May 20 2009

Break your big goal into chunks


It can be hard to stay motivated when paying off debt or building up savings when the amount is a rather large number.

It’s easy to look at how much money we want to save before buying a house and think, “That’s so much money. It’ll take years for us to get there. Why even bother?”

After all, it’s easy to do nothing. It’s much harder to be disciplined and save tens of thousands of dollars in a short time.

To tackle this behemoth of a down payment (and all that goes into it), I’m going to break it into chunks. It’ll be easier for me to see actual progress and stay motivated to keep on going.

I’ll track our overall progress in a widget in my sidebar, and I’ll keep the break-down progress listed under that.

We’re saving for:


  • Moving costs 
  • Emergency fund – Since our monthly expenses will go up, our emergency fund will need to as well. Once we see our actual numbers we might need to adjust it.
  • Immediate customizations – When we move to a house, we’ll need to get some things right away. Might need to buy some appliances, a lawnmower, tools, lightbulbs, weatherproofing, etc.
  • Prepaids – We’ll need to pay a year’s worth of property taxes and homeowner’s insurance up front.
  • Closing costs – Yes, we can finance a portion of this, but we’d rather not so we can save money over the long haul.
  • Down payment – Five percent of the purchase price is our miniumum, but hopefully we can do at least 10 percent. I don’t know if 20 percent would be doable in a few years, but we’ll see.
  • Furniture –  We have minimal furnishings right now, since we have minimal space. We’ll want a couch at the very least when we move.


To me, even though the dollar amount is the same, it’s starting to feel more doable now that I’ve broken it apart.

If you have a lot of student loan debt, you could try breaking it into years you were in school. Have $40k in student loans? Then break it into the four years you were in school, or how many semesters, perhaps. Tackling $5k or $10k at a time doesn’t sound as scary as $40,000, does it?

Or if you’re saving for an emergency fund, work on achieving one month at a time rather than being daunted by the full amount you want to save. 

How do you work toward big financial goals?

Posted under Uncategorized | 11 Comments »

11 Responses to “Break your big goal into chunks”

  1. Hey, Kacie

    I just wanted to tell you that insurance and property taxes were included in our closing costs when we bought out home 7 years ago. The total closing costs that we paid were about $2200.

    You’re very smart to be planning for these things so far in advance. Good luck

  2. Sounds like you got a great deal! When we spoke with some mortgage lenders, they explained to us that closing costs and prepaids were separate things. We could expect $3k to $3,500 for property taxes and insurance in addition to about $4,000 to $4,500 in closing costs. Ugh.

  3. That’s such a great idea, I never thought to look at it that way. I’m trying to save for a house too and it seems unattainable. Thank you for the tip, I’ll certainly use it. Love your blog!

  4. Another potential piece of motivation- interest rates. It would be ideal to lock in a long-term, low-interest rate asap before they start steadily increasing to curtail the imminent inflationary pressure.

    It’d require some number-crunching, but it could potentially make sense to buy sooner, assume more debt, but lock in a much better rate.

    Congrats though on actively working towards your goals. I’m reading ‘Think and Grow Rich’ right now, and Hill keeps reiterating the importance of a defined plan backed by a focused, persistent effort. Seems like you’ve got that down!

    As for the question you posed to us, I too like to break savings objectives down into smaller, more psychologically-friendly chunks. ING helps tremendously.

  5. That’s an awesome way to look at it – I LOVE the idea :)

  6. Kacie, that point about the student loans is awesome. I am slowly chipping away at over 6 figures of student loan debt (med school tuition is insane!) I’ve paid down about $7,000 so far, and I think it would help to “check off” each semester as I get it paid. Thanks for the great idea! Good luck on saving for the house.

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Hey! I'm Kacie, wife and mother of 3. I write about my family's finance: how we save money, improve our spending, and plan for the future.

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