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Friday, January 27, 2012

Update On Debt

I should be jumping in the shower right now so I can make it to my son's school on time for his Dance of the Dragon, but I am going to eek out this post really quickly. (Real quick? Really quick? Real Quickly?)

I posted a while ago about mine and Joe's journey into Financial Peace University, a Dave Ramsey program.

We have been to 2 classes (tonight is actually our 3rd class) and we are really pumped at our progress already.

Before the program even started, we had been making strides to pay off debt. For like YEARS we have been paying off or settling credit cards that we had run up HIGH balances on when we had life's catastrophes smack us in the face. We. like SO MANY others, believed that the best way to handle these emergencies was to charge them.

And now we are paying the price...literally and figuratively.

At 29% or more interest, that purchase we made 4 YEARS AGO is still kicking us in the arse.

Anyway...in my last post I told you we had $400-something saved up toward our $1000 Emergency Fund. Guess what happened?

AN EMERGENCY. I kid you not.

Our washer died.

And with our gargantuan family, a washer is not a frivolous item. It's a necessity. We do about 2-3 loads of laundry A DAY and that's conservative. It broke down during the week the whole family had the flu. And the kind of flu where you should NOT take any chances if you're feeling a little pressure...catch my drift?

So, we had PILES of newly "striped" Batman and Iron Man underwear that needed to be washed. Time was of the essence.

So, while it sucked that we had to fork over our hard earned cash, it was awesome that we paid CASH....we didn't charge it. And that is a huge first step on the road to financial recovery!

In about a week's time, if all goes according to plan, we will have our $1000 Emergency Fund in place AND we will be paying off about $8,000 (or roughly 10%) of our debt. That will free up about $125 a month for us. It's a wonderful feeling.

I know this is just the beginning, but we are learning and hearing from others who have become debt free that as you persevere and press forward with this proven program, you gain momentum and pick up speed.

Um...here's where I feel I must confess something though...

Dave says that until you 1) Save $1000, 2) pay off ALL your debt (including mortgage), and 3) save 3-6 months of living expenses, your foot should not leave the gas pedal. That means, no frivolous spending that is not budgeted, no big splurges, and you keep your eye on the prize...

Well, *ahem* we kind of veered off the path a bit.

I know, I know!! I'm hiding behind my hands right now...

It was SORTA an accident (but not really...)
A friend GAVE us a queen size mattress, box springs, bed frame and headboard. GAVE US. As in FREE.

We had a King size bed which was wonderful because of its size, it was also horrible because of its size. Our bedroom pretty much only had a bed in it and very little space for walking around.

So, we thought a queen size would be wonderful for giving us some more space.

And as we were discussing it, I thought, "Hey...this would be a great time to tear up the carpeting that the dog ruined in there!" So Joe agreed.

As he was tearing up the carpet, I thought, "Eureka! This would ALSO be a GREAT time to paint this hideous green and sparkly yellow bedroom. The one that we have lived with for 6 years..."

So, that's what we did...we tore up carpeting and painted. We put the bed together and we are now finishing up with making it look "pretty."

We spent $$ that was definitely NOT budgeted. And I do have the guilts. But I'm also very excited for the bedroom to finally feel nice.

Not that I'm justifying...

So...that's where we are. A work in progress. :) As always.

**I was not compensated in any way for this post. Dave Ramsey has absolutely NO idea who I am and if he did, he would be kicking my butt for going off the track with this bedroom makeover...
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