Wednesday, 8 October 2014

Dolla Dolla Bills, Yo.

So back a few months ago I put up a whiney post about being on strike at work and having no cash, and generally not being sure about our financial situation. Since then you may have noticed that the blog has been light (even for me, even for in the summer) on new content.

That's because we're doing something about it.

In the time since the strike (about 13 weeks) we have tracked savings, specifically funneling cash into TFSA's in order to have a war chest/ emergency fund/ slush fund/ rainy day fund/ opportunity fund - dammit there's a million names for these things. Our goal was to set aside $25,000 in a year in order to have a nice little cushion that will allow us to avoid credit, and take advantage of new opportunities as they arise.

Checking out the savings as they grow has become a sort of strange fixation for me, and delivering pizzas is my new hobby. Trouble is, while we are fixating on our savings, we are still handcuffed by our debts.

A friend sent me a bookmark to check out - a blog by dude who works casually and calls himself retired at 30 based on lifestyle and spending decisions he calls "Financial Badassery" I liked that enough to take a closer look. I like the blog and the ideas are worth thinking about, even if I don't completely buy into all of them. I doubt SWMBO would ever get 100% on board with the things he suggests (save money and drink olive oil in stead of eating meat!) but some of his ideas are very valid - especially in our situation, and much of his philosophy isn't far from what we should be doing.

Anyways, our warchest has grown to almost $10,000 in 14 weeks, which is pretty sizeable. Most of that cash has gone in from delivering pizzas and cleaning offices, $3 at a time, a little here, and a little there. In that same time, our debts have been nibbling away at what money we could be putting into the warchest. Which is why we are about to change our focus and we likely won't hit our $25,000 goal in savings this year.

Its showtime, and MBNA is about to stop picking our pockets. As far as I'm concerned, killing off the debts is as good an investment right now as filling up the warchest, and once those debts are gone, well, we'll have that much more cash to dump into the bucket. Some time soon we are going to need to change our financial adviser. We have spoken with a few, but I'm not getting the right vibes yet. That will be a tricky bit for us.

With $10K set aside, we won't have to incur new debt as we kill off the old. We aren't bulletproof yet, but we do have a pretty strong shield up. If a car craps out, or we need to redo the backyard, or the roof starts leaking, that warchest will carry us along ways before we have to pull out a credit card. If we must dip into the warchest, we can turn our focus from debt killing back to topping up savings while we prepare for the next hit. In the interim, its sitting there making interest. The beauty of this is that we've set that cash aside without any major lifestyle changes. Sure I've missed TV nights, but paying to watch TV versus getting paid to drive around town doesn't seem like a tough decision.

Our big decision now is whether to have $10K celebration or wait and have a debt-free party. I think we need to add a new goal section to our 14 for 2014. Or maybe it will be our 15th for 2015.

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