Wednesday, July 22, 2009

Budget Frustrations

I'm so happy I have my new car, especially since my other one was totaled out. That Mercedes drives better than I could have ever imagined. I love my new luxury, but it has put a huge dent in my budget. I keep scanning it over and over to see where I can cut out something. I based it on my salary from my first year teaching, so my income will be slightly higher than listed.

Because I do not like having a car payment, my goal is to pay off my car completely by July 2011. I will have to be very aggressive, but I believe I can do it! How do I plan to accomplish this?
-All bonuses will be applied to my car loan. ($3000 in September)
-Student loan and grant money will be applied to the car loan. (I would rather pay the interest rate on my student loan than my car. This will be up to $12,000 this semester and $5,000 in the spring)
-I will work each summer and take on extra paid professional development opportunities to increase income (that can add as much as $9000!)
-I will work part time during the next two summers (up to $6000 total!)

By doing all of this, I can see my car being paid for in two years easily. I don't feel as bad about using my student loans to help pay for it because the interest is a lot lower and because I'm a teacher, I will be able to have a huge portion of my student loans forgiven. After my car is paid for, I plan on using the same strategy to pay my remaining student loan debt.

Debt free by the time I'm 30. That's a nice dream. I think 35 is more realistic for me. Or 33 even. Debt free by 33. House by 35.

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