rate went up to $13 at the time of my one year anniversary. I was still freelancing, too, though not as much since my computer died around Christmas and I couldn't bring myself to buy a new one.
Throughout all of this, I was doing my best to save at least $300 per month, though I frequently put away $500 or $700 when I could, or more, in the case of the aforementioned bonuses. I was aggressively paying down my student loans. I was also investing in a Roth IRA, and putting money into my 401k at work.
Things went on this way for a while. I worked no less than 6 days every week, doing everything I could to pull in extra cash, and saving as much as I could after making my gargantuan student loan payments every month. I worked really hard, and made a dent of about $5,000 on the principle of my student loans within the first year of paying them. I was financially stable, but I didn't *feel* stable at all; I worried about money all the time, and felt guilty any time I went out to eat with my boyfriend, or bought something for myself (which hardly ever happened).
I'm incredibly lucky.
Last month, one of my fellow innkeepers abruptly quit to move out to California, freeing up the one-bedroom apartment attached to the inn. This apartment is given to the innkeeper who agrees to take all the emergency calls that come in after hours. In exchange for being the on-call emergency contact, this person is given the apartment, along with all electricity, gas, cable, and internet costs waived. Though my lease wasn't up until May, I could not pass up this amazing opportunity. I quickly enlisted the help of a broker, rented out my apartment within days, and moved into the inn. I even inherited several pieces of furniture (including a less than one-year old pillowtop mattress) from the girl who lived here before me.
My expenses have decreased dramatically -- I'm now able to save over $1,000 a month in addition to the large payments I apply to my student loans. At this rate, my loans will be paid off within the next 7 years. I'm also putting money away for a downpayment, as I hope to purchase a condo or home within the next couple of years while prices are still low.
Living rent free is great, but it's not without its challenges. With an extra $1,100 in my pocket every month, it's really tempting to spend. People in my life who know about my arrangement pressure me to go out to eat or to go shopping all the time, and frankly, it's hard to say no. When I do make these purchases, I don't feel a lot of the guilt I used to, which scares me. Being able to breathe easier shouldn't mean spending more -- just because I can now afford more doesn't mean I *need* more, afterall. I did just fine for the two and a half years before I moved in here, buying clothes and going out to eat sparingly. I want to hold myself accountable to my goals and financial aspirations while I'm living here. My goal is to live well below my means for the next year and save as much as I can so that I'll never have to pay rent again.
In November 2006, things changed: my student loan payments kicked in. The interest rates were all over the place, and my combined monthly payments were over $1,000. In an effort to exert some minor measure of control over the dozen or so bills that were coming in every month at wildly different interest rates, I consolidated most of my loans, bringing my monthly payments down to about $575. I made the payments on time every month and still had a little leftover to put in savings, but I definitely felt squeezed.
A few months passed, and I got a better job in publishing, my field of choice. Had I accepted the $27,000 starting salary offered, I would've taken a $4,000 pay cut, which I just couldn't afford. Despite being told that the starting salary was non-negotiable, I got them to agree to pay me what I had been making at my previous job. Around the same time, I moved into a larger studio that increased my living expenses by about $100 a month. I panicked and started applying for part-time jobs, and wound up landing a job as an innkeeper at a bed & breakfast just down the street from my new apartment. I worked only one shift per week, and after a probationary period, I was making $12 an hour plus monthly bonuses (between $100 - $150) based on sales, bringing in an additional $400 a month, on average.
This February, at my annual review for the full-time job, I was given a promotion and a 5% raise (the company rarely offers more than 3%, pathetically enough). I also received a performance-based bonus of $4,500 a month later. Meanwhile, my innkeeping hourly rate went up to $13 at the time of my one year anniversary. I was still freelancing, too, though not as much since my computer died around Christmas and I couldn't bring myself to buy a new one.
Throughout all of this, I was doing my best to save at least $300 per month, though I frequently put away $500 or $700 when I could, or more, in the case of the aforementioned bonuses. I was aggressively paying down my student loans. I was also investing in a Roth IRA, and putting money into my 401k at work.
Things went on this way for a while. I worked no less than 6 days every week, doing everything I could to pull in extra cash, and saving as much as I could after making my gargantuan student loan payments every month. I worked really hard, and made a dent of about $5,000 on the principle of my student loans within the first year of paying them. I was financially stable, but I didn't *feel* stable at all; I worried about money all the time, and felt guilty any time I went out to eat with my boyfriend, or bought something for myself (which hardly ever happened).
I'm incredibly lucky.
Last month, one of my fellow innkeepers abruptly quit to move out to California, freeing up the one-bedroom apartment attached to the inn. This apartment is given to the innkeeper who agrees to take all the emergency calls that come in after hours. In exchange for being the on-call emergency contact, this person is given the apartment, along with all electricity, gas, cable, and internet costs waived. Though my lease wasn't up until May, I could not pass up this amazing opportunity. I quickly enlisted the help of a broker, rented out my apartment within days, and moved into the inn. I even inherited several pieces of furniture (including a less than one-year old pillowtop mattress) from the girl who lived here before me.
My expenses have decreased dramatically -- I'm now able to save over $1,000 a month in addition to the large payments I apply to my student loans. At this rate, my loans will be paid off within the next 7 years. I'm also putting money away for a downpayment, as I hope to purchase a condo or home within the next couple of years while prices are still low.
Living rent free is great, but it's not without its challenges. With an extra $1,100 in my pocket every month, it's really tempting to spend. People in my life who know about my arrangement pressure me to go out to eat or to go shopping all the time, and frankly, it's hard to say no. When I do make these purchases, I don't feel a lot of the guilt I used to, which scares me. Being able to breathe easier shouldn't mean spending more -- just because I can now afford more doesn't mean I *need* more, afterall. I did just fine for the two and a half years before I moved in here, buying clothes and going out to eat sparingly. I want to hold myself accountable to my goals and financial aspirations while I'm living here. My goal is to live well below my means for the next year and save as much as I can so that I'll never have to pay rent again.
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