Posts Tagged With: budget

Renewal: Debt-free Living

debt-free

 

Taking Stock

It’s Thursday, and that means one thing at my house: budget day!

There are a few things that I do before diving into the budget.

First, I pay tithe

Second, I take stock of the finances.

I am going to save what I mean by paying tithe for a later post and first discuss what it means to take stock.

As mentioned in the first post of this series, we did all of the homework assigned in Financial Peace no matter how brutal. The first assignment was to take stock of our finances.

Taking stock as described by Ramsey is totaling one’s “non-mortgage debt,” including “any money [one] owes on anything.” This means listing totals of credit cards, student loans, bank notes, car loans, outstanding doctor/dentist bills, home equity loans, etc. Everything one may owe outside of the first mortgage and monthly utilities.

This assignment was probably the single most eye-opening assignment of the class. I knew in my head how much we owed and to whom, but I never actually added it all together. Listing our debtors by name or title and the amount we owed to each brought a new level of seriousness to our situation. When I calculated the list and wrote down the total in the workbook, it brought me to a shocking realization: we were in debt more than $50,000. It took the wind right out of me.

What the heck? How did this happen? We can’t possibly own that much?

So I added it together again. The total was the same.

What the heck? None of the bills seem that large! Well, except the two car payments, but that couldn’t be helped. You can’t plan for a deer jumping out of the ditch and totaling your car.

And on and on went the week-long conversation I had with myself.

By the end of the week, I was mad. I remembered going into the first class hopeful that we would learn to live debt free. Now I was determined. It wasn’t a regular type of determination. It was fire and brimstone determination. I walked into the second class ready to get to work and pay off all the debt.

After that class, every Thursday I have taken stock of our finances. I make a grid on a simple sheet of writing paper, write the debtors on the lines, how much we owe, what is paid that week, and how much extra we can afford to pay, and then I total everything up.

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A template of the grid I use. As you can see, I am not highly technical. I am positive that using a spreadsheet program would be easier and less time consuming; however, writing it by hand and calculating it myself forces me to pay closer attention to the details.

 

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This is an example of what it looks like filled in. The grid is designed according to Ramsey’s signature “Debt Snowball” – listing debts from smallest to greatest by the balance owed. The amount listed in the “Payment” column is how much is being paid out that week. The “Extra” column is for any additional payments I can make that week.

I do this weekly because we get paid weekly. Plus we make weekly car payments and bi-weekly mortgage payments (I’ll explain why in a later post), so it helps me to keep track of how much we pay and when.

It may seem tedious, but I do this every Thursday for three reasons:

  1. It reminds me of the reality of our situation. By writing it down every week with my own hand, I am forced to claim it and take responsibility for it. That’s is my handwriting. That is my debt.
  2. It reminds me from whence we came. Each week, I am reminded of how much has changed for the better.
  3. It encourages me to not give up. As I see the gap grow between where we started and where we are now, I take pride in writing down a smaller number each week, not to mention the great satisfaction I get from crossing a debtor’s name off the list.

Once I have taken stock of our bills, I am ready to dive into the budget. Taking stock before doing the budget strengthens my resolve to live debt free, and I start cutting out unnecessary spending with a renewed vigor.

As Dave Ramsey says, “If you live like no one else, later you can live like no one else.”

That’s the goal.

This is an example of what it looks like filled in. The grid is designed according to Ramsey’s signature “Debt Snowball” – listing debts from smallest to greatest by the balance owed. The amount listed in the “Payment” column is how much is being paid out that week. The “Extra” column is for any additional payments I can make that week.

Note: I am not a credit counselor, nor am I or this blog affiliated with Dave Ramsey or Financial Peace University in any capacity other than a student. The following post strictly a testimonial designed to encourage debt-free living.
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2013 in review

So here it is, 2014.  I remember celebrating the New Year in 1985 and thinking, “Wow, it feels like 1982.” I was a senior in high school in ’85 and finally felt like I could make it in high school.

It takes me a little longer than most to build confidence, but I get there eventually.

When I started blogging in September 2011, I was far from confident that I could generate any type of following, but I did.  I have my 2013 New Year’s resolution – to be better – and family, friends and some awesome fellow bloggers to thank for that.

Was I better in all things? No, not at all, but I made progress in many areas:

  • Health – getting a better grip on my hypothyroidism and Hoshimoto’s decease.  With diet, exercise, and a vitamin regimen of athletic champions I am feeling tremendously better. 😉
  • Driving – I almost made it all year without getting a speeding ticket. Blast you Perry, GA!  Even with that one ticket, I still finished 2013 better than 2012. One more year doing “better” and I’m no longer considered high risk. Whew!
  • Parenting – I took a huge step into the completely uncomfortable and decided to homeschool F and Z this year.  I am not saying in the least that homeschooling makes me a better mother, because I don’t believe that it does; however, it has provided the time needed to uncover deeper causes of some troubling issues.  I am confident that with the information gained I can be a better parent.  I’m just not convinced the discovery is weighty enough to balance the intellectual and emotional scarring they’ve experienced by having me as their teacher.   Only time will tell.
  • WalMart – I didn’t step foot into a WalMart store for all of 2013, and I am a much better person for it! Not to mention my pocketbook is much happier, too.
  • Work – Continuing to tutor homeschooled students in various levels of high school English, I’ve also taken an adjunt English instructor position with an area community college.  I’m not sure how I’m going to juggle all of it, but I’m pretty sure Adderall will be a key player.
  • Financial – In July, I started listening to David Ramsey’s Financial Freedom seminars through Gateway and reading his blog.  I have my budget, my cash, and my plan.  One small credit card paid off, car to be paid off by March, and the first of two big credit cards to be paid by the end of 2014.  You may not understand the magnitude of this step in the better direction. It’s *hands spread shoulder-width apart, fingers spread and bent as if to catch a basketball, and with a deep voice say…* BETTER!

I didn’t do so hot with my reading list or my writing, but I’m not going to allow those two perceived failures to squelch the contentment I feel.  Something has to give, right? Seriously, if I had to choose between spending countless hours completing my book list or spending countless hours discovering what is troubling my child, I am obviously going to spend those hours on my child. Although, it would have been a lot less painful reading the books.   😉

On the lighter side of things, “the WordPress.com stats helper monkeys prepared a 2013 annual report for” me, and I’m quite happy with it.  My blog stats are better than last years (largely in part to gaining new readers, so thank you new readers of my blog for making my year successful), so I’m feeling good, my friends.  Feeling good, indeed.

Here’s an excerpt:

A San Francisco cable car holds 60 people. This blog was viewed about 2,400 times in 2013. If it were a cable car, it would take about 40 trips to carry that many people.

Click here to see the complete report. It’s worth a look. I especially liked the map of the world. I can’t believe people in India read my writing!

So what’s my resolution for 2014?  Is it a cop out to keep the same resolution – to be better?

As I said last year, “I don’t have to beat myself up by not making big enough strides […], because in reality, the goal [to become the best person I can be] is unattainable; however, I can be better. And if I don’t consult the devilish stick that measures me against other people and stick to one simple question – Am I better than I was? – then I can do it.”

I like being better.

How about you?  What is your 2014 resolution?

Categories: Education, Family, Holidays, Parenting, Personal, Writing | Tags: , , , , , , , , , , , | 2 Comments