January 2015 Monthly Review

Thankfully, 2014 is now in the books and our cash issues are over as we’ve switched to my wife’s health insurance. This is something we have been waiting to do for about 6 months, and as predicted our cash levels really jumped up this month. It was nice to see that, and see the effects of us consciously focusing on lowering our spending as well.  We decided at the end of December that we would stick to a hard limit of spending per month, and allocate the rest for savings.Monthly Review

Since we’ve lowered our spending quite a bit, we now needed some places to put all that (tax advantaged, preferable). I opened a traditional IRA for myself, and my wife opened a 457 account through her employer. She also has a Traditional IRA for herself, and in total we will be able to shield up to 29,000 from the tax man in 2015. We probably wont hit that number, but we will still be saving a significant portion of our income (around 65%, if numbers hold). This is exciting, as it will go a long way to help us achieve our next financial goals.

In other news, I’m thisclose to being finished with the redesign, so that should be coming up soon. I’m trying to take a few new pictures for the layout, and at the moment the weather is being rather uncooperative. The weather should turn this weekend, and hopefully my photographer can find the time to get some pictures of me.

Debt

House

Mortgage $ 102, 937 (-$778) This is continuing to go down steadily, and we are happy with the way this is progressing. At the end of 2014 we upped the extra payment to $250 every two weeks. Unfortunately, I set it up wrong and it didnt paydown that amount every time in January. That has been fixed, and we will continue to send $250 every two weeks to our note (in addition to our normal payment). By my calculations, we should be free of this debt in 6 years or so. Due to this, I’ve been casually looking around for a 7/1 ARM at a lower rate than we have now, but that has proven difficult. We have a low rate right now, I can’t find anyone willing to give me a rate that makes it worth switching.

Total Debt: $ 102, 937

It’s nice only have 1 source of debt (and even then, we know we can sell our house for more than what we owe on it. Now that this number is solidly in control, it’s time to ramp up our savings.

Savings

This is an area we did really well in this year. We were able to max out Roth IRA accounts for both me & my wife, in addition to the mortgage pay down we saw. We also built up some cash reserves, though we used them for the project on the house. We’ll still keep the goal of maxing our retirement accounts for 2015 (though we will be focusing more on pre-tax dollars this time, for reasons which I’ll explain later).

Vacation fund $1,000 – A dip in this account was cause by our severe cash flow issue (wife’s employer messed up her paycheck last month, so she was paid much less this month), so we had to move a bit out of savings to cover it.

Emergency Fund $9,000 – We are working building this back up after pulling some out to do some renovations to our house. This will go up a bit slower than it was last year, as we’ve diverted part of the money that was going in here to my wife’s 457 plan.

The year is plugging on just fine, and I’m hoping everything will continue like this.

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