Planning for the future is purely a numbers game, Part 1

The future is coming…

​Fairly recently, I recognized a slight dissonance in my personal plan.  I prided myself for my future planning in terms of building these businesses, and working to make more pursuits possible.  Pursuits that I benefited from, as well as my family.  Sure, I do all of the textbook things like 401K, independent investing, and automating bill payments so there is less risk for late payments.  Nonetheless, I took an accidental, but honest, inventory of where I was at in life and compared it to where I wanted to be.

I didn’t like the future I was laying out…

Through my work, I make decent money, and it provides me the ability to pursue my other interests.  I provide for my family, and myself.  Truthfully, I am blessed.  I have a loving family, a home, gainful employment, and this seemingly unquenchable thirst for knowledge.  However, like many others I have a bit of a spending habit.  I realized this when I was trying to create a budget.  I was going over my credit card debt as well as my student loans.  It truly was enough to make you want to throw up all over someone’s shoes.

I have student loans that are currently sitting slightly above twice the national average.  It is gross.  I went to state schools for undergrad and grad school, but it still ended up being a rather expensive adventure.

​Boo Hoo! Me and everyone else with our student loan whining…

​That’s not what this is, though.  I don’t want my loans nullified, or paid for me.  I was fine accepting the money, so I am fine paying it back.  To do this, I enlisted the nerdy side of me.  I outlined every single debt that I have, (mortgage excluded for now,) and put it all into a spreadsheet.  Then, by using a simple calculation system, I incorporated the interest rates for each of the loan accounts and then identified when everything would be paid off.

I wish I could say that it is all sunshine and rainbows now, but just having the end listed did nothing for me.  My loans are structured to the extended repayment system so in the event that I hit financial hardship I am not fighting for a concession.  Most of these loans are expected to run their course after 25 years of paying.  That is 300 months for those of you counting at home.  Now, this is where the nerd comes in.  I started playing with adjusting the repayment amounts to better understand how much time I could shave off by increasing my payments.

​Coupling this with my budget that I finished, I found that the future does not actually need to be so bleak.  I can add much more money to those payments and have it paid off in ten years.  Then I remembered I had not incorporated the CC debt into the equation.  Are you all familiar with Debt Snowballs and Debt Avalanches?  We will go in-depth on those next time, but let me tell you, this system may be the one for me.

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