So, as some of you know (who have been paying attention), I have started implementing some of Dave Ramsey’s wit and wisdom into our financial well-being. And while, as I have said before, I am usually leery of anyone who is all “Jesus-y” (yes a word, deal with it), I find a lot of what he says to be pretty common sense-based, and it all makes sense. So I read “Financial Peace”, “Financial Peace: Revisited”, and “Total Money Makeover”. Let me tell you. I took more notes while reading these books than I did in most of my grad classes. Seriously. SO much of what he says just is so simple. It blows my mind that I had to READ about these things, but then like my wise husband said, “If saving money was easy, no one would talk about it. They would just do it.” Which, duh, makes sense.
So, we began the cash envelopes, and those are working like a charm. Like, I am SO in love with that system. Every time I talk about these with someone, they tell me that they either implement them or their dad does. It always seems to be older people (not saying my friends are old, but I mean older than me) because their grandparents and parents did it. Which, duh, makes sense. During the Depression, they did it because they couldn’t trust banks. So that’s awesome. It’s an old system, tried and true, and I am SO proud of us for keeping up with it. Now it’s kind of a pain to go to the bank every time we get either unemployment or I get paid, but I do it with a smile. My bankers love me, and they know what I am doing. They ask how it’s working, which is fun. So, cash envelopes, check!
Zero line budget, DONE! Every dollar that comes in has a name, from savings to bills to envelopes. This is easier than I thought it would be, and with February done and almost over and March already mapped out, I can’t complain. 🙂 And then, of course, the goal is to STOP BORROWING and stop using credit for purchases, and that’s just basic common sense when wanting to budget and live within your means. We have accrued ZERO CC purchases and NO extra debt because I refuse to!
Dave Ramsey also talks about Seven Baby Steps to Financial Freedom. And while I don’t know if I will ever get to the light at the end of the student loan tunnel *though I am working on it!!*, we started following them as well. Baby Step One is to have $1000 cash in an emergency-only fund. This is a fund that is not quite savings, can be used if needed, and should always be (if used) at $1,000 to start. Well, folks, 107 days into a layoff when all seemed lost at first, we have done it…
I can’t believe we got there as quickly as we did. It seems like we JUST said we’d try it out, and BOOM! Step One, done. 🙂 Now, let me say we started at the beginning of the layoff with more than $1000, but with bills and life and whatnot, we had to use some of it. Until I got the budget down, I had to use it to cover things. But with the zero line budget, and not spending money on anything that we do not need, I am able to only utilize my paychecks and my husband’s unemployment. So, I was able to save what we had left of our original miscellaneous money, add in as we could, and today we rounded it out to $1000. It will grow, of course, but to be able to say we have it and don’t need it…is…awesome.
Step Two involves the Debt Snowball, and the point of that is to write out all of your debts and start paying them off, smallest to largest. EXCEPT for the mortgage. He handles that in a later step. So, I did what I was supposed to, and yesterday morning, I wrote out our Snowball plan, and putting it on paper makes it so much easier to see. We have two small balances on zero interest cards, like I said before, and those will be handled AFTER we pay ourselves from our taxes, whenever we get them done. I am putting that off on purpose because I don’t want to be tempted to live off of them. I want to keep our budget as it is, and then the taxes will go to our savings and our debt snowball. After those little balances is my husband’s car, and I figured out how to get it paid off within three years. THAT is an awesome feeling. To see it in front of me, and how easy it will be to get it moving, really makes me want to tackle it with “gazelle intensity” like Dave says. After car is student loans, and those… I don’t even want to think about how long that will take, haha. Now, I was going to wait for the Snowball until my husband gets back to work (soon we hope!!), but then I figured, why wait? I will do what I can now, and then really get into the thick of it… I don’t want to lose momentum, or focus, and I have already proven that nothing is impossible if you want it bad enough. God provides, but you have to want it bad enough to work for it.
Step Three involves saving 3-6 months of expenses and income, and that will come after I finish the debt snowball. I might work that alongside the student loans so as not to lose ground on savings, but I have that figured out (of course I do!). No slowing me down, friends. Onward!
So, step one, done! Bring it Step Two! Let’s do this!!
(I am listening to The Boss’s song “Jack of All Trades”, and he just sang a line and in it was, “God provides…” Hello, perfect timing!)