Monthly Update: December 2007(-$47,635.15, +$1,817.91)
We managed to finish our first year on a positive note posting a $1,817.91 gain in our net worth which brought our total gain for the year to just over $41,000 dollars.
Over the course of the past year we managed to maintain positive growth in 10 out of the 12 months.
The majority of these gains came from our ability to save our day to day income. In years to come as we are able to build our savings we will hopefully see a larger percentage of our yearly gains coming from our investments.
Here is December:
We are closing in on almost $90,000 in cash savings. While that number looks impressive, $64,000 of that is borrowed money in the form of 0% balance transfer offers. Although we started 2007 with the intention to eliminate all credit card debt, the prospect of an extra couple of thousand dollars of interest was too much to turn down.
Currently interest rates falling and balance transfer fees are rising making it a little harder to make worthwhile gains with this strategy. Our current take is that if a good offer comes by and we can make money on it then we will continue to take advantage of these offers.
Our retirement savings were mixed last month. My wife’s accounts posted some slight losses and my accounts posted some slight gains. I also made my last contribution to my Roth IRA for a while in December.
Because of the increased costs of our expanded household in 2008 I will pause my Roth IRA contributions until I am sure that we will be able to cover our living expenses with a diminished 2008 income.
We continue to slowly pay the minimum on our student loans. Our remaining education debt has a maximum interest rate of 5% with the bulk of our loans consolidated at less than 3%.
If interest rates continue to fall over 2008 we will have to reconsider paying off my federal school loan which is at 5%. We are able to write off the interest we are paying on these loans in our taxes so I am not overly anxious to pay these off even if the interest rate is slightly greater than what we are earning in savings.
All in all, 2007 was a great year for our household. We accomplished many non-financial goals and made solid progress on our journey to financial independence.
Thanks for following along during these first slow years. As I finish my training and make the transition into my career as board certified physician I hope to be able prove that pursuing higher education can be financially worthwhile.
