Thursday, February 21, 2008

Shifting Priorities

I've been mulling around my financial picture for a while, and I'm starting to think more long term instead of short term. For all of 2007, my goal was to get my financial house in order, fix the problems from the past and work on improving my credit score. I've brought all accounts to current, and haven't had a late payment in over 6 months. My credit score has come up about 50-60 points in the last 9 months, so the progress is paying off.
I want a house. Not right this second (although that would be nice), but someday. So I talked with a mortage broker yesterday. She looked at everything and it was nice to hear that I could qualify for one NOW! My credit score has also passed the point where they penalize borrowers with higher interest, so that's good too! After asking a billion questions and getting her opinion, I've decided to ease up on the debt repayments and get more aggressive with my savings. In fact, I'm doubling my savings from $250 a month to $500 a month. Also, any financial windfalls that come my way (gift money, bonuses, etc) will be split 50/50 between debt and savings. For the next 6-12 months I will save as much as I can, without sacrificing the quality of my debt repayment. In this amount of time I my bad credit will age, and my good credit will get stronger, so my score will continue to rise. I also am up for a promotion and raise that will hopefully go through in March. That will help in both arenas, as well as provide a higher income for a qualifying mortgage later on. Hopefully this time next year I will have made a wise investment and be a home owner!

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