{ Year End Fiscal Inventory }
Admittedly, I get side tracked from my Keeper of the Pennies theme when I have holidays, two feet of snow and a family member wandering around the house with two weeks off from work...but I'm back now and ready to embrace the New Year! Taking stock of where I've been is crucial to knowing where I am going in 2009. As many of my friends in retail have done or are doing in recent days, I have taken a fiscal inventory of my life.
Our current debt load is as follows:
Mortgage with taxes and insurance (30 year fixed at 5.5%): consumes 22% of our annual gross income.
Credit card : We decided to take on debt mid-year by taking advantage of a 3.00% for the life of the debt offer. Our thinking was to complete home maintenance/reno projects that would complete our 7 year remodel. We drew down a fixed amount of money with a 24 month pay off plan. This debt when incurred consumed 22% of our annual gross income. It puts us over our debt to income ratio of 35% of gross income but we treat it as a short term loan with an aggressive payoff plan. We purposefully decided against a home equity line because they are too tempting to keep open and drag out.
Other "Overhead" Costs: things like utilities, car insurance, gas and food another 20% of the gross income.
Taxes and health insurance comprises about 26% of our gross annual income. This is a new fiscal earning year for the self employed half the household so we're not sure if we have paid enough to Uncle Sam yet.
The remaining 10% gets divided pretty evenly between short term savings and retirement savings. In the coming 18 months it will need to stay that way while we pay off the debt but once that is gone we need to bulk up the short term savings in a BIG way.
I feel good about doing my inventory. It gives me a foundation on which to stand in 2009. I encourage you to not avoid your numbers and spend a couple of hours this week doing your own inventory.
Our current debt load is as follows:
Mortgage with taxes and insurance (30 year fixed at 5.5%): consumes 22% of our annual gross income.
Credit card : We decided to take on debt mid-year by taking advantage of a 3.00% for the life of the debt offer. Our thinking was to complete home maintenance/reno projects that would complete our 7 year remodel. We drew down a fixed amount of money with a 24 month pay off plan. This debt when incurred consumed 22% of our annual gross income. It puts us over our debt to income ratio of 35% of gross income but we treat it as a short term loan with an aggressive payoff plan. We purposefully decided against a home equity line because they are too tempting to keep open and drag out.
Other "Overhead" Costs: things like utilities, car insurance, gas and food another 20% of the gross income.
Taxes and health insurance comprises about 26% of our gross annual income. This is a new fiscal earning year for the self employed half the household so we're not sure if we have paid enough to Uncle Sam yet.
The remaining 10% gets divided pretty evenly between short term savings and retirement savings. In the coming 18 months it will need to stay that way while we pay off the debt but once that is gone we need to bulk up the short term savings in a BIG way.
I feel good about doing my inventory. It gives me a foundation on which to stand in 2009. I encourage you to not avoid your numbers and spend a couple of hours this week doing your own inventory.
posted by Steph at
7:57 AM
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