My husband and I are weird. I mean really weird. We live in a small 1950′s house that isn’t perfect and requires us to do manual labor on a fairly regular basis. Our newest addition to our vehicle fleet was a 1990′s Chevy truck and our newest vehicle by age is from 2004. We don’t do flashy. We don’t care if our lifestyle impresses our friends and neighbors. My husband and I try to live within our means, pay off debts from past mistakes (of which there were many) and look forward to a debt free and prosperous future.
This journey isn’t always easy and we stumble and bumble along the way, but we have each other to report to, so we stay in line for the most part. If we want something we wait until we have the money to buy it. We sacrifice, a lot, but we’ve already paid off around $10,000 in debt and for the first time in almost 14 years I don’t have to stress about if there will be enough money to make sure all the bills will get paid. A huge weight has been lifted off my shoulders when it comes to finances and I can see the light at the end of the tunnel and that light is debt free living!
For us this journey started with Dave Ramsey’s book The Total Money Make Over (http://www.daveramsey.com/store/books/dave-s-bestsellers/the-total-money-makeover/prodtmmoclassic.html). The book resonated with me so loudly as I read about how people, just like me, “were sick and tired of being sick and tired” when it came to their finances. I decided to take the plunge and try Dave’s plan. His babysteps are:
1. Save $1,000 Emergency Fund
2. Pay off all debt using the debt snowball
3. Build a cushion of 3-6 months of expenses
4. Invest 15% of your income into retirement
5. College Funding for the Kiddo’s
6. Pay off that House
7. Live and Give like no one else.
(You can find out more about Dave and his plan here at his website http://www.daveramsey.com/home/?snid=home)
The biggest challenge of Dave’s method is the budget. It challenges you to make your money work for you instead of it just magically disappearing after each payday, but it works. If you sit down and write down where you want all your money to go and then follow that plan over the months, your money starts listening. You don’t have to figure out where it went anymore because it all has a place to go. For me being a bit of a nerd, writing the budget down is the easy part. Sticking too it is sometimes a little more challenging. It took a few months to catch on as sometimes unexpected expenses do arise and when that happens you have to go back to the drawing board and rework all the numbers, but if you stick with making a budget and living off the budget I promise it helps! Dave has made budgeting even easier with his new budgeting software Every Dollar (http://www.daveramsey.com/everydollar/?ictid=ag43). Check it out, it’s FREE.
Now, I won’t lie and say I follow Dave’s plan perfectly because I don’t always. I went a little out of order on my debt snowball and my emergency fund might be a little bigger than $1,000 but in my case we have expenses that come up quarterly or yearly so those expenses have beefed up our emergency fund so that we have them when the payments come due. I’ve also learned how to work a little magic with money since starting Dave’s program, so often the money earmarked for the quarterly expenses can stay in the savings account and I can wiggle the expense out of the monthly budget. This plan really has changed my life. Stress has decreased drastically and my husband and I fight less about money because we have a common goal we are working towards. Communication is key! So I present this challenge, if you were like me and are “sick and tired of being sick and tired” when it comes to your finances, give it a try. It can’t hurt any worse than what you’ve already done…
Peace and Blessings!