Tuesday 9 February 2016

New Game Plan

Okay, after finally deciding that I will buy a place, with said process beginning in earnest in August, this means that my financial plan needs to be tweaked, yet again. 

Since I am not working to pay off Wanda and Trea in order to wander the earth like an extra in some post-apocalyptic movie, my plan must change to match my priorities. 

I have decided that I will be ready to commence this purchasing process as of August 1, 2016, so that means that two things need to be done before then: 

1)  Mortgage Pre-approval. This I will do in July, so as to have time to get this in hand, ready to go. 

2)  Down Payment Saved up. This one will take some doing, but can be done. 

I have decided on a target of a down payment of $10,000.00 and it can be done by utilizing what I have been using to pay off bills ($1500.00 per month). 

If I just put aside $1000.00 for January and $1500.00 for each month from February through July, that will give me my $10,000.00.

In order to get back on track, where I should be at this very moment ($1500.00 in the Long Term Savings account) I had to shift money around. 

What this means is that I had to wipe out my contingency fund of $1000.00 and steal $400.00 from my personal overdraft. 

When I added this to the $100.00 that I put in the Long Term Savings Account when I opened it last month, this brings me up to my target of $1500.00. 

This also leaves me with a hole in my personal overdraft and no Contingency Fund. Technically the money I am putting aside for the down payment is a contingency fund, but one that I really, really, really don’t want to touch. 

I will do what I have always done, look for ways to save and use that salvaged money to repay my personal overdraft and then build up my contingency fund again. I expect to be out of my personal overdraft by next month.

I am treating this savings plan like yet another credit card, in so far that the payments into it are non-negotiable. The other thing that is non-negotiable is that my credit cards are maintained at a zero balance. I also plan to stay above $1000.00 in my main account; this is also important to me and non-negotiable.

We shall see how much actually ends up in my Long Term Savings as my down payment come August 1. It goes without saying that more would be better, but at least I will have my down payment, and eventually, my house.

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