Working for Financial Freedom

We've Moved!

noreply@blogger.com (Mom of 3) — Sat, 18 Aug 2007 19:20:00 +0000

Hi! Just wanted to send a little note out... Working for Financial Freedom has moved from Blogger to Wordpress. We can now be found at http://www.workingforfinancialfreedom.com Thank-you!

Can't Attend Financial Peace University- Now What?

noreply@blogger.com (Mom of 3) — Wed, 15 Aug 2007 15:52:00 +0000

Well, it turns out that attending Financial Peace University this fall won't work out. The classes are going to be on Monday nights. Between soccer practice that night and my husband's crazy work schedule we'd end up missing too many classes.

This morning I've been researching my options.

Personally, I think we are on the right track even though we haven't attended FPU. We've read Dave Ramsey's The Total Money Makeover, created a budget, actually lived by the budget and paid off $18,000+ in 4 1/2 months.

As we go through the steps though we want to make sure we are doing the best job we can. This will become even more important as we start investing money. Research, reading and educating ourselves is what is going to help us achieve our goals.

We don't want to ONLY study Dave Ramsey's book, there are many trustworthy and well-educated financial experts out there that will be able to help us to to our goal. I don't think it's an absolute necessary to attend this class to get out of debt, but I think it's an excellent tool and I'd still like to attend.

So what are our options?

A.Attend FPU in another location at a better time

B.Attend FPU online

C.Skip FPU altogether and use the money on dinner and a movie

D. Skip FPU and put the money towards debt

Option C would be fun, but I think I'm leaning towards Option B. Taking Financial Peace University online would give us the flexibility to "attend" class anytime we want.

Have you taken FPU online?

For those that have gotten out of debt or are currently getting out of debt what books and resources did you use to learn how to do it?

Free Tools to Keep Track of Your Money

noreply@blogger.com (Mom of 3) — Tue, 14 Aug 2007 03:11:00 +0000

One of the first things someone might ask themselves then they take a look at their empty wallet and maxed out credit card is "Where did all my money go?" Having a budget and actually USING it is one of the biggest ways to get rid of debt and keep it from ever growing again.

Keeping track of your budget will tell you how much you spend and where you spend it. This can enable you to plan ways to cut back so that you are able to throw more money at your debt.

Now, in order to actually use a budget, you need to write it down. Somewhere. Anywhere. As long as you can reference it when you need to. Of course, the more organized you are, the better you will be able to track your money and your spending. If your budget is penciled on post-it notes strewn throughout the house; there is a good chance that you might forget to deduct a payment or forget about an upcoming expense. Important Tip: keep it in one place.

Some ways to keep track of your budget:

Pencil, Paper and a Calculator

Create a spreadsheet using Microsoft Excel

Microsoft's pre-made Budget Excel Spreadsheets - this is what I use. I'm able to modify the spreadsheets to fit my needs without having to create a new one from scratch.

Spreadsheets from JimnKim These spreadsheets are created by Dave Ramsey followers. There are over twenty different spreadsheets to download including a Snowball Calculator than can help you figure out when you will be able to pay off your debt.

Quicken

Do you use something else not listed here? Are you like me and have tried a few different things?

Baby Stepping....the Dave Ramsey Way

noreply@blogger.com (Mom of 3) — Fri, 10 Aug 2007 15:20:00 +0000

Here are the Baby Steps that Dave Ramsey suggests you follow to get out of debt. If you don't know much about Dave Ramsey and haven't read his book, The Total Money Makeover, hopefully this gives you an idea of what his advice is.

We are currently on #2. But hope to have that done by April 1st, 2008 (right about the time we move)

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.

What step are you on? Since starting Dave Ramsey's program how long did it take you to get to this step?

No longer a pencil and paper user!

noreply@blogger.com (Mom of 3) — Thu, 09 Aug 2007 01:08:00 +0000

It's been awhile since I posted. But we are still chugging along with our new budget. Paid off a little more debt too.

I've noticed it's really easy to get lazy (it has been HOT lately and who wants to cook) and blow the grocery budget by going out to eat too often.

