The main reason I started this blog was to create a diary of My Journey and it didn’t take long for me to realize that accountability leads to success. As such, every year I create a sort of Goals and Objectives, my latest one being my Goals and Objectives for 2009. I then highlighted throughout the year how I did on it – the two most recent updates were in July of 2009 and on my Birthday in November 2009.
Well, its 2010 people so time for me to create some new goals and objectives. I don’t call the resolutions because, they are not open ended, but rather very specific goals.
Last year, The Wife and I got rid of all our Credit Card Debt! It is now time to focus on a different type of debt, and to decide on a pre-payment strategy. Currently I have,
- $12,000ish Auto Loan 8% – 7 year amortization schedule
- $7,000 Law School Loan #1 – 5% 10 year amortization schedule
- $57,800 Law School Loan #2 – 4.5%, but payments are increasingly tiered costs over 30 year amortization schedule
- Mortgage of $228,000ish – 5.875% – 40 year amortization schedule
Unlike the nasty Credit Card Debt I got Rid of (over $16,000) nothing here screams at me get rid of it. So the first question I have to decide is which one I am going to focus on? Here are my issues with each one:
- It feels weird prepaying the Auto Loan since it is a depreciating asset. It is very unlikely that I will own the car until it dies.
- Law School Loan #1 is capped at 5%, and may be tax deductible
- Law School Loan #2 is capped even lower at 4.5% and again may be tax deductible.
- Mortgage doesn’t seem worthwhile since The Wife and I have plans to be out of here within the next couple years.
There are pros and cons with each debt. The Auto Loan is at the highest APR, but I have full intentions of getting rid of the car as soon as it isn’t upside down anymore, so to throw more and more money after it seems just dumb. Law School Loan #2 is a longer amortization schedule, and is HUGE compared to law school loan #1 so I think I will lose interest quickly (a la Dave Ramsey), and the mortgage doesn’t seem to make any sense, again for the same reasons associated with Law School #2.
So I think I am going to start paying down Law School Loan #1, but I want to hear alternating theories PLEASE TELL ME IF I AM WRONG.
The next question comes down to How am I going to Pre-Pay the debt. As I previously learned my lesson (avoid my previous mistakes with prepaying loans) I am going to prepare a whole bunch of $25 Checks marked “For Principal Only” and then send them weekly or bi-weekly depending how aggressive I am feeling that week. Why $25? Because my checking account is unlikely to feel just $25. Any and all income I receive from this Blog will also be applied to that debt.
Savings & Investments
My liquid funds are not where I want them to be right now. Currently, I am sporadically adding to them, with no real plan. I am going to continue to do so without any plan. For my ING accounts I use a zero based budget, and so every once in a while I move money from my ING checking into my my ING saving sub-accounts.
As far as investments go:
- I just have a non-qualified trading account worth less than $2,000 that I use for short term, small time playing around – not adding funds to it
- I will continue to fund my 401(k) to the max of my match
- Continue to fund my Wife’s Roth IRA.
- Continue to add $25/month to my Prosper Account
My most important goal is to have a child! Beyond the “practice makes perfect” mentality I don’t think I can control this much. I highlighted all my problems last year with this subject. It was a sad and tough time for The Wife and I. We are hoping for better news this year.
While I have my 9 to 5 day job that I absolutely love, but I truly believe that having Multiple Streams of Income is the way to go. That being said, every couple of months I track down my direct bosses and ask if there is anything I could do to better serve them in my position.
There is absolutely no reason that I don’t practice law outside normal working hours. My Goal is to enter into one new attorney-client relationship a month. Additionally, I have a few ideas for websites that I would like to finally get off the ground.
I freaking love blogging! But I have a lot of shortcomings.
- I never submit to carnivals;
- I rarely guest post;
- Despite being VERY tech savvy, I can’t figure out the fascination or how to properly work Twitter;
- My posting schedule is inconsistent; and
- I am not involved in the PF Blogging Community as much as I should be
I listed them out in an effort to fix each one of them over the next year. I think the most important goal on this list is to get more involved in the PF Blogging community, right now search engine traffic accounts for about 70% of all traffic. Which from what I am reading, is nuts. So I think its time to try and get the referral traffic up.
If you want to be held accountable to someone then guest post about your goals and objectives, and please share your thoughts on my debt repayment.