I was updating my net worth calculations, and it got me thinking: What am I saving for?
My current financial goals are not very specific. Many pf bloggers have noted their short and long-term goals, often using nifty status bars. They’re saving for an emergency fund, or a new puppy, or a down payment. And I realized that I’m just saving to be saving. At least for the short term.
My goals are stepwise. First goal is to have a positive net worth. Then I want to eliminate all debts (currently $60k+ student loans and $17k+ car loan). After that, I guess I’d be saving for a down payment.
I think I’m sometimes just saving for the future, but I have no idea what I’m going to use that money for in the future. Will I be buying a house? I hope so, assuming it’s the right time and place for it. And if marriage and kids are in my future, will I be paying for the wedding? I’ll need money to raise kids, and maybe consider putting money away for their college education. But really, I think I’m just hoarding money, with the intent of having it around in case I find myself in need. It’s almost as if all of my savings is one big Emergency Fund. The money’s there if I need it, but I don’t really have a plan of ever using it.
I realize that I could probably use some of my savings to pay down my debts. But I just feel safer having a larger emergency fund than having a smaller debt, even though, mathematically, it’s not the best choice.
Should I start creating a “fund” for everything? My long-term financial goals seem so far away. I feel like I’m just saving and avoiding spending, and hoping that it will all fall into place.