Thursday, December 28, 2006

Unexpected Expenses - Are they Really Unexpected?

You know how it seems that as soon as you get close to accomplishing a goal something always comes along to set you back? That happens often in my life, especially with my financial goals.

It seems like every time I free up money - by paying off a debt, getting a raise, or a money gift - something comes along to eat up that money. And, that "something" always shows up AFTER I've made plans to spend the extra money or have actually already spent it.

So, I've paid off my credit card debt and freed up $185 a month. I planned to put that money toward paying down the mortgage, saving to buy a house in the country, and adding a little extra to my food budget.

And that "something" showed up. That "something" is Major car repair. OK, it wasn't really unexpected. I knew it was coming, eventually. Both of our cars are OLD, and my car has been sitting in the driveway - not working - for several months now.

I've had my car in the shop 3 times in the last year to fix the same problem. It seems there is not one mechanic in this town that can figure out what is wrong with it, so I just keep paying to fix something else "that might be the problem," but isn't.

So, we just parked the car and decided we could get by with just one car. We've been told that the transmission in this car is on it's way out. The "brilliant" mechanics in our area told us that the transmission could last another 6 months or another 6 years. That was 3 years ago. So, I guess it's close now.

The car still works, but it's something that we just can't keep ignoring. There are little sounds and symptoms that warn us of imminent doom. So, why haven't we been saving and preparing for this major expense?

When you've lived poor as long as I have you learn to just push the specter of major expenses out of your mind, because you know you don't have the means to really prepare for them.

But, that has to change now. I have money freed up that can be saved for this expense.

So, I've re-written my goals again, including the car repair.

New Goal #1: Pay Off Credit Card Debt

SHORT-TERM GOAL: 3 more months till all credit card debt is paid.ACCOMPLISHED

LONG-TERM GOAL: Stop using credit cards unless total can be paid each month ACCOMPLISHED

New Goal #2: Save for Transmission Repair/rebuild

New Goal #3: Save just for Home Improvements needed to Sell the House

New Goal #4: Save for Down Payment and Closing Costs on a Home in the Country.

They say that Life is what Happens When You've Made Other Plans. I guess they were right.