Dumping Debt and Building Wealth with Dave Ramsey ~ May - Page 3

[phathui5]

Staying on track with our economic stimulus money

We got our stimulus check direct deposited today. It was $1890.10. I wrote a check to our midwife for $700 (still paying off the last baby). When I get the bill from Best Buy, I'm going to pay that off completely. Our snowball would have covered most of it, but I'm adding in about $100. Another $940 will go to Room Store/Retail Services (on top of our regular payment).

The other $150 I'm going to use to buy clothes and keep for things that come up that well, we want. I guess it'll be stimulating the economy. And let me tell you, that money will go a long way at the thrift store and the homeschool consignment shop!

Then our BS2 will look like this:
$466 Capital One- killed!!!
$614 Van loan - killed!!!
$1091 Best Buy- killed!!!
$750/$1770 Midwife
$1004/$2184 HSBC Retail Services
$4249.63 Needed to get out of Truck loan- sitting in savings until we decide whether to sell it or keep it

BS2 may actually have an end in sight!

[crunchy_mama]

That is wonderful ! Wow, you only have like about $2k left right? At this rate it won't be anytime at all!

I think we will be getting our stimulus next week, it is going toward vacation, dh is building the kids a playset, and money towards a carport(to go along with other we have in a savings account.

[VagrantNic]

So hail storm came through. $500 deductible on my car and no money. Come on stimulus check...get here tomorrow! (We are on the May 9th round.)

Also, I have a question. What would you do? The stimulus check is going to pay for the $500 ded and the $350 that we fronted to replace a windshield. That leaves $350. Where would you put it? I was thinking savings, but since it's "extra" money, I want to put it on CCs/loans too. Any thoughts?


Here's where we're at:
BS1: 8.37/1000
BS2:
$3805 Chase CC
$491 Capital One CC
$5733 USAA CC
$3746 AAFES
$14796.57 Car Loan-Mine...I know I know...(updated exact total)
$7899.86 Car Loan-Husband...(updated exact total)
Not even going to think about School debt until this is taken care of. I am still in school, so I don't have to worry about it.

[Mama Rana]

I don't have much of an update at the moment; need to catch up on my finances. But the budget for May is looking good. I should be able to put another $225 into my emergency fund. I'm not sure how much we'll be getting in our stimulus package, but I don't expect it anytime soon since we're in the last wave of direct deposit payments. I'm not counting on it for anything, but it will be split between emergency fund and vacation fund, and maybe a little bit here and there.

BS1 $1,000 to start an Emergency Fund-- Done
BS2 Pay off all debt using the Debt Snowball--Done
BS3 Three to six months of expenses in savings--$12225/$15000 as long as May goes ok.
BS4 Invest 15 percent of household income into Roth IRAs and pre-tax retirement--Not sure what percentage, but we are already contributing to IRA's and a 401K
BS5 College funding for children--~3.5% of our net income a month
BS6 Pay off home early--We're on schedule to make one extra full payment a year
BS7 Build wealth and give! Invest in mutual funds and real estate--I'm going to need a lot of help when I get here!

[Mama Rana]

Originally Posted by VagrantNic

So hail storm came through. $500 deductible on my car and no money. Come on stimulus check...get here tomorrow! (We are on the May 9th round.)

Also, I have a question. What would you do? The stimulus check is going to pay for the $500 ded and the $350 that we fronted to replace a windshield. That leaves $350. Where would you put it? I was thinking savings, but since it's "extra" money, I want to put it on CCs/loans too. Any thoughts?


Here's where we're at:
BS1: 8.37/1000
BS2:
$3805 Chase CC
$491 Capital One CC
$5733 USAA CC
$3746 AAFES
$14796.57 Car Loan-Mine...I know I know...(updated exact total)
$7899.86 Car Loan-Husband...(updated exact total)
Not even going to think about School debt until this is taken care of. I am still in school, so I don't have to worry about it.

DR would tell you to put all the extra towards your snowball, smallest loan first (you could almost pay off that Capital One card). I tend to put the majority of any extra money towards whatever step I'm on, but take a small percentage to do something fun, or fund our vacation budget.

