Getting Out of Debt - August 2012 - Page 2

[EmsMom]

Originally Posted by TallToriV 

I hear you on the coupons. My bill would be higher if I did couponing, mainly because I have access to the commissary. It seems best for people who really don't want to give up their pre-packaged stuff. Making a meal plan, too, just doesn't work for me and my husband - we have to have room for spontaneity or we'll rebel, lol.

For grocery savings, I've yet to find a resource better than The Tightwad Gazette - I have the big complete book, and it seriously puts many other frugality resources to shame. (Actually, I just bought another well-known frugality author's ebook, only to demand my money back because it was so far below the standard I'm used to!) Amy, the author, advocates pantry-based shopping rather than meal plan-based shopping; if you've been trying meal plans and it hasn't been working for you as well, give this a try! Most libraries have her books. 

The pantry method from this book has worked well for me for years.  I seldom do much meal planning except as in, what should I make for dinner tonight?   I always have everything that I need, bought at the best prices possible because I basically only shop for sale items, especially loss leaders.  Also fuels my creativity and I can usually easily go a couple of weeks without needing a grocery store, except for fresh produce or perhaps milk.  Of course, to be able to do this, you do need to be able to cook creatively (as in not needing recipes except as idea starters) and also to bake, because children need to eat much more than adults and baking muffins, desserts, etc. helps to fill them up.  But these are skills that improve with practice. 

[lilacvioletiris]

Pantry cooking sounds interesting.  I have heard of the Tightwad Gazette, but have never read it.

Waiting impatiently for payday on Tuesday, Aug. 21.

[nyssaneala]

DR influences the way we pay down debt, and we use one of his worksheets to track debt, but I do deviate from him.

My biggest achievement in July was paying off our car loan. This means we only have student loans and a mortgage.

Of course, DH's student loan is bigger than most people's mortgages, if you happen to look at my post last month which detailed our debt, you'll see. 

We haven't made any extra payments yet this month. We had a possible leak in our roof, so we were holding on to any extra money until we found out the cause and cost of that! Thankfully, it was a very minor problem, and easily solved!! Right now, we're anxiously waiting to find out how much his one-year production bonus is, we should know this week. A chunk of that will go towards student loan #1, as well as our retirement account. I'm optimistically hoping we can pay off student loan #1 in the next 12 months, but right now it stands at $40,000...I think I'm being overly optimistic.

This is probably where I deviate from DR. We could put DH's entire bonus towards student loan #1, the DR way. Our tentative guess is his bonus will be around $12,000. With that number, we plan on putting $5,000 towards student loan #1, $3,000 in retirement, and give ourselves $2,000 to buy a few things for ourselves and the house. His road to finishing residency has been such a hard and long road. This is his 1 year anniversary since finishing residency and being a real doctor, and we sort of want to celebrate; I feel like we earned it. Plus, I sort of want chairs for my breakfast table, and furniture for my home office.  The remaining bonus money will go into our savings, and then right out again in a few months to pay for DH's board exam and the rest of our daughter's preschool tuition for the school year.

Feel free to convince me otherwise!

[lilacvioletiris]

Sometimes I think we all have to remember that "blow money" is part of the DR way.  I think your idea of keeping $2000 for yourselves to "cash flow" some of the "fun things" you haven't been able to buy or do is okay because you still have your eyes on the prices of paying off DH's student loans.  Getting rid of the car mortgage is a big thing!  Congratulations.  I can't wait until my DH's car loan is paid off.  It is so painful each month to send a huge lump sum to Canada to pay down his car payment.

[nyssaneala]

Originally Posted by lilacvioletiris 

Sometimes I think we all have to remember that "blow money" is part of the DR way.  I think your idea of keeping $2000 for yourselves to "cash flow" some of the "fun things" you haven't been able to buy or do is okay because you still have your eyes on the prices of paying off DH's student loans.  Getting rid of the car mortgage is a big thing!  Congratulations.  I can't wait until my DH's car loan is paid off.  It is so painful each month to send a huge lump sum to Canada to pay down his car payment.

It has been a few years since I read a Dave Ramsey book, so I am rusty on the details of his philosophy. I guess I also thought he advised paying off debt before putting money into retirement accounts? If not, I guess I am more of a DR follower than I realized! I love his snowball debt worksheets, although we chose to pay off highest interest debt first, no matter how large or small the debt.

I'm wondering how our choice to continue to travel and take vacations fits in with his philosophy?  I know we would pay our student loan debt much faster if we didn't say, go to France last spring (not incurring any more debt from the trip, but taking 2 months off from making extra payments)....but that's something I won't sacrifice. Watching my 4 year old DD experience a new culture for the first time, and get to travel outside the country 10 years earlier in life than I was able to....priceless. 

