2009 Personal Finance Goals

When we started our monthly finance meetings back in October, we listed several goals with target dates. Since most of them have target dates in 2009, I’m making them part of our finance goals for this year.

1. Increase Emergency Fund to $15,000 by March 1st
Our current balance is $13,550 so I’m crossing my fingers that we can fill this bucket sometime in February.

At some point I would like to increase this, but I don’t think that will happen in 2009, unless we are especially blessed!

2. Payoff Volvo
My Volvo is our highest interest debt and still has a hefty balance (approx. $15,000) This is by far the biggest goal for 2009 and we will start throwing most of our extra cash flow at it as soon as #1 is done. I also need to make sure there are no prepayment penalties and figure out the best way to structure the extra payments.

3. Save $5,000 for replacement vehicle
M’s 15 year-old Blazer will need to be replaced sometime soon. We are hoping to get at least another year or two out of it and that should give us time to save up for a replacement. It only has around 100k miles on it and it’s paid for. Even if we spend $800 per year on repairs and maintenance, we think it’s worth it.

This goal will be put off towards the end of the year (after we finish #2) and can also serve as an extra $5k E-Fund until we need it.

4. Invest in a retirement plan for M
M is finally at a job that offers some retirement plan investment options, so we will look into what the best option is and start putting money away for him this year. I already contribute to my employer’s plan (that also matches) and have for a few years. We need to start one for M because he was in law school, then had jobs that didn’t offer anything and we had other priorities.

5. Move savings into higher interest account
We have an ING account, but moved our savings to WAMU early in 2008 because they had a better interest rate and I love the convenience and instant access of transferring from savings to checking. However, since Chase bought out WAMU, our rate has continued to plummet down to the current abysmal rate of 1.5%. Yuck! I will look at moving it back to ING or something else (??) very soon.

6. Explore taking property taxes/insurance out of mortgage company escrow
We pay extra to our mortgage company every month to cover our property taxes and homeowner’s insurance. They put it into an escrow account and pay the expenses annual (taxes) and bi-annually (insurance). This is really convenient and easy, but I don’t think we have to let the mortgage company be our middleman. It seems like we could create our own “escrow account” and pocket the interest.

How will we do it? As we continue to stick to our budget and look for ways to decrease our expenses, we have created a positive cash flow each month. We hope to grow that even more in 2009 through raises at work and other cost-saving behaviors. We are aiming high with our goals, but I get so excited thinking about paying that Volvo off! I know we will be challenged to not “relax” our budget and by new surprises that always pop up, but we are thinking positive and looking forward to a great year!


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