[lizziebits]

Hey All!

We're back for our second month. I'm Liz, married to my husband Matt. I stay at home with my son Greg, who is 15 months. DH is a teacher, and also does part time landscaping during the summer. I am starting nursing school in the fall, and doing some pre-req courses starting May 14th. We started doing Dave Ramsey last month, and I am proud to say we stuck to our budget and are pretty darn gazelle like!

We're on BS#2, the debt snowball, but we haven't been able to get a real good start on that because of paying for my summer classes. However, b/t extra money from last month and a reimbursement class, we should be able to start throwing money at our 2nd mortgage this month. YAY!

OK, so here is our deal:

BS0 -- Always done.
BS1 -- Starter Emergency Fund: $1000/$1000
BS2 -- Snowball: 0/~$25,000 (2nd Mortgage), 0/~$18,000 (Student Loans)
BS3 -- Emergency Fund: 0/$10,000
BS4 -- Retirement Fund: 7.5%/15%
BS5 -- College Funds: 0/$200
BS6 -- Pay off House: 0/$125,000
BS7 -- Build Wealth and Give!!

[phathui5]

Also, I have a question. What would you do? The stimulus check is going to pay for the $500 ded and the $350 that we fronted to replace a windshield. That leaves $350. Where would you put it? I was thinking savings, but since it's "extra" money, I want to put it on CCs/loans too. Any thoughts?

Until your BS1 emergency fund is full (at least $1000) every extra penny goes into savings. Make the minimum payments on everything until you have that done.

Then you move on to BS2, paying off your debts like this:

$491 Capital One CC
$3746 AAFES
$3805 Chase CC
$5733 USAA CC
$7899.86 Car Loan-Husband...(updated exact total)
$14796.57 Car Loan-Mine...I know I know...(updated exact total)

Once the BEF (basic emergency fund) is done, you throw every cent you can find at the first debt, making only the minimum payments on the others. As you get each one paid off, you go on like that, attacking the next one.

[JackieR]

JackieR's Update

JackieR
0: Get current on bills: Always done
1: $1,000 to start an Emergency Fund $4600/$1000 (We don't get paid from 5/15-7/15, so we need a huge EF to carry us)
2: Pay off all debt: $8000 home improvement @ 2.9%, $64400 in student loans at about 3.5%
3: Three to six months of expenses in savings $0
4: 15% income into retirement: Always done - Current value about $110K
5: College funding for children: $100/mo goes to their 529 - Current value is about $1200
6: Pay off home early - $143K home loan @5.5%
7: Build wealth and give! Invest in mutual funds and real estate. We have four or five parcels of land beyond our home (hubby's hobby). We do minor giving to school, local, and state fundraisers but not as much as we'd like.

[FeelingBlessed]

Definitely want to get in for another month here; finding this thread very inspirational! Feels like we are gaining momentum, which is quite exciting. Signed a Purchase & Sale agreement today to sell some land we own and have no plans to use; should have $60K to put against debt within the next 2 weeks.

BS1 - $1K EF - DONE
BS2 - Debt Snowball - Working on it... (see below)
BS3 - 3-6 months expenses (might go out of order + put some of land sale proceeds in here)
BS4 - Save 15% for retirement - DH & I have $ in IRAs rolled from former jobs; also contribute minimally to my 403(b)
BS5 - College funding - both kids have 529s established w/ financial gifts
BS6 - Pay off home early - someday...
BS7 - Build wealth + give! Invest in mutual funds + real estate - looking forward to being in a financial position to give exponentially more; we currently have 3 rental properties, (1) of which we plan to sell this summer, with proceeds going toward debt; also have mutual fund investments

SNOWBALL PROGRESS...

