Car Shopping . . . but no car payments. . . .

I absolutely detest shopping for a car.  The last two vehicles we purchased were from a car rental company that sells their cars after they are no longer renting them.  Very pleased with our purchases from a quality and a cost standpoint.  You guys know how much I love Dave Ramsey and these vehicles fall into the DR category. 
Sprat is going to need a car this next year at school, Big T gets his car in August. Sprat's new school is a little further out of the city than that first school and the new school allows sophomores to have cars on campus. No, he does not get to pick out what he wants, he will take what we pick out and be happy.  We are now shopping reliable used cars and I have gone back to the rental place.  I have been hawking this website and the lot since it is close to us.  They used to carry a lot of the vehicle I am looking for for Sprat and now they do not have any from this manufacturer. I  am a little bummed and so I have ventured out to the local car lots.  Big mistake, car lots are awful, they want to sell you more car than you want or can afford.  In my case they are trying to sell me more than I want to afford.  I have a dollar amount I am going to spend and I am not going over that for any reason.  I am sticking to my DR plan.  I am not borrowing money to buy this car, we did not borrow to buy the other two and I am not going to for this one either.  Whewww!! It feels good too say that, I will not go into debt for this. 
I will share a little secret too, I am having a little mid - life crisis around this car shopping.  I have found a car that I want and again I have been hawking car websites and such looking for the best deal.  I have had to put that on the back burner till we can get Sprat something to drive but I am still shopping for me.  This will put my mid - life crisis on hold for just a bit because I will not go into debt for my mid-life crisis.  NO more debt for this family!!
Stay tuned for my car shopping adventure.

Financial Friday the 13th. . .

Good Friday morning.    On this rainy and overcast Friday the 13th I think we should do a check up of our rainy day fund/emergency fund.   Are you saving for that rainy day or emergency?  If you are not prepared for the rain a simple appliance problem could send you in to financial ruin or at least zap your budget.  Dave Ramsey talks about saving $1,000 in cash and fast as your on hand emergency fund.  He also talks about saving three to six months of expenses for your long term emergency fund. If you have an emergency fund in place, your emergencies do not seem so big.  
If you have not checked out Dave Ramsey I highly recommend it.  Read his information and test out his theories for yourself.  I am not a financial guru nor do I claim to be, I have followed most of what Dave Ramsey says to do and we are debt free except our house and saving like crazy for the boys to go to college.   I was thrilled that my friend Beth invited me to my first Dave Ramsey class and I was excited when my friend Craig said he would be teaching a class.   You do not have to attend a class to learn his system, check out the Dave Ramsey website.  I also encourage you to read books from other financial people like Suzy Orman.  There are many financial businesses that will counsel you in your financial matters but, do you really want to take advice from someone who has less money in the bank than you?  I am not saying that they are all like that but, I find it hard to take financial advice from someone who is in more debt than I am.  As Dave says, if you want to be a millionaire you do what millionaires do and millionaires do not take financial advice from broke people.   You can find Dave Ramsey's books at the library and at some used book stores.
Here is my disclosure:  I am not receiving any perks or kickbacks for this post.  I write this because I truly believe in this system and I think we would all be better off out of debt.   Imagine the contributions that could be made to charity if we were all out of debt. . .  

New Year and Finances. . .

I am curious how everyone is doing with their financial goals and if anyone is still doing the Dave Ramsey plan I posted about last year.  If you are new to the blog, Dave Ramsey is a financial "guru" that says you should not use credit cards and to pay cash for everything.  The hubby and I have been doing his plan for many years.  I read all of his books and followed Dave for many years before I actually took his class, Financial Peace University.  I have to give a shout out to Beth Cotell for inviting me to the class she was taking.  A huge thank you!!  
There is a lot of free information out there for anyone looking for financial help but, be careful who you take advice from.  You would not want to take advice from a financial person that is broke, right?  Dave Ramsey is a millionaire and has been bankrupt too, so I feel like he has the credibility to teach me what to do and what not to do.  The information I share on this subject is Dave's and I give him all the credit.  I am not being compensated by Dave for writing this either.  I truly believe in what he says and how he approaches money matters.
One of the things that I really like about Dave's approach is, he not only uses a mathematical approach but a biblical approach too.  He incorporates what the Bible has to say about financial matters into his teachings and I love it.  His budget system is the first one that I have seen that put giving at the top over and above anything else.   Giving to others is so important in this day and age of the self-involved and self-centered society that we live in.   The hubbs and I have always given to our Church and other charities even when we did not have very much we still gave.
I am very proud to say that with the help of Dave's plan and his cash envelope system we are debt free and have been for two years, except for our house.  We are paying it down though with great speed and we are also saving for College for the boys too.   There are lots of options to save for college; there is the 529 if you are in North Carolina, Roth IRA, and I know that other states have savings plans for in state tuition.   If you are going to do the 529 and you have two or more kids you only need to do one 529.  Put the account in your oldest child's name and if for some reason that child does not need that money then it can be passed to the younger children and even to the parents if they want to go back to school.    These are all good ways to save for college and let's face it, College is not getting any cheaper.
Please check out Dave at www.daveramsey.com and you can follow him on Facebook too.

