Happy Birthday to Me

Here's what I gave myself this year:

• I enrolled in my employer's Flexible Spending Account (FSA) for 2009. I started this job in January, right after the deadline 2008 had passed so I'm excited to be able to participate in this again (I have done this with previous employers). I put in $400 for the year, which may not sound like a lot, but it will pay for a new pair of eyeglasses and a pair of sunglasses. It will also cover any prescriptions I may need to get during the year.

If you've never done a FSA before, here's the scoop - its money that is put away pre-tax for medical expenses for you or your dependents. The method of how you spend it depends on the company - some give you a debit card to use, some have you pay up-front and then submit for reimbursement. The nice thing is that its pre-tax. The not-so-nice thing is that if you don't use up all the money in your account by the end of the year, its gone. I think I may have heard somewhere that may change in the near future though.

• I increased my monthly after-tax contribution to my Roth IRA account from $80 to $90.
• I increased my monthly pre-tax contribution to my 401(k) plan from 6% annually to 7%.

These are small changes, but over time, they will really add up. I'm amazed at how much I've saved towards retirement in just the four year time span I've been socking away money - not including the stock market's recent activity of course. I'd love to save even more, but I also have to keep in mind my short-term savings goals, such as an emergency fund and eventually a downpayment for a house.

In six months, my car will be fully paid off (I cannot wait!) and that will free up more money each month to save. My payment now is $265 a month. The game plan is to save $200 a month for a new car (I don't ever want to have to make a car payment again and I plan to drive my car as long as possible so I'll have a while to save) and save the extra $65 a month either towards my emergency fund or downpayment fund, or maybe a little into both. We'll have to see how it pans out at that time. Also, when my car is paid off, I'll also be able to drop some insurance coverage (comprehensive I think? I can never remember which is which off the top of my head) on my car to save a bit more. I have to have that now because my car loan is financed through Honda and they require full coverage.