The saga of my best friend and her financial situation continues, unfortunately. I share to vent, use her as an example of what not to do, and for those us who have it together to find a some understanding and compassion.

This is the friend with bats in the attic...third time in three years. Technically, they do not have the funds to remove them. However, they have decided to open a credit card to pay for the $2,000 extensive repair. They cut up their cards a few months ago, when the took out a 401K loan to pay off their debt. Right now the friend doesn't know how she will make the payment. Yikes!!

To make matters worse, she called me last night to tell me that they did some van repairs to the tune of $1200. I assume also put on the credit card. There were many things in need of repair, but they only did the critical ones. She said she broke down, flipped out at work. She is beside herself with despair. She does not have the money.

As my title suggests, they have no emergency fund. They never have. They so need one for times like this. I know I have said this before, but I truly believe an emergency fund is the building block to financial freedom. It doesn't even have to be a big one to start with. Dave Ramsey suggests $1000 to start. I'm in agreement. It's a good start to changing the behavior from spending every last penny to saving a little for the unexpected. My friend and her husband need to change their behavior. Fast!

Luckily, I am seeing signs that she is willing to make some changes. She declined to send her daughter to an out of state camp, which would have cost $800. She has put a bug in her husband's ear to get a part time job (she already has one). She also wants them to consider selling their fifth wheel camper which they purchased three years ago for cheap. They actually could make a profit on it! (Side note: even though the camper was cheap, they had to trade in a one year old truck for a larger truck that could handle the load. Ugh!)

The new credit card statement changes have really opened her eyes to the amount of interest they are paying. I was actually a bit shocked that this was new information to her. I obviously take knowledge about compound interest for granted. Oops!

She is sharing her frustrations, but not exactly asking for help. I so would love to get my hands on their financial particulars and work out a plan for them. I really would. I'm sure I would learn quite a bit, too.

I guess it's time. Time to track the van loan. It is one of our 2010 goals, to pay it off. Or at least get much closer to zero!

The current balance is $18,137.47. I'm going to start the ticker there, even though the original loan was larger. We bought the van in May 2008. If we pay it off this year, that makes the borrowing time only 2.5 years. Not bad!

I expect we will pick up the payoff pace in June or July. For now, just expect regular payment updates each month beginning in April!

Update on survey cash out mentioned yesterday: it was deposited yesterday in my paypal account. Only one day after the request. Yipee!

The home equity loan is PAID OFF!!

I have tried to log into our account with the mortgage company and it seems not to exist any longer...so I'm taking that as the official sign!!

The loan was taken out 3 years 5 months ago when we purchased our current home. We made a plan January 2009 to get it completely paid off. And now here we are!

Only debt now: the mortgage and our van loan...which we will start working on this year.

Thanks for cheering us(me) on along the way!!

The certified check that I ordered for our home equity loan payoff arrived in the mail yesterday. Today it is going back out in the mail to the mortgage company!! The processing center is less than two miles down the road from my house, so I expect they will receive it tomorrow. Maybe by Thursday I can log on and see a zero balance.

Our regular payment did go through with the mortgage company yesterday and our new balance is $82.19. Yipee.

Um...not sure why the ticker on my sidebar is not cooperating. I even tried making a new one and it did the same thing. Ugh!!

I called for our payoff amount which is now $82.69. Wow! Interest of $0.50. I ordered our certified check for that amount and it will be sent out tomorrow. We bank online so I don't have a bank to walk into and request the funds. I'm hoping the mail is super fast!

Once the check arrives, I'll get it sent down the street to the processing center about a mile from my house. I'm looking forward to logging in to our account and seeing that big fat zero.

Our basic goals for 2010 break down like this:

1) Max out our Roth IRA's = $10,000
We make monthly contributions that are automated
2) Save 7% of basic pay in TSP
Automatically taken from paycheck
3) Pay off home equity loan
Only $199 plus interest to go!
4) Save money for college = $3,300
We are scheduled to start contributions in March. I hope to automate these as well
5) Add money to emergency fund = $7,000
I expect we can start adding money in April
6) Pay off van beginning balance = $19,444
Balance is now at $18,579.87 from regular contibutions only. We will begin adding extra in June
7) Convert IRA's to Roth IRA's
Approximately 65% of our IRA's were converted in February. May not convert the rest until later in the year.

I'd say we are on track so far in meeting all goals. Yipee!!

Yipee!! I made the $1,800 principal payment to our home equity loan bright and early this morning. Obviously, I'm very anxious to get this thing paid off.

New Balance $199.00

I like that we are getting closer to zero.

The first entry regarding this: the loan on our Honda Odyssey.

We bought it used 1.5 years ago. The interest rate is 3.9%. We borrowed $26,955. I don't like writing that number, but I do LOVE driving my van. It's the most expensive vehicle we have ever owned. Prior to this, the most we spent on a vehicle was about $12K. The plan is to keep it as long as possible, which could be a long time. It's a Honda.

Today our current loan balance is $18,579.87. I just made our regular payment and $433 went to principal.

This will be the next debt we attack once we finish up the home equity loan. It's almost like starting over again with the home equity loan. In fact, it is MORE money than the home equity loan was.

And in case your curious. Our only other debt is our first mortgage on our home.