G.O.O.D. January '05 thread- Let's go! - Page 2

[lunamama]

New to this thread....so very inspiring to read all of this!!!!

My financial goals for the new year are:
1)use all tax return money to pay down cc's
2)pay car payment bi-weekly(when dh is paid) and pay more than the minimum
3)save, save, save!!!!
4)open a savings account for each of the kids that gets a set amount each check to cover various expenses throughout the year
5)stick to our budget!!!!
6)give dh a cash budget each week

Mainly I want to get more organized so I can keep track of where everything goes...

YAY!

[newmainer]

our goals:

- continue to use a weekly cash system for everything that is *not* a monthly bill and get it down to $160 a week.

- dh and I commit to our weekly "Domestic Management" meetings to check in on finances, plan/goal set for short, medium, and long term.

- continue to pay down cc's.

our update:

We are working on getting our house refinanced. We met with our loan agent last week, and if our house appraises for 252,000 we'll be able to pull out 25,000 to put toward cc's!! That will pay off the card that has our renovation balance (15,000) and almost an entire card that has debt we've been working on paying off since college . If this happens, we will might even be able to be debt free by the end of 2005!! (ok, not including mortgage, my student loans, or our car. just cc's). But, oh my god, we are so excited we can hardly stand it. it is sooo motivating!! it all hinges on the appraisals. 252k might be a little high, but even if we can pull out 15,000 that will be huge. we'll get rid of our private mortgage insurance and our payment will only go up $100, but the minimums on the 2 cards are close to $500 a month, which we'll be able to use to pay off the remainders.

yippee!! great resolutions, mamas!!

[mamamoo]

Great worksheets!! :)

http://www.cahe.nmsu.edu/pubs/_circulars/Cr-593.pdf

[stretchmark]

Hi, I want to join in here just a bit too busy right now.


I did want to add that as I skimmed through the posts, I notices someone said they wanted to put money towards savings before paying the CCs.

This is a bad idea. If you have 10,000 credit card debt and 10,000 in savings you really have no money. You actually have less money because of the finance fees. You are getting charged interest on the total amount of you CCs and if you have 100$ in savings that you could pay down the CC with, then you will pay less interest.
You can always use the CC in an emergency but get them paid off.

[tracymom]

Originally Posted by morebabies

I did want to add that as I skimmed through the posts, I notices someone said they wanted to put money towards savings before paying the CCs.

This is a bad idea. If you have 10,000 credit card debt and 10,000 in savings you really have no money. You actually have less money because of the finance fees. You are getting charged interest on the total amount of you CCs and if you have 100$ in savings that you could pay down the CC with, then you will pay less interest.
You can always use the CC in an emergency but get them paid off.

Actually, Dave Ramsey (Financial Peace University) recommends establishing an emergency fund of at least $1000 first. He also advocates allocating charity/church/giving money and savings money first in the budget. Then pay on your debt, using a debt snowball in which you pay the smallest balance off first, then apply that amount toward the next smallest debt, and so on. This is done regardless of the finance charges involved.

The reasoning for this is fairly simple. It is much more encouraging to have an emergency fund in the bank for simple small emergencies. It keeps you from continuing to charge. Also, the debt snowball concept is to keep one motivated, and paying off balances and closing accounts is tremendously motivating and energizing. The money you would 'save' by being smart about the interest rates and so forth is really a drop in the bucket if you are serious about eliminating debt. In the whole scheme of things, it won't matter all that much if you are paying off your debt in a fast period of time.

[nova22]

I'm new to this thread too. Hi everyone.

My goals are pretty much the same as everyone else's:
1. Pay bills when they arrive
2. Pay ahead when possible (or pay slightly more than is owed)
3. Make frugal purchases - no impulse buys
4. Don't eat out when I can eat at home instead

ETA: Those worksheets are great, thanks to the PP who linked to those!

[stretchmark]

Hmmm, I don't get the David Ramsey thing. I get the part about the snowball but don't understand the part that is challenging my opinion, which is actually not my opinion, I got it from those financial experts that are always on Oprah. :LOL
I think I get having a bit of savings for emergency but it is true, if someone has 10,000 in debt and savings, they really have NO MONEY! I'd be much more inclined to pay off the credit cards than to keep paying a little and adding to my savings, that makes no sense to me.

[tracymom]

Actually I don't think he advocates that MUCH savings until you get the debt paid off because you are right it doesn't make a lot of sense. Where he flies in the face of conventional wisdom is his disregard for the interest rates. He also doesn't recommend consolidation loans as he says it makes people more complacent and less motivated to pay off the debt than if the interest is too high. It's more of a behavioral thing; he recommends really charging at it and throwing everything you have at the debt until it is gone, but he recommends having that emergency fund in place.

[newmainer]

morebabies, I've been on this thread for a long time (it goes back to the summer) and I can tell you that there is no one here who has 10,000 in savings that they aren't putting toward debt. I'm sure you were using that as an example, but there's a big difference btw having 1000 in savings that you aren't putting toward cc's, and 10,000. You might want to read back through some old threads. This topic has come up before, and I think we all have unique situations and comfort levels with having/not having an emergency fund while paying off cc's. We don't b/c it is far more psychologically draining on us to have the debt, and we make enough to cover little things that come up between 500-1000, its just that then we can't put that toward cc's to pay down the balance. For my own peace of mind, all extra goes toward the debt.

The topic of cashing in on 401ks etc... has also come up and been discussed. Not that it shouldnt be brought up again, but just fyi.

[stretchmark]

Sorry I am unable to to read back through right now but will look later.

I also didn't mean to spin the thread off, so let's get back to goals:

For January

*Eat out less
*Cook simpler foods/save at grocery store
*Use extra money to pay down CCs
*Buy no more knitting stuff
*Use trades in place of childcare

[Belleweather]

Our big, number one goal for 2005 is to live off our monthly income rather than dipping into our student loan money. If we can manage that (and since rent alone is about 45% of that money, it's tough for us), then we'll have an emergency fund finally, and money put by for predictable expenses like car repairs.

Smaller goals are:
-Switch to pre-paid cell phone plan.
-ebay all the 'crap' that MIL sent us from when they moved.
-Sell DH's car, which we never drive
-Finish my last year of Law School Part time and work full time, so we're not borrowing our living expenses anymore.

[Peppermint]

Yeah- on the savings, I am the one who said I would put some into ssavings first- right now we have NO savings at all. We also have over $20,000 in CC debt. I feel that having a small emergency fund is necessary for *us* as our debt has come mainly from "emergencies" that we didn't have a small savings to get us through. For us to get out of debt, we need to get that smalkl savings going so that we have an emergency "cushion" so we won't charge anything else.

It wouldn't be the right move for everyone, but it definitely what *we* need to do.

So- the "service Engine Soon" light on my car just came on yesterday, I have $100 in cash that my IL's gave me for Christmas to buy myself something "nice", and a few gift cards for Gap and Old Navy that I could sell if need be. I have to say, if the car needs major repair, I will be perfectly OK with using my $100 and my selling my gift cards. Dh thinks I should use the GCs and money on *me* stuff, so that I don't feel strapped, etc. But- I can honestly say I'll feel better paying cash for car repairs (instead of charging them) than I would to have a few new pairs of jeans, etc..

I am going to transfer a bit of money to savings RIGHT NOW! Before I pay bills .

[kerc]

on the debt vs. savings issue. I wanted to chime in that I read someplace some time last spring that it is helpful to have money in savings so that you don't have to rely on debt to get by. For instance. this morning my hubby's car wouldn't start. Needs a new battery. because we've been putting some money into savings we are able to pay it instead of having to charge it and pay later.

Another instance -- we just had to decide not to go to a funeral because we didn't have the $$ upfront to pay for it. If we had been smarter about it all we would have $$ in savings and then be able to rely upon that for the emergency trip.

[sm3247]

Glad to see a new thread - my goals for this year -

- stop eating out. DH and I get into cycles where we are always getting take out or eating at restaurants. We've made it so far this year

- stop using credit cards for living expenses - we don't technically have CC debt, but do tend to "spend ahead" which keeps us from paying off other debts quickly.

- pay off the smallest portion of my student loan (they're divided in odd categories, so I go with the smaller ones to feel a sense of accomplishment)

- build up our savings. I agree in theory that you need to pay debt first, but our debts consist of a no interest car loan, house mortgage, and government backed student loan - also at very low rates. We don't have close to enough in svgs to pay these off. Also, I'm hoping to quit my job and DH works for a NP environmental group that always has funding problems. I feel much better with the cash in the bank knowing that we could minimize our payments if disaster struck and get by for a while. I think it's very much about individual comfort levels.

BTW, I wondered if anyone has read anything about a "no spend" year that a family in Oregon did last year. They decided not to buy anything that wasn't depletable. For example, they could buy toilet paper, but not a new toilet. I've been contemplating taking this on, but wondered if it was really possible as I have a new baby on the way. Any thoughts?

[member]

Originally Posted by sm3247

BTW, I wondered if anyone has read anything about a "no spend" year that a family in Oregon did last year. They decided not to buy anything that wasn't depletable. For example, they could buy toilet paper, but not a new toilet. I've been contemplating taking this on, but wondered if it was really possible as I have a new baby on the way. Any thoughts?

I read about it and I thought it was interesting, but personally, I thought the spending money on first-run movies and eating out was just as wasteful with money, but I guess they were more focused on decluttering. Personally, I think it's more helpful to a YMOYL spending journal than to just stop buying "stuff." Just my thoughts. All in all, it was a cool piece to read and it got a lot of us talking over at simpleliving dot net.

[Dumpling]

I'm new and I don't know what GOOD means but I would like to learn! Can I join? I would like to get a better handle on spending and save more. I think of trying to make a budget with all the whacky expenses I get now - my child was recently diagnosed with a disorder that sucks us dry of every penny on doctors and therapy.

However, I would like to follow two resolutions for the month and see how I can do. 1. write down every penny I spend and/or make 2. make a budget (have no idea how to do that)

Also I wanted to save the New Mexico link someone posted - it's a pdf and won't save to my desktop. Anyone else have luck?

[westernskies]

We get paid every week- so bills have to be spread out throughout the month. I am excited to say that after all my bills and expenses for the week were done yesterday- that I came home with $11.00 extra. Okay, that doesn't sound like much- but I figure that $11.00 a week adds up to quite a bit to add to the top debt on my list that I am paying off. I printed a copy of our January budget and took it with me as I ran errands. After each bill was paid, or money stuck in the food envelope etc... I highlighted it. It felt awesome to come home and look at all that I was able to accomplish yesterday. Usually only 1 or 2 things would be paid, but I crossed off quite a bit thanks to sticking to my budget! yahoooooo!

I had to resist the flannel sheet clearance at Walmart... Ooooh, that was tough. Sales are going to be hard for me to pass up! But even though it was only $11.00 I came home with "extra" it gave me a sense of satisfaction knowing that I did it! One week down..............

[Peppermint]

GOOD= getting out of debt

[kerc]

Originally Posted by westernskies

I had to resist the flannel sheet clearance at Walmart...

ok this is a hard time of year for me too. It is cold out, we will still need winter clothes for some time. Flannel sheets also call to me. Yet the stores are beginning to stock warm weather stuff.And everything is on sale. Myself, I have an unwritten goal of avoiding the cheap crappy stuff they sell at walmart, kohls, and the like and saving for the better stuff. When I was a kid I had a flannel top sheet that lasted me from k-garten thru college. Two years ago I got a cheapie flannel sheet set that is already threadbare. I must resist!



Peppermint -- how old is your car? I drive a 99 Honda accord and the service engine soon light comes on when you exceed the recommended interval for oil changes. (the light is on right now for instance). I often exceed the interval as I often forget to get my oil changed before making a big trip. Imagine my horror when 200 miles into a 1000 mile trip the darn light came on!! :LOL

[sm3247]

Originally Posted by Selu Gigage

I read about it and I thought it was interesting, but personally, I thought the spending money on first-run movies and eating out was just as wasteful with money, but I guess they were more focused on decluttering. Personally, I think it's more helpful to a YMOYL spending journal than to just stop buying "stuff." Just my thoughts. All in all, it was a cool piece to read and it got a lot of us talking over at simpleliving dot net.

I kind of thought the same thing - if it were my goal, I would have different rules. For example, it didn't make sense to me that you could buy disposable diapers but not cloth, and my goal would definitely be to eat at home rather than out. However, I did like that they came away from the experience with a sense that they didn't need new things the way they had believed before. I'm thinking of doing this for a month - in the hopes that I'll get of the habit of thinking that I "need" something, rather than want it.