let dash off dot com

from the editor.

one of my four goals for 2010 is to pay off $8,000 of my school loan (about half of my remaining total).  this hasn’t been working.  i need to re-examine what’s been going on and come up with an alternative solution.

the state of things.  i set out initially to pay $750 per month against my school loan, delivering payments via credit card to the loan company.  last month’s payment was a paltry $350, and this month’s payment totalled $450.  what the hell happened?

essentially, there were numerous expenses i’d not factored into my initial budget.  these include:

• emergency repairs (looks like my car’s electrical system is on the blink…if it cares to blink at all)
• car insurance (currently over $900 per year, which isn’t much but the quarterly payments are significant enough)
• travel (yeah, i do want to take vacations and breaks…this costs money)
• other 2010 goals (these cost money too)

i have dipped into my savings account (via my automatic overdraft protection) a couple times since april: basically once every month i’m paying out of my savings account, even if it’s something less than $50.  though it’s not much, i feel it’s a horrible habit to begin, and definitely not a sustainable behaviour in any case.

how do i solve this?  i see several options.

1. extend the goal into 2011. this will delay the goal about 6 months.  by default this is do-able.
2. re-assess the goal to be $6,000 instead of $8,000 by year’s end. again, this is an approachable goal, and it would be done soon enough anyway.
3. pay off whatever i’m short the $8,000 at the end of they year with my savings account. this is also doable, but i feel it’s undesirable (too close to “admitting failure” than i prefer).  in all honesty, i see myself doing this anyway.
4. improve my income stream in some way. this is possible, but at the present time it doesn’t seem a very realistic possibility.  one of my other goals for this year is to publish a board game of my own, and i will be acquiring a construction certification in late july as a possibility for side jobs.  but there are a number of other commitments i would have to sacrifice in order to make a side job viable, and the board game has no financial guarantee.  i am not ready for this step just yet, i reckon.
5. stay on a $750 payment schedule, but pay these every 1.5 months. so i would keep the $750 payment structure, just not on the same timetable.  although it satisfies one of the criteria, putting a wrinkle into my solid monthly payment schedule doesn’t seem like a good idea.  furthermore, it doesn’t help me meet the goal any quicker.

out of all the options i’ve listed above, a combination of the first two seems the friendliest option.  however, as i mentioned above, i’m more concerned about accomplishing the goal i’ve set.  i think my course of action will be to pay what i can per month (which seems to be about $450 per month at the moment) and then make up the difference at the end of the year with payments from my savings account.  although this takes away some of my financial cushion, it’s likely to afford me greater peace of mind than stretching the goal out along a lengthier time table.

this is, of course, dependent on whether or not i still have savings left; unforseen emergencies may come up that cause some additional dwindling of my savings.  that’s not worth even speculating at this point.  my “plan b” (which combines options 1 and 2 above) can compensate for a significant loss of savings assets, so i’ll defer to that if necessary.

as this is a personal goal, and no one else really has any stake in it, i’m merely thinking out loud with this.  but i had made a promise to myself to do it in 2010, and i want to find a way to achieve that goal.  i’m not too pleased about this at the moment, to be honest, but i have a feeling i will be much more satisfied once i can finally write off that debt.

Tags: economy, personal, writing //