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Getting Out of Debt, December Edition

post #1 of 116
Thread Starter 
Brr, baby its cold outside. Lets get moving on that debt reduction. We had some good success last month, we had a car paid off, some credit cards paid off and a lot of people snowballing like crazy.

Its december which is notoriously a bad month for falling off the wagon. Lets keep each other on the straight and narrow. Who is in for a month of getting out of debt and getting into financial shape? Most of us use Dave Ramsey's method but please join us even if you're following someone else/your own plan. All welcome!

Here's DR's plan:

These are the Baby Steps:

Pre-Step 1: Get current on your debts and do a budget
0.1 Commit to NEVER borrow $$$ again
0.2 Talk with spouse and get him/her on the same page as you concerning finances.
0.3 Do a written budget
0.4 Temporarily stop all retirement contributions
0.5 Get current on all the basics (Shelter, Food, Utilities, Basic clothing)
0.6 Amputate "toys" (bikes, boats, ATV's etc) if they will keep you from completing the snowball within 12 months
0.7 Cut lifestyle (Cut CATV, Cellphone, Regular phone "extra's", Internet, Eating out, etc) and/or take second job if $1000 EF will take more than 30-90 days.
0.8 Get current on ALL bills

BS1 $1,000 to start an Emergency Fund
1.1 Chop up/freeze CC's (You have an EF now)
1.2 Get Health insurance NOW if in the US (chances of getting sick w/ major medical bills are larger than that of death)
1.3 Get Life insurance NOW if you have considerable debt/your family couldn't make it financially if you died.
1.4 Amputate cars that you can't pay off within 24 months
1.5 Consider raising insurance deductables to $500 or $1000

BS2 Pay off all debt using the Debt Snowball
2.0 Do the debt snowball, paying all your debts from lowest BALANCE to highest.
2.1 You can take your first vacation since finding Dave if you can pay cash for it (no using the EF !!!)

BS3 Three to six months of expenses in savings
3.1 Start car replacement fund
3.2 Save up 20% for home purchase OR pay down existing mortgage to the point you can drop PMI.
3.3 Start furniture or other non-essential stuff replacement fund

BS4 Invest 15 percent of household income for retirement

BS5 College funding for children

BS6 Pay off home early

BS7 Build wealth and give! Invest in mutual funds and real estate


Here's the link to Dave Ramsey's website:

www.daveramsey.com

Please join us!
post #2 of 116
Thread Starter 
If you need added or removed from the list, or I got your details wrong just let me know and I'll fix it.

Pre-Step 1
anstar
BelovedK
BonnieNova
dfunk98
eirual
greenmom4
kittywitty
lactivistmama
luckybamboo
madsommer
MamatoWill
Miasmamma
Stephenie

BS#1: Save up $1000
2lilsweetfoxes
annettemarie
Contrariety
CookiePie
crunchymomof2
dex_millie
Evenstar
fairydust020409
JamieB
JenniferH
JustKiya
Kaitnbugsmom
KnittingKara
Krisis
Ksenia
ktg
Leav97
lj2blessed
mamabain
mommaknowsbest
neveryoumindthere
NWmt_Mama
Sihaya
teenyToona
Tryingforbaby

BS#2: Pay off all Debt (except the mortgage)
100%Mom
AFwife
AllieFaye
astar326
Belia
Bluegoat
canuckgal
claddaghmom
Cody'smomma
ColoradoMama
Contrariety
corrie43
cymbeline
Deir
eirual
excitedtobeamom
FeelingBlessed
goldfishkate
HappyMommy2
Hedgehog_Mtn
herwitsend
hollytheteacher
indie
jeliphish
jjawm
kavita
Keeta
killick
lalaland42
laohaire
LittleBirdy
lizziebits
llamalluv
LZP
major_mama11
mamabain
MamaPam
mamimapster
mich
MomtoWilmo
MyTwoAs
my2girlz
Nickarolaberry
okapi
onlygirls
onthemove
Pernillep
p1gg1e
PluggingAway
RoadWorkAhead
samandhenrysmom
shllywlly
smallmama
stellarae
sweetjasmine
thenaturefreak
Tradd
tricia80
triscuitsmom
tynme
twin_mama
whiddle

