I'm two weeks past our Dave Ramsey anniversary, but I haven't had adequate time to sit and figure all of this out until now. Two years ago we started Dave Ramsey's amazing Total Money Makeover plan. You can read all about our first year, during which we paid off a whopping $11, 113 here.
Drum-roll, please. This year we paid off another $12,760. That is a two-year total of $23,873.
Well, sort of. Unfortunately, we had to incur some debt this year. Having to buy two cars in one day will do that to you. So, even though we did pay off $12,760, we actually only made progress of a little over $6000. Still, that's $6000 in the right direction. And then there was that emergency fund. Oh, we were so happy for that emergency fund this year, and we had to replenish it over and over. First there was the new refrigerator, then the $2000 transmission (you know, the transmission on that van that got totaled a week later), the new water heater, the repair work on the new van, and, finally, the oven. And what astounds me is that we had the cash to pay for all of that stuff: because Dave Ramsey showed us how.
First of all, we both read his Total Money Makeover two years ago. (Right now, just in time for Christmas, Dave is running a $10 special on every book he sells, including TMM!) Then we began the baby steps to financial freedom:
• $1,000 to start an Emergency Fund.
And during this past year, we have used that emergency fund many times (see above). For all of those things, we paid CASH (which means that we had to replenish the Emergency Fund on several occasions).
Next, we began tracking all of our expenses and created a budget a la Dave Ramsey. After tracking our expenses for a few months, we began using the envelope system for everything except for those bills we pay by mail. This has helped us with Baby Step #2:
• Pay off all debt using the Debt Snowball.
Dave’s system is to pay off the smallest debts first so that you feel successful. It really does work. We have two debts slated to be paid off in the next few months, and then we can tackle the Biggie (AKA, the student loan). It may be a long time until we get to the next several steps (although we do have some college funding going for the kids):
• Three to six months of expenses in savings
• Invest 15% of household income into Roth IRAs and pre-tax retirement
• College funding for children
• Pay off home early
• Build wealth and give!
We still have a long way to go. That's what happens when you take out student loans for six years (post-graduate) and put a piano (among other things) on your credit card. The credit cards are paid off; we're whittling away now at the student loans. But we've made huge progress, and more than anything else, we have financial sense. We only use cash, and we are serious about our monthly budget.
Dave's favorite word is FREEEEEEDOOOOOOOOOMMMM, and we are tasting it. People have said to us, "How can you stand to be strapped down to a budget?" As parents, we know that kids do better with a structured life. They have freedom in knowing what is expected of them. It's the same way with finances: we feel a sense of relief knowing that this is what we have to spend--and no more.
I am so tremendously thankful for Dave's plan. Randy and I were both raised to be good stewards of our finances, but we did not really understand what this meant until it was too late. I know I shouldn't say this (Dave wouldn't approve), but I don't regret the student loans. Because of the loans, I was able to stay at home with our two little ones while Randy worked on his PhD, and I also finished my master's degree. God has given us abundant blessings through Randy's hard work and ensuing PhD. I'm sure there are things we could have done differently, but I wouldn't give up being a SAHM for anything. That said, without finding Dave Ramsey, we might have continued down a spend-more-than-you-make path for a long, long time.
I don't see the light at the end yet, but I do have faith it's there.
Showing posts with label Dave Ramsey. Show all posts
Showing posts with label Dave Ramsey. Show all posts
Sunday, December 16, 2007
Wednesday, November 7, 2007
Dave Ramsey Has Brainwashed My Child
November 7, 2007
In the car yesterday, as we pass Shoe Carnival:
Me: I need some brown boots. Really comfortable brown boots.
Duncan: But you have black boots. Why do you need brown boots?
Laurel: Because sometimes she needs brown boots and not black boots!
Duncan: You can spray paint your black boots.
Me: Duncan, here is something you need to know about women because someday you will have a wife. Women usually like shoes. Most women like to have lots of shoes. You need to understand that sometimes your wife will want brown and black boots.
Duncan: Well, you can't have brown boots. Because WE ARE TRYING TO SAVE MONEY!
Geez. Who invited Dave Ramsey into our house, anyway?
Comments
Wednesday, November 7, 2007 - Kids say the darndest things.........
or as Rory loves to quote back to me "You don't NEED brown boots, you WANT brown boots." Sheesh, I hate when my own words come back to bite me like that.
Wednesday, November 7, 2007 - Untitled Comment
HA HA HA!!
Blessings, Beckie :o)
Wednesday, November 7, 2007 - Untitled Comment
Oh, no! I love shoes. That simply would not do.
BTW- you should send that do Dave Ramsey himself.
