Uncertainty

Those of you who subscribe to me via an RSS reader saw my post on PART of what happened. Actually, what I talked about in that post was what happened on Friday. On Monday shit really hit the fan. However, I’m going to refrain from talking about it here. Period. Suffice to say, it is surprising that today I actually had a really great day at work.

While I’m not in danger of losing my job in the next 3-4 months, or potentially even longer than that. I feel this uncertainty within me that I’m not sure what is going to happen in July when my funding will be half up. It isn’t unreasonable to break it at this point, to be perfectly honest. Though my boss and I both had intentions of using the entire time on the funding. However, circumstances have changed – for both of us. I’m no longer sure how much longer I want to be working here and I’m pretty sure that if I didn’t have an outside funding source I would be on a much more severe probation than I’m on.

All of this to say,  I’m starting to rethink my strategy and goals for the next few months.

I still want to be credit card debt free by December 31st, 2010. However, I have to weigh this against my happiness and my general life well-being.

I’m debating for the next 6 months, paying $500/month of my credit card (rather than the $1,512 I was planning on paying) and instead put that extra $1,000/month into my E-fund. Essentially, I’d be bulking up my savings in case I need to be unemployed for a period of time or need to relocate for a new job. If things seem fine in June/July region, I can then take that extra money and put a large lump sum payment on the credit card. I’ll be able to save up probably around $5-6,000 into an E-fund. Which would subside me for a few months of job searching and living expenses (especially when combined with potential Tutor.com money, community college teaching, ect).

The other option is to continue paying off the card at my current rate and just live off the credit card if situations become dire. I don’t like this option as much – as I’m afraid if my CC balance goes up again I’ll never have the motivation to bring it back down again, but if I don’t end up leaving then I’ll save money on interest because I’ll still be diligent at paying off the balance.

I have to clarify that, there is a 80% chance that this will blow over and I’ll finish out my post here with flying colors. However, that isn’t a certainty. I’m just not sure what the correct financial move is to make here without costing myself too much money and without knowing the future.

I’d really, really, really appreciate your opinions on the two options. (Or any other options you might have for me!)

What made me happy today: A very kind DM on Twitter from eemusings. Thanks!

Advertisements

14 Responses to Uncertainty

  1. I think your strategy to continue to make your credit card payments at $500/month and to save as much of the rest as you can in your emergency fund makes sense. It might cost a little more in interest IF you end up keeping your current job come July, but even if that happens, you cannot kick yourself for being prepared for other contingencies. Paying off CCs now only to run them back up would be a huge emotional blow (if it were me), and it would be worth almost any amount of additional interest to me if it meant that in the long run, I’d have the motivation to continue toward debt freedom. And don’t worry, we’ll all be here to kick your butt to pay off those cards when you are in a secure financial position! 🙂

  2. Laura says:

    I think you should definitely bulk up your e-fund. I’ve always heard it’s a good idea to have at least a three month reserve in your e-fund.

  3. I agree with Life as a Purse. I think you need to hope for the best, but plan for the worst. As you say, if there’s an 80% chance it’ll all blow over then you have nothing to worry about, but this way you’re at least covering your bases if, in fact, you do end up leaving. You’re still making decent payments on your CCs and having worked so hard to get to this point, it would be disheartening to say the least to have to rack them up again because you weren’t prepared. I think six months is plenty of time to be able to suss out how the situation is going and change your plans. Good luck!

  4. Jessie says:

    Hey there Lady… second what life as a purse said. Continue CC payments at $500/month makes the most sense right now if you put everything else in your emergency fund. You said yourself that you don’t know if you would ever have the motivation to pay off your CC again, so avoiding using it while preparing for job less is an excellent strategy!

  5. Airam says:

    I’m in agreement with Life as a Purse. Pay off your credit card at $500/month while saving the additional $1000 in your emergency fund.

    And try to not stress too much, when it’s all over (and it will be soon) everything will work out for the best.

  6. Have you looked into lowering your CC rates wit P2P lending? I know Money Funk did that successfully with Lending Tree. I’m not sure what you’re paying now, but maybe you wouldn’t lose quite as much in interest by holding back some cash.

    And I do recommend holding back some cash. Especially because of the new credit card rules that come into effect next month, there’s no telling what the CC companies are going to do. Raise our fees, cut our limits, who knows? There’s no way I’d rely on my CCs for EF money, even though I’ve got about 40K in credit lines atm because I want to be able to cancel them all if necessary.

    Sorry to hear that your job stuff is not going so well, but it seems like you’ve got a good plan for handling it. Looking forward to hearing how it all works out.