BS#3: Build up to 3-6 months of savings
akichan
annethcz
beansmama
Crunchy*VT*Mom
Denvergirlie
mammamo
maryjane
MCsMom
mtm
Nora_SEA
phatui5
phillytwinmama
Rev1053
sarafi
Stone_Fence
yasinsmama

BS#4


BS#5
Maluhia

BS#6
kanga1622
rebeccalynn
Sarah8Jane
Softmama
post #3 of 116
I'm still stuck in BS#2. This weekend I landed in the ER after trying urgent care. I expect to pay through the nose for this since I've got the deductible plus my portion to cover. However, by the time I went in, everyone around me was horrified I hadn't gone before I was in so much pain (migraine times a million). I just kept focusing on the $$ part, but I really have to sometimes realize that money isn't everything too. Hopefully this won't set us back even further with being laid off. If the materials come in in time, DH might have work, but thats a big if. At least I have meds to last me now!
post #4 of 116
Still plugging away on BS#2. We started snowballing again and hopefully will get a closing date on our house here soon.

The holiday is paid for in cash though I keep remembering more and more people that need gifts LOL Hopefully I can pull it off!
post #5 of 116
IN IN IN!

I'M IN!!!

Someone...please...do me a favor and if you don't see me posting, send me a PM and ask me WTF is up, lol!

We're still on BS3...STILL at about $2k. Dh finally asked me...what was up? Why aren't we saving?

He pointed out that when we were paying off debts I used to put money towards it all.the.time. $2 here (literally), $15 there...now I'm lucky to get in $50 a month.

Totally ridiculous! We are able to save upwards of $700/mo now too...gr at me for being so frivolous lately!

It's almost 2010 and I have goals. Stick to my budget PERFECTLY. YES...perfectly. And get the EF finished (with tax refund for sure - so um, march-ish) and start our down payment fund. If I don't do this...well...5 years will turn into 10 years and that's just crappy.

Must get gazelle intense------------>now!
post #6 of 116
Desiree - "perfectly" is hard - but how about giving yourself monthly saving goals that are as specific as debt goals? Then minimize every two weeks how many "off track" items there are - you don't want to quit over ONE mistake because you are no longer "perfect" yes?

RoadWorkAhead - I am glad you are feeling better, please do check the hosipital's policy on lowering costs for patients who can't afford it, maybe you could qualify and it would not end up as big of a $$ burden?

Out here I am reaping the rewards of all-year planning. I bought Xmas gifts for my 7 nephews last year in the after Xmas sale, so that is DONE and I sent them on Black Friday. My Xmas cards go out today, and I had them ready earlier with stamp books bought in September's budget For DD I *found* more dollhouse rooms in the closet that we forgot to give her last year (there were so many rooms) so this year she'll get to add to her dollhouse and I don't have to spend a *thing* other than a santa gift which I think will be a my-little-pony For DH I got his two Aloha Shirts - one from DD and one from me on Black Friday sale so cheapO I got the teapot and creamer set I wanted and a George Forman Girll - both gifts I'm excited for even if I did get them myself (it was Black Friday sale!).
Even better I budgeted in the summer to buy vodka, coconuts, tahitian vanilla (at a discount from Tahitian family members) and bottles and have been stewing 36 bottles of homemade vanilla coconut extract all Fall so I need to make labels and give them out locally to all my friends....tada! I made more than I need so I have hostess gifts, etc.....

Now of course I'm starting online college in January and I'm deciding if I can budget in a Kindle so that I can buy textbook and textbook pdfs on there to make the monthly costs cheaper. I've got to look closely at this month's budget and see where it puts us to buy a Kindle.....

