Welcome to another edition of personal finance confessions — a totally irregular recap of things you might not know about how I’m managing my money lately.
This round features five confessions (although much like the first two posts, I still think calling them personal finance confessions is a bit dramatic).
Here we go.
Five personal finance confessions
With less than a month left of 2020 (finally!), here are my eight personal finance confessions to wrap up the year.
We won’t achieve all our 2020 financial goals
As a reminder, I set three goals for 2020:
- Be equipped to handle an emergency in excess of $4K ($1K per person/pet) without adding to our debt
- Be under $20K in debt by 2021
- Take one meaningful step toward the prospect of buying a house
For each of my three 2020 goals, I designed “projects” to bring me closer to achieving those goals over the span of the year. These projects included:
- Get our emergency fund back to $5K
- Shave $10K off the principal of the student loan
- Save $8K, which will be used for some part of the house-buying process
The good news: we made progress on all the goals we set this year. Hooray!
The bad news: we won’t finish two of the three projects.
We completed the $5K emergency fund project, but we will fall about $100 short of shaving $10K from the student loan principal and we’ll end the year about $2K short on the house savings goal.
Normally, I would feel a little bummed about this but I feel fine about it because…
Paying off the student loan is not our top priority right now
For the last several years, our top financial priority has been paying off our debt.
We’ve made a ton of progress — we wiped our credit card balances, our car loan, our credit line and a large portion of our student loan. I’m happy about that!
But the thing about sending so much money to debt is that it can’t go anywhere else. And while I get — and generally agree with — the idea that it’s good to clear your debts quickly, being debt-free isn’t our only financial goal.
One thing that has felt important to use lately is beefing up our emergency fund. So…that’s what we’ve been working on.
Doing this means we’re putting less on the student loan and we’ll be about $2K short on the house savings goal we set for 2020, but I feel like this is the right choice for us at this point in time (especially where the interest on our student loan is only 2.45 per cent).
If you’re in the same boat, weighing whether or not to focus on debt or saving, I found this post from Money After Graduation helpful.
Our grocery budget has been insane lately
Lately, I have found it to be almost impossible to leave the grocery store without spending at least $130/week. And that’s a minimum — some weeks are more like $140-$150.
I know, right? Ridiculous.
I don’t think our shopping habits have changed a lot over the last few months, so it’s been a little surprising to see the bill keep climbing.
Is anyone else experiencing this?
I’ve been spending a lot of money lately
One thing we have done from the start of our debt-free journey is include a line for personal spending allowances in our budget. We started with $40 each biweekly and have since moved up to about $100 each biweekly.
I like to do a few different things with what I call my fun money.
The first thing I do every two weeks is put between $20-$25 on my Starbucks card. Generally, I make coffee at home four days a week; the other three days, I treat myself.
Next, I take between $20-$25 and contribute to my TFSA or donate to a charity.
Finally, I take what’s left and transfer it to my savings account.
For a long time, that money just…stayed there. I’d spend a couple dollars here and there, but for the most part, I was content to just watch that account keep growing.
Until the last few months. The last few months have been uh…expensive.
That being said, I’ve been happy with the purchases I’ve made lately. I feel like it’s been a good mix of wants (hello, Sephora orders) and more practical purchases (like, for example, a new wallet). Regardless, it’s been a spendy few months.
I have barely thought about financial goals for 2021
Maybe the most confession-like personal finance confession on this list.
We’re coming up to the end of 2020…and I don’t have anything definitive in terms of our financial goals for the year ahead.
Does that make me a bad personal finance blogger?
I assume my hesitancy to set financial goals for 2021 has to do with how weird 2020 turned out to be. It’s hard to think too much about finance goals for 2021 when the world still feels so completely out of control at times. Some days, just being some semblance of “on track” feels good enough, you know?
I’m sure as we get closer to the new year, I’ll actually put some thought into this. But for now, I don’t know what I’m setting for financial goals for 2021…and I feel OK with that.
There you have it — some personal finance confessions from the final quarter of 2020. I’m still not sure “confessions” is the best term to use for these little snippets about our finances but I’m going to go with it.
What’s something you’ve been struggling with lately when it comes to money? Have you set financial goals for 2021 yet?