Save $50,000

But since saving money is a major part of reaching this goal, that’s OK.

I received my phone bill in the mail today (I was looking forward to receiving it. Yes, I’m strange), and opened it up to see the changes. The amount due was less than half of last month’s bill. I can handle that.

And even more good news: Apparently I’m an excellent driver, and my car insurance premium just got reduced by $65 (5-year good driving discount).

Now to see where else I can cut costs.

With a wave of my magic wand, watch as these unnecessary charges disappear. I called the phone company and asked for removal of long distance service (calling card’s better), internet downgrade, and removal of some toll-free number service that I don’t remember signing up for.

And apparently I’ve been paying for that toll-free service (I love oxymorons) for the last several months. The cost wasn’t that much (maybe $10 a month), but adds up over time along with the “why pay for something not being used” rationale.

That’s done, and will save me almost $50 each month.

Last month I renewed my CD at a rather good rate. Right after that I noticed the bank putting a small stack of pamphlets advertising the special rates (4.5%) for CDs.

But after my last visit to the bank, those pamphlets mysteriously disappeared, and the special CD rate dropped to 4.25%. Very eye-opening. At least I’ll be able to capitalize on that 4.5% for the next 11 months.

Although I do think it’s time I tried CD laddering (But not the 1/2/3/4/5 year ladder, that’s far too long for me wait, and the rates for those aren’t good). Maybe splitting my money into several CDs at different financial institutions.

I’ll try $5000 at my local bank (if the interest rates recover by next August. Go go gadget “Rate Boost”), Probably $5000 at a credit union, and think about considering E-Loan, Bank of Internet, or other online institutions (surprising rates there). Also I’ll try to stagger the dates each CD is purchased, to allow for some liquidity.

I feel stupid for missing out on those rates last time (Let’s not talk about Google stock), but at least now I did my homework and am somewhat prepared for next time.

Or else this goal will take quite a while to reach.

Currently my monthly expenses total about $1100, but I’d like to try and reduce that amount to under $1000.

I’ll start by cancelling the cable (what’s the point of paying for it every month if I never watch TV at home? Yes, I’m quite stupid for not cancelling it sooner). After that, I’ll downgrade my internet connection to something not as fast (essentially cutting that cost in half).

Then I’ll remove the long distance from my telephone. I was basically conned into signing up for a worthless long distance plan (back when I said “yes” to everything, different story), and I make about 10 LD phone calls per year. A calling card would be better for that purpose I think.

And I’ll stop buying expensive foods, and make wiser and healthier choices.

After all of that, I’m estimating my monthly budget could be around $900 (And that’s taking my continued piano lessons into account). Astonishing, I think. That would allow me to easily save up $6000 every year, maybe more if I sell some of my unused things on eBay.

Let’s see how that all works over the next year.

And the bank actually gave me a better interest rate upon renewal (It was 4.3%, now it’s 4.5%. For a local bank, that’s unbeatable).

I was also able to deposit $3000 to it as well. Although next year at this time I might shop around for even better rates. There’s a credit union offering an amazing 5.1% rate, but the nearest branch office is quite a distance away. But, if they still have the CD special in 2008, I’ll consider.

I have my former eBay habit to thank for the reduction in saving money recently.

However, in 2 weeks my 6 month CD will mature (earning $215 interest). I’m planning to transfer about $2500 (preferably $3000) from my other accounts into the CD account and renew that for another 6 months.

Saving $10,000 took about 2 years, and my mortgage is about halfway paid off, so assuming nothing truly catastrophic happens (crossing fingers, knocking on wood), I should reach this goal in about 4 or 5 years.

I’m trying to deposit a few hundred dollars each month in my savings account, and when my CD matures, transfer the money from the savings into the CD and renew for another 6 months, rinse and repeat until goal is hopefully met.