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Old 11-22-2015, 09:03 PM   #1
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Dave Ramsey -Winter Thread

We are here to support each other now while we live like no one else, so that in the future we can live like no one else.

The Baby Steps:

Pre-Step 1: Get current on your debts and do a budget
Before you begin the baby steps, you must be current on your bills and, if you aren't doing one already, begin doing a monthly budget.

Baby Step 1: Save $1000 cash in the bank
Start your emergency fund. If your income is less than $20,000, make that $500.

Baby Step 2: Get out of debt
With Gazelle intensity and using the debt snowball, pay off all your debts.

Baby Step 3: Finish the emergency fund
With the money you were paying towards debt, now with no debts, you can save 3-6 months of expenses into a fully funded emergency fund.

Baby Step 4: Save for retirement
Saving 15% of your income didn't seem possible before, but with no payments, you'll be ready for retirement and not have to take a job as a Wal-Mart greeter.

Baby Step 5: Save for College
Instead of taking out student loans, your kids will be eternally grateful you thought ahead and had a plan for their higher education.

Baby Step 6: Pay off the house

Baby Step 7: Build Wealth and Give It Away

---------------------------------------------
Expanded Baby Steps:
0.1 Commit to NEVER borrow $$$ EVER for ANYTHING other than possibly a house
0.2 Talk with spouse and get him/her on the same page as you concerning finances
0.3 Do a written budget
0.4 Temporarily stop all retirement contributions
0.5 Get current on the basics (You MUST have Food, Utilities, Shelter, Basic Transportation)
0.6 Amputate "toys" (bikes, boats, ATV's etc) if they will keep you from completing the snowball within 12 months
0.7 Cut lifestyle (Cut CATV, Cellphone, Regular phone "extras", Internet, Eating out, etc) and/or take a second job if $1000 EF will take more than 30-90 days. (depending on income)
0.8 Get current on ALL bills.
1.0 Save $1000 in Baby Emergency Fund (EF)
1.1 Chop up CC's. (You have an EF now, no NEED to keep those CC's!!!)
1.2 Get Health Insurance NOW (chances of getting sick w/major medical bills are larger than that of death), especially if you have children.
1.3 Get Life Insurance NOW if you have debt/your family couldn't make it financially if you died. Especially important if you have children! Social Insecurity only provides a small amount of coverage if you have dependents.
1.4 Amputate cars that you can't pay off within 24 months (you have an EF to fix "bondo buggy" if something should happen)
1.5 Consider raising insurance deductibles to $500 or $1000 and dropping full coverage on paid for "bondo buggy" (you have an EF ya know)
1.6 Draw up a will.
1.7 Get Long-Term Disability Insurance.
2.0 Do debt snowball, paying all your debts from lowest BALANCE to highest.
2.1 You can take your first vacation since finding Dave if you can pay cash for it. (no using the EF!!!)
3.0 Save 3-6 months EXPENSES in EF (FFEF)
3.1 Start replacement car fund.
3.2 Save up 20% for home purchase OR pay down existing mortgage to the point that you can drop PMI.
3.3 Start furniture or other non-essential stuff replacement fund.
3.4 Move up in car if you still feel the need to (must pay cash for it!, you can only buy NEW if you have a net worth over a million dollars)
4.0 Start contributing 15% of your paycheck to retirement.
5.0 Save for kids college fund.
6.0 Pay off the house early.
7.0 Live like no one else since you have lived like no one else! Give, Build Wealth and Have Fun!

Here's a link to some of Dave's budgeting forms - check them out if you need a place to start with creating a written "zero based" budget.
http://beta.daveramsey.com/tools/budgetForms

Some good quotes for motivation...