Edited by skdenfeld on Wednesday, November 7, 2007 at 11:58 AM
Wednesday, November 7, 2007 - that settles it
I can never move down there.
I have the best brown boots, to be sure. Got them at a Bass Outlet on the way home from your house, but on the way in to my Daddy's baptism, I asked Neal to check out my friend Cheryl's killer boots. They, too, were brown but I KNOW I could get them in black, which I have been trying to convince Neal that I need for some time now. I keep going back and forth between my strappy heels and my sandaled heels pointing out each time that my whole foot is UNcovered and will very soon be getting too cold for comfort.
(crickets chirping)
I think he thinks like Duncan.
stink.
Wednesday, November 7, 2007 - so what's my problem?
I like shoes too, except here is my shoe repetoire (don't worry, this won't take long)
Brown leather sandals -- almost 12 years old
Brown fantastic heeled shoes -- almost 8 years old
Black really painful wore them as a bridesmaid high heels, actually might have just thrown them out finally -- almost 9 years old
Nike Hiking boots -- 12 years old
Nice summer dress sandals -- 5 years old
That's it.
sad. poor lonesome me. Although I do believe that Kristina and I are the same size so maybe I'll go steal her brown boots. they really are fantastic.
Wednesday, November 7, 2007 - Ho hum
Now I feel really sad, because I have no boots. Well, I have that old pair for horseback riding, but surely they don't count.
I was pining away after some snow boots in the LL Bean catalog when I realized that it probably will not snow here ever again!
Wednesday, November 7, 2007 - Okay, I'm so glad I didn't have any liquid in my mouth when I read that!
I totally snorted! I've tried to explain a girl's need to own multiple shoes to my hubby as well (and we are low maintenance gals). He was really confused the year that I bought several pairs of flip flops for the girls from Children's Place (the price was cheaper than Wal-mart).
Thanks for the compliment about my girls and stopping by my blog!
Abby
Thursday, November 15, 2007 - Very cute!
I'm teaching Financial Peace for the Next Generation to high school kids at my homeschool co-op right now.
Did your son see the session on Relating to Money and how men and women are different wrt money? It was a hoot! But sooo true. I didn't think high school age was too soon for them to understand the dynamics of money in a marriage. Good for you for teaching your son early about women's needs and wants.
The kids in my class think Dave Ramsey is very funny and they're learning a lot too.
Wednesday, November 29, 2006
Happy Dave Ramsey Anniversary to Us!
It’s been one year since we began actively implementing Dave Ramsey’s Total Money Makeover program. In this past year we have completely and radically changed how we handle money. The result: in one year we have paid off a whopping $11,113. We have a long way to go (7 years of student loans will do that to you), but we are one year closer to calling Dave and yelling, “WE’RE DEBT FREE!” That is going to be one awesome day in SmallWorld.
So what have we done? First of all, we both read Total Money Makeover. Then we began with Baby Step #1:
• $1,000 to start an Emergency Fund.
And during this past year, we have used that emergency fund for car repairs (twice), a new dryer when the old one finally bit the dust, a new dishwasher (ditto), and oven repair. For all of those things, we paid CASH (which means that we had to replenish the Emergency Fund on several occasions).
Next, we began tracking all of our expenses and created a budget a la Dave Ramsey. After tracking our expenses for a few months, we began using the envelope system for everything except for those bills we pay by mail. This has helped us with Baby Step #2:
• Pay off all debt using the Debt Snowball.
Dave’s system is to pay off the smallest debts first so that you feel successful. It really does work. We paid off several small debts and our van. We have two more debts slated to be paid off in the next few months, and then we can tackle the Biggie (AKA, the student loan). It may be a long time until we get to the next several steps (although we do have some college funding going for the kids):
• Three to six months of expenses in savings
• Invest 15% of household income into Roth IRAs and pre-tax retirement
• College funding for children
• Pay off home early
• Build wealth and give!
So while we still have a long way to go, we have absolutely gotten a taste of the financial freedom—and it so, so delicious. We are about to celebrate our second CASH ONLY Christmas. We have not put anything on a credit card in a year. We planned and budgeted for all of our travels this past year. Randy taught a class this past summer to earn extra money, and, besides my regular teaching at our support group’s enrichment classes, I have been blessed with a regular proofreading job (thanks, Ang!) that satisfies my yearning for a little something extra every now and then. We did not squander away our income tax refund or Randy’s summer salary. Most of all, we have not accumulated any new debt. We changed our behavior, and the fruit has been abundant. I am looking forward to this time next year, when we are even closer to knocking out that nasty debt.
Subscribe to:
Posts (Atom)