In my quest to shape up my finances, I've been doing a little virtual rearranging. I have labeled my emergency savings account as a true emergency savings account, although I have unfortunately had to dip into a bit lately. But I went to REI yesterday and emerged without buying anything that wasn't on my list, so that was a good start at controlling spending. I also opened an extra checking account for things that aren't regular expenses, such as vacations, car repair, car insurance, etc. I calculated how much I spend on unexpected expenses each year, then divided it by 12 and set up an automatic transfer to put that much money in that account each month. Hopefully this will help me, although until I pay off my credit card (which should happen in another month or two), it's going to be tight.
I now have two dilemmas. I had another savings account, my old, traditional savings account, and I can't for the life of me remember why I kept it open. Maybe I was thinking that I would use it for regular savings, but I'm not planning to have any regular savings until I pay off my student loans.
Which brings me to my next dilemma - my student loans. I HATE being in debt. I've figured that if I take any extra money I have each month, and put it towards my loans, I can cut the repayment period to 16 or 17 years. If I stop contributing to my 401(k) and put all of that towards my loans, I could have them paid off in 9.5 years. But is it worth the peace of mind of having my loans paid off earlier?
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