As I prepared to make the shift from debt payoff to saving, I imagined all this extra cash I was going to have. Over the last year, my payments averaged $2663*, ranging from $1726 to $4416.* That’s like a small briefcase full of cash now available for my next goal. I was worried about all that cash burning a hole in my pocket. What would I do with so much cash? Spend it? I hope not. Save it? I hope so.
Thinking about potential savings goal progress, I got excited. Saving on average $2663 every month over the next year is more than $30,000. Throw in a little bonus money or a little help from Hubs and I could be a SAVINGS MASTER.
Then I paid off my loans and that money magically figured out a way to disappear.
Where’d all the money go??
While I was in debt repayment mode, debt was priority #1 with little competition. Sure, I was saving for retirement, but my 401k diverted a whopping 1% and my Roth IRA was getting $100-200/ month. Prioritizing debt happened naturally, even though I sometimes fought it along the way. Anyone remember my habit of building and draining savings accounts?
Now that I’m saving, my money is going all over the place. Yes, I want to save for a house, but I also want to save for other things. I gave my 401k a serious bump right before my loans were paid off and my Roth is back on track to be maxed out by the end of the year. My HSA is full again and I also set aside $1000 in an FSA this year. That’s a whole bunch of savings accounts taking money away from my poor, poor house. #thieves
Maybe that’s just how it has to be because I don’t want it any other way.
While I would love to make excellent house savings progress today and tomorrow and be done by next summer, missing my house savings goal doesn’t bother me. I have 22 months until I need a down payment. To raise the rough minimum for 20% down, I am going to need approximately $40-50k. That’s about my average payment without windfalls from now until then. If can only save 10%, that’s just over $1000/month. $1000 each month is doable even if I go crazy and try to max out my 401k. If we decide to stay in the apartment for one or two more years, that’s fine too.
What I do know is that time is still on my side to save for retirement. I want to take advantage of that. I already gave up a year for my student loans. It is going to feel pretty gosh darn sweet to get my retirements accounts to a critical mass so they can do a little bit of the leg work themselves. Then, if I need to put on the brakes, I can.
I also know that going to Japan is more important than buying a house on a fixed timeline. The house can wait, Japan may not be so flexible. My uncle’s days in Japan are limited so I need to visit while he’s still there. Otherwise, I may never find another reason compelling enough to go. I’m still kicking myself for not visiting my cousin in Rome when I lived in England. I’m going to Japan.
My biggest take away from this stage of my early transition to saving is that so long as I try, it really doesn’t matter how much progress I make toward my savings goal. I could knock it out of the park, or I could strike out. If I’m spending and saving according to my values, I already won.
Winning with money feels a lot cooler than a rigid savings goal.