[trekkingirl]

DH was itching to take a trip so we spent the weekend in Reno, Nevada. It turned out being a five hour drive when it is usually a three hour drive due to road work.  Today is DD1's birthday and she had a great day! She turned 9 today!

[lilacvioletiris]

nyssaneala, yes, DR says to pay off debt before making substantial deposits to retirement (although I think he does say to put in whatever a employer will match, but no more).  I was talking more about the "blow" money for things that aren't on the budget per se.  DH and I save up money so we can cash flow our trips to see family (9 hours west to see my mom, 9 hours east to his parents).  We aren't going to stop visiting them just because we are trying to pay off debt.  My opinion (not Dave Ramsey's), is if you can go on a vacation without incurring new debt and go on vacation only in moderation to keep yourself sane in the what may be a long haul to pay off debt, do it.  If a vacation means new debt, then DO NOT DO IT.

trekkingirl, congratulations on being a mama for 9 years!  Say happy birthday to your little girl.

[nyssaneala]

Originally Posted by lilacvioletiris 

 My opinion (not Dave Ramsey's), is if you can go on a vacation without incurring new debt and go on vacation only in moderation to keep yourself sane in the what may be a long haul to pay off debt, do it.  If a vacation means new debt, then DO NOT DO IT.

That's where I'm coming from. I love to travel, and it used to be a part of my job. We had 5 long years of no vacations (other than visiting family) while hubby was in his residency program, because it would have caused new debt. Our France trip was the "WOOHOO it's over!!!!" trip we had been saving up for, for two years. :-)

I buck DR on the retirement front because we made zero contributions during DH's 4 years of medical school and 5 years of residency. There was just no extra money, it was hard enough to put food on the table. That was our entire 20's, so now we're trying to pay catch up on that front so 10 years from now, we hopefully won't be behind in our retirement goals. 

[TallToriV]

I think enjoying the ride is a vital part of getting to financial freedom. There's a huge difference between blowing money on something and arranging your goals to allow for a high quality of life along the way, and if the second course is an option, it's great!

I have a friend who worked her tail off to get out of a huge credit card debt on a non-profit salary. She did this by living for years with what I'd call black-belt frugality rules. By this I mean a very rigid structure, with no room for treats - even frugal, cost-effective ones. Any extra money at all, even $20 saved on a bill, went to the credit card. She succeeded, but instead of feeling accomplished and secure, she immediately set a very high emergency fund goal for herself, stayed on the black-belt plan, and funneled all of her previous credit payments into savings. Now, on paper, that sounds great! But as her friend, I've watched her actually become MORE stressed out and anxious since the debt was paid off! It makes me sad.

I think it's so important to understand the difference between your bank balance and your feeling of security and peace, and work on both!

[lilacvioletiris]

Balance in all things! 

Excited because I got my reimbursement today.  I am so happy.  I think I really have to be careful of how money can mess with my emotions though.  I want peace and security, but money shouldn't be the only thing that peace and security are attached to.  The reimbursement will give us the money for our trip up to visit DH's parents for Labor Day. 

[trekkingirl]

Originally Posted by lilacvioletiris 

trekkingirl, congratulations on being a mama for 9 years!  Say happy birthday to your little girl.

thanks

[forestmushroom]

oh, I guess we already do a pantry then.... we have tons of dried beans, flour, sugar, etc.

but I am not going to buy a bunch of stuff from the store that is fresh and let it just die in the fridge. We do pick berries and fruit to can, and can tomatoes.. so we have a lot of stuff for below store rate...

I guess we sort of do that, but we should just tighten the belt on it. :)

[trekkingirl]

I decided to cancel my trip to San Diego that I had planed for September. I need to save more aggressively for the home purchase. I also need to pay down some debt before I get into a mortgage. Vacations can wait!

My sister has recently decided that she wants to buy a house. She has a considerably large income and within two weeks got preapproved, paid off $6000 in CC debt, and has started looking at homes to make an offer. A few months ago I tried to talk her into buying a home and she got so defensive and cranky that I never brought it up again. Now all the sudden I am working slowly towards home ownership and she accomplishes in two weeks what I've been working on for two years! Maybe I can learn from her mistakes.

A close friend gave me a real gift of perspective this week. I have always had grass is greener syndrome for people that were set up financially by there families. Help with home down payment etc. Well my friend has been battling with her mother as she is trying to steal her house from her. She had to get a lawyer and everything! I am so grateful I'm not in her shoes. When I struggle to purchase my home without any family help I will never have to worry about any family members feeling like they have rights to my house!