"If broke people are making fun of your financial plan, you’re on track." -Dave Ramsey

"Whenever you find yourself on the side of majority, it is time to pause and reflect." -Mark Twain-

"What can you do when you have no payments? Anything you want!" - Dave Ramsey

"Debt is dumb, cash is King, and the paid off mortgage has taken the place of the BMW as the status symbol of choice" - Dave Ramsey

"People often say that motivation doesn't last. Well, neither does bathing—that's why we recommend it daily." — Zig Ziglar

"We buy things we don't need with money we don't have to impress people we don't like." - Dave Ramsey

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Old 11-23-2015, 08:24 AM   #2
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Re: Dave Ramsey -Winter Thread

Ok, starting now for winter!
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Old 11-23-2015, 08:33 AM   #3
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Re: Dave Ramsey -Winter Thread

So we need a little bit of help?
We are doing well, saving a little each month but don't have health insurance, and I don't think we are consistently saving enough to be able to get it from what I have found?
My husband works for a small company that doesn't offer insurance, and we would really rather not be on Obama care, does anyone know of some affordable options?
We have looked at Samaritan but I don't think my husband is comfortable with it.
I can tell he is getting stressed especially sense the baby is near due. Prayers for no complications and we will be fine because we have the money saved to pay cash! But a hospital transfer would be devastating right now...
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Old 11-23-2015, 08:48 AM   #4
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We are on baby step 2 but honestly we haven't actually started it. We are a pretty basic budget set that we have been doing since I believe August or September. It needs to be more inclusive because it's missing a couple of critical things that will be needed for starting out snowball.

Our debt is 99% student loans. Unfortunately they are a hot mess and have tons (thousands) of $ in tacked on fees etc.

We also have a small bit of medical debt. This is much easier to deal with.

I just need to get a snowball figured out and started.
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Old 11-23-2015, 04:15 PM   #5
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Re: Dave Ramsey -Winter Thread

Quote:
Originally Posted by KatieBum View Post
So we need a little bit of help?
We are doing well, saving a little each month but don't have health insurance, and I don't think we are consistently saving enough to be able to get it from what I have found?
My husband works for a small company that doesn't offer insurance, and we would really rather not be on Obama care, does anyone know of some affordable options?
We have looked at Samaritan but I don't think my husband is comfortable with it.
I can tell he is getting stressed especially sense the baby is near due. Prayers for no complications and we will be fine because we have the money saved to pay cash! But a hospital transfer would be devastating right now...
I'm lucky & don't have to deal with this. While I understand you don't want to do "obamacare"... most insurance even without a subsidy is through the state/federal obamacare websites.

If you can't afford a good policy, I'd get a high deductible plan. Something that would only cover expenses over $10,000. Basically it would just be a stop-loss policy & not cover the day to day stuff.

You can also set up an HSA... This is an account that puts money in Pre-tax. Then you use it to pay your medical expenses. (Be cautious as some have fees that negate the savings from not paying taxes, Also some are not HSA's but FSA. A FSA sounds like the same type deal but any money not used will disappear Dec 31st each year! Make sure your money carries over if not used)

You'll also want to consider the price of the tax penalties if you don't have health insurance. Could you scrape by paying premiums monthly & pay for the rest of it with your tax money?? (So You won't have to pay it monthly ??)

Sorry I don't have any good advise. I don't know anyone who is using a Christian type insurance plan, so I can't say if any of the are legit.


Are you on a written budget each month? Do you reconcile it at the end of the month? You should be able to figure out exactly how much $ you have each month to spend on it.
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Old 11-23-2015, 04:29 PM   #6
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Re: Dave Ramsey -Winter Thread

Quote:
Originally Posted by Rdesonia View Post
I'm lucky & don't have to deal with this. While I understand you don't want to do "obamacare"... most insurance even without a subsidy is through the state/federal obamacare websites.

If you can't afford a good policy, I'd get a high deductible plan. Something that would only cover expenses over $10,000. Basically it would just be a stop-loss policy & not cover the day to day stuff.

You can also set up an HSA... This is an account that puts money in Pre-tax. Then you use it to pay your medical expenses. (Be cautious as some have fees that negate the savings from not paying taxes, Also some are not HSA's but FSA. A FSA sounds like the same type deal but any money not used will disappear Dec 31st each year! Make sure your money carries over if not used)

You'll also want to consider the price of the tax penalties if you don't have health insurance. Could you scrape by paying premiums monthly & pay for the rest of it with your tax money?? (So You won't have to pay it monthly ??)

