Financial Peace University is offering one free class the week of April 5th-12th. This is a great way to find out what Dave Ramsey is all about. He will be teaching his steps on getting out debt and building wealth. Register to find a free class in your area.
Thank-you Money Saving Mom!
I previously wrote that we aren’t done yet. We paid off our debt sure, but that doesn’t mean we can quit working and buy a beach house just yet. We are using Dave Ramsey’s Baby Steps as our guide.
1. $1,000 to start an Emergency Fund
2. Pay off all debt using the Debt Snowball
3. Three to six months of expenses in savings
4. Invest 15% 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.
Since paying off our debt we have been able to save enough to fully fund our emergency fund with 6 months worth of expenses. We’ve also been able to put quite a bit into savings for a down payment on a house. It’s been over 18 months since we sold our house, moved and started renting while we looked for a house.
Where does that leave us?
*Step #4. Invest 15% of household income for retirement.
Currently we are still investing 4.5% and saving the rest for the downpayment. I waffle back and forth on whether we are doing the right thing. I’m not sure if we should continue to do this, or invest the full 15% and save the rest for a downpayment? I know that investing a full 15% every month would significantly lower the amount we could save and take us longer to save up for a house. What would Dave Ramsey suggest? Not sure. What do you suggest?
I do know that I, at the very least, want to continue investing the 4.5% into the 401k. My husband’s employer matches that and I would hate to lose out on that free money.
It’s amazing how time goes. It’s hard to believe it’s only been 8 months since we paid off the last of our debt. It feels like making that last car payment was forever ago. We’ve slipped into a nice routine of not even thinking about debt or making a monthly payment. We are no longer have decide whether to make the minimum monthly payments or try and pay extra. The thought of having credit card debt or a car payment makes my heart beat a bit faster and my chest feel a bit tighter. For all the nice ‘things’ debt could buy us, the worry, heartache and stress is not worth it for us anymore.
During the last eight months I’ve thought a lot about what to do with this blog of mine. I started writing to keep track of our progress and journey to financial freedom. 3 years ago I first read Dave Ramsey’s book The Total Money Makeover and knew right away it was something we could do. To keep the motivation and most of all to stay accountable I started a little blog. It’s made a world of difference in our debt-free journey.
*It’s held me accountable. Who wants to claim they are trying to get out of debt, only to have to add $10,000 in new furniture to the debt total? Umm…not me. I did not want to see our debt go up, and it excited me to see that number go down; dollar by dollar and penny by penny.
*It’s also great proof that getting out of debt IS possible. Debt does not have to be the “American way.”
*It’s also been encouraging. I can go back and see where we started and see how far we have come.
But we aren’t done.
I can’t even describe my feelings right now. Relief. Accomplishment. Thankfulness. Those are just a few of the emotions I’ve felt since yesterday. What happened yesterday you ask?
Well….we paid off our very last car loan. Which means we are DEBT-FREE!!!!!!!!!
We started out with $58,345.16 a little over 2 years ago. When we started with that amount of debt it seemed huge to us, almost insurmountable. We had 2 car loans and a maxed out credit card. Now, 27 months later we have no debt. We aren’t normal, and I love it! The automatic payment scheduled this Friday for our car loan won’t happen. Instead, we’ll get to keep our money, and let it accrue interest in an account, instead of paying interest to someone else.
If you feel like you never have enough money, or won’t be able to retire when you want, please, please pick up a copy of The Total Money Makeover by Dave Ramsey. It will change your life, I promise.
If you have already begun the journey, and feel overwhelmed or can’t see the light at the end of the tunnel, hang in there. It will get better, and one day you will be celebrating too. Let me know when you are debt-free!
It’s official. The honeymoon is over. For years I’ve enjoyed doing our taxes myself. Yes, I did use enjoy and taxes in the same sentence. I loved entering everything on the forms and working the numbers.
It all started when my dad sat me down in high school with a pencil and a copy of a 1040EZ. I filled out the form and he instructed me in how to fill it out. Ahhh, those were the days. When I joined the Marine Corps and got married I moved up to a 1040A. Things got more complicated and we went to the 1040 and I started using TurboTax to help me file. We got tax refunds for many years before we got smart and figured to have less taxes withheld from our paychecks instead of loaning the government our money all year. There were even a few years while my husband was active duty and deployed to the middle east that our tax liability was $0. We are in a different income bracket now, so while I’m truly thankful for that, our taxes have gone up and gotten a bit more complicated.
I’m done with doing it myself though. In 2008 we sold our house and moved across the country. We had two state income tax forms to file and of course the federal form. If you’ve ever tried doing 2 state income tax forms you know it’s not fun or easy by any means.
So while I have this little voice in the back of my head telling me I’m a failure for not being able to do it myself, I don’t trust my sleep deprived brain enough to file our taxes. I need help. IRS, if you are reading this, why do you have to make it so stinkin’ complicated?!!!
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Starting Debt $58,345.16 as of March 28th, 2007
DEBT-FREE on June 30th, 2009!
