* * * * * * * * * * * * * * * * * *
The saying on my signature "Want to make God Laugh? Tell him your plans" has caused a phobia of the P word in my family for ages now. I guess it helps my vocabulary in a way. Please note the lack of the P word in this post
* * * * * * * * * * * * * * * * * *

I've been mulling over a debt payment 'strategy' to try and get my finances more in order and improve my floundering net worth. It's either increase assets or decrease liabilities when it comes to net worth, so I'm choosing the latter.

I've 'decided' to start hitting it heavy in January, and before everyone gets up in arms let me explain why! The money I 'intend' to put towards debt reduction is 1100 per month. For the next three months I will stash that amount in my current savings, because December will see the holidays, my car taxes, and my first property taxes on the house. ACK! By stashing 3300 over 3 months I will have more than enough to cover all three of those expenses in December, and what remains will hide in savings as a small EF. Sensible, yes? Oh, and for those who've taken a gander at the budget I posted in here, I will also be sending 300/month savings as my monthly 'payments' towards these bills for next year.

My known debts (more on this later) are as follows, highest interest rate to lowest (can't believe I'm actually posting amounts...):

Honda Card $ 2200 (came w/ the marriage)
Car $14900
House $59000 (more below)
Stud. Ln $ 8000
Hospital $ 1100 (DH back surgery last yr)
Inlaws $ 9000 (came w/ the marriage)

By April the Honda Card and hospital will be paid in full, giving me 1200/month to put towards debt. This is also tax season, and my federal income tax return (beefed up by the high interest rate I'm currently paying on the house), goes straight to student loans. Here's where I can't decide what exactly I want to do. If I put the full 1200 towards the student loans they'll be paid of in 6-7 months. If it's towards the car, it will be paid of in 11-12 months. OR, I could split the money up between the car, student loan, and money owed the inlaws.... Hmmmm...

As for the house, we are going to refinance it towards the end of next year. Sister is a loan officer at my credit union and has informed me that, for members, they refinance homes at 5% with no credit check at the appraised value as long as it's been more than 1 yr since purchase. And there's a $50 filing fee. This is good b/c the house will be worth about 20k more than what we owe on it at that point, without any improvements. Refinancing will cut my interest dramatically, and getting 10k in equity will allow us to bring the kitchen from 1969 standards to 1995 standards (plus some roof maintenance). The change in interest rate will be so dramatic that, even with owing 10k more on the note and escrowing property tax and insurance, my monthly payments will be about the same. Which means the $150 I currently set aside each month for property tax and insurance can be put to other uses.

So, there it is, out of my system, my battle 'strategy' in the ongoing Money War.