J.D. is on vacation. This is a guest post from Katrina Ramser, a freelance writer who contributes to various websites, newspapers and magazines. She also writes about swimming at SquidKid and about cars at Vehix.com.

I’m predicting 2009 will be a fantastic financial year for me. Not so much due to any income figure or increase or another form of windfall money, but rather because of my bottom-line affecting attitudes. Here are six reasons I am looking forward to the new year. 

No monthly debt payments
I pride myself on having read a slew of financial books. Elizabeth Warren has helped me to discover all my worth, David Bach to be a woman who finishes rich, and Suze Orman to be young, fabulous, and broke. But it wasn’t until Dave Ramsey’s Total Money Makeover that I understood who I was in spite of all my idealist financial thoughts — a serial debt recidivist. 

Until now, I’ve carried debt since I got my first credit card, nearly 14 years ago. I did stupid things at first, but over the years refined how I manipulated myself to live just a little beyond my means. I’ve put some of the best excuses I’ve ever had on my credit card:

  • Online tax software, so I could file my own business taxes instead of paying an accountant.
  • Training dues for a fitness class, so I could make more money teaching a water aerobic class.
  • A plane ticket to Chile, so I could participate in a Habitat for Humanity program and build houses for the poor.
  • An expensive professional camera, because I had already been hired for several well-paying photography jobs by a trusted client.

I began 2008 with Ramsey’s reality slap, $4,884 of combined credit card and student loan debt. Inspired by Ramsey’s toughness, I made $450 monthly debt payments. This meant I said “no” as much as I could and lived with few perks. This allowed me to kill the debt for good. It won’t grow back again.

Living greener (another way to spend less)
I’ve replaced old habits with new ones. I used to love to window shop, wine binge, read fashion or home magazines, and worry about a non-existent expendable income for any of these things I coveted. Because I spent last year applying every available nickel for hefty credit card payments, I turned to canning, gardening, bar-be-queuing, baking bread, dying old clothes into new outfits, cutting my own hair, raising chickens, bartering my goods for other people’s goods, and being greener by using a line drying system, unplugging appliances, and walking — activities that all actually teach or produce something useful.

These are habits I’m going to keep in the New Year, mainly because they’re much more satisfyingly than a J. Crew jacket.

Riding the highs with the lows
As a freelance writer and photographer, riding the highs with the lows of unpredictable income is part of the process. Almost immediately after committing to my credit-card payment goal, I lost a major $20,000 a year client. That’s a lot of money for me to lose!

Money was tight at first, but I brought in five new clients during the first half of 2008. (And I probably put in a quarter of the effort I thought I was going to have to in order to do so.) By the fall, I added my sixth and highest-paying client. By gracefully accepting the loss of one client, I fell into a very organic, safeguarded plan to increase and diversify my income.

With freelance work, I’ve learned that when questionable things happen, you have a choice to either dwell upon the negative or quickly switch the puzzle pieces around to make a working, positive picture. You have to if you want to survive. But this isn’t just true with freelance work. A normal, fixed-salary job can also have unfortunate surprises — only you get side-swiped harder because you thought you had the right to let your guard down.

Correcting previous financial mistakes
Last year I learned that no matter how much you think you know about managing your money, you can always learn more. And you can still make mistakes. I made a whopper last year.

A client sent me a 1099 one week before 2007 taxes were due. It was for a significant amount of money. This client was a friend, and I thought we had agreed the work that I was doing for her was not going to be claimed. That means I didn’t save the appropriate tax dollar amount.

I know it is illegal to not receive tax forms by the end of January, and I know it is illegal to not claim all your income. That’s why this whole issue was a financial mistake on all accounts. To make matters worse, the tax funds I did manage to save &madsh; which tallied to a risky 20% of my non-taxed income — acted as my emergency fund account.

April wiped me out completely. My spirit and efforts were derailed. Learning from my mistakes, I immediately established a separate savings account with a decent percentage rate and have placed 30% of all my 2008 non-taxed income into it. I’m not going to screw myself over twice with this one!

Making my job pay for some major expenses
It’s no coincidence that I have gravitated toward writing about cars and swimming. Doing so helps make ends meet. Vehicle makers want me to get behind the wheels of their product and drive on their gas dime. For the past five months, I haven’t driven my own vehicle, which means I didn’t have to buy gas or pay for maintenance fees. Some of you know from a previous essay at Get Rich Slowly that I drive one very boring, unattractive, hand-me-down 1996 Chrysler Cirrus, which has attractive yearly insurance fees of less than $400.

As a swim instructor, I have a free membership to a wonderful community center where I can watch television at the treadmill, catch up on magazines in the sauna, and use their water (as well as body wash, shampoo and conditioner). They have also paid for a portion of my training so I can teach more classes and make more money. And I get a discount at a local swim shop on swim equipment.

Sticking to realistic financial goals
I am not where I should be with my Roth IRA goals. If my car goes kaput on me, I will have to take a loan, putting little down. Lose another client, and the emergency fund won’t pay for much more than one month’s rent. I’m ashamed to admit I am one of the 45 million Americans without health insurance, and need some in a big way because I have some major dental work in the future.

A lot of my financial goals are still at the starting gate. I’m like anyone else trying to do a good job with the money: Attempting to feed my mouth, have something left over for investments or savings, and still like myself and what I do. I do care more about my money more than anyone else, but I struggle to have enough to complete a perfect balanced money formula.

  • Was it right to keep steady with a monthly retirement deposit while I was slowly paid that debt off?
  • Is it 20% of my income I should save in an untouchable IRA? If so, am I still advised to drop another percentage into an accessible savings account?
  • Is my savings for my Dream Fund? Or is it for the Freedom Account and unexpected-expected costs?
  • Wait. Maybe it’s money for my Emergency Fund. But I really think I should have health insurance before that goal is met, so I need to readjust my budget.
  • And when do I get that long-awaited vacation again?

I guess the more you learn about personal finance, the more you create paths to the journey’s destination. But sometimes it feels as if I haven’t even left the driveway! In 2009, I might just have to be content with the satisfaction of knowing I can keep the car running.

You can read more of Katrina’s writing at SquidKid and Vehix.com.

This article is about Planning, Real-Life  Monday, 29th December 2008 (by J.D. Roth)