Since the official launch of our snowball on 2/15/08:

Snowball - Phase 1 (short-term): $3,514.75 PAID OFF

Snowball - Phase 2 (long-term - mortgages for 3 properties + grad school loan): $1,125.61 PAID OFF

TOTAL PAID OFF: $4,640.36

Snowball Goal for May was to break the $7K mark (this was going to be a stretch, but with the pending land sale, we should blow through this, so will now aim for $60K)

Kim

[JackieR]

Missouri

crunchy_mama - where in MO are you? My husband and I are (combined) five-time Mizzou grads!

Go Tigers! RAWR!

Jackie

[TanyaS]

Originally Posted by lauriem33

I think on the April thread someone had mentioned doing Dave's FPU. Could you tell us a little bit about it, was it a video class or online or how did it work? I know you had said it got DH more on board than just talking about it and I would really love that for me and my DH.

We started the class at the end of January. It's a three month class that meets weekly. We met at our church, and childcare was provided for free for our three kids. The beginning of the class is a video of Dave at an FPU class he led. Very engaging and rarely boring. At the end of the class, we split into small groups for "small group discussion." Here we went more in depth on the lesson and shared our personal struggles and strengths. Later in the course, the beginning often started with others sharing good news. At the last class, one couple announced they were debt free! Overall, the combined debt payoff for the class was over $158,000 in just 90 days!!!

The most important thing we learned was how to talk to each other about money. It really opened up the communication lines between me and my dh. My dh also has issues not getting on board 100% just because I think it's a good idea. He might agree in theory, but not with actions. This class jolted him into action! I think part of it is he didn't just hear it from me.

I believe there is a video class online, but the support from real live people was invaluable, much the same way this thread is priceless!

I also got my economic stimulus check today and paid off THREE credit cards. Bye, bye. Don't let the door hit you on the way out.

[phathui5]

Good work Tanya!

Anyone else get economically stimulated? What are you paying off? Adding it to savings? Share your gazelle-like stories.

[JackieR]

When we're stimulated on 5/9, we'll be adding it to our savings for the summer. Whatever is left over at the end of the summer will go to the shed debt. I'm hoping for $1000.

Jackie

Originally Posted by phathui5

Good work Tanya!

Anyone else get economically stimulated? What are you paying off? Adding it to savings? Share your gazelle-like stories.

[CeciMami]

We were stimulated today (heh heh...) and i immediately paid it towards my MC...we're under 11K for the first time in YEARS!!!! :

[crazyeight]

i have not planned anything yet. not sure what to do with it. we will be buying a swing set so that $200. i am wondering if dh and i should go on a mini vacation but not sure yet. mostly i think i will just put it into savings to go towards our car debt since thats what we are working on.

[lalaland42]

We are still working on BS2 and paying off DH's cc. We are under $3000.

It looks like I will have to dip into the emergency fund to fly me and DD home to visit my Grandma. Her memory is getting really bad and they just found a tumor that looks even worse. This seems like an emergency to me.

[Mavournin]

We were stimulated on Saturday. I haven't done a lot yet because I need to make some phone calls in the morning. I got on the computer last night to pay off my small bills (just starting the snowball this month) and found that the majority of the medical bills cannot be found in the hospital system. I know I paid off a pile of stuff last spring and in the late fall, but I didn't think it was these bills. (boo hoo if it was, I could have included it in my taxes) It would make sense though, if I paid and can't remember, the first set was paid two days before I had a baby and the second set when I was in the height of the PPD.

Anyway, if these bills are already paid it will just go towards our only credit card.

[shanetedissac]

Originally Posted by phathui5

Good work Tanya!

Anyone else get economically stimulated? What are you paying off? Adding it to savings? Share your gazelle-like stories.

Well, the federal government miffed us and instead of getting out tax return to us by direct deposit, as requested through out accountant, they cut us a check. That means that we do not get our stimulus check until Aug! We are planning on using it to get a new desk top computer.

Be well,

[bc1995]

We got ours. We are going to need to use part of it for two mini vacations we are going on with family. (I had really hoped to have enough saved to not have to do that, but at least we will have the cash.) The other part is going towards my WAMU card that I am snowballing right now.

[sunkissedmumma67]

The truth is, very few people ever accumulate real wealth, while working for someone else!