OH! And DH is traveling for 22 days this month so my goal is to use up as much pantry food, etc. this month and try to really minimize grocery costs - I already did great last night with using up carrots (I bought too many for Thanksgiving) and other items in the house to make curried carrot soup and homemade parker house rolls.....it will be lunch today too!
post #7 of 116
I think my name is under BS1 and it should be 2.....we finished the EF in Oct.

I'm hanging on by a thread while trying to handle Nov finances.....not easy but we just barely did it.

I'll update better later but I'm really hoping for an awesome December!!!!
post #8 of 116
Still at BS2. Will be there for awhile. I'm not strict DR but following it more or less. My tax refund next year is already planned for which does not include paying off debts but rather paying the annual cost of our auto insurance and rent insurance. We save alot of money doing it that way rather than monthly. I also promised my sister who lives in Colorado that I would pay her air fare to come visit me next year and I'll be using some of our refund for that. We are very close and she just can't afford the price of the tickets on her own. It's easier for her to get away than it is for me to travel up there.

This month will be hard to put any extra on debts. As I've mentioned in other posts, we aren't getting our annual Christmas bonus at work this year so I have 5 stepkids and 2 grandkids to get gifts for out of our regular budget.
post #9 of 116
Quote:
Originally Posted by Maluhia View Post
Desiree - "perfectly" is hard - but how about giving yourself monthly saving goals that are as specific as debt goals? Then minimize every two weeks how many "off track" items there are - you don't want to quit over ONE mistake because you are no longer "perfect" yes?

RoadWorkAhead - I am glad you are feeling better, please do check the hosipital's policy on lowering costs for patients who can't afford it, maybe you could qualify and it would not end up as big of a $$ burden?

Out here I am reaping the rewards of all-year planning. I bought Xmas gifts for my 7 nephews last year in the after Xmas sale, so that is DONE and I sent them on Black Friday. My Xmas cards go out today, and I had them ready earlier with stamp books bought in September's budget For DD I *found* more dollhouse rooms in the closet that we forgot to give her last year (there were so many rooms) so this year she'll get to add to her dollhouse and I don't have to spend a *thing* other than a santa gift which I think will be a my-little-pony For DH I got his two Aloha Shirts - one from DD and one from me on Black Friday sale so cheapO I got the teapot and creamer set I wanted and a George Forman Girll - both gifts I'm excited for even if I did get them myself (it was Black Friday sale!).
Even better I budgeted in the summer to buy vodka, coconuts, tahitian vanilla (at a discount from Tahitian family members) and bottles and have been stewing 36 bottles of homemade vanilla coconut extract all Fall so I need to make labels and give them out locally to all my friends....tada! I made more than I need so I have hostess gifts, etc.....

Now of course I'm starting online college in January and I'm deciding if I can budget in a Kindle so that I can buy textbook and textbook pdfs on there to make the monthly costs cheaper. I've got to look closely at this month's budget and see where it puts us to buy a Kindle.....

OH! And DH is traveling for 22 days this month so my goal is to use up as much pantry food, etc. this month and try to really minimize grocery costs - I already did great last night with using up carrots (I bought too many for Thanksgiving) and other items in the house to make curried carrot soup and homemade parker house rolls.....it will be lunch today too!
I guess I should clarify "perfectly"...I just mean I don't want to go over budget on our "blow" money...anything left over after bills and budgeted funds (including blow money) goes into the savings...that was about as specific as I got as far as paying off the debt was concerned with as well...

But we should be getting life insurance by the end of this month (or sooner!) so once I know the *exact* amount that'll be I can figure out an exact amount to designate for our emergency fund (now that dh is on salary it makes it much easier!).
post #10 of 116
We're chugging along. I've found a few cheap "treats" which include a buy one get one free Orange Julius cupon (never had one before, but when the sweet tooth kicks in, may as well spend it on something you get two of) AND our bank serves coffee. Instead of going out and spending money while out and about, I'm thinking I could swing by the bank, make a deposit and grab a coffee to go!

