Friday, May 16, 2008

how not to make a plan

Sorry! Its been awhile!
I haven't been excessively busy or anything, just giving in to springtime premenstrual malaise.
Oh, and also freaking out about money, but what else is new, right?
I had a minor car emergency: the 'ol dear decided to need a new exhaust system (among other things) in order to pass state inspection. So I had to fork over just over $2000.00 to make things right.
It was really painful for me. I had the money--I have been saving pretty aggressively-- toward the goal of purchasing a new-to-me vehicle sometime early next year--so I had about $5000.00 in an account called "the transportation fund". I did a big pro-con list and toyed with the idea of giving up on my car and trying to sell it for parts instead of fixing it and just getting by with a bike until weather gets bad again(I tried this last summer--gave my car to my youngest sister and took the bus / biked / walked everywhere until a car cut me off on my way home one day and I broke my wrist falling off my bike, so in theory this is doable, but it makes me slightly nervous given past events). My sister pushed for immediate car shopping and using the money I had as a down payment on something new-er, pointing out that the $600 + a month I had been putting aside would be less than a car payment on most things (also, she likes to go car shopping). And then I talked to the mechanic and voiced all of my concerns and he told me that the car looks to be in really good shape (other than the exhaust) and should make it to 300,000 miles with ease(it is currently at 220,000, so this is maybe two years away). So I took $2000.00 out of my transportation fund and had it fixed. And then when it came to $2300.00 I gritted my teeth and put the rest of it on a credit card.
This was an exercize in re-working goals. I have this tendency to get really driven toward a particular goal and to lose site of other stuff, and having to go in and evaluate where I was putting my money made me realize that my $500.oo emergency fund is inadequate, and that as much as I might want a newer car, putting nearly all of my savings into one goal / fund isn't the smartest way to make it happen. Because I do get really rigid about what the money is supposed to be for, and then have trouble with re-allocation and not thinking of it as a failure. So I've restructured my savings a bit: dropped contributions to the transportation fund back to 10% of my net income and increased contributions to my emergency fund to 10% as well. I'm also putting 10% into a "house" fund (that will be way more long-term: I don't even know what town I want to live in yet!) and 10% into a sort of "undeclared" (meaning I have not stated a specific purpose for it, not that I am hiding it from the government or something) playing-with-stocks fund (through Sharebuilder, divided among 5 different index funds) that, theoretically, I can to wherever I most need the money later on . Barring sudden crashes of the economy and my own ridiculousness regarding money.
I haven't changed my pre-tax savings at all; I am still contributing 15% (which still, sadly, does not get me close to the cap of $15,500/year) of my gross every paycheck to the company 403c (but they upped their match from 7% to 8%!! so there will be slightly more money going in there after June 1). This is money I never count, although when I get the biannual report it is always nice to see those numbers and think "someday this could be mine" Haha.
I feel better about it, though I am sad when looking at the considerably lower balance in my transportation fund especially when I think about how I only paid $500.00 for the car I just fixed for $2300.00!! My hope is that it will be money well spent though, and that I will have the car for another two years at least.