My RDL introduction - Financial breakdown
Monday, April 14th, 2008
Where do I start? I’m currently a laid off Sprint employee looking for work. My official release date was March 21st, 2008.
Despite the layoffs, I’m determined to get my family financially fit. I prepared for this round of yearly layoffs by treating myself as a corporation. I cutback on bad debt in order to increase my bottom dollar. I paid off both cars (2002 Yukon Denali XL & 2005 Ford Freestar) in April 2006. That alone allowed me to save $500+/month. It hurt me to have to write a $20K check which drained my savings & cashed in stock but it was worth it in the end.
I then switched to Vonage in February of 2008 for home phone service, saving me $40+/month. On top of that I switched my trash removal service which netted me a savings of only $20 /qtr (every little bit helps).
These cutbacks and debt payoffs now allow us to save approximately $1000 - $1500 per month.
Currently I receive a severance package from Sprint that allows me to get paid (bi-weekly) until August 22nd, 2008 (with benefits). If I land a job soon I have a real opportunity to get a great head start on becoming debt free.
A breakdown of our situtation:
- We bring home around $5k/month.
- Outside of mortgage and utilities we have…
- My wifes $30K student loan ($288/month)
- My $3500 student loan ($110/month)
- $2000 Nebraska Furniture Mart bill ($130/month)
- Our $58K rental property mortgage ($505/month)
- The rental property is currently generating $205/month income.
Currently we’re on track to have at least $20K in savings by the end of the year ($15k if I don’t find a job by then). If I can land a job soon, $40k in savings shouldn’t be out of the question at the end of the year.
Having given a financial breakdown of my situation, I’m hesitant to payoff the NFM & my student loan bill at the moment. Doing so would deplete our current savings account to a little less than half. Considering I’m unemployed at the moment, I wouldn’t feel comfortable taking out of our emergency stash at the moment to pay these off. Besides, The NFM bill is interest free until the middle of 2009 and the current $130/month payment will have me paid in full by that time. Also, my student loan is only 6% interest rate so it’s not like it’s killing me at the moment. I’ll pay it off early regardless as I pay at least $150 every month (applying the extra to principal).
Well there you have it. My financial breakdown for future references.
Roger Garrett