Here's a question...I went in search of coupons to see what the fuss is about (my general philosophy is that if it weren't in the company's best interest they wouldn't give them out, so why spend money on something you wouldn't normally buy only because it's cheaper- doesn't save you anything!) and I can't help thinking that there are strings attached to everything and you're almost better off ignoring coupons and just going about your business. Take this Orange Julius thing, is that to get you hooked so you'll come back and give them more money? Is using a coupon for a product you wouldn't normally purchase ever a wise idea? What's your take on coupons- useful tool or marketing scam or somewhere in between?
post #11 of 116
Well I failed miserably in November with finances so I am hoping to make a turn around in Dec.. It will be really hard to make much progress in Dec. but I just want to keep my head above water!!
post #12 of 116
Okay now that the kids are calmer....

We were way under expectation for income in Nov, DH took time off then ended up with unexpected (unpaid) time off on top of it.

We didn't save the savings/extra money like we did in Oct and I didn't get anything else sold on CL so the income was WAY down. On the flip side we stayed within our income and had about 900.00 left today (30th)

So originally this was the paying down the debt money but that left me with nothing but the true EF for the baby's birth.......I decided to pay ALL of Dec's bills with it. Well everything but the mortgage, I will pay that with Thursday's check. So by 12/3 every single Dec bill will be paid.

If I don't have the baby right away the paychecks will just go directly into the bank account and sit there. If there are no surprise transfers etc with the birth then by the end of Dec ALL of the money can go to debt, but if something unexpected happens then we will have that money to handle it without touching the EF.

I felt most comfortable with having the money sit as a backup rather than have nothing in case of unplanned events surrounding the birth.

For Christmas I have a small amount budgeted from DHs second job so I will be using that extra job money for gas, groceries, spending money and Christmas......each of those envelopes will get money as long as DH is working and not home with me and baby, those categories have flexibility and if he's home with me we will have to spend less for them if he's not making that money. That is how we made it through Nov so it should be doable.
post #13 of 116
Quote:
Originally Posted by eirual View Post
Here's a question...I went in search of coupons to see what the fuss is about (my general philosophy is that if it weren't in the company's best interest they wouldn't give them out, so why spend money on something you wouldn't normally buy only because it's cheaper- doesn't save you anything!) and I can't help thinking that there are strings attached to everything and you're almost better off ignoring coupons and just going about your business. Take this Orange Julius thing, is that to get you hooked so you'll come back and give them more money? Is using a coupon for a product you wouldn't normally purchase ever a wise idea? What's your take on coupons- useful tool or marketing scam or somewhere in between?
I think they are useful if you know how to use them. If I am buying something I otherwise wouldn't buy....No I don't think they help at all.

If I buy brand A flour and brand B is on sale, plus I have a coupon then buying B and doubling the savings (sale price + coupon and even better if the store doubles) then I've saved on something I would buy anyways. This requires some organizing and checking circulars etc but if used this way they can save you a ton.

Often the coupons aren't for things I use so in that case I don't use them at all.
post #14 of 116

Please add me

....to step 2, I asked last month but don't see myself there on the list.

We have always tried to live with a written budget, but only recently have plugged little leaks in it. Since last month, I have combined my cc and line of credit, and have (gulp ) 30,000 to pay off. This is a combo of a previous cc, school related expenses, a second car when dh went to school, etc. I have even made a little bar graph in my chequebook holder to see my progress.

I am a part time RN. I did manage to snag a per diem/cover sick time-vacation job in a endoscopy unit/recovery room as well as the extra I can pick up on my usual unit...huge for me as just one extra shift on my paycheck is another 250.00 after taxes and deductions, and I can work it around dh schedule/homeschooling as he does evenings. I have made a budget, however based only on my part time job, so there will be a minimum I can put onto my debt per month, and extra work goes onto that debt. So far in the last 2 mo I have put 1500.00 onto it. We do have a loooong road, I hope to put this debt to rest in 4-5 years time. We probably could do it sooner if I worked full time to overtime, but we really want to keep homeschooling and have some sort of quality family life (and as it is our extracurriculars like organized sports or swimming are pretty limited)...so it's sort of a balancing there.

