If there’s been a common theme for this year for me, it’s been “savings”. I’m still on track to eliminate credit card debt by the end of October, but about a week ago, it hit me. I want to own a home. It’s been a passing wish for years, and I’ve browsed real estate listings off and on since the bubble, but it hit me hard this week, as I did my bi-monthly review to make sure I was still on track financially.

I want to own a home.

Until now, my financial views have been relatively short term: get out of credit card debt. I made a goal I could stick to, with a detailed plan, and I’m following it. But that just took me from January until October. I also knew that the money I was now spending on CC debt would be diverted to savings, and that savings may one day buy a house, but I had no sense of time scale, and I wasn’t too motivated to figure it out. Now that’s changed.

I want to own a home.

I made a spreadsheet. A couple, in fact. I’ve got some pretty ambitious plans, but as far as I can tell, it’s not a stretch. This is all money I’m spending anyway, so I’m not overextending myself in this plan.

  • I’m currently paying $720 per month for credit card debt, and saving $202.12 per month in what can solidly go toward buying a home. (It’s actually closer to $250 in liquid savings, and if times are good, I’m skimming off the excess “immediate savings” into “home savings”, but I’m not counting that toward long-term savings.)
  • By the end of October, I will have my credit card debt paid off. I’m over half way to that goal, and on track.
  • From November on, half of that, $360, will got toward extra principal payments on the car. The other half will go toward long-term savings.
  • In December 2011, I should be making the last payment on my car, 25 months and $10,273 early. At that point, I should have about $18,000 in savings.
  • So now I have $202.12 per month in base savings, a full $720 per month in what I was originally spending on credit card debt, and now $455.26 per month that is no longer being spent on a car payment. That’s $1,377.38 per month. Yow.
  • With $1377.38 per month being saved, it’s only a short 10-month jump to September 2012, at which point I should have $30,386.57, a tidy down payment for a new home.

So that’s my 40-month plan. What’s yours?

I want to own a home.

The problem with all this planning and attention is I’m pretty jittery and excited about the whole process, and we’re talking about something that is at least 3 years out. I’ve been looking through listings on Zillow a lot lately, thinking about crazy “what if” scenarios. The real estate market is great for buyers right now, for obvious reasons. However, I’ve found a great guide entitled How to Buy a House, and it’s actually very good at convincing me that I shouldn’t buy now, even if I technically could. See, even in a good banking economy, my debt to income ratio would be too high with both home and credit card debt. No good banker would lend to me now, even with my excellent credit rating. Of course, the scary thing is I probably would have been able to find a not-so-good banker before, even up to a year ago.

Still, the only thing I hurt by browsing Zillow listings is my sanity.

I want to own a home.

Food for thought: In these next 40 months, I’ll be spending $37,200 in rent.