365 days of deals and tips completed.

Friday, May 15, 2009

Day 82

A great email question:
Dara, I’m curious about how you learned to live debt free. My husband is a railroader and we move a lot so the debt is piling up.
First I would recommend reading the book The Total Money Makeover by Dave Ramsey. It was a huge eye opener for both my husband and I.... It was the first wise financial decision we made....We had it in our shopping cart and were going to charge it to our credit card, we looked at each other and said this is crazy. We put the book back on the shelve and checked it out at the library :)
~The first thing we did was sit down together and add up how much debt we had. I thought we had around $20,000 but in reality we had $48,000.
~Saved $1000 Emergency Fund
~Then we payed our debt off smallest to largest no matter what the interest rate was
~We made a budget and put a name to every dollar
~We use the envelope system....taking out cash for budget categories....that way we do not overspend....when the money is gone from the envelope we know we are done spending for that category
~Canceled Cable...don't miss it....still don't have it, have basic cell phone, basic home phone we cut back on anything and everything we could.
~Squeezed every penny out of the budget to throw on our debt
~My husband and I started communicating about money....that was huge for us.... now we are on the same page and were and are intense to make sure we honor God with our finances
~and most important lots of prayer
Wishing you the best of luck.....be intense....and tell every dollar where to go!
Thanks for the question,
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