One of my 2008 financial resolutions is to pay off $40,000 in debt. February was a great month for debt reduction. We didn’t have a windfall this month, so our progress wasn’t quite as spectacular, but we’re still on track to pay off the full $40,000 by the end of December. I’ve also made more progress on other goals.
Debt Reduction Successes in March
This month we paid another $3400 towards our debt, in addition to our regular monthly payments. One credit card is now completely paid off and the other one is down to 1/3 of its original balance.
Debt Goals for April
For April, we will cut the remaining credit card debt in half again. The interest will resume in mid-April, but the balance will be low enough that transferring it wouldn’t be worthwhile. Thanks to our economic stimulus check, we should be able to eliminate the credit card debt and a medical debt completely in May.
Progress on Other Goals
We haven’t yet boosted our retirement funds or started an emergency fund, but I can feel it getting closer.
We’re also reconsidering our goal of buying a house by the end of the year. On the one hand, our windfalls may mean that we’ll get hit by the AMT if we don’t find more deductions. On the other hand, prices in LA are expected to continue plummeting at least into early 2009. Although we plan to buy a place we can live in for five years, we still don’t want to overpay. If we opt not to buy until early 2009, we’ll focus our finances on saving for retirement, planning for taxes, building an emergency fund, and paying down higher-rate student loan debt. We may even squeeze and affordable vacation in at the end of the year, without creating new debt to do it.
If you have financial resolutions or debt reduction goals, how’s your progress? Tell me in the comments.
