A Month of Saving Day 6

Today's entry is not really a new concept for us, but something that has made a huge difference in our day-to-day spending. We use a budget. I have every monthly expense on a spreadsheet that we track and watch pretty intently. Now, of course, during several seasons of our marriage, there have been times when we have been more focused on this than others. The last 2 years have probably been the most lax, as we have been spending time learning how to be parents and less time worrying about where every dollar goes. As we are learning about parenting, however, we are realizing that part of being parents is modeling good money habits. I have spent the better part of naptime this week reviewing our budget. I got on a website with a loan calculator and started figuring out how we can pay off our debt more quickly. As we have reviewed our finances and discussed ways to cut costs, we have come up with 3 goals for our financial future:

Short-term goal:
Pay off our van in 2011 (2 years ahead of schedule)
Medium-term goal:
Pay off all student loans in 2012 (8 years ahead of schedule)
Long-term goal:
Pay off our house by 2016 (7.5 years ahead of schedule)

While we realize unexpected expenses arise, and we cannot be certain what the future holds, we can be diligent in putting extra money each month toward our student loans, mortgage, and any other outstanding debt we might have. It is pretty incredible if you look at an amoritization table with any of your outstanding debt and compare the savings in interest when you pay something off ahead of schedule. While writing the check for the same amount every month is easier and takes less planning and thought, I prefer to pay the banks and other financial institutions less interest and save the difference. If you're interested in seeing how much you can save, simply google "loan calculator" and have some fun!!

Have a great weekend!