More on Dave. . .

I told you when I started this, that you would probably get tired of me saying, "Dave says," or "According to Dave" and such.  I follow most of Dave's principles  which in reality follow God's principles.  Dave said, you could get a PhD in finance simply by reading Proverbs.   At that point we were in the middle of reading Psalms with the kids, so I decided that after Psalms we would read Proverbs.   In all my years of reading the Bible, I had never really sat down and read the book of Proverbs.  You know, you read a verse here and there relating to a specific sermon or a Bible study but you do not sit down and read every verse.   After Dave's class we read Proverbs.
One of the things that impressed me most about Dave Ramsey is,  he incorporates the Bible and God into his financial lessons.  I have read a couple different books on finance by different people and so far, not one of them does that.  Dave not only talks about saving money but he also talks about giving, stewardship. Not many financial gurus would even think of discussing stewardship much less devote a whole section of their financial class to the subject.    He encourages you to give to charities and to the Church.  His big point at the end of his lesson is that could you imagine the good that can be done if we were all out of debt and could give freely to those in need.   Cool idea.

He talks about the things that our grandparents used to say, "the more you give the more you will receive."  
Several years ago we were doing a stewardship series at Church and I was asked to give my testimony.  I was terrified and yet very excited about getting to share how God had blessed our family.  I am very passionate about how God has worked in our lives.  We were only supposed to do a two minute talk, when I had finished writing down what was on my heart I had about a 15 minute talk.  I did trim it down, I did not want to drive anyone away.  The hubbs and I talked about what I would say, so I had his approval.  I shared some very personal things about our first few years of marriage and how we struggled and strained with money some days.  My point to my talk was that even though we struggled we still gave to our Church.  Money always found us just when we needed it and I believe it did because we gave and had faith.  We are after all, mere managers of what God has given us.  

Finally Friday. . .

Another crazy week behind us and a crazy weekend ahead of us.   The other day I was trying to get my house back to some semblance of normalcy and I found an old journal from when I was finishing up the Dave Ramsey Financial Peace University class back in July of 2012.  During this time we were trying to refinance our house to get the great rates they were offering then.  The hubbs and I both had pristine credit and almost no debt due to our Dave Ramsey plan.  We were getting the run around from one bank and so I called one of my friends in the banking business and her reply was priceless.  I told her what was going on and all she said was bring me your papers and I will see what I can do.  We had been jumping through hoops for this one bank for 2 1/2 months and she got it done with a lower interest rate in less than 30 days.  Love her dearly, she was a life saver.
My point to this story is, shop around anytime you are looking for a loan of any sort.   Find out what they require up front and what the turn around time is for the paper work and what their time line is for your approval.  If you know someone in the business talk with them, I would probably still be waiting for the first bank to get around to our approval if I had not called my friend.
As I am reading back over my journal of what was going on in our lives I realize how God has worked through so much for us.  During this particular time of refinancing and getting out of debt my dear hubby was also facing a company wide layoff.   This was the third time in a few years that he survived and was not laid off.  I give full credit to the good Lord above for getting us through that ordeal.  We are a single income family and I do believe that God watches over us each and every day and I see it more clearly reading over my old journals.  I began writing in a journal when I participated in my first Gemeinschaft ( geh-mine-shaft) Bible study in 2009.  Gemeinschaft is a small group Bible study of the Moravian Church designed to provide an intentional and disciplined program that will enable people of faith to grow and experience God's saving grace and power in our lives.  I still journal and read my daily text and Bible daily thanks in part to the routine that I began during Gemeinschaft. 
When you journal and write your prayers down or write down things that are troubling you that you are asking God for help with you can look back and see how he responded.  

I know I have gone in all different directions today with this post but, I write what is on my heart and some days my heart is all over the place.  

Credit Card Craziness. . .

Flash back to 1997, I had been in business for myself for almost a year and had gotten involved in Junior Achievement through our Chamber of Commerce.  Junior Achievement was a program that sent business people from the community into the schools to teach a practical business class.  They had lessons that we used and this was all on a volunteer basis.  I went into the high school once a week and taught a lesson in practical business finance to a freshman economics class.  It was a lot of fun and the kids were great.

