The Big Goal

So now that the 2015 Goal has been met, it’s time to unveil my 2016 Goal.  In 2015, my goal was to pay off $20,000 in loan principal.  In 2016, my goal will be to pay off…$20,000 in loan principal.  What?!

I was hoping to be able to put a big goal out there, but we’re looking ahead to spending a lot of money on the house, and we need to replenish the house account as a result. So I’m not planning on putting any rental income into my loans in 2016.  Or if I do, it won’t be until the back end of the year.  Maybe one or two rent payments’ worth.

I’m hoping to pay off $800 a month in principal with my standard payments ($550 to my remaining law school loan — currently less than $50 a month going to interest, but hopefully dropping quickly; $554 to my former federal loans — currently about $270 a month going to interest). That only adds to $9,600.  The other $10,000+ will need to come from my bonus, our tax return and anything else we can throw at it.  I’m trying to plan as though hubby won’t be working, so that any money he does bring in will be gravy.  If things are going really well at mid-year I may consider a stretch goal of $25,000.

Smaller Goals

Some more financial goals, other than this biggie, that I’d like to throw out there for accountability purposes:

• Contribute $10,000 to my 401(k)/IRA – I’m actually a little unsure on this one, but I’m thinking that I might change my contributions to Roth contributions from their current pre-tax status.  I’m currently contributing 10% of my salary, plus a to-be-determined bonus contribution, but given that the Roth contributions are after tax, I don’t know if maintaining this percentage would reduce my paychecks too much to be doable.  I also have a small Roth IRA that I try to contribute $100 a paycheck too, but this doesn’t get direct deposited into it, and therefore sometimes ends up elsewhere. This number doesn’t include my employer contributions.
• Contribute at least $4,000 to my HSA – Most–if not all of this–will come from my bonus.  That will take a big chunk out of this goal pretty early in the year, and then halfway through the year I’ll reevaluate my needs, and see if I want to contribute more.  The nice thing about this is that I can change it at any point in the year.  I just have to be careful not to mess it up like I did this year.
• Save $3,000 in my primary savings account — This doesn’t seem like a lot, but I find myself dipping into savings more than I would like.  Some of this spending in 2015 was for more major items (car fixes, wedding things, extra loan payments, buying a dishwasher and a new tv), but some of it is just not maintaining a budget.  I don’t keep much in savings, because most of my extra money goes to loan payments, but hubby has always been a saver, so even though my accounts look pretty skimpy, we’re not completely without savings.
• MAINTAIN A BUDGET – This means evaluating how much is expected to come in each month, and how much I expect to go out.  So I’ll need to go through my expenses this year, and see what my unusual expenses were (Amazon Prime, car registration and taxes). I’m debating buying YNAB for this, and I’d be interested to hear feedback on how much it has helped people. I’m hoping to work on evaluating this in the next coming days so I can start planning for a monthly amount to set aside for these expenses.

Overall it’s a lot to think about for 2016, and I think pretty ambitious, in spite of it being pretty similar to my 2015 goal.  These goals are contingent on two major things:  a good/great bonus and a healthy baby…