One thing I am experimenting with...I am paid bi weekly, so there are 3 months with a 3rd pay for 2010. I am trying to get ahead in my bank balance, so those checks don't have to be used in your monthly expenses. For the 1st check in Jan, we are hoping to use it to go see my family this summer (live 3 provinces away). I have only seen them once since ds was born 6 yrs ago and my grandma is not healthy. To not put this trip on a credit card would be huge. The other two will be used to gut out our moldy basement...the only home repair (other than painting) that we can do for awhile until this debt is paid off...I figure we will have to take care of this (health issue, and also our well pump will break down any time I am sure), and windows/siding/kitchen/carpet and flooring can wait for a long while, LOL! Those "extra cheques" can go to debt of course too, but this year we thought we had better get this stuff done.

All in all I am actually enjoying the challenge of staying in grocery budget, of shopping second hand, etc especially when I see it helping me in the long run. Looking forward to reading all of your stories.
post #15 of 116
Like most posters, my goal for December is to just stay within budget. No snowballing this month as our expected income is less than other months.

Also, I think in 2010 we are going to focus on putting more $$$ in our EF and stop the snowball for a while. Dh really needs more $$ in our savings to feel comfortable. We only have the car loan (last cc was paid off last month!) so I feel good about that decision too.
post #16 of 116
I haven't posted in a while.
We are still on BS2 but getting more gazelle. We went to a DR trained financial coach and he has really helped us figure out a workable budget for our family and my business. We have paid over $2500 in the last 6 weeks. AND, we budgeted for Christmas!
I am starting a new job (20 hrs/week) next week and will get health insurance through it. Our current insurance is $1611/month and going up to $1800 so I am very excited about this job!!!
post #17 of 116
Sign me up.

I feel like we're sort of at a standstill until after Christmas. Things are really getting exciting with our debt snowball though. We only have $1400 left in credit card debt-- at $500 a month, that's less than 3 months until we are done, done, done, never to go back again DONE!

Then we are looking at 2011 to have everything but the mortgage and student loans paid off. We need to make a decision about doing the income based student loan repayments. We're learning towards yes, because as a pastor, DH is just never going to be making that much money.

We did use a bunch of my Advent book money for Christmas, but I should still have $300-$400 to throw at debt this month, plus our Christmas bonuses. But it just made sense to use the money for Christmas. I think this is the first Christmas ever that we've been able to pay for, free and clear, and not have to worry about the bills coming due after!
post #18 of 116
Between DD's bday, Christmas, and my 3 Jan/Feb annual bills (bar dues $450, homeowners assoc dues $550, and CSA fees $460), December is more like Debt-cember for me!

Is there a Step 2.5? I seem to bounce back and forth between 2 and 3. Once this flippin' cc gets paid off FOR GOOD, I hope never to see Step 2 again. Note to self: it's a lot easier to pay off a cc if you stop using it.

Step 3 is going to take a while as I'm only ~28% of the way to goal.

I already do #4 and #5, so I'll skip to #6 when the emergency fund is completed.
post #19 of 116
I would like to join you! Can you put me on pre-step 1 just because my DH and I have not talked about a plan yet. I am not sure that he will go for lifestyle changes that will have to be made. I will have to convince him though.
post #20 of 116
Still plugging away on BS3.
DH gets very discouraged every month we put less than a thousand into savings... He feels like he has to work overtime everyday until our EF is done. But every time we talk he wants to up the EF. Very frustrating. I want it to get done too but I also want a life while I working towards that goal.

I am also disappointed with myself. I have been saving my blow money in the hopes that I can buy a laptop for myself sometime. But since the holiday season has started I have been spending like crazy. I could have had enough right now to buy and Eee but instead I bought the kids a gift that wasn't in the budget. Now I am looking at getting DH another gift. I need to stop.
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