Monday, December 31, 2007

New Year's Eve 2007/2008

I'm not usually one for New Year's Resolutions. They feel trite and pretentious. But right now I have a couple of goals, and I figure I can document them now in time for the new year! It just happens that the timing works.

Resolution #1. Exercise 3x a week. I'm not going to make drastic changes, but I need to be sure that I am working out regularly. For the most part I eat healthy, although I am trying to cut out more processed food. But 3x a week is smart and something I can stick to, maybe even go over. Even if I am just running down to the fitness room at work and hitting the treadmill for 30 minutes, that counts.

Resolution #2. Get my debt down to a goal number this year. I've been reading a load of personal finance blogs (starting with No Credit Needed, in my blog roll), which has led to personal finance books, which led to me writing down every debt I have, who it is to, for how much, and what the APR is. I almost had a heart attack, but the good thing is that about 1/2 of what I owe is in the form of student loans with very very low interest rates so I'm not terribly concerned about that. The other chunk of debt won't be so hard to pay down because I've made a plan.
Step #1: While paying minimums on everything else, pay off my loan for getting my teeth fixed (oh yeah, still not done yet). As long as I pay that off in the year there is no interest, after a year the interest shots up to 23%! So that is definitely the priority!
Step #2: Take the money I've been putting toward my teeth, and apply that to the credit card with the lowest balance, which also has the highest APR. Then once that is payed off, put all of that money to my other credit card and pay that puppy off.
Step #3: Take 1/2 the money that was going towards credit cards, and put it toward paying off my car (again, low interest so I'm not too concerned about that one). Take the other 1/2 and put it in savings.
I guess this is a form of Dave Ramsey's snowball plan, and I think it will work for me.

In order to do this, I've made up a budget, which is way out of whack because I should have more money left over at the end of the month than I EVER do. But I know that being aware of the scope of my debt is going to help me to reign in all of those "small purchases" that really add up fast.

Part of the problem with having debt for so long was that it seemed so overwhelming that adding to it didn't feel like such a big deal. Now I know better, and I'm having a hard time forgiving the "me" of 5 years ago for the stupid choices she made. I need to let it go, and fix the problem I've created. I'm also having a hard time not blaming my parents for not teaching any money skills whatsoever when I was growing up. But again, let it go and fix the problem. I have the tools I need now, and there is no reason to start a pointless blame game with myself.

Books I've been pouring over, mostly about how to change my attitude:
The Complete Tightwad Gazette by Amy Dacyczyn
America's Cheapest Family by Steve & Annette Economides
Your Money or Your Life by Joe Dominguez and Vicki Robin
These have been great. I bought the Tightwad Gazette because it is a huge book full of useful information that I will be looking back at a lot. The other two I found at the library, which is fine because America's Cheapest family, while worthwhile for the section on budgeting alone, I won't need around constantly. Your Money or Your Life has made me sort of depressed and not wanting to go back to work on Wednesday. So I don't need to have that one around constantly either.

I know that between going to the library instead of the bookstore, as well as bringing my lunch to work everyday, I'm already seeing an improvement on the money front.

As far as impulsive purchases go, the Mikasa (to which I always want to reply "Su casa!") at Opry Mills is going out of business and the deals were incredible. I got boxes of tea candles for 40 cents each, 4 wine glasses for $16 (marked down from $60), and my Dad bought me two champagne glasses as well. The wine glasses are amazing- I've never had wine glasses, just goblets that go with my stoneware every day dishes, but I usually drink wine out of these handle-less mugs I have. Well not any more! I tried some okay-cheapo wine in one of the glasses and I couldn't believe how different it tasted. Definitely better, I think it hit my tongue in a different place or something, maybe I could smell more of the notes? I want to become better acquainted with wine, I really enjoy a glass in the evenings. So this was a good purchase.

And, now that my goals are written down and I have a better chance of sticking to them, Happy New Year!


Heather Meadows said...

Good luck with the resolutions!

A lot of people have money issues...I think it's something that happened subconsciously as the average family's wealth increased. We had the generation in the Great Depression, where no one could afford anything, but then the next generation could, and they bought extras because they had heard what it was like before, and they felt that they should enjoy the wealth while they had it. And then the next generation had zero perspective on that and just learned no respect for money at all ;> That's my theory, anyway!

Anyway, it sounds like you have a really good plan. I'm sure you can do it!

Meredith said...

The Tightwad Gazette remains my favorite. 10 years of constant re-reading still brings new information to light--no matter what stage of life I'm in.

Yet Another Heather said...

Heather- I think you're absolutely right. We think we should be living to the same standards our parents do, conveniently forgetting that they worked years to get where they are. I remember when I was little my mom and dad really scraped by on nothing. But as I got older that changed and I sort of forgot the times when money was tight. I forgot that movies and eating out every weekend are exactly normal.

Meredith- your blog is a huge inspiration.