Wednesday, January 15, 2014

To Save or to Spend?

I already know the answer to this question.

But now that I am not putting my money towards credit card debt, I am antsy to spend. I have been looking at listings for a new (to me) car.

My criteria are: low kms, manual transmission, and air conditioning. I don't care about the other features.

My current automobile is the little Toyota I purchased from a graduate student in 2011.

I am in a love/hate relationship with this car.

First, last summer was unbearable, what with she having a black exterior and no air conditioning. We had only a couple of weeks of heat-wave, and I was miserable. This summer I hope to drive to NY state for a vacation and I'd really like air conditioning for the highway.

Second, the driver's side lock is finicky, in such a way that sometimes I get locked in, and I have to climb over the stick and out the passenger side door. So frustrating! Slightly embarrassing!

Other than those things, she's a great little car. If I could find one just like her, maybe in red or gold, with low kms, manual transmission, and air conditioning, I would be set.

I have set a timeline to purchase by June, and a budget no higher than $6000. Which means that I have to save $1000 a month, and then re-introduce insurance, gas, and other expenses into my budget. Currently I share those expenses with my partner, whose car died last Fall. I discouraged him from purchasing another car because his line of credit is still over $8000 to be paid. We now get by with sharing/ car-pooling/ public transit. I think it works ok for now, but I still would really like to have something else by the summer.

Thursday, January 02, 2014

Debt Free Again

I paid off the last bit of credit card debt (again!) in December. I owed about $500 on a low-interest card; I think it was left over from 2012's yoga teacher training or perhaps it was half of what I paid for 2013's meditation retreat. Either way, it is paid.

I actually paid $900 for debt re-payment last month, since I accidentally sent a $500 payment to one of my student loans instead of to the credit card. Whoops!! I felt stupid when I caught the mistake, but realized it was ok because the student loans also have to be paid. I cashed out my savings for the first payment, and most of my mutual funds for the second payment.

I also contributed $600 to my RRSP savings account, making up for the $50 a month that I used to save, but ceased when I began my debt-free journey back in 2009. In a couple of months I will contribute another $600 to cover the year ahead.

Since I last posted, I took on a few more part-time hours at the university, which I believe has tipped me into the next income tax bracket, since my monthly tax deduction from my pay cheque  has increased five-fold. I hope I will get some of it back when I file all the carry-overs (tuition, fitness credits, taxable donations, etc.) that I have not been able to use in the past few years, since I did not make enough money!

I managed to stay on Interest Relief for my student loans for five years, and moved into the Debt Reduction Repayment plan last year. With the extra income I am finally paying back a portion of my four student loans. I do not yet have a goal to eradicate that debt, but I hope to by next year when I can see how a full year on this income looks in the big picture.

My goal for 2014 is SAVING. I have a strict budget in place, with some pockets for birthdays and holidays so that I don't feel any burnout. I'm already used to making my own coffee and buying second-hand clothes. My biggest challenge is still online shopping. I think last year I spent close to $1000 online, mostly on skincare, which may or may not be an obsession for me. I also buy a lot of gifts online and it adds up, especially when you have to make a minimum purchase to receive free shipping.

I do use Swagbucks for Amazon gift cards and I also use Web Perspectives to slowly earn gift cards for Chapters-Indigo. None of these sites or companies have paid me to mention them.

Near the end of 2014 I will turn forty. My goal is to purchase a house by then, so saving is a priority. I would like to learn how to invest some of my savings, but I am afraid of making wrong decisions and losing my money. So far I only put $100 in an ING fund each month, but I would like to learn to do more.