Valdosta Daily Times

February 23, 2014

Killing two birds with one bank account

Brittany D. McClure
The Valdosta Daily Times

SAVANNAH — The hubs and I are in a dilemma that many young, married couples find themselves in. We are trying to save while at the same time, paying down debt. It’s a debacle, and financial experts never seem to give consistent answers. Some argue that you should pay off debt before you even save a penny, while others say that you should save first and pay off later. One way or the other may have sufficed ten years ago, but now, we are in very different economic times.

Young men and women are coming out of college in debt up to their eyeballs before they even find a job. The job prospects are so dismal that many go into graduate school to defer loans, while at the same time, incurring more debt. Those of us who do find jobs, usually make just enough to scrape by because in addition to paying towards $60,000 plus in loans, rent is also at an all-time high. Buying would be cheaper, but thanks to greedy and irresponsible Americans who lived a lifestyle they can’t afford, we are now suffering the consequences because it is close to impossible to get a home loan.

Thankfully, we have made it past most of that anxiety. The hubs and I have been out of college for four years and we have worked our way up to jobs that fully support us in terms of pay and benefits. Now, we are in a place where we are ready to make big financial decisions, like buying our first home. As some of you may recall, we were under contract for a house almost a year ago, but we had to back out due to rising interest rates.

During our first home buying experience, we were using a USDA loan, which required us to buy in a certain area, and required no down payment. Now, we are pursuing a regular home loan that would require us to have some money down. This is where the debacle comes in. We have debt that we are trying to pay down in a little over a year, while at the same time trying to save a down payment in just seven months. When you find yourself in a similar situation, this is what you need to do:


1. Determine your priority.

Our priority is saving a down payment. Why? Because the market for homes in our area is low, and we are trying to catch a deal while it’s still hot.


2. Determine your reality.

In order for you to know what is possible, you need to have a come to Jesus moment with your bank account. First, look at how much your priority is. For example, my priority is saving $2,000 in seven months, so for this to be possible, I need to save approximately $285 per month. Next, look at your next goal of importance. For example, mine is paying off $4,000 in debt in one year. This would mean I would have to pay approximately $333 per month. This does not seem possible because of my priority goal because I don’t have more than $600 in extra income every month, so I must adjust my secondary goal. My adjustment looks like this: For seven months I will put at least $285 per month in savings and will put $180 per month towards my debt. After my savings goal is reached in seven months, I will have also paid down my debt and now only have approximately $2,740 more to go. I will now continue to put $180 plus the $285 I was putting into savings towards my debt. In approximately five months, I will pay off my debt. The total debt pay off time would be one year, which is still in line with my goal. As you can see, keeping both goals is possible; it just requires some math, and a lot of diligence.


3. Track your progress.

My bank, USAA, offers a free goal-tracking tool. For those of you fellow military kin, you can access this tool by logging into USAA online, and by clicking on “my account tools” and selecting “goals” under “budgeting and goals.” My debt so happens to be on my USAA credit card, so after selecting that pay off as my goal, it automatically inputs my total amount and interest rate. As I adjust my desired pay off date, it adjusts and tells me the amount I need to pay each month. Many other banks offer a similar service, but if yours does not, here are some services you can use that offer a free version:

• (I highly recommend this one).

• (great for those of you who use the envelope system).



When you’re trying to save money or pay off debt, tracking your progress is essential because when you feel like it’s not worth it, you can eyeball your progress and see a light at the end of the tunnel.

That’s all I have for you this week budgeteers. Don’t forget to like me on Facebook at and follow me on Twitter @BudgetBrittany.