Sunday, July 1, 2007

More About Me

Financial independence is my key to finding happiness. I don't thrive on change and risk so I need the security of a steady income to allow me to pursue other interests without fear of failure. And by failure I really mean homelessness and starvation although those seem extreme. They are still real fears to me.

My goal is to save enough money so that it will earn enough interest on the balance to support my basic needs. Basic needs are housing, food, utilities, insurance, and transportation. Ideally I would like to have $1000 a month. Some may think that is a lot. Most will think that is too little. How low my standard of living can go depends on what I can live without. The more motivated I am to becoming financially independent, the more I can live without.

I graduated from college with $18,500 in student loans but managed to avoid credit card debt. That was one lesson from my parents that I took to heart. I almost always pay the balance in full every month. I can only think of 2 times in college that I didn't accomplish that. The sight of finance charges on my bill quickly convinced me to try harder.

My first real job payed well ($60,000) mostly because there was an added traveling bonus. Luckily, I had already decided that I either wanted to save enough to retire early or save enough so that if I did get married and have children, I would have my own investments, perhaps even enough to stay home with the children or pursue home business ideas. I spent hours analyzing my paycheck, making a budget, seeing how much I could save each year.

Early on I bought a few "pet" stocks. I call them that because they are individual stocks that I picked because I liked the company and they have a dividend re-investment program so they will slowly grow on their own. Some of them have gone up, some down. I lost interest in them after a while. There isn't much to do with stock other than watch them or trade them.

Next I decided to get rid of all of my debt as quickly as I could. These included the student loans, my car loan and my newly acquired RV loan. I bought the RV as alternative housing. I was tired of living in an apartment and decided that maybe RV life in a trailer park was better. After all, retired people do it all the time. It must have its advantages. I did enjoy living there. There was a pool, pool tables, activities, laundry, so most people were 30 years older than me, that may have been why I didn't meet any marriage prospects. Well, there were offers.

After paying off my debts by following my strict budget I decided to buy some property. Property can be more fun than stocks although property tax can zap some of that fun. I bought a few acres with a view. It also had an old mobile home that I used for storage. I tried to live in the mobile home but it had so many problems from bad wiring, leaky roof and pack rats to no kitchen or heating and cooling. I don't know which one was the final straw but I then decided to buy a real house.

Now, buying a real house for a single girl was a huge thing. Single girls don't buy houses. I am supposed to wait until I am married and then we buy a house together right? I think when I reached 30 that didn't apply anymore. My job, although lucrative at the moment, was only temporary and I thought that if I didn't get qualified for a mortgage with my current job, then I would never be able to afford a house. I didn't know how true that was. I purchased a small, brand new house. I spent the weekends decorating it and planting things in the backyard. It was my playhouse. I was still living in my RV 3 hours a way so I could only visit my playhouse on the weekends. I new my job would end someday and then I would move to my house.

What I didn't count on was how much of a burden the house would be once my high paying job was gone. I should have sold while the market was hot but I had the bright idea to rent out my house as a short term vacation rental. That idea worked well for 3 months but then the tourist season ended and I am left with more house than I need in a very slow market.

That brings me up to date with my financial situation. I have a new job. I earn much less than I did before. I don't really enjoy my job. I have a house that is too big for me. I can pay the mortgage but there is nothing left for savings. The house has been on the market for 1 month. My realtor says to expect 4-5 months. I moved the RV on to my property which is about 25 minutes away from my house. I want to move to my RV after my house sells. Then I will be able to save money again and I will be able to see my financial independence goal begin to blossom.

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