Dave Ramsey Check-In: Share Your Progress on His Financial Plan!

[finley1991]

Yeah, I did totally score with that car! The guy had to sell it because the insurance was too high for him with his 16-year-old!Ironically the car I got that was a lemon was a honda accord.... brand spankin' new. Supposedly good cards but I will never own another one after my experience.

 

[hperschnick]

DH and I are doing FPU right now... we just saw the dumping debt lesson last night. We are working on Baby Step 1 - building the emergency fund. We started budgeting Jan 1 and using the envelope system. We haven't really been working the entire plan... like allocation of lump sums that we receive. I have done some photography jobs on the side and we end up using that to supplement for diapers and groceries and things. We didn't quite have the budget right this month... we FORGOT to put diapers in there so we were using grocery money. So I guess it was kind of an emergency fund.

We are going to call the CCs tonight and find out our balances and prioritize them. This class has really helped us because I was the only one doing the finances and stressing about it. DH has stepped up and keeping up with the spreadsheet part of it and it has really helped to know that this is now a joint effort and he knows what is going on too.

I think we spend less when using cash... it does hurt more to spend that - even on necessities like groceries and gas.

 

[GeorgiaPeach]

For those of you that have already done DR stuff.....we listened to the TMMO on audio. (We start the actual class on 2/11). He said something about using a debt consolidation company (like InCharge or CCCS) is BAD. He said it was like having a default (or something like that) on your credit report.

Anyone know why? I never figured it out. All payments are made on time since you pay them one lump sum and they distribute the money and they negotiate lower %. They do close your account once it's paid off but that's the only thing I can see as the downfall.

 

[finley1991]

All payments are made on time since you pay them one lump sum and they distribute the money and they negotiate lower %. They do close your account once it's paid off but that's the only thing I can see as the downfall.

NOT NOT NOT TRUE! A friend of mine did this last summer. When she moved to another state for a new job, she couldn't get an apartment because all of her credit cards (six in all) had not been paid on time for the previous 6 months. Not once. Those kinds of companies are bad because they do whatever they want. They were paying her bills when they wanted to... not when they were due. She had to have her new employer rent her apartment for her. She was totally embarrassed.

Because these types of companies can't be trusted, DR recommends working directly with the credit card companies yourself and not relying on someone else.

 

[GeorgiaPeach]

NOT NOT NOT TRUE! A friend of mine did this last summer. When she moved to another state for a new job, she couldn't get an apartment because all of her credit cards (six in all) had not been paid on time for the previous 6 months. Not once. Those kinds of companies are bad because they do whatever they want. They were paying her bills when they wanted to... not when they were due. She had to have her new employer rent her apartment for her. She was totally embarrassed.

Because these types of companies can't be trusted, DR recommends working directly with the credit card companies yourself and not relying on someone else.

We signed up with InCharge 16 months ago. (Before I hear DR's take on it). They have paid on time every month and by the end of next month we will have 3 cards fully paid off. I called to ask how they apply the rest of the money (the amounts that normally went to the accounts that are now closed). They apply it exactly as Dave recommends.

I agree that there are MANY companies that prey on people that have fallen behind and are scared by the phone calls. But I also think there are some companies that will do what they say they will.

 

[erinb]

For those of you that have already done DR stuff.....we listened to the TMMO on audio. (We start the actual class on 2/11). He said something about using a debt consolidation company (like InCharge or CCCS) is BAD. He said it was like having a default (or something like that) on your credit report.

Anyone know why? I never figured it out. All payments are made on time since you pay them one lump sum and they distribute the money and they negotiate lower %. They do close your account once it's paid off but that's the only thing I can see as the downfall.

It reports basically like a Chapter 13 BR on your credit report. It's actually the same tactic as a Chapter 13 but instead of it being an attorney and the court system working with creditors, it is a company.

 

[janetupnorth]

I am just refinancing our house and combining our mortgages and both combined will be at a lower