Thursday, January 28, 2010

Financial Goals for 2010

John Wesley said "Gain all you can, save all you can, so you can give all you can." As a result we need to frame our financial goals with God's plan for us.

Here are some of our GOALS for 2010:

Increase Giving Goal of 15%. We were pretty consistent with our tithes but we were a little slack with other charitable donations. With the Haiti earthquake, we are going to give a little bit more. We've been listening to some sermons about being a good steward of God's resources. The question shouldn't be how much should I give, but how much does God want me to keep for ourselves. So giving should be number one priority for financial goals in 2010.

We are at about 86% of our mortgage which means we are still paying PMI, about $100 extra a month. We need to be at 80% which means we have about $13k to go from $185k to $172k.

We took out a 14k loan from my TSP last year when we were doing renovations on the house. Since this money is mine, I decided to pay this off first since this is money that goes into investments. For 2010 I will be putting in around $500 a bi-week or about $1000 a month. Since we have about $12k left on this loan, we should be able to pay this off this year (God willing).

So for the house and PMI, we are paying an extra $500 each month to pay down principal. At this rate, it will take about a year and a half to get to the golden 80%. We'll see if this is wise. Dave Ramsey says to pay down your smallest debt first. Then attack the next one. This is the debt snowball plan.

As for our budget, I am making about 80k which includes salary, bonuses, and investments. After taxes we are bringing in about 4k a month. So for budget goals, we hope to spend about:
  • 45% $1400+500 Mortgage
  • 15% $600 giving
  • 10% $400 for food
  • 7.5% $300 utils (phone, gas, electric, internet, water)
  • 5% $200 auto (gas, insurance, etc)
  • 12.5% $500 loan repayment (which most will go to TSP)
  • 5% $200 savings/investment
Hopefully as things progress, we'll decide what to get rid of first, but it looks like our mortgage payment of around $2k a month is a bit excessive in terms of our financial goals. But I personally really want to get rid of the PMI payments. Tell me what you think.

What can a budget do for you?

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