I am roughly following Dave Ramsey's Total Money Makeover plan, but I've modified it to meet my needs and circumstances - namely, my impending move to LA. Instead of throwing all of my extra income at my debt after I fund my baby emergency fund, I'm instead going to continue saving for the many components of my moving plan. My reasoning:
- My student loan debt (the only debt I carry) is small (less than $5,500 total)
- The interest rates are very low on these small debts.
- My total minimum monthly payment is currently only $84, and that's the highest it's going to get.
- One of my three loans will be paid off in six more months.
- I am not sure how much my income will increase. The additional $5.5k could potentially delay my move by a year.
My combined fund contains the following components:
- Emergency fund + cushion: $3,000
- Used car: $5,000
- Car Insurance (6 mos): $800
- Plane ticket to parents' (to buy car and pick up belongings): $300
- Shipping current belongings home: $200
- Moving expenses: $1,000
- Sublet/lease rent+deposits : $1,800
- Total: $12,100