Sorry I don't have any good advise. I don't know anyone who is using a Christian type insurance plan, so I can't say if any of the are legit.


Are you on a written budget each month? Do you reconcile it at the end of the month? You should be able to figure out exactly how much $ you have each month to spend on it.

We would defiantly be doing stop loss that isn't a question! Good reminder though thank you!
At this point even if we get it we will still have the tax penalty which is a bother, I believe you have to have had insurance for more than half the year to avoid the penalty or at least that how it seemed a while back when we were checking in on it.

No I don't think our budget is written down, it seems like we end up with more at the end of the month when we don't have a written budget it's crazy! We need to do it though i am sure; it's just hard. We are new married. We figure we got pregnant five days after the wedding lol so we haven't really had a lot of time to figure this all out although God has definitely given us great blessings!
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Old 11-23-2015, 04:46 PM   #7
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Re: Dave Ramsey -Winter Thread

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Originally Posted by Fashionably Green Baby View Post
We are on baby step 2 but honestly we haven't actually started it. We are a pretty basic budget set that we have been doing since I believe August or September. It needs to be more inclusive because it's missing a couple of critical things that will be needed for starting out snowball.

Our debt is 99% student loans. Unfortunately they are a hot mess and have tons (thousands) of $ in tacked on fees etc.

We also have a small bit of medical debt. This is much easier to deal with.

I just need to get a snowball figured out and started.
It's normal for it to take 3 months or so to get your budget right! Don't be discouraged. It's a bit of a learning process as you realize you forgot to include XYZ or you completely forgot kids need new shoes sometimes more often that every 6 months or Something breaks & you realize you don't have any place in the budget to replace it. I think it's good you are being cautious as you just lost your babysitting money & kinda needed to see how that would effect your budget.

We had ours down pat but now it's all going to change! No more "new house fund". No more rent! BUT we will need a remodel fund, gasoline costs will go up, Plus we will need to buy propane every winter. Our insurance went up as a homeowner (vs renters insurance... that was expected) . Our property taxes are crazy cheap (Less than $150 a year!) but we'd still like to budget that monthly. So my mad money amount will probably not go up anytime soon while we transition through all this.

It feels SOOOOOOOOO GOOOOOOOD to be debt free! And it feels double good to now be a "homeowner" (FINALLY!!!) It's such a huge blessing that we bought the house for cash. We looked at other houses that needed just as much remodeling as this one did but they were in the $90,000 to $100,000 range. If we could do it, anyone can do it!
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Old 11-23-2015, 05:01 PM   #8
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Quote:
Originally Posted by Rdesonia
It's normal for it to take 3 months or so to get your budget right! Don't be discouraged. It's a bit of a learning process as you realize you forgot to include XYZ or you completely forgot kids need new shoes sometimes more often that every 6 months or Something breaks & you realize you don't have any place in the budget to replace it. I think it's good you are being cautious as you just lost your babysitting money & kinda needed to see how that would effect your budget. We had ours down pat but now it's all going to change! No more "new house fund". No more rent! BUT we will need a remodel fund, gasoline costs will go up, Plus we will need to buy propane every winter. Our insurance went up as a homeowner (vs renters insurance... that was expected) . Our property taxes are crazy cheap (Less than $150 a year!) but we'd still like to budget that monthly. So my mad money amount will probably not go up anytime soon while we transition through all this. It feels SOOOOOOOOO GOOOOOOOD to be debt free! And it feels double good to now be a "homeowner" (FINALLY!!!) It's such a huge blessing that we bought the house for cash. We looked at other houses that needed just as much remodeling as this one did but they were in the $90,000 to $100,000 range. If we could do it, anyone can do it!
losing the babysitting was irritating because I had *just* got us in the groove of things. However, it has been amazing for my mental health. I was in such a bad headspace. I knew it was bad but didn't really fully realize until they were gone.
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Old 11-23-2015, 05:06 PM   #9
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Re: Dave Ramsey -Winter Thread

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Originally Posted by KatieBum View Post
We would defiantly be doing stop loss that isn't a question! Good reminder though thank you!
At this point even if we get it we will still have the tax penalty which is a bother, I believe you have to have had insurance for more than half the year to avoid the penalty or at least that how it seemed a while back when we were checking in on it.

