We started our financial journey with the Dave Ramsey Baby Steps for personal finance. While we don’t financially support his brand and have distanced from it, we still generally follow those steps. So we bought a house. Now what?
Now that we’ve financed a home, we’re evaluating our next financial goals. There were a few different ways that we felt we could approach our next steps. When we bought the house, we dipped into our emergency savings account by about $10k in order to have a 10 percent down payment. So we need to rebuild that (back up to about $20k).
We also need to focus on retirement savings. Having graduated with so much debt post college, we postponed this for a long time (and longer than Dave Ramsey recommends) in order to direct all extra funds toward paying off the debt.
While it was an active choice to do that and we don’t regret it, we know that we need to start making up for lost time.
Thirdly, we have a few home improvements we’d like to prioritize.
Figuring out how to decide where to put our attention next took a bit of processing and talking through.
We made a list of the home improvements to make and ordered them by necessity, priority, and cost.
I revisited the Baby Steps and a few articles on Dave’s site to figure out the guideline for how much more we should contribute to retirement. We’re both contributing now to our 401k’s with our employers. But we know we need to increase it and wanted to figure out by how much and where we should do that.
*There’s also the very real fact that we’d like to start paying off our 30-year mortgage as if it’s a 15-year mortgage and start contributing to our kids’ college funds.
But for now, here’s what we decided:
- First, we’re prioritizing a tile job for our kitchen and dining room. Both are currently carpeted and with kids, that’s just not ideal.
- Next, we’ll rebuild our emergency fund savings account.
- Third, we’ll open Roth IRAs and start contributing more $ into those accounts.
Once we have these done, we’ll plan on incorporating some of our other items, which include a bathroom remodel, paying more on the mortgage, and working in the kids’ college funds.
Moving comes with a lot of extra, unexpected costs that add up. For example, we bought new bookshelves and a mattress and paid for a plumbing improvement.
I’m excited to continue to get settled in the new home and budget. I’m also excited to transition into our next goals with momentum.
While budgeting and being detailed about your financial picture isn’t always fun, I’m thankful that we have no (other) debt. This has made the fact that we can afford this mortgage payment and pursue our other financial goals possible.
Having disposable income is huge and it’s difficult for me to imagine ever going back to a tapped-out lifestyle. If you have the means and ability to get on a budget and pay down/off debt, I highly recommend it. Click here for other personal finance posts.