Or: Why I’m Tapping the Brakes on Saving for a Home
Not to toot my own horn, but I’ve made some pretty serious progress on saving for a home in the past five months. I started out January 2016 with $16,873 saved and I’ll end May with $28,645 – that’s $11,772 saved in five months, an average of $2,354 per month.
But it hasn’t been an easy journey. I’ve put aside many other financial priorities and attacked this goal with a gazelle intensity that borders on insanity. I don’t even know why I’ve thrown every last cent I earn towards saving for a home. I’m still months away from my 2016 goal of saving $35,000 total and even further away from my overall goal of saving $40,000. So why the rush?
It seems that when I set my sights on a goal, I only have two speeds: first gear or full throttle. Right now I’m going full throttle, but after five months of breakneck speed, it’s time to dial it back a little.
It’s time to tap the brakes on this goal.
You might be wondering why, and the answer is simply: life.
Life happens, unexpected expenses come up, and those expenses need to be paid for, and that money must come from somewhere. Here’s a brief list of the unexpected expenses that have popped up lately:
- My husband’s replacement cell phone
- Car repairs
- Higher than average utility bills (Winter!)
- A variety of personal expenses including new glasses, physiotherapy, a Headspace annual subscription, new running shoes
In total, we’re talking around $1,600 in expenses that need to be paid for. In the short term, the money will be coming from my emergency fund, which has slowly been depleting. I talked about my criteria for accessing my emergency fund for unexpected expenses here.
I hate carrying credit card debt, especially when I have cash in the bank, so I’ll use my emergency fund to pay off the unexpected expenses above. But to replenish the emergency fund, I’ll be using the money I normally have designated for my house down payment fund, along with a little from my travel fund and new car fund.
Multiple Savings Goals Are a Challenge for Me
I’ve found out something important about myself over the past five years of financial management: I work best if I attack one goal at a time. Well, I shouldn’t say that. I should say I achieve the best results when I focus on one goal at a time. When I have a single goal to focus on, I put everything I’ve got into achieving it, and I get results quickly.
Having a single goal is easy. Having multiple savings goals requires discipline and patience. I lack both.
But at least for the next few months, I’m going to have to practice having multiple savings goals: saving for a home down payment and replenishing my emergency fund. Both goals are equally important, and I’ll be dedicating equal resources to handling both.
That means I won’t be averaging $2,300 per month going into my house down payment fund for the next few months. As much as I’m sad to see this stellar progress stall out, I know that I can’t sacrifice my financial health – I can’t drain my emergency fund and not address it – in the name of saving for a house. It’s like robbing Peter to pay Paul, it’s dangerous and unhealthy.
Practicing balanced financial management has never been my strong suit. I’m much more of an all-in kind of girl. While this style of money management has helped me accomplish great things with my finances over the past five years, it’s also led to some spending binges and a general feeling of deprivation that I know in my heart of hearts is not sustainable.
So let’s try this balanced saving thing out for a few months and see where we stand, shall we?
Are you a single goal or multiple goal kind of person? What motivates you to save? I want to know!
Photo Credit: Jon Ottosson