Since I am feeling the burden of debt lifting I find myself looking forward to the future more and more. As you probably know if you are a regular reader, I am planning on tackling the remaining debt on my car once the consumer debt has been destroyed! And as you probably know as well my budget has been really tight during this consumer debt destruction.
So both of these things raise two thoughts in my mind. The first thought is how do I celebrate once the debt is repaid. I would LOVE to do something nice for each of my parents. They have been huge encouragers and have listened to all my
The other thing that I am wondering about is how much I should allocate each month to the car loan when I am paying it off. If I keep my budget as tight as it is right now that will leave me $850 extra. I would like to loosen it up a bit though and allow more for groceries, entertainment and gas for my car.
I will owe approximately $7410 in April 2012 (which is when I hope to be starting to tackle this loan) and if I want it paid off by Dec 2012 (which is my current goal) that means I will need to pay an extra $500 a month (roughly) starting in April. I get to that amount because my current payment is $363 a month with approximately $330 going to the principle. $7410/ 9 months = $824. $824-330=$494 which gives me my rough payment of $500 extra a month. That will leave me $350 extra a month to add to the various jars.
If I leave my budget as it is now that means my car loan would be paid off in about 6 and 1/2 months. Which would be an awesome birthday gift to myself come mid-October.
So that's where my thinking about the future has gotten me so far. Care to add your 2 cents? I'm open to all suggestions because I'm sure there are lots of things I'm not thinking about. What did you do to celebrate being debt free? Since we are in the gift giving mood with Christmas coming do you have any idea on a thank you gift for each of my parents?
I say do the $500 more each month so you can save and have some other fun money in there. You could also say that you'll put any extra money toward the car as well (I don't know if you get tax returns, but that could be a big boost toward the car loan.)
ReplyDeleteI guess it depends how your feeling, if you need a bit of a breather or if you feel OK to keep paying the amount you are now. It would be great to be debt free by your birthday though
ReplyDeleteHow about setting an amount you would like to spend for your parents and for yourself. Then I'd be happy to toss in a few suggestions! :)
ReplyDeleteThanks guys. I think I will use my tax return to finish up my consumer debt (if needed) and if not then I would like to use it to buy my thank you gifts for my parents. Thanks Jane, I guess I would like to spend about $200 each on my parents and perhaps about $100 on me.
ReplyDeleteI say definitely do the extra $500 a month!
ReplyDeleteI think your ideas are great! I love the idea of paying off the car in December of 2012. I also want to pay off my car by 2012. I will be CC free buy December 2011. Then I will be studio free by May of 2012, then I want to pay off the car by 2012. We could be car pay off buddies. However I will not have any extra money to pass out to fund other accounts. I am not keeping myself on as strict a budget as you. What an inspiration.
ReplyDeleteI agree with other commenters - $500 sounds like a good amount/month. In terms of a reward, have you ever had a massage? Would that be something you might enjoy? It's an entirely frivolous expense, but I always feel AMAZING afterward & it might be a wonderful way to reward yourself after all of that hard work!
ReplyDeleteAmazingly I want to finish my car loan by Oct. 2012 or by Dec. 2012 latest.
ReplyDeleteI can't really give you advice on what to do when you are consumer debt free. I believe you will figure it out on your own but I would advise you to loosen up a bit. Maybe not in every category but at least one. I think you will come to a decision you are happy with. All paths lead to debt free. Take the one that makes you happiest.
How about you increase the gas & food to where they need to be for you to be comfortable and add a little extra to your entertainment. Continue to pour the remaining $350 into your car.
ReplyDeleteMy reasoning for this is that if you drag it out for the whole year, you will continue to live with this burden hanging over you. Why not limit it to 6 months?
In October you would have $1174 freed up in your budget to do whatever you want. Imagine what you can do for your parents and yourself at that point?!