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Goal Snowball

October 28, 2008

I’m going to do a sort of “goal snowball” to get my Emergency fund to $15k by the end of the year (or at least, by January 2009).  Typically, I approach my goals in a balanced way, giving the most money to the highest priorities, but still providing some to the goals that are a little further down the list.  But I’m going to deviate for two months and go all out on finishing the emergency fund.

Now that my student loans are in remission (deferment, but I like to call it remission), I intended on contributing $75 each month to a dedicated savings account to offset the balance (because who pays a 0% interest loan?).  That is roughly how much was going to principal each month.  However, this student loan fund will be on hold until the Efund is goal reached.

My car fund is around $350, which will cover minor repairs.  I’ll suspend contributions to that as well.

My gift fund is around $300, which is what I’ll need for the holiday season (plus November’s and December’s $100 contributions).  My travel fund will go back to getting the basic $75/month contributions, but I don’t want to suspend that one.  I’m also a little ahead on Roth IRA contributions, so I only need to put in about $190 November and December.

With those adjustments to my budget I should be able to shuffle $650 for both November and December into the Efund, ending the year really close to $14,900.   I’ll settle for topping it off in January.

So basically… I’m not really doing anything differently.  Money that was for one cash pot is going to  another cash pot.  A dollar by any other name is still a dollar.   Still, the efund has been this ever moving goal post, a goal I’ve worked towards since I graduated in May 2006.  It’ll be very very exciting to call  it DONE (even if it means I’ll just be calling my cash savings by another name).

6 Comments leave one →
  1. October 29, 2008 4:17 am

    I guess in the end it is all about priorities.

  2. October 29, 2008 6:34 am

    nice work. interesting about putting the $75 into a savings account instead of continuing to pay the loan. I’m in somewhat of a similar situtation, I have a loan for 1100 that is due in September, but requires no payments until september and stays at 0% until then. I’ve been torn between just fully paying it off now (since I have the money) or keeping the money in a savings account and potentially using it for something by accident. I don’t think I trust myself enough yet.

  3. October 29, 2008 12:31 pm

    This new prioritizing makes a lot of sense but do you think $75 will be enough for travel over the holidays?

  4. October 29, 2008 1:04 pm

    @sammy – Yeah, I guess. I think in this case, I’m just too impatient to wait for it to fill up on its own

    @zeromoney – If you don’t trust yourself, just pay it. I actually already have about $1500 in the account. The overall impact is probably minimal, but it works for me.

    @Anny – I think so, in fact, I really don’t plan to have any travel spending. I already bought my plane ticket (and used miles, so it was only $10!) for xmas and am not going home for thanksgiving. I may drive to an uncle’s in NorCal, but we’d carpool and it would be pretty cheap I think.

  5. October 30, 2008 12:19 pm

    Finances are all about prioritizing and its a good thing you have it all organized. It’s hard to objectively view your own finances and prioritization can be hard, hope it all works out in the end!

  6. Stacey permalink
    October 30, 2008 1:05 pm

    Zeromoney, I had the same problem. But in the end, I was spending so much mental energy thinking about my 0% loan ($1000) that it was just easier to pay it off.

    There was also a charitable motivation: The loan came from our school’s loan pool. While we didn’t get charged interest, payment was based on the honor code. The longer I took to pay off the loan, the less money the school had to lend to new students.

    As a side note, it feels GREAT to have my student loans paid off.

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