February 2012 - Dave Ramsey Financial Peace support thread - everyone welcome!

[cody82414]

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 deductables 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 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

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

[cody82414]

February is typically a bad month for us financially.

I took inventory of the meat in the freezers
and am going to do what I can to be creative with it
before buying anything else.

We also prefer fresh fruits and vegetables,
but I am going to try to use up what we have jarred and canned.

[VivaciousJewelz]

I was just looking to see if you'd started this thread!

I'm in. This month will be all about building my emergency fund and finding out what debts I can discharge in a bankruptcy. Then hopefully I can file in March and get to work on paying my student loans.

[Spanelli8706]

I'm in as well!

[jenrose]

I'm here to cheer everyone on and try to build up my savings to cover full time kindergarten that I want to pay in full August 1st! Ugh!

And working on getting DH to have a desire to pay more on the house each month.

[xmas tree]

Still here and if things work out, meaning we get our tax return before the month is over, than we can eliminate another CC.

[Dengineer]

We are finished with Baby Step 3 and are now in super saving mode. We want to save enough money to pay cash for a piece of land (we don't buy houses, we buy land.)

[cody82414]

I was just looking to see if you'd started this thread!

I'm in. This month will be all about building my emergency fund and finding out what debts I can discharge in a bankruptcy. Then hopefully I can file in March and get to work on paying my student loans.

praying for all good things for you

[cody82414]

I'm in as well!

I'm here to cheer everyone on and try to build up my savings to cover full time kindergarten that I want to pay in full August 1st! Ugh!

And working on getting DH to have a desire to pay more on the house each month.

Still here and if things work out, meaning we get our tax return before the month is over, than we can eliminate another CC.

Glad you are all here

xmas, I just love when tax returns come in and hear of everyones progress!!

[cody82414]

We are finished with Baby Step 3 and are now in super saving mode. We want to save enough money to pay cash for a piece of land (we don't buy houses, we buy land.)

AWESOME!!

WTG!

It has been wonderful having your experience here
Thank you for sharing with us the hope!!