Financial Sanity Update – May

Financial Sanity - Paid

May brought huge changes in our Financial Sanity.  First of all, we can now celebrate automotive freedom.  Namely, we paid our car off.  I can’t remember the last time we haven’t had a car payment.  Another bit of closure comes the finalization of the our personal damage claim against the insurance company from our wreck last May.  It only took a year to clean that mess up.  Anyhow, after paying our medical bills, the leftover proceeds have gone into our Emergency Fund.

Speaking of emergency funds, we recently had a bit of medical scare, causing me to re-think the amount we should keep in our emergency fund and how quickly we should beef it up.  As such, I looked at our monthly expenses and figured three months comes out to about $10,500, adding a bit of wiggle room brings the total to $12,000.  This has become our next priority and we plan to attack it before going full bore on the Land Loan.  At our current savings rate, we should have it fully funded by August.

Here’s how we stand this month – treating the Emergency Fund as a debt:

Item                             Previous                      Current                      Difference
GMC                             $8,083.87                      $0.00                            ($8,083.87)
Land Loan                   $39,627.26                    $39,372.40                   ($254.86)
$12K E-Fund                $12,000.00                   $9,589.00                    ($2,411.00)
TOTALS                        $59,711.13                   $48,961.40                 ($10,749.73)

All told, I can’t tell you how great this makes us feel.  Going from our mountain of debt to having only one real debt and the luxury of putting it on hold in order to fund an emergency fund is a beautiful thing.  Once we have $12,000 in the bank, sleeping at night will become effortless.  Then on to complete debt elimination!!!

On the business front, we’ve decided to shut down our side business on the last day of June.  Needless to say, cleaning other people’s toilets and emptying their trash is not fun.  We have a new found respect for all the hard working folks who do this everyday in order to put food on the table.  Also, everybody needs to realize that you can learn a tremendous amount about somebody by seeing what they throw away.  Further, don’t ever mistreat the cleaning staff – they have access to the building when no one else is there…

I am currently kicking around another business idea that would be much less labor intensive and much more knowledge-based.  It will take a little capitol to start up but if I can successfully build a client base, it should easily out pace the earnings generated by the cleaning business – without requiring my wife to work.

Until next time…

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