The biggest change was this week I went from a pencil and paper budget to doing it on the computer!!

Yeah-I know. Welcome to the 21st century!

I discovered that Microsoft's website has some nifty little premade templates to use in Excel. I was able to download quite a few budget templates. With only a few changes to personalize them, they are going to work great for us.

I'm usually the one to work on the budget, so now I can just email my hubby the spreadsheet for him to look at.

How is everyone else doing?

Are you a pencil and paper budgeter? Or are you high speed with your fancy spreadsheets and computer programs?

What do you use to keep track of your budget and checkbook?

Kind of ironic...

noreply@blogger.com (Mom of 3) — Mon, 16 Jul 2007 14:27:00 +0000

At church yesterday before the sermon started they showed a little video.

Guess what they were advertising?

Yep. FPU - aka. Financial Peace University which is a series of financial classes taught by Dave Ramsey. The church is going to host the classes this fall.

As much as I was dragging my feet to get out the door to church yesterday, we needed to be there to see that.

I can't wait to sign up for classes!

What's Your Pudding Score?

noreply@blogger.com (Mom of 3) — Sun, 15 Jul 2007 13:38:00 +0000

This is a fun little test that I found on another blog

Check your Pudding Score

According to the website:

What does my Pudding Score™ mean?

Your Pudding Score™ is a measure of how your current retirement fund assets compare to the amount the Benchmark Account says someone your age and pay should have accumulated by now.

A score above 100 says you are ahead of the index at this point in time and a score below 100 says you lag behind the index’s pace.

So what is our Pudding Score?

yikes. Only 32.

We need to get this debt paid off asap so we can sock away more in our retirement funds.

As Emeril says.... "Bam!"

noreply@blogger.com (Mom of 3) — Thu, 12 Jul 2007 19:31:00 +0000

Bam!

Took Dave's advice and we were able to make a huge payment on the debt!

When we read The Total Money Makeover Dave recommended that if you are in debt, take your savings (except for a $1000 baby emergency fund and your 401K) and use that to put down on your debt.

Makes sense right?

Let's say you have $5000 in debt you are paying interest on, but you have $5000 in savings. It's makes more sense to take your savings and pay down your debt, instead of paying that credit card or loan interest every month.

So after much thought (and stress) we exercised some options and were able to pay off quite a bit of debt.

Still have $40k in debt left, but at least the amount is getting lower right?

Next on the chopping block?

Getting rid of one of the car loans....

$58,000 paid off in one year?

noreply@blogger.com (Mom of 3) — Tue, 10 Jul 2007 14:28:00 +0000

Well, we needed a GOAL date to pay off this debt.

We started keeping track at the end of March.

I want to have this debt gone and done with by April 1st, 2008.

That is 8 1/2 months away!!!!!!!

We've been getting intense around here about cutting our spending, reducing/cutting bills and paying down the debt.

And I'm doing my bit by trying to bring in a little extra money from home. Yeah, it would be nice to bring in thousands of $$ extra every month, but I just don't have the time to make it a full time thing. My husband works full time, and unless I get a babysitter, I'm not going to be able to work full time also.

But I'm happy with a few hundred dollars or more extra each month I can make by working part-time during my little one's naps.

Cut Your Spending - Part II

noreply@blogger.com (Mom of 3) — Mon, 09 Jul 2007 16:02:00 +0000

One of the parts to getting out debt that I personally think is the hardest is cutting your spending, ie "changing your lifestyle and habits."

We know what we need to do to get out of debt, and are willing to do it. But changing our spending habits and the way we think about money has taken discipline, creativity and sacrifice.

It's almost like being on a diet.

Here's an example of how my thinking has changed. Instead of swinging by Starbucks and getting my Grande Vanilla No Fat Latte and a slice of coffee cake and spending $7-$8 I think beforehand, "What is more important? That coffee or paying off our debt? And can I still get my caffeine fix without spending $7?" I might go home and make myself a cup of coffee for pennies, or instead of springing for the latte and coffee cake just get a small coffee with cream and sugar.

Ummm...so how is this like a diet?