One of the lessons I wanted them to learn was about credit cards.  This was the prime time for credit card companies to send out credit cards to entice people to join their company.  I decided as part of a lesson I would keep all of the credit applications I received for a month and total the amounts to show them how much debt they could be in if they filled out all of the credit applications.  I think it is very luring for young people to think they can buy things now and pay later or buy things now and pay forever.    I took them the stack of applications both my hubby and I had received and wrote on the board the amount of credit we could have, had we accepted all of those applications.  I was astounded, my total was around $350,000 and my hubby had $400,000+ in one month of mail.   The kids were amazed too, especially when I told them if we had used those cards we would not have been able to pay them back.   

Today they do not send those out with as much frequency, thank goodness.   They have picked up recently though and it is funny they do not have an amount of credit they are offering you on them anymore.  I am not sure how that works now, maybe if you work for a credit card company you could post and tell me about that.   

I am sharing all of this because I fell into the credit card trap in college and I was in debt when my dear hubby and I got married.  I did get out of that credit card debt but I did not truly learn my lesson.  It is so easy just to swipe that card and not think about having to pay the bill for several weeks.  If you use it often enough it gets easier and easier and the deeper in debt you become.   I did get better about using my credit card and I tried not to use it until I had the balance paid off but then something would come up and I would use that card again.  

Here is my closing advice:  do a little plastic surgery and cut those cards up and pay that balance off.  We do not use credit cards any more.  It is a great feeling being out from under that credit card.  I encourage you all to step out and take charge, no pun intended, of your finances and stop being a slave to your credit card company.   Good luck!!

Happy Friday! Topic Today the Big B. . . Budget

Yep, it is time to revisit that nasty word, Budget.   That word always carried a restrictive connotation with me for many years.  It is actually very freeing to be able to sit down and tell each dollar where it is going before you get it.   If you do that you want be wondering where it all went at the end of the month.   I told you when I started this that I was terrible at balancing my checkbook and doing a budget.   I had never balanced my checkbook till I took Dave's class and worse than that I had never really looked at my bank statements before either.  I know, that is the worst.  That is why I tell you, I have made many mistakes and I wish I knew about Dave or anybody else for that matter earlier.  It would have saved me so much money and heart ache too.
Let us get down to the nitty gritty of the big B.  Dave says, managed money is like getting a raise.  That is so true, I would have never thought that before I put together a budget.  Do not look at your budget as restrictive, look at it as spending on paper for a purpose.  (another Daveism) The first thing I did was write out, longhand, what we spent in a month.  Even though we are in the technology age I still like using pencil and paper when working with my budget.   I took old bank statements and looked at each one and wrote down what we had spent to try and compile my budget.  Group your items together for example, restaurants, groceries, insurance, car payments, house payments, utilities, and phone bills etc. . .  Do not forget to put give and save at the top of your list.  Remember what your grandparents always say the more you give the more you receive so, always keep giving at the top.  You also have to remember to pay yourself (save).   If you are at the height of your debt snowball you may think, how can I give and save if I am paying crazy to get out of debt?   You may have to cut back on saving during your debt snowball period.  That is ok because once you are out of debt you will be able to save and give like crazy.  I did not believe it either but it is possible and we are giving and saving like crazy.  We are still paying down our house but it is not like before.    Dave says during the debt snowball that everything should be going to pay off your debt.  He talks about using your savings to get out of debt.  I guess if you were in several hundred thousand dollar debt then that would be understandable, we were not that bad off so we did not use any savings to pay ours off.  We used everything else though and, we never stopped giving.  To me giving was the most important part of our budget.  The old adage stands true the more you give the more you receive.  We are proof positive in that.  I cannot tell you how many times early in our marriage that we did not know how we were going to pay bills but we never stopped our giving and we never missed any payments.
Being able to budget and get out of debt has been a huge blessing and I want everyone to know how to do it.  Imagine a debt free world, imagine the amazing things that could be done if there was no debt hanging over our heads, imagine the lives that could be changed.  That is what I hope for, amazing changes for everyone.

Debt Snowball. .

