As many of you already know, Matty and I desperately trying to be debt free. We attended Dave Ramsey’s Total Money Make-Over Class and it has transformed our lives. We are now more in control of our money then ever before. We have completed step 1 ($1000 emergency fund) and are working on step 2 (debt snowball).
We have a car payment and credit card payment. We should be completely debt free by 2011 if not earlier. Sometimes I get discouraged by that number, but I know that we will not be adding any more debt , EVER. We are way, way ahead in our car payment so we are hoping to get that paid off first. Then we will tackle the monstorous credit card. Our payments are both over the minimum, but it’s hard to see progress because of the interest rates on both.
Another fun aspect is to pay with cash using an envelope system. We have a super detailed budget that aligns all of our spending for the month. We currently use cash for food, gasoline, car repairs/tags, clothes, Simon’s school tuition, and hair cuts. It’s actually really fun to pay with cash and people are surprised whenever we pay. Paying with cash creates an emotional connection, therefore making it harder to spend. Paying with cash also lets you haggle for prices. The brakes on the van were shaking and because of our commitment to pay with cash and some haggling, the cost went from $200 to $125.00. We also had enough money budgeted to cover the tags for both cars this month. Another purchase made with cash.
I do wish that I could pay with cash for my diaper habit. (Maybe I would spend less?) I really try and limit myself and I haven’t bought any diapers since Bennett’s birthday so it was time to splurge. I bought this Goodmama (which I might give to my sister) and I bought this super cute T-shirt.