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Credit Cards and Consumer Debt
Pay Yourself First

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By Lurker1999
October 30, 2007

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I established a $200 monthly automatic transfer to savings in July 2006, money tasked for projected long-term, high-cost expenses such as a new car and most importantly a down payment, closing costs and moving expenses for a house.

I also started to move money randomly into the account whenever the checking account looked "too full". Over the past year this actually managed to fill up all of the ancillary tasks except the down payment.

I bumped the monthly transfer up to $1000 in July 2007 to hurry things along as the down payment would take decades at a $200/month rate. Tonight I funneled a bit of cash from another account to this savings account and when I totaled things up it hit me.

I'm 25% to my down payment goal.

All of the other amounts in this account are at 100%.

I can actually see the end in sight.

In the past few months my discretionary spending has risen somewhat so the sporadic deposits have tapered off slightly.

So I made the decision tonight to double my monthly automatic transfer to $2000 a month. I will use a steady paying myself first approach for the majority of the savings instead of depending on sporadic deposits to get me the rest of the way there.

I project I will have enough for the full down payment in 3 years assuming no additional random deposits (which may still happen). I have no desire to buy at present. However once I have the down payment fully saved up I'll have the ability to strike when an opportunity presents itself.

This may additionally reign in some of the discretionary spending so I can get to the 50% mark quicker.