How appropriate since we are experiencing crazy cool weather that we talk about the "debt snowball".   This snowball has nothing to do with cold though.  Yes, this is from Dave Ramsey.  It is an ingenious plan to get out of debt.  I am not judging anyone, remember,  I have made these mistakes and I know it is easy to get into debt.  In fact I got into debt in college with my first credit card, that I had no business having.  I had a modest job and was going to school and they gave me a crazy high credit limit.  Needless to say I let it go to my head and bam!! Debt.  I am sharing all of this because if my mistakes can keep someone else from making them or help them recover from them then it is all worth it.  You know the old saying, if I had known then what I know now.  Well here ya go.
Look at each of your credit cards and loans, list them  from smallest balance to the largest balance.  We are only going to think about the balance, the bottom line nothing else.   You want a quick win, that means paying that first balance off quick.  This means putting any extra money you have left after you; give, save, and pay bills.   Always give first, even if it is just a few dollars it will help someone else and will open doors for you that no man can close.   Then you pay yourself (save) and then take care of those bills.   Macy's should not get theirs if your house payment and power bill is not being paid.  Take care of your family first.  While you are pouring extra money into that one smallest balance try to keep up your minimum payments on all the others.   Once you have paid that first one off, shout wahooo and if it was a credit card cut it up.  As Dave says, do a little plastic surgery, it will do wonders for your bank account.  Now you take what ever you were paying on that balance plus the minimum you were paying and start paying the next smallest balance on your list.  This is called the "debt snowball" and it does work.  I am proof positive it does.   I kept a copy of my balances on my fridge and as I paid things off I took a red pen and marked through them.  It was a great feeling when we got down to just the house being on that list.  We are now dumping crazy money at the house to get it paid off so we will truly be debt free.   It took me two years and we were not in as bad a debt as some but we took things slowly and made sure we were giving and saving while we were paying off our debt.  

When I talk about giving I am talking about money, time, and things you may not need.  Especially this time of year there are so many that are in need that if you have things laying around that you cannot wear donate them to your local Samaritan Ministry, Church, Goodwill or the Salvation Army.  There is an old adage that when you give you get back ten fold.  This means when you give you get back ten times what you gave.  You may not see it immediately but it will come back to you.  Our family has been so blessed because we share generously.   If you have not realized, I am a very passionate person, about God and my family and what I believe in.  I truly believe in sharing and the blessing that we have received because we have shared.  I have gotten a little off track today, sorry about that but I do believe I needed to share.
So far we are trying the envelope system and working on that debt snowball.    Stay tuned who knows what I will tell about next week.  

Evil Credit Cards. . .

I have posted numerous times about how much I love Dave Ramsey.   I am not paid by him so this not an advertisement but a testament to his program. 
I read his books and semi followed his plan for several years before I got serious.  It has been two years since I took his Financial Peace University class,  I loved it.  It brought all of my reading together and wow.  We are on our way to being debt free.  I am not saying you have to do everything he says, you can pick and choose how you want to approach each thing.  We don't do everything he recommends but we do most. 
The item that rings so true is the; do not use credit card part.   When I was in college I was a credit card queen.  I had them all and they all had a balance.   I wish I had known about Dave in college.   When my hubby and I decided to have the plastic surgery, as Dave puts it, we started keeping the free credit advertisements that we got in the mail.  I kept them for each of us for a month.   I totalled up how much credit or debt we could have if we had signed up for them all.  Hubby had a total well over $500, 000 and I had over $300, 000.   Now imagine, we have two boys we hope will go to college one day and we would like to retire before we die.  Thank goodness after I totalled everything up I shreded those nasty little papers.  I must say having Dave's plastic surgery  was the best thing we ever did and I highly recommend it.
We use the envelope system which is like how your grandmother or great grandmother kept up with their money.   We give,  save, and spend in that order.  If you want a risk free look into Dave's program go to your library and check out one of his books.  That is how I got started.  Then I went to a used bookstore and bought his book.  Do your own reaearch and see what you think.  As always, I would love to hear from you and your thoughts on Dave. 

Dave Ramsey. . .continues

I completed the Dave Ramsey class last year and to date we are still credit card FREE!  I am so glad for that.  We are well on our way to paying off the car and we are building our emergency fund.  We still have a way to go but slow and steady will win this race.  I have been using Dave's envelope system now for a year and it does make you think before you whip out that cash for an item.  You feel that money going out of your wallet rather than that swipe of the debit card or credit card.  
With all of the identity theft and stolen credit card numbers, what more reason do you need to use cash.  Even if you just use cash for eating out, you are taking your credit card or debit card out of extra hands and eyes.  The more people that have access to your pertinent information the more likely that it will get taken and used by someone other than you.  Try using cash in one or two areas of your life and that will reduce some of your risk.  In my opinion, eating out is one of the easiest ways to cut back on debit and credit card use.  I feel sure I have posted about this before but it needs to be repeated.  One of  the couples in our class said that their credit card number was stolen while they were on vacation.  They were able to track it to their waiter at one of the restaurants they had visited.  When the police tracked him down he had a notebook with many other credit and debit card numbers written down that he had stolen.  That was my wake up call.  What will your wake up call be?