How We Lost Sight of the Big Picture

It is fairly obvious that we are hyper focused on paying down my girlfriend’s student loans. I have been writing a lot about it recently with posts like Debt Pay Off Updated – January 2013 and How We Set Up Girlfriend’s Budget.

It is awesome that we’re working to pay her debt off by the end of 2013 but being hyper focused on her debt caused a problem with our finances.

We Lost Sight of the Big Picture

Joe at the Free Financial Advisor said it well when he wrote that Getting Out of Debt Isn’t a Goal. He says

When you reach the summit and actually get out of debt, you shouldn’t be surprised when you bellow out a gigantic “WHAT NOW?” You have more money, more freedom and more flexibility. What do you do with it all these new resources?

We have been so focused on paying off my girlfriend’s debt that we didn’t have any solid financial goals. What do we want to accomplish with our money once the nasty debt monster is finally slayed? We have some general ideas but we don’t have a solid game plan yet.


Our number one priority post student loans is to set ourselves up for a secure retirement. Currently my girlfriend is only contributing 3% into her 401(k) at work. This is enough to receive the full match from her employer, which is the main reason why she is contributing to her retirement at all.

The interest rates on her student loans are high enough that we felt comfortable not putting more toward retirement while we attacked her student loan debt. However, 3% is nowhere near enough after the student loans are paid off.

We’re both still young so we don’t have a ton of catching up to do to get where we should be in terms of retirement savings. We will be kicking up her retirement contribution percentage to between 15% and 20%. This should be easy because she’s not used to spending the money she pays toward her loans so she won’t miss it.

Car Replacement

I will be using my car replacement fund to help my girlfriend pay off her student loans so my car replacement fund will be at $0. She doesn’t have any savings specified for a car replacement either so we will be rather behind in this category.

Luckily we both have reliable cars that should last us many more years. Her car should last at least 3 to 5 more years (if not more) before giving us any major problems that would require us to get a new car. I’m hoping my car will last us 7+ more years!

Even though our car replacements are many years away it makes sense to start saving for replacement as soon as possible. We’ll aim to have a few thousand dollars in savings within a year of the student loans being paid off so if something bad happens we can either fix our cars or buy a cheaper used car to replace our failing car.

Our Next House

Our last goal for our money after my girlfriend’s student loans are paid off is saving for a down payment on our next house. We bought this townhouse because it fit our needs for the immediate future (3-7 years) and we knew that should we decide we wanted to move it’d be a great first rental property.

We have a couple ideas of where we’d like to live down the road. We could either buy a larger house in town or we could buy a condo on the beach. We’re not sure which way we’re going to go yet but we’re leaning toward the condo route. Either way, we’ll need a down payment because we don’t want to sell the townhouse.

We’ll start shoveling all of our left over/extra money into this account so that we can move when we’re ready. Then, once we move into the new place we’ll tidy up the townhouse we currently live in and rent it out! Then, if we ever want to downsize or have a yard again all we have to do is rent out our new place and move back to the townhouse!

Big Picture Back in Focus

We’re glad that we took some time to figure out what we want to do after my girlfriend’s student loans are paid off. If we hadn’t come up with a game plan we’d either have a growing bank account with no purpose or we would find other frivolous ways to spend our money.

Do you have a goal for your money once your debt is paid off? What type of debt are you working to pay off right now? If you don’t have any debt, what is your number one money goal?

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About Lance Cothern

Lance Cothern, a Certified Public Accountant (CPA) licensed in the Commonwealth of Virginia, is the founder of Money Manifesto. You can read more about him here or connect with him on Facebook, Twitter, Google+ or Pinterest.


  1. These are awesome goals, Lance. I think it’s great that you two are working so hard together on this. I am just trying to head off our student loans so they aren’t epic when my husband finishes school. So I’m trying to pay off mine now and pay a little interest in his so we can at least have an easier time of paying them off in a few years. Great job on this so far!

  2. For a while, our goal was working and paying everything down so we could take a year off, but that seems to be morphing into add a few more years to working in order to take off forever and leave the structured employer/employee relationship behind forever. But either way, the debt needs to go first.

  3. Tony@YouOnlyDoThisOnce says:

    Lance, this is all awesome! I am assuming this “girlfriend” will be called a “fiancé” soon? I mean, wow!

  4. I remember reading that article from Joe awhile back and he definitely made a great point. Getting out of debt isn’t my primary goal by any stretch but it doesn’t mean we’re not focused on it. The only debts we have left (other than our house) are student loans. Hopefully things will change but we’re trying to pay at least $300/month extra towards our smallest SL and the rest is going into emergency fund savings and for a house down payment.

  5. Good luck with your goals! We definitely want a new house next year (I say this like every day haha) and a new car. Ahh I’m a bad pf blogger.

  6. Those are some great goals Lance and many are one s we had when we were getting out of debt. Getting out of debt really is not a goal like you stated, because you could potentially fall right back to bad habits if you don’t start analyzing your priorities while paying off the debt. Thankfully all we have left is our mortgage and are working on many of the ones you listed.

  7. You always need a plan! Even if things change a plan keeps you focused. Good luck.

  8. Its good to take a step back every now and again to see the forest from the trees. My problem is not so much debt as it is focusing on generating income (so we can retire early). From time to time, I have to put down my laptop or close my book, and remember to give my wife and kids the attention that they need. The main reason that I want to retire is to have more time to spend with those that matter. So it would be pretty ignorant of me to get so caught up in that goal that I neglect to spend time with them right now!

    • I can see that happening to me one day. Thanks for the advanced warning.

      The biggest percentage of income you save means you live on less of your income and might not need quite as much income in retirement! Keep that in mind. Depends on how you want to live 🙂

  9. Hahaha, yes man, it’s so true. THat happened to my wife and me when we finally crawled out of debt. There suddnely wasn’t these monthly payments and we thought, “Uh, so uh, well.. uh, now what? How do people get rich from here?” Lol, it’s funny but true! We started to learn about investing more and stuff.

  10. Those are great goals! I’m so far from redefining our goals beyond debt freedom I don’t even know what they’d look like!

  11. If I ever get out of making some payments off my student loan, I think I’ll add it to my principal for my mortgage. I wish I can live debt free one day.

  12. My big picture was to get out of debt. Since I completed that, my next goal is to save for a down payment. After that, retirement.

  13. All great ideas! Mine would be to fill up some more of my emergency fund and the rest would go to retirement, and hopefully just a small percentage to travel. But with retirement, I have a lot of catching up to do.

  14. All these goals are great ideas, but there’s more to life than just paying down debt. I took a very similar route as you on my debt/student loans and it was exhausting, but I was also moody and a pain in the ass. Why? I lost the site of the big picture and forgot how to have fun.

  15. Having goals is important. Otherwise, it’s easy to become unmotivated.

    Right now, my big goal is paying off my student loan. I put $500 a month into it, plus any extra money that I earn (usually between $100 and $500 a month). I’m hoping to be all paid off in 2 years after which… I am not sure. Haha. I have a vague notion of increasing my TFSA investments and increasing my monthly mortgage payment.

  16. Love reading other people’s goals. We too plan to rent our condo out when we move to a bigger place (probably in the suburbs). Our goal for now is saving as much money as possible to put into a down payment for an investment property.

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