No I don't think our budget is written down, it seems like we end up with more at the end of the month when we don't have a written budget it's crazy! We need to do it though i am sure; it's just hard. We are new married. We figure we got pregnant five days after the wedding lol so we haven't really had a lot of time to figure this all out although God has definitely given us great blessings!
Everydollar.com is the free budget software from Dave Ramsey. It costs a fee if you want to link your checking accounts but You can just manually enter the info.

Doing a budget monthly helps you & your spouse to agree and be walking the same path financially.

This example is going to make my husband look like a real jerk but ....
We had a car payment. It was automatically drafted from our bank account to the same banks loan place. I wanted to pay it off early. DH disagreed. I skimped... I saved.. every extra cent! Then I'd go down & make a loan payment when it was $200 or so. I went on a "NO Spend year" and was using Swagbucks to buy the kids shoes! I was saving and doing without. I figured DH would be happy later when it was paid off early.

BUT what I didn't know was if I made a payment, they just didn't take that amount out of your checking the following month. So DH knew all along I was making extra payments & they were not counting. He let me go without stuff ... all the while accomplishing nothing. (Because he didn't think there was anything wrong with being in debt as long as you could make payments/ not underwater)

So Fast Forward, I go to look up the pay-off amount & I just started balling crying. I told DH we needed to get on the same page. He bought me Financial Peace for my Christmas present in 2014. He started to go through it with me & He's a completely different man in regards to money.

Now we both look at how much is in the bank. We both look at where money is going. We both decide how every cent will be spent before the month begins. We agree.There are no fights., no arguments, no sabotaging the other. It's a plan just not for how we spend our money today... but how we are planning our future. We are a team financially. Really every married couple should be a team with the same financial goals.
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Old 11-23-2015, 05:56 PM   #10
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Re: Dave Ramsey -Winter Thread

Quote:
Originally Posted by Rdesonia View Post
Everydollar.com is the free budget software from Dave Ramsey. It costs a fee if you want to link your checking accounts but You can just manually enter the info.

Doing a budget monthly helps you & your spouse to agree and be walking the same path financially.

This example is going to make my husband look like a real jerk but ....
We had a car payment. It was automatically drafted from our bank account to the same banks loan place. I wanted to pay it off early. DH disagreed. I skimped... I saved.. every extra cent! Then I'd go down & make a loan payment when it was $200 or so. I went on a "NO Spend year" and was using Swagbucks to buy the kids shoes! I was saving and doing without. I figured DH would be happy later when it was paid off early.

BUT what I didn't know was if I made a payment, they just didn't take that amount out of your checking the following month. So DH knew all along I was making extra payments & they were not counting. He let me go without stuff ... all the while accomplishing nothing. (Because he didn't think there was anything wrong with being in debt as long as you could make payments/ not underwater)

So Fast Forward, I go to look up the pay-off amount & I just started balling crying. I told DH we needed to get on the same page. He bought me Financial Peace for my Christmas present in 2014. He started to go through it with me & He's a completely different man in regards to money.

Now we both look at how much is in the bank. We both look at where money is going. We both decide how every cent will be spent before the month begins. We agree.There are no fights., no arguments, no sabotaging the other. It's a plan just not for how we spend our money today... but how we are planning our future. We are a team financially. Really every married couple should be a team with the same financial goals.
I didn't know about every dollar. That might help because that way we can both access it easier! We were having trouble both getting in the same space but with that I can put it on our phones not just his computer! That will be very beneficial!
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