Saturday, November 29, 2008

Money. Moolah. Green.

So, with us not having a TV or all that many investments to worry about, I'm probably more out of the money loop than most people. But I do know the obvious--the economy isn't so hot right now. And as I mentioned before, with work the way it is right now, every once in awhile I wonder whether or not buying a house was the right thing to do or not. I KNOW that we're perfectly capable, and we've done budget after budget that demonstrates that it is. But because our first mortgage payment isn't until January, we don't feel like we're in the swing of things yet. Additionally, there have been a lot of one-time expenses that will settle down after this month, but will also make things tight this month. December and January are undoubtedly going to be tight (though yesterday we did purchase 7 Christmas presents for a a total of about $40!), but I'm hoping that things will slow down in February along with tax time. I don't think I've EVER been this excited for tax time!

Although I'm trying not to count our chickens before they hatch, we are expecting a fairly large tax refund for several reasons--first, my husband is silly and never changed his withholdings once we got married, so they're still withholding like he's a single guy. Second, we're eligible for and plan to take advantage of the $7500 tax "credit" available to first-time buyers. So we're thinking that our total return will probably be around $10,000. Now, I know financially saavy people recommend having withholdings changed to as little as possible, and putting that money into a savings account so that while you owe taxes come tax-time, you've made interest on it. I can obviously see the benefit, but practically, that probably wouldn't work for us. Plus, this lump sum is going to be such a blessing on our lives. We've tentatively outlined how we'd use it all when and IF it happens:

Approx $2000- Laminate wood flooring in living room, carpet remnants in bedrooms.
Approx $253- Extra car payment.
Approx $800- Lump credit card payment
Approx $600- DIGITAL SLR CAMERA!!!
Remainder (hopefully at least $4000) to be put into a high-interest savings account. I'm sure we may purchase some other goodies in there too though.

Our rationale is simple for the above items--we've always known the house would need new carpet. They're really gross, and really bad for my allergies. As for the extra car payment, our bank sent us a "skip a car payment" voucher, which we elected to do this month to give us a little more discretionary income for Christmas. However, we don't want to extend the life of our loan, so this is a great compromise, and will allow us to switch payments over to the 1st of the month instead of the last day of the month. As for the cc, our cc's both have a max of less than $2000--this was at our request, though we could have qualified for more. So, although our debt is small, I'd still like to bring our balances due down a little bit. As for the DSLR, it's just something that I've wanted for a really long time, and my darling husband suggested this might be one of my few opportunities to get it. It would also allow me to think about doing some photography on the side--mostly just for fun and stress relief.

Plus, Justin and I both believe that when the economy is down, it's important to stimulate your local economy--that's why most of our purchases will probably be made through locally-owned businesses, even if we have to pay slightly more to do so. That said, we also want to start re-building our savings, since buying a house seriously depleted it!

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