Financial Planning

When to Check Your Financial Pulse and Why it Matters

I did not feel like doing anything on Saturday. Complete snooze-fest. Seebs couldn’t have been happier. After a couple of minutes tearing around the yard, his Great Dane “energy” was depleted.

I was productive, though. I ordered groceries from Giant Eagle Curbside. I’m unsure how I functioned before online ordering for groceries. Who has time to walk through the store and pick out groceries? The store constantly rearranges the aisles anyway. Last time, the tortillas were in aisle 2. Now they’re in aisle 6. No one bothered to tell me. Sooo much time wasted!

Groceries–check.

Cbus is also super cold, grey, and dreary. What better way to deal with a normal Ohio winter than with tacos and beer? And newsflash–Local Cantina has Saturday Happy Hour. Nonfiction.

After the queso (oh, the queso…) and halfway through a Crunch Wheezy, we decided this probably shouldn’t become a regular thing…

It’s been a busy year. It’s already March and we’ve come to the stark realization that we need a new financial goal. Since paying off our credit cards, purchasing our home, and upgrading two vehicles, we need a new plan. We have plenty to do as far as financial goals, but the hardest part is figuring out where to start.

When you’ve reached a financial goal, the first thing you need to do is check your financial pulse.

When to Check Your Financial Pulse and Why it Matters

What is a financial pulse?

The thing about financial planning is that it never ends. No matter how successful you are or how many goals you reach, there is always more work to do.

Checking your financial pulse basically means reevaluating your financial situation. Take inventory of your goals, achievements, expenses, and income. Decide what you want to do next.

Do I need a Band-Aid?

It’s easy to let discipline slide after achieving a financial goal. After working hard last year, we became more lax in our spending habits. We eat out more (seriously, the Chinese delivery guy knows us) and we’ve made a few fun purchases. This is exactly why it’s important to check your financial pulse annually or whenever you reach a financial goal. This way, you can make a plan and stay on track. Otherwise, it’s REALLY easy to backslide and start blowing your money.

Until now.

We did a complete inventory of our monthly expenses and monthly income and decided on our next big goal. We’re going to get hardcore about our budget and start aggressively paying down our student loans.

Even though it seems completely obvious (because who the hell doesn’t want to get rid of student loans?), it took awhile to get to this point.

We began in turmoil–no savings, credit card debt, NO RETIREMENT! It was a nightmare scenario. One that many of us know all too well.

When we started paying off our debt, we didn’t just start slinging money wherever we could. After prioritizing our debt, we paid off all our credit cards first (and closed all but two). After that, we couldn’t decide whether to start paying off our massive student loan debt or start a nest egg for retirement.

Grad school has a way of completely delaying (or destroying) your entire financial life. Even with funding, it’s often not possible to build a substantial savings or retirement account. Honestly, grad school is just about survival. But even if you’ve been out of school for awhile and completely flaked on planning for the future, it’s not too late to start!

Where do I start?

When we stopped hemorrhaging money and got our credit cards under control, we started a list of financial goals. This list included paying off credit cards (check), paying off student loans, saving for a home, etc. After paying off the credit cards and purchasing our home (way closer to work), we started aggressively saving for retirement.

We chose to save for retirement because OMG WE HAD ZERO RETIREMENT!

It was confusing at first–should we get aggressive and try to pay off all our debt first (which would take years) or should we aggressively save for retirement so we at least have SOMETHING, thus delaying our student loan debt pay-off?

It’s a totally emotional decision.

If you’re saving any money or paying down any debt, you’re already ahead of most people. However, it’s really easy to over-analyze your options and paralyze yourself with the fear of making the wrong decision.

We chose to aggressively save for retirement because the first money that you put in retirement is the most important. We did this by using a supplemental account in addition to our regular retirement contributions through our employers. For six months we saved additional money in order to play catch-up and maximize our initial contribution.

Depending on how your retirement savings are invested, that money will grow at varying rates over time. The more you put in initially, the more that money will grow.

After saving for six months, we feel comfortable with the amount we have. Now, we can stop contributing to the supplemental savings account (but still contribute the regular amounts through our employers) and use that money to start aggressively paying off our student loan debt. Even though we’ve stopped contributing to the supplemental retirement savings account, that chunk of money is now growing on its own!

Have you ever heard that phrase, “make money while you sleep”? This is one of the ways that happens.

Working toward financial goals is exciting, but it’s easy to get discouraged. When I was in the middle of paying off credit card debt, I didn’t think it would ever end. I looked at how far I had to go and I wondered if it was worth it.

Spoiler Alert–Yes, it’s worth it, so quit crying about it and keep making your payments!

The day finally came when I made that last payment and the credit card debt was GONE. It was crazy and elating and I couldn’t believe I ever doubted that I could do it. Even though I’m starting at the beginning of another goal, I know what those emotions mean now and I can ignore the doubt when it starts to creep in.

Being debt-free is worth the struggle, which is why it’s important to take your financial pulse and create a game plan for staying on track!

When was the last time you reevaluated your finances? Have you reached one of your financial goals yet? If so, what did you do next?

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