  7. I think it’s wise to reduce the payments to $500 but keep the extra in an emergency fund. If things become more settled or you find another position you’re happy with, then you can safely put that extra money toward the debt. In this case, sounds like it’s better to be safe than sorry. Good luck!

  8. Revanche says:

    As Option 1 was my strategy (minus the CC situation, but same difference) when I was expecting a layoff, I can vouch for it. It’s definitely a good idea to keep the cash on hand because you can always use the extra cash if you need it, or pay down the cards with a lump sum later on if you know you’re ok.

    Good luck!

  9. eemusings says:

    Aw, you’re welcome!

    Like everyone else, I think your idea to beef up the EF is the way to go. Cash is king! And you’re right, it could be hard to motivate yourself to pay it off again should you end up running it up later on.

  10. WellHeeled says:

    I agree with everyone here: in times of uncertainty (or in times of layoff), cash is king. Bulk up your emergency fund while you can and hold off on super agressive CC payoff for now. Once you have a more clear vision of how the chips might fall, you can reevaluate your decision. Best of luck!!

  11. NoRearView says:

    I have been following your blog from the beginning, but have been hesitant to post because, like you, I like to retain my anonymity. Lately though I have been having some thoughts that I haven’t heard anybody else bring up and am willing to break my silence to offer my opinion. First, I thoroughly enjoy your writing style. You seem very comfortable, like the words just flow from you as a stream of consciousnesses. Second I would wholly enjoy being added to your relationship blog, I feel a lot of who you are was lost when I couldn’t access that part of your life anymore. I don’t really want to publicly post my email though, is there a private way to do this, I have no problem giving it to only you.

    A few weeks past you had a problem with you paycheck coming late and screwing up you finances, I personally bank with the local Credit Union and they offer a line of credit loan. I thought a person of your standing should be able to get one of these relatively easily. The limit I have on mine is one months worth of necessities (rent, utilities, etc.). The interest is much lower than a credit card and it only gets used if there are no funds in your account. Just a thought.

    As for the above situation, it was difficult for me to decide if you were upset with your boss or the situation you/he put you in. You have to find your passion and figure out what’s the best way for you to develop that passion. If you’re upset with your boss because he did something deceitful remember that poor leaders show you the way NOT to lead. I’ve had plenty of bad bosses and each one of them has taught me something useful.

    My thought on the money matter above is it sounds like you just want to hear everybody tell you your right! Ha. The rational you have laid out sounds like something a financial planner would lay out for a person that was asking their advice in this same situation. If you think you’re going to need your money save it in a way that lets you access it, if it turns out you don’t then you have a huge lump to throw at your debt. Sounds like solid planning to me. I hope everything works out in your favor!

    For at home food ideas there are plenty of disgruntled employees that post restaurant recipes on the internet. I find that they are very close to what you get in the establishment, but way cheaper to make at home.

    • SS4BC says:

      Thanks for your thoughtful comment.

      The truth of the matter is that I’m not upset with my boss really. He’s upset at me for good reason – I FULLY deserve his anger and will be the first to admit that. The things that I don’t like about my current situation stem from personal conflicts in the lab coupled with my hesitancy that the career path that I’m on. I’m not sure if this position is the best place for me PERSONALLY anymore.

      So, I already have had career hesitancies before any of this went down (remember before all I this I was considering this other job and doubting my current position), but the recent troubles at work have just furthered my resolve to try to figure out if this is REALLY what I want. I’ve spent so long following the suggested path that I never stopped to consider if I wanted what was at the end or just like that the path was so long and challenging. Now that I’m nearing the end, I don’t like what I see at that end point.

      Thank you again for such a thoughtful comment.

      I’ve actually put a hold on the relationship blog for now. It is private to everyone but me for the next little while. I’ll be sure to let you know if I re-publicize it.

      • NoRearView says:

        Well I hope you sprinkle some of your more benign relationship musings in here until then! I do remember that post, but thought it sounded more like a desperation move than something you actually wanted. I think you also have to take into consideration the current situation you’re in and how that will change in the near future given your choices. If it’s conflict in the lab will that necessarily change moving to another similar place (industry), or will being the boss (academia) move you from that situation and place you in a true collective of your peers.

  12. I’m casting my vote for temporarily shifting your emphasis to increasing your E-Fund. I find that the increase in security I feel from seeing my e-fund go up is much greater than the extra $20 or $30 I find to throw at it — it’s like it is worth $200 or $300 to me in terms of peace of mind.

    I feel for you with your career quandary. If this is a simplistic recommendation, just ignore it, but when I was considering returning to school, and wondering what professional schooling I wanted, the book _What Color is Your Parachute_ was very helpful to me, as was discussing my options with a career counselor.

    Continued good wishes to you!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: