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Dumping Debt and building wealth with Dave Ramsey JANUARY

post #1 of 585
Thread Starter 
My disclaimer: I've been described by my mother-in-law as only thinking in Black and White. I can be brash, very straight forward and could be seen as insensitive. Other than that I am empowered to be very wealthy in my future and to have my children forever debt free.

Roll call:

If I get typos please let me know I liked how one poster copied and then filled in, if did the same. It will make it a little less complicated for me too

Shane in CT:
0-- Get current on bills - n/a
1 -- $1,000 to start an Emergency Fund done
2 -- Pay off all debt using the Debt Snowball done
3 -- Three to six months of expenses in savings done
3.5 -- save for downpayment on house if you do not already own a house already have a house with a mortgage
4 -- Invest 15 percent of household income into Roth IRAs and pre-tax retirement doing
4.5 Bar Mitzvah funding saving up to $3000/$21,000
5 -- College funding for children after the Bar Mitzvah's are funded
6 -- Pay off home early I so can't wait to be here!
7 -- Build wealth and give! --- Invest in mutual funds and real estate To be able to share will be a bessing.

Stephanie in AR (tannersmommy):
0-- Get current on bills DONE
1 -- $1,455 to start an Emergency Fund (extra for taxes)DONE
2 -- Pay off all debt using the Debt Snowball
1 DOWN
2 down (medical) 1/08
4 TO GO - $18K (med, cards, & car), $18K SL
3 -- Three to six months of expenses in savings
4 -- Invest 15 percent of household income into Roth IRAs and pre-tax retirement
5 -- College funding for children
6 -- Pay off home early
7 -- Build wealth and give! --- Invest in mutual funds and real estate

Galatea
BS#0 - na
BS#1 - done
BS#2 - $60000+
BS#3:
BS#4:
BS#5:
BS#6: Student Loan, no mortgage

Carrie (bc1995) in SE AR
BS#1:
BS#2: Van
Student Loan

wendygrace
BS#1:
BS#2: In progress

Sarah (mom2dea)
BS#1:
BS#2: Medical bill

Bunnyslippers:
BS#0 -
BS#1 - 40/1000

MonkeyPrincess

Sam: organic-momma in Calgary AB
BS#0 - done
BS#1 - working on
BS#2 - van

wendizbaby
BS# 0 - done
BS#1 - done

BS# 2 - It is there but skipping for now
BS# 3 - $1000

gsmama2
BS#0 - done
BS#1 - 350/1000
BS#2 - Medical $500
cc's $2700
car $9000

Mommyjoy7021
BS#0 - in progress
BS#1 -
BS#2 - cc's $12000
IRS
SL

Piglet68 in
BS#0 - done
BS#1 - done
BS#2 - done 1/08

BS#3 -

phathui5
BS#1 - Done
BS#2 -
BS#2.1 - $593.34/$5000 sell truck fund

Sara in SC
BS#1 - done
BS#2 - done
BS#3 - Verizon Wireless 175.00 done
Greenbriair appartments 1200.00 done
IRS 750.00 done
CC#1 1000.00
CC#2 1250.00
DH school Loan 4500.00
DH Car 7000.00[/B]
BS#4 - 3/6 months expenses in bank
BS#5 - Invest in retirement - 3% currently

Jamie in West Virginia:
BS#0 - done
BS#1 $885.59/$1000.00

Barb in PA:
BS#0 - na
BS#1 - 1/08
BS#2 -

ReikiMommy07
BS#1 - 900/1000

JackieR

Einley in WI

my2girlz
BS#0 -
BS#1 -
BS#2 - gymoree - done
Target - in progress

Starling&Diesel in
BS#0 - done
BS#1 - 5/1000

APBTLuv in
BS#0 -
BS#1 - done
BS#2 - In progress

Guin in New Mexico
BS#0 -
BS#1 - done
BS#2 - working on

Namella in the expensive eastcost
BS#0 -
BS#1 -
BS#2 -

Heather somewhere in the northeast
BS#0 - done 1/08
BS#1 - Step 1: $771.25/1000. WOOOHOOOOO
BS#2 - HD:1867.28
Car: 3681.69
WaMu: 7078.28
At&T: 16,155.03
UCU: 11,465.43
Student Loan: 100,000
BS#3 -
BS#4 -
BS#5 - $200,000 mortgage
BS#7 -

MissSJ:
0-- Get current on bills Done
1 -- $1,000 to start an Emergency Fund Done
2 -- Pay off all debt using the Debt Snowball Our only debt is our car, what is the Debt Snowball?
3 -- Three to six months of expenses in savings Definately not done.
3.5 -- save for downpayment on house if you do not already own a house Done
4 -- Invest 15 percent of household income into Roth IRAs and pre-tax retirement We are currently putting 8% into dh's 401k but I'm guessing it is more important to pay off the car and build up our savings than to increase this to 15%?
5 -- College funding for children I wanted to open a 529 for the boys next month, per Dave Ramsey is it better to all of the above first? What about the tax benefits?
6 -- Pay off home early I don't even see this happening... What is the benefit, other than obviously not having a mortgage?
7 -- Build wealth and give! --- Invest in mutual funds and real estate

Amanda in
BS 0 - getting current

ILoveMyBabyBird in
BS#0 - getting current

Liz from Maryland (phathui5)
DONE0-- Get current on bills
DONE1 -- $1,000 to start an Emergency Fund
$5k to sell dh's truck, then about $5k more for other ones2 -- Pay off all debt using the Debt Snowball
3 -- Three to six months of expenses in savings
4 -- Invest 15 percent of household income into Roth IRAs and pre-tax retirement
5 -- College funding for children
6 -- Pay off home early
7 -- Build wealth and give! --- Invest in mutual funds and real estate

TattooedMama
0-- Get current on bills DONE
1 -- $1,000 to start an Emergency Fund (was done but some was just used to pay back taxes. Will be replenished this week)
2 -- Pay off all debt using the Debt Snowball (working on this)
3 -- Three to six months of expenses in savings
4 -- Invest 15 percent of household income into Roth IRAs and pre-tax retirement (still investing $100 monthly in Roth IRA)
5 -- College funding for children
6 -- Pay off home early
7 -- Build wealth and give! --- Invest in mutual funds and real estate

CeciMami in NV
0-- Get current on bills DONE
1 -- $1,000 to start an Emergency Fund DONE (more actually since DH has unreliable income)
2 -- Pay off all debt using the Debt Snowball $16K CC, $13K SL, $20K Minivan
3 -- Three to six months of expenses in savings
4 -- Invest 15 percent of household income into Roth IRAs and pre-tax retirement
5 -- College funding for children
6 -- Pay off home early
7 -- Build wealth and give! --- Invest in mutual funds and real estate

Amanda (mumkenna&lucas) in CA
0-- Get current on bills we are here should be current in next 2-3 weeks
1 -- $1,000 to start an Emergency Fund Hopefully we will be able to complete by end of Feb.
2 -- Pay off all debt using the Debt Snowball
3 -- Three to six months of expenses in savings
4 -- Invest 15 percent of household income into Roth IRAs and pre-tax retirement
5 -- College funding for children
6 -- Pay off home early
7 -- Build wealth and give! ---

Daisie125 (michigan)
0-- Get current on bills - done! Finally!
1 -- $1,000 to start an Emergency Fund - $40.76/$1000
2 -- Pay off all debt using the Debt Snowball
3 -- Three to six months of expenses in savings
3.5 -- save for downpayment on house if you do not already own a house already have a house with a mortgage
4 -- Invest 15 percent of household income into Roth IRAs and pre-tax retirement
5 -- College funding for children
6 -- Pay off home early
7 -- Build wealth and give!

esokitty in
BS 0 - getting current

artparent in
BS#0 - done
BS#1 - 700/1000
BS#2 - we have snowballed both credit cards to 0, but allowed them to pop up again. i'm addressing this in another thread!!! have a creditline to pay down, and another loan. i'm hoping to get rid of our car and join a co-op/ride a bike!

Ann in MN:
BS#0 - done
BS#1 - done
BS#2 - in progress

Elizabeth in CT:
BS#0:
BS#1:

Bridget in Missouri:
BS#0 -
BS#1 -
BS#3 -

Kelsi from Maryland
BS#0:
BS#1:
BS#2: working on

TanyaS in
BS#0: in progress

Michelle in an expensive city:
BS#0: done
BS#1: done
BS#2: in progress

Mommyddeville
0-- Get current on bills - n/a
1 -- $1,000 to start an Emergency Fund *currently at $800
2 -- Pay off all debt using the Debt Snowball *snowballing right now
3 -- Three to six months of expenses in savings *will do
3.5 -- save for downpayment on house if you do not already own a house *already have a house with a modest mortgage
4 -- Invest 15 percent of household income into Roth IRAs and pre-tax retirement *currently at 7%
5 -- College funding for children *not started
6 -- Pay off home early *I want to move into a big enough house for our family, and then pay it off
7 -- Build wealth and give! --- Oh, to be at that point!

Allyoop 20 minutes from NYC
BS#0 -
BS#1 -
BS#2 - in progress

Jean (Red) in Mass
BS#0 - getting current with electric bill
BS#1 -
BS#2 - in progress
BS#3 -
BS#4 - n/a
BS#5 - kids are on their own

Andrea in TX:
BS#0 - done
BS#1 - done
BS#2 - almost done

Wendi in:
BS#0 - in progress

ILoveMyBabyBird
BS#0 - in progress

lalaland42
Get bills current. - done
Emergency Fund - done
Pay off debt using snowball - Working on it!

Viv
BS#0 -

Charissa in OR
BS#0 -
BS#1 - done
BS#2 - in progress

Curvyred in
BS#0 -
BS#1 - done
BS#2 - in progress

Another month is upon us and we are getting intense! We are on baby step 4.5, saving for our three boys Bar Mitzvah's.

Here is our budget for Jan:

CHARITABLE GIFTS:
local radio station - 10
Tzdaka - 2 (yea it's tiny but will grow some day)

SAVINGS:
Retirement Fund: 175 (my dh also has a mandatory pension contribution which gets us to the 15%)
Bar Mitzvah Fund: 100

HOUSINGS:
Mortgage: 771.72
Real Estate Tax: 625
Homeowners Ins.: 70
Umbrella Ins.: 27
Repair: 60

UTILITIES:
Electricity: 109.12
Oil: 130
Phone: 84.40
Trash: 8
Computer: 65

FOOD:
Groceries: 480.76 (we put the budget surplus to food this month)
Eating Out: 0

TRANSPORTATION:
Gas: 240
Repairs: 20
Insurance: 176

CLOTHING:
Children: 30
Adult: 8

MEDICAL/HEALTH:
Drugs: 13 (includes vitamins and homeopath)
Dr. Bills: 20
Optometrist: 100
Pets: 50 (our dog is starting on pain killers permentantly, he's really old!)

PERSONAL:
Life Ins.: 34 (we got Zander insurance and our monthly budget for this went way down!)
Toiletries: 26
Hair Care: 19
Education: 0
School Supplies: 0 (we homeschool)
Subscriptions: 7 (covers Net Flix)
Gifts: 10
Blow: 0 (have not been able to put any in here since starting over a year ago)

RECREATION:
Entertainment: 0
Vacation: 10
Scouts: 37 (we alternate this every few months with sports)

TOTAL HOUSE HOLD INCOME: 3518 (mostly dh income and then $400 from my part time job.)
post #2 of 585
I need to fine tune my budget before I post it, but I wanted to subscribe to the thread.

Happy New Year.
post #3 of 585
i just finished reading the book last week so we're on bs1. dh is NOT fully on-board so i know this may take a lot longer.

do we have to post our budgets? how do we account for carry-overs that have to be paid on multiple months?

sarah
post #4 of 585
subbing!
post #5 of 585
You do not have to post your budget. These are support threads, participate as you wish.
If you have excess in one budget area monthly you could adjust that category if you are consistently having an overage. Or you would add it to your EF if that is the step you are on, or the snowball if that is what you are working on.
Or if you are like me with my grocery part of the budget, you can carry it over to the next month... or spend it to zero. I have a pantry and a deep freeze... there is always SOMETHING I can find to buy with grocery money.
post #6 of 585
I just deposited my December paycheque straight onto dh's visa bill and get a cheque for 1200 mid month so will do a second payment then. Feels so good to have one card paid off and start hitting the second, gives us faith in the snowball. I feel like the end is finally in sight, by this time next year we should have no consumer debt (just mortgage).

Sarah, it took my dh a few months to get onboard too and we never got gazelle intense but after reading the book and watching my credit card get paid off and nothing new put on, dh is a convert.
post #7 of 585
Subbing ...

I read last month's thread with interest and have already spoken with DH about starting an EF, which he is on board with. So far, EF balance is around $125 ... it's a start! When I get home from holidays (we're staying with my IL's at the moment), I'm going to see if I can borrow the Dave Ramsey book from my local library.
post #8 of 585
Subbing for the first time.

I ordered the Dave Ramsey computer budget software. I hope to get that set up in January. Our only debt is our mortgage, plus the credit cards that are paid off monthly.

However, our necessary expenses are way to close to our income. I would really like to keep an eagle eye on expenses and make sure we aren't losing out. We haven't started saving for DD's college, and I would like to invest more for retirement.
post #9 of 585
Thread Starter 
Quote:
Originally Posted by sarahlyao View Post
i just finished reading the book last week so we're on bs1. dh is NOT fully on-board so i know this may take a lot longer.

do we have to post our budgets? how do we account for carry-overs that have to be paid on multiple months?

sarah

When I first started the plan we did not do the budget. We accounted for everything that we spent on paper. For the first three months I just wrote down everything that we spent on lined paper as it was spent. No catagories and such just date, item, and amount. After doing that for the first few months then I began the budget. The budget is very daunting at first. You are to figure what you are actually going to spend for the month to come, not the average of the past year and such. Some things will be consistent: rent, mortgage and such. Some will not: clothing, repairs and such. It takes many months to fine tune a budget, don't give up when you get there.

Have you been writing down all your spending?

Be well,
post #10 of 585
HydePark - let us know how you like the software. I was thinking of trying it because I can use all of the extra help I can get to become organized, but I'd like to hear some reviews before I buy it.
post #11 of 585
I can't really post a budget, because I never know what - or even if - dh will get paid each week. Plus, because he was unemployed for 8 months, we are behind on everything. I will be making changes to our monthly bills (cancelling things, changing carriers, etc.) for January.

This is supposed to be a good month for our financial situation, though, so we'll see...

Subbing for help and motivation.
post #12 of 585
Quote:
Originally Posted by MonkeyPrincess View Post
I can't really post a budget, because I never know what - or even if - dh will get paid each week. Plus, because he was unemployed for 8 months, we are behind on everything. I will be making changes to our monthly bills (cancelling things, changing carriers, etc.) for January.

This is supposed to be a good month for our financial situation, though, so we'll see...

Subbing for help and motivation.
I hope it's a good month for your family!!!
post #13 of 585
My January budget:
Rent (includes water/sewer, trash/recycling): $588.12
Renters Insurance: $20
Phone/internet: $39
Electric: $50
Satellite: $38.73
Gas (cooking): $20
Fuel oil: $136
Alternative healthcare: $30
Savings: $60.24-145.57 (higher end is steep but I hope to make it...)
Household: $10
Food: $200 or less
DH: apparently we're paying to get his PC fixed... Don't know how much it will be, but he's not getting allowance until he pays me back.
DS: $30
gifts/gift-making supplies: $16.66
post #14 of 585
OK, i read the thread last month and asked a few questions, now i'm ready to start. Since i am also compacting it should make it easier to stay on budget. Good luck to me
I will post my budget once i finalize everything!
post #15 of 585
Quote:
Originally Posted by shanetedissac View Post
Have you been writing down all your spending?
We have not been writing all of our spending because we use the envelope system so I don't write the things in envelopes like gas and groceries down.I do track our blow $ though.. I have been keeping track of my non-necessary spending on the no spend thread here.

Here is our January budget
House: $500
Truck: $386
Car Ins. $183
PG&E: $90
Water: $40
Food: $300
Gas: $400
Cable: $50
Credit Crads: $120
Dance: $45
Amerigas: $50
Fidelity: $45
Medical Bills: $190
Garbage: $40
Blow: $100

We actually took alot out and are going to try it this way for a while that leaves alot of extra $$!! so I am pleased with that, however we are not current on a few things since dh did not work as much as normal in Dec. So at first that extra $ will have to be used to play catch up
post #16 of 585
I'm amazed at how low people's housing costs are. We rent a 3-bedroom townhouse for $1354/month, plus water, gas heat and hydro. And that's out in the suburbs; not in town. We did previously rent a 3-bedroom townhouse for $1131, which was cheaper, but the neighbourhood was unsafe with beer bottles broken everywhere, we found firemarks on the side of our house, and we called the police on the neighbours regularly for suspected child abuse. It was terrible. The house itself was a mess also...

I'm going to sub to this thread to get some ideas. We are planning on buying a house this summer, and we've got our financial work cut out for us between now and then. We'd like to cut back our monthly expenses which includes debt expense. Our largest debt is for our student loans.
post #17 of 585
I'm going to sub too. We just condensed our CC's into a low interest home equity loan so it's going to help a ton with cash flow. I'm going to borrow the Dave Ramsey book from my SIL. I stink at finances. I used to be awesome but not anymore.

Our house payment is $2400/month if that makes anyone feel better. WAY over budget. Dh has gotten about $25000 in pay cuts since we moved here and the housing market is so bad it makes no sense to sell right now. So we're hanging on by a thread and praying for relief soon.
post #18 of 585
I read Dave's book yesterday. It was so easy to read. He is really good at keeping up the interest level all throughout it. I couldn't put it down!

I loved reading the stories of the people who managed to get out of debt.

I have decided that I do not want to live like "everyone" else says that I should live. I do not want to buy a car I can not afford or move out of my modest, $420 month rental house and buy my own home that I can't afford right now. I want to be WEIRD

So DH is really excited that I finally found something that made it click in my head. We cut out our eating out and I cut out any extra driving. I am proud to say that I have not been to a Big Box Store in over a month And I have not had any fast food in over a month Not only have I saved money, but I have lost weight What a concept!

The other day I took a hard look at what I had in the pantry/freezer and I made a grocery list for the next two weeks using cheap meals using up ingredients we already had. I am proud to say that out of the $200 I used to budget for two weeks of food can be reduced. I aimed for $175, but only spent $100!!! That is $75 extra dollars that I can take TODAY out of the envelope and sock in to the EF Plus the $25 I already saved by cutting it out in the first place.

And now I am gearing up to make the next two weeks menus with things we already have

I used to be embarassed about my old house and my old car, but now I am proud of them. Because I am living below my means already, even before reading the book, so I can only go further from here

I have decided that since I work nights and can sleep at work if it is slow, that maybe I will start taking a substitute teaching job once a week or so for extra income. Plus, I have a lot of books that I might be able to sell on Ebay. I am going all out gazelle here, folks!

Now to try to convince DH in to selling his car. Wish me luck on that one :
post #19 of 585
Subbing.
post #20 of 585
Question about Student Loans... If your SL are huge, like $100+k, should they still be paid off in BS#2 or moved to BS# (um whatever the mortgage one is - I'm still stuck in BS#2)

TIA!
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