Comments on: Pay Off Debt AND Save For The Future At The Same Time http://www.moneycrashers.com/pay-off-debt-and-save-for-the-future-at-the-same-time/ Personal Finance Blog, Your Guide to Financial Fitness Thu, 09 Feb 2012 21:11:00 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Paulhttp://www.moneycrashers.com/pay-off-debt-and-save-for-the-future-at-the-same-time/#comment-5427 Paul Tue, 01 Jan 2008 18:49:36 +0000 http://www.moneycrashers.com/pay-off-debt-and-save-for-the-future-at-the-same-time/#comment-5427 I've been making amends this past year for terrible financial decisions made in my first 3 years out of university. I was about $55,000 in debt to student loans 15 months ago, about $6,000 behind in taxes, and had another $3,000 in familial debts and other random debts that I let slide. I moved to different city with a lower cost of living and cut my lifestyle expenses down by what must be 80 percent. I got a roommate, to life on low rent. I didn't taken any holiday time, and I have no kids. I broke up with my then-girlfriend, who also was living her financial life in an out-of-control fashion. I admit that my only goal right now is debt reduction, based primarily on fear of financial ruin. My student debt, in 15 months, shrank to approximately $32,000, and I am currently paying about $2,500 per month on my student loans. Luckily enough for me, I have a professional job with an income that will rise each year, while my debt decreases. I suppose that, according to another school of thought, I should be investing this money, but there is a lot to be said for peace of mind. I also began to detest the social stigma of being a person who does not pay his debts, and I do not want to further any stereotype of the student who avoids his government-issued loans, leaving tax payers to pay the debt. Any advice for me? My sneaking suspicion is that I should decrease my debt to somewhere in the neighbourhood of $15,000, and then start aggressively saving and investing for retirement. Thanks a lot, Paul I’ve been making amends this past year for terrible financial decisions made in my first 3 years out of university. I was about $55,000 in debt to student loans 15 months ago, about $6,000 behind in taxes, and had another $3,000 in familial debts and other random debts that I let slide.

I moved to different city with a lower cost of living and cut my lifestyle expenses down by what must be 80 percent. I got a roommate, to life on low rent. I didn’t taken any holiday time, and I have no kids. I broke up with my then-girlfriend, who also was living her financial life in an out-of-control fashion.

I admit that my only goal right now is debt reduction, based primarily on fear of financial ruin. My student debt, in 15 months, shrank to approximately $32,000, and I am currently paying about $2,500 per month on my student loans. Luckily enough for me, I have a professional job with an income that will rise each year, while my debt decreases.

I suppose that, according to another school of thought, I should be investing this money, but there is a lot to be said for peace of mind. I also began to detest the social stigma of being a person who does not pay his debts, and I do not want to further any stereotype of the student who avoids his government-issued loans, leaving tax payers to pay the debt.

Any advice for me? My sneaking suspicion is that I should decrease my debt to somewhere in the neighbourhood of $15,000, and then start aggressively saving and investing for retirement.

Thanks a lot,

Paul

]]> By: Craighttp://www.moneycrashers.com/pay-off-debt-and-save-for-the-future-at-the-same-time/#comment-5406 Craig Sat, 15 Dec 2007 14:49:50 +0000 http://www.moneycrashers.com/pay-off-debt-and-save-for-the-future-at-the-same-time/#comment-5406 We're a dual income family that subscribes to the second school of thought. We prioritize retirement and both max out ($15,500) every year. Then we prioritize college savings for our toddlers ($1,200/month), then the rainy day fund ($250) month, then whatever little is left after life's necessities (i.e. mortgage, groceries, bills), we try to have some fun with it. We don't carry credit card debt, with the exception of a loan we converted from home equity to get a 1.9% rate. We always pay the minimum and usually try to chip away at it with an extra $100/month even though we could earn more by investing that cash. That's purely for psychological reasons - we don't really want to carry the credit card debt for 7 years, even though it's only at a 1.9% rate. We’re a dual income family that subscribes to the second school of thought. We prioritize retirement and both max out ($15,500) every year. Then we prioritize college savings for our toddlers ($1,200/month), then the rainy day fund ($250) month, then whatever little is left after life’s necessities (i.e. mortgage, groceries, bills), we try to have some fun with it. We don’t carry credit card debt, with the exception of a loan we converted from home equity to get a 1.9% rate. We always pay the minimum and usually try to chip away at it with an extra $100/month even though we could earn more by investing that cash. That’s purely for psychological reasons – we don’t really want to carry the credit card debt for 7 years, even though it’s only at a 1.9% rate.

]]> By: Blaine Moorehttp://www.moneycrashers.com/pay-off-debt-and-save-for-the-future-at-the-same-time/#comment-5405 Blaine Moore Fri, 14 Dec 2007 18:29:35 +0000 http://www.moneycrashers.com/pay-off-debt-and-save-for-the-future-at-the-same-time/#comment-5405 We are on one income while my wife is in law school, and still manage to build up our emergency fund and make extra payments against our mortgage and save for retirement. We aren't very good about the whole budgeting bit; we just try not to spend more than we have to and keep ourselves too busy to buy random junk. We are on one income while my wife is in law school, and still manage to build up our emergency fund and make extra payments against our mortgage and save for retirement.

We aren’t very good about the whole budgeting bit; we just try not to spend more than we have to and keep ourselves too busy to buy random junk.

]]>