[chrissy.eew]

Originally Posted by trekkingirl 

Welcome to all the noobies! Are you guys doing Dave Ramsey's total money makeover?

can i jump in? i'm not following Dave Ramsey's total money makeover but it sounds like im close to it. i had stumbled upon snowball plans from google a few months ago and have been trying my hand at it. august was my first month of not following my plan and i'm soooo bummed. i was supposed to pay off debt#1 in august and that just didnt happen. i overspent and didnt receive child support for the month and ended up with an american express bill i can't pay.

so now im trying to get back on the wagon and ride this out. im the only income for our family of 6 and the stress is starting to freak me out. that felt super good to "say" that out loud actually :D

nice to meet everyone!

[trekkingirl]

Welcome to MDC Chrissy!

[chrissy.eew]

Originally Posted by trekkingirl 

Welcome to MDC Chrissy!

thank you :)

i spent some time on google yesterday reading up on dave ramsey. turns out my snowball plan was a little off. i didn't have them in order of lowest balances first. i tweaked it (rearranged debt#2 & debt#3) a bit using a snowball calculator i found and all of a sudden debt#3 is set to be paid off 7 months earlier than anticipated. im in super financial dorky glee right now!

[lilacvioletiris]

Welcome Chrissy.  Always feels good to move forward.

trekking, sorry to hear you needed to postpone your vacation, but I can totally agree that waiting for vacations can help us closer to our goals.

DH had an in depth discussion about finances this weekend.  I have been really stressed "waiting for his reimbursement" so we could move forward with our invitro fertilization.  Having hope and then getting it dashed every two weeks has not been good for me.  Also thinking about having to go to the doctor all the time for for a month is more than I can handle while trying to teach full time.  Right now we have decided to wait for the IVF cycle until June 2013 once I am done with teaching so there will be no stress of having to get back to work when my body is bulging with follicles.  It also means that whenever the reimbursement comes, we will put it in savings and wait for next summer.  Also since we will in the United States, and all the maternity leave I get is 6 weeks paid leave and up to 6 weeks of sick time (if I hadn't used it for doctor's visits before hand) as paid leave otherwise it would be unpaid.  Knowing that we have enough sperm frozen for an IVF cycle reduces some of my stress. Waiting will mean we can focus on our debts as we go along.  I want to be a stay at home mom and with all the debts I accumulated before I got married are thwarting my desire to be a stay at home mom because we won't have enough money to pay for our 4 walls and all our debts.

[trekkingirl]

Lilac if I remember correctly, you get two weeks disability before baby and four weeks after. Then you get six weeks paid family leave as well as your DH. Then you would get whatever your job gives you, which in my case was only whatever vacation pay I had saved up. HTH

[chrissy.eew]

Originally Posted by lilacvioletiris 

Welcome Chrissy.  Always feels good to move forward.

trekking, sorry to hear you needed to postpone your vacation, but I can totally agree that waiting for vacations can help us closer to our goals.

DH had an in depth discussion about finances this weekend.  I have been really stressed "waiting for his reimbursement" so we could move forward with our invitro fertilization.  Having hope and then getting it dashed every two weeks has not been good for me.  Also thinking about having to go to the doctor all the time for for a month is more than I can handle while trying to teach full time.  Right now we have decided to wait for the IVF cycle until June 2013 once I am done with teaching so there will be no stress of having to get back to work when my body is bulging with follicles.  It also means that whenever the reimbursement comes, we will put it in savings and wait for next summer.  Also since we will in the United States, and all the maternity leave I get is 6 weeks paid leave and up to 6 weeks of sick time (if I hadn't used it for doctor's visits before hand) as paid leave otherwise it would be unpaid.  Knowing that we have enough sperm frozen for an IVF cycle reduces some of my stress. Waiting will mean we can focus on our debts as we go along.  I want to be a stay at home mom and with all the debts I accumulated before I got married are thwarting my desire to be a stay at home mom because we won't have enough money to pay for our 4 walls and all our debts.

where will you be debt wise in June 2013? in significantly better shape than now? i hate that i accrued debt but it happened. staying at home isn't an option for me and it's hard. somehow along the way my husband has become a stay at home dad...thats what i get for finding the right job i suppose. lets do our best to stay positive. june 2013 sounds like a great time to start IVF, it's already less than a year away :) i was just watching a documentary about teachers in the US and one of the subjects was a pregnant teacher. not a fun movie.

[lilacvioletiris]

Debtwise in June 2013, we would have 3 more debts paid off and by April 2014, we would have the car paid off and 3 other debts.  We wouldn't be able to snowball if I was no longer working full time and staying home with a baby or babies (since IVF is the route we are having to take because of DH's extremely low sperm count).  My DH would also be done with his further education which could mean a higher paying job for him.

I would probably still do some online teaching or something if I stayed home with kids but the money from that wouldn't be as much as I make now.