Tuesday, November 4, 2008

Wish I Had a Time Machine

I’ve updated my debt balances and I have to admit, I’m getting really impatient with my progress. I know I’m making decent progress every month, and I know I’m better off now than I was even 3 months ago.

I’m also VERY grateful that I haven’t had any serious setbacks since I started my blog (knock on wood). But this plodding is making me antsy and I’m afraid that this dissatisfaction will make me fall off the proverbial horse.


In an attempt to make myself feel better, I think about how things were back in November 1998. I’d just graduated from law school in June and I’d taken the bar exam some time in August or September. I was still working as a clerk at a private law firm until I got my bar results.

After I passed the bar in late November, I was earning $45,000/year with no retirement benefits. (Yes, folks. Not ALL attorneys make bank straight out of law school.) The deferral period for my student loans were coming to an end and the repayment period was starting. I’m pretty sure I had less than $500 in my savings account at the time and I had no clue how I was going to repay my student loans. I’m also certain I had quite a bit of credit card debt since I lived on my credit cards while I was unemployed after graduation. Stupid, stupid, stupid.

Here’s a bit of depressing (or more accurately, pathetic) news: I graduated in 1998 with approximately $100,000 in student loans. Guess how much I currently owe 10 years later? $103,619.61!! This is due to negative amortization from forbearing on the loan when things got tight. (Keep in mind that at the time, "financially tight" meant I wanted a new Coach purse and my credit card was maxed out.)

Let me be a warning to you all: Do not request a forbearance unless you ABSOLUTELY have no other options. (I really feel like belting out Cher's "If I Can Turn Back Time" right about now...)

But flash forward to present. Although I have just as much debt as I did in 1998, I also have MUCH more in my retirement and liquid savings. I've also turned a new leaf and I have a plan for paying off my debt by 2014. I'm not incurring new debt in the interim and I'm also saving little by little.

But why, oh, why is this process so tedious and excruciating? [Whine...]

I wish I had a time machine where I could see how I'm doing in 2018. If all goes to plan, I'm hoping that:
  • I'm debt free other than my mortgage
  • My home is financed with a 15-year fixed mortgage
  • I'll have $36,000 in liquid savings
  • I'll own $3,500 in US Savings Bonds
  • I'll have $457,000 in my 401k and Roth IRA
  • I'll be making plans to downshift my career at age 59 1/2.

I hate putting down my long term goals in writing. After all, as Homer Simpson says:

(Thank you to Sallie's Niece, from whose blog I lifted this picture.)

I guess in 2018, I'll look back at this post as a time capsule. I wonder what I'll be thinking then?

Anyhow, it's election day. Hope you're all voting!


jpkittie said...

cute simpson photo ;) and cat photo! lol

but to the important stuff - atleast you are on the up & up now & are making progress.. that is all that counts is the present - we just need to move forward with our goals in tote... you will get there & then you can go celebrate, maybe with a new coach purse & matching coach shoes paid with the first month of no payments money!

Sharon Rose said...

Hi there-a really great post and I can only stress that you've done a really wonderful job to date!! You've got a real grasp of personal finance now and where you want to be and this mindset comes through life experience and time. Another saying I've heard is 'Man Plans, God Laughs'. But I'm hoping he doesn't laugh too loudly, as I've a 5 year plan too! Seriously though well done and you need to remember to keep focused and motivated, little inexpensive treats every now and then (paid cash) will make things more bearable!!

Money Beagle said...

It's good to have a long term plan but make sure to have some short term goals along the way. If you wait until 2014 to say 'Ah, success!' then you'll probably get lost somewhere along the way. Set some interim goals along the way that you can reach every few months. That'll give you more motivation in the short term and keep you focused along the way.

For example, our goal right now is to pay down my wife's larger balance and higher interest student loan. It'll probably take a few years as it started around $19k, but I set some interim goals, such as: $15,000 then $12,500 then to have the balance fall below the other student loan (currently $11,500) and then $10,000 and so on.

It's cool to get to say 'cha-ching!' along the way.

Sunflowers said...

ACK. This scares me. :\ When I graduate law school, I'll have around 170k in student loans...

"Do not request a forbearance unless you ABSOLUTELY have no other options."

I will definitely follow this advice.

Someone recommended that I consolidate my loans now... I have to admit I know little about consolidation (I'll have to read up on it). Did you do it with yours at any point, and what are your thoughts on it?

Budgets are Sexy said...

As long as you have a plan girl, you are a-okay in my books! i hear ya on the slowness factor, but it'll be next month, and then the next-next month in no time.

For now? we just blog and keep it up. and look at funny LOL cats ;)

Anonymous said...

Wish I could turn back time for my money situation. I don't know what I was thinking in my 20's.

Good job on changing your path!