Wednesday, March 20, 2013

Competing Priorities

Now that my RSP is $25K and that goal is complete, I'm going to shift my focus. The problem is to where? My personality type is one that would prefer to focus on one thing and get it done, as it gets done faster and gives me more motivation (which is why I picked the snowball method of paying off debt). But, I may not be able to do that all the time, and I'll admit that I find it frustrating.

Here are my competing priorities (in no particular order):
  • Pay my Aunt back the $4K I borrowed for my RSP
  • Pay off remaining credit card debt ($3900)
  • Save for house down payment outside of RSP (approx $5K)
  • Re-establish Emergency Fund (at least $1K)
  • Save for trip to Alberta in summer ($200, flight paid for w/Airmiles) - July
  • Save for gifts/Christmas/misc (at least $500)
  • Buy a bike ($150-250)
Ok, lets add that up (using highest totals and ignoring interest, just for example purposes) = $15,150. I will at the very least pay $400 to my Aunt and probably $400 to the credit card to bring it to $3500. The rest is going to depend on how much my next paycheque is. But let's say I pay off and save a total of $1000 in March, that leaves me with $14,150

After March we have 9 more months in the year (yes, already!) 14,150/9=1572.22 per month that I would need to pay/save (not including interest) each month for the rest of the year. That's pretty much a whole paycheque! Also, since some of those goals need to be completed before the end of the year, that number isn't completely correct, its more for example purposes.

I will have to give my budget a look over to determine how much I will be able to give to each of these goals and how to make the best use of my money.

I will post my budget at the end of the month once I have an average of money spent for the last 3 months. I also get my OT "bonus" at the end of the month so I will have a better idea of the total I have left to repay/save. I will then try to determine how to best fit these payments into my budget going forward. I will post that to this blog.

How about you? How do you deal with competing priorities?

Morgaine
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5 comments:

  1. AnonymousMarch 20, 2013 at 3:34 PM

    Maybe you could clarify this, because I'm a little confused. I thought your aunt lent you $4000 for your RRSP, which would generate a $4000 refund, which you were then going to pay her back with? Did the agreement with her change? I've been confused since you put the refund money into your RRSP.

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    1. MorgaineMarch 20, 2013 at 4:27 PM

      Sorry, I think I mentioned it in another post. We changed the agreement that I will pay her back monthly so that I could reinvest the refund back into the RSP which put it up to $25K. This was done so that I could stop contributing monthly. She gave me this on a zero interest basis so I have no real need to pay it off quickly, we agreed on $400 a month which would have the loan paid off by the end of the year.

      Since I have to have any contributions I want to use under the Home Buyer's Plan in my RSP at least 90 days before I can use it, me and T thought that this was the best plan. It gives us a lot more flexibility into when we can look at houses.

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    2. AnonymousMarch 25, 2013 at 9:55 PM

      Ah, that makes more sense then.

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  2. AnonymousMarch 20, 2013 at 11:11 PM

    If I were in your position, I'd probably try to wipe out my debt as much as possible since it accrues interest, and minimally save for the other items. I'm also kind of cheap and don't really spend more than $200 or so on Christmas gifts, but that's because we do a Secret Santa type system with my family. It's always nice to "find"someone new with the same type of financial goals (though mine is mostly digging myself out of my debt mess) - best wishes on accomplishing yours this year! :)

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    1. MorgaineMarch 21, 2013 at 9:14 AM

      Hi!

      Sorry, maybe I should post the interest rates along with the numbers to give a better idea of where the priorities might go. I'm actually paying 0% on the credit card debt due to a balance transfer, at least until end of June. When I look at the budget numbers and actually decide how much I'm going to put towards each goal, I will post the interest rate, whether is being paid by me or the bank, it may give a bit better insight into why I'm doing what I'm doing. Oh, along with when I need money for certain goals.

      I have been trying to spend less on gifts as well, that $500 is to include money for gifts all throughout the year as well as misc costs (medical, dental, vet, etc) so more of a "buffer" account, if you will.

      I've been digging myself out of this debt mess for about 4 years now and although the finish line is close for that, I just feel like there's so much else competing to my money and I have to admit its stressing me out!

      Thanks for dropping by! :)

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