When we started this process in April of 2017, we were working with the following constraints:
- One of us had a somewhat unpredictable contract job
- One of us had a regular but low-paying job
- We were repaying three credit cards, two student loans, and a car loan
By last September, our situation had changed:
- Both of us had regular jobs, though mine still paid peanuts
- We'd paid off our car loan and one credit card
- We'd both taken on side hustles
Now our plan and budget are changing again, and for several reasons:
- We paid off Credit Card #2, which leaves us with one more credit card and two student loans
- We broke our lease (via our tax refund) so that we can move from our raucous, sleep-inhibiting apartment building into a quieter but more expensive duplex
- My new job pays more...
- ...but my health insurance is more expensive...
- ...and we're putting slightly more money into both retirement and an HSA
So what does all of this mean in terms of actual numbers?
Here's our totally transparent breakdown of the old budget versus the new one:
In sum: rent and health insurance are going up. We'll be contributing slightly more to long-term savings. Our debt repayment allocation is going down.
Sidenote: We are well aware that the rental is expensive, though for our ridiculously-priced city and given its ideal location (right by a trail and within walking distance of school and work), it's considered reasonable. I'll write another post in a few days that explains our decision to keep renting instead of taking the leap into buying.
Here's what all of this means for the big-picture debt repayment plan:
This new plan is only a couple of months off from the old one in terms of the projected payoff date.
Of course I'm hoping that we'll be able to pay it all off sooner than that, and I think we will, especially if we receive work bonuses. But regardless, this new plan seems reasonable to me because it reflects goals and values that have become increasingly important to us over the past year:
- Even though it's expensive, we love our community, and we're willing to pay the price to live here.
- Our home is our haven. We value a quiet place where we can truly relax.
- We want to become more dedicated to saving for the future.
- We're determined to pay off this debt.
What about you? Have you recalibrated your finances lately, and if so, what prompted you to do so?