Well, when you are a on diet you either cut back on or cut out completely things that are causing you to gain weight or preventing you from losing weight. My biggest temptation is sweet things. So on a diet I would cut out desserts, or try to find low calorie alternatives to get my sweet fix. For example, instead of eating rich brownies or a New York Cheesecake for dessert, I might have some fresh strawberries or make a pan of brownies using the No-Fudge Fat Free Brownie mix.

On our debt diet we are using cheap/free alternatives to things we would like to do. Or cutting certain expenses out altogether.

Step Two to Reducing Your Debt - Cut Your Spending

noreply@blogger.com (Mom of 3) — Sun, 01 Jul 2007 14:48:00 +0000

The second step in reducing your debt is cut down on the amount of money you spend.

Take another look at the list of monthly bills you wrote down.

What can you cut out?

When my husband and I sat down and took a good, hard look at our bills we were able to cut some things out.

Pest Control $75
Lawn Service $52
Netflix $21
Total= $148 a month savings

Then we looked at what we could reduce. I called our cable internet and TV provider and got a discount. Other options include calling your car insurance provider to see what options are available for lowering your rates, such as raising your deductible.

Cable/TV $10
Monthly phone bill (switched providers)$10
Total= $20 a month savings

Just by dropping some services and making a few phone calls we were able to save $168 a month.

Next, look at the things you have to pay; such as food, electric/gas, water, and gas. How can you conserve in those areas? Shopping at places like SuperTarget for food, making a mealplan, using coupons and shopping sales are all ways to reduce your monthly food bill. Bring your lunch to work and eating out less is another way. Turn off lights when not in use.

There are some great tips on Sharing My Two Cents on how to use coupons and rebates and other ways to cut down the amount you spend on groceries, cleaning supplies and health and beauty items.

Take The First Step to Get Out of Debt...

noreply@blogger.com (Mom of 3) — Sun, 01 Jul 2007 01:00:00 +0000

by making a budget.

Get out a piece of paper and write down all of your bills for each month. Food, gas, TV, internet, mortgage/rent, electric/gas, phone, water, credit cards and loans etc...

Now, add them up. What is the dollar amount you need to pay all your bills each month?

Write down what your take home pay (after taxes) pay is. Is that number higher or lower than the amount you need for your bills? The goal is to have the amount you spend on your bills much lower than the amount you earn each month. The more money you have leftover, the more you'll have for paying off and credit cards and loans.

This may seem like a simple task, but the hard part for many is not spending more than you budget for. The reason many people are in debt is because they spend MORE than they make. Make a budget and stick to it.

More details on making and keeping a budget will come later.

How Are We Going To Get Out of Debt?

noreply@blogger.com (Mom of 3) — Mon, 25 Jun 2007 15:35:00 +0000

My husband and I have been slowly working on paying our debt off. But it always felt like we were just spinning our wheels and not getting anywhere. On a message board I visit I noticed that there were people that kept asking about Dave Ramsey. Everyone keep recommending his book The Total Money Makeover: A Proven Plan for Financial Fitness I didn't want to spend the money on a book that could turn out be just a lot of hype. So I requested a copy from my local library. There was a long wait list for the book! Once I got it I couldn't put it down, and even dh read some.

So, if you want to get out of debt, but aren't sure where to start I'd get a copy of "The Total Money Makeover" by Dave Ramsey. I would make that your starting point.

So we read the book, and then started our second step. Making a budget. I'll cover that in my next post.

Ever see the commercial....

noreply@blogger.com (Mom of 3) — Sun, 24 Jun 2007 17:27:00 +0000

Where the guy is mowing his lawn on a riding lawn mower, cleaning his pool, driving in his new car etc... but then says he's up to his eyeballs in debt?

It's a sad representation of many Americans today. But I love that commercial. Why? Because it's a great reminder for me and my family that we do not want to live like that.

We have debt. We have a credit card and car loans. But you think "Everyone has a car loan!" Nope. There are many families that don't, they pay for their cars with cash.

We want to be one of those that pay for their cars with cash, and can retire comfortably when the time comes.

What about you?