How to get out of debt, part 2

We are moving on in our series, Monday Money. Just a disclaimer note, we are using everything we have learned from Dave Ramsey. If you can find one of Dave’s classes, PLEASE take it. We are willing to help, but these are his ideas and he can teach you much better. Or, head to the library and check out his books. (They are free at the library, remember?!)

I’ll let Matty take it from here. I’ll be back this week. It’s our anniversary and you know that I have things to say about that!

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Ok, credit cards are gone?! Chopped up, thrown away?! I won’t lie. This was hard for us because of the "what-if’" factor. What if we have an emergency, want to order something online, or even want to reserve a hotel? What if our car breaks down? Credit cards even help build our credit! (Credit- an imaginary number.) However, we had already decided that we were in this to win this! We were not going to let our debt control us. We chopped, we discarded, and moved on!

Keeping those "what-ifs" in mind, we planned and saved for a mini-emergency fund. A mini-fund consists of $1000.00 cash sitting somewhere, just in case. Just in case my car breaks down. Just in case the air conditioner goes out. Just in case the cat gets sick and needs $300 worth of care. (True story.) People do this different ways. We put our emergency fund in a Money Market Account, that has transfer or check writing capabilities. Others put it in a regular savings account at their local bank. I have even read stories of people putting money in a coffee can and hiding it someplace where it would be inconvenient to get to, unless there was a real emergency. It doesn’t really matter where you put your cash as long as it is only used for an emergency.

You’ll find that you have much less emergencies, once you are actually prepared. This is also the hardest step because you have to decide that you are willing to change. Are you willing to change?

This came to us somewhat quickly. We had tax return money come in about the time we started this thing. We also took any extra cash we had and put it into our account. It didn’t matter the amount of cash, whether it be $5, $10, or 100 bucks. If we had it, we put it there. Saving must become a priority. Your emergency fund is not an investment, it is insurance.

Bad things do happen. Protect yourself. Have insurance. Get $1000 in the bank.

Anyhow, since we started a serious budget, I think that we have only touched our emergency fund one time. It is a good feeling knowing that the money is sitting there, just in case. We now don’t need the credit card for an emergency. We are prepared. We have the cash and we don’t pay for things later. You can either learn to manage your money, or the lack of it will always manage you.

We have learned and are learning, cash is good!

Get moving. Make sure those cards are cut up and start looking for extra change. Ready? GO!

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Please feel free to share, re-post, and pass the word. We want everyone to have the ability to control their money.

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