2012 Year End Review

What a year! 

At the beginning of the year I set out some pretty hefty goals for myself to reduce expenses, raise extra cash, build an emergency savings, pay off my parents, and pay off all of my credit card debt (a little over $10,500).  Let’s see how I did:

1. I paid off the $300 I owed to my parents.

2. I set aside $1,000 in an emergency fund.

3. I paid off $5,885 (or 57%) of the $10,263 I owed in credit card debt.  Not exactly what I was shooting for but I’m still happy with the amount of progress I made this year. 

Besides not really having a great understanding of budgeting and forecasting expenses when I wrote my 2012 goals, there are a number of other reasons I didn’t get the entire amount paid off.

Firstly, I became eligible for and started participating in my company’s 401(k).  I wasn’t originally planning on participating until I had paid off the credit card debt and the car loan but after a lot of research and soul searching I felt like passing up the company match of 4% plus potentially not saving for retirement for who knows how much longer when I haven’t been saving for a few years now was just plain dumb on my part.  It will take longer to pay off the debt but the extra 4% plus whatever that money earns makes up for the interest payments in leaps and bounds in the long run.

Secondly, I got engaged!  S popped the question which besides being a personal milestone also set into motion the need to have a much bigger savings account for a wedding than the little emergency fund I had set up.  I started funneling some extra money into savings instead of paying towards debt for our upcoming 2013 joint wedding expenses.

And speaking of joint expenses for 2013, we found out we were preggo in late October and then found out we were expecting twins in mid-December!  This really wasn’t  in the plan for the coming year (see above for engagement and wedding planning) and it certainly wasn’t in the plan to ever get a 2 for 1 deal but sometimes nature has its way over reason and planning!  We haven’t really gotten too far into figuring out what this means as far as other life plans go but we do know that we’re going to need some hefty money set aside.  Since we found out, I pulled back on the debt reduction and starting beefing up the savings instead.

All in all 2013 is going to be a wild ride and I am currently working out the plan for handling all the financial and personal changes going on.  I’m still very motivated to pay off the debt, just need to figure out what is going to be possible with all the new expenses and changes coming our way! 

Here’s where the 2012 numbers came in:

Student Loan: $36,284

Car Loan: $8,605

Credit Card 1: $0

Credit Card 2: $4,261

Credit Card 3: $117

Parents: $0

Total: $49,267

Here’s my starting point back in October 2011:

Student Loan: $38,339

Car Loan: $11,684

Credit Card 1: $10,577

Credit Card 2: $3,635

Credit Card 3: $0

Parents: $600

Total: $64,835

Paid off to date:

4th Q 2011: $5,051 + $0 in savings

1st Q 2012: $1,298 + $150 in savings

2nd Q 2012: $2,771 + $506 in savings

3rd Q 2012: $3,195 + $344 in savings

4th Q 2012: $3,253 + $1381 in savings

Total: $15,568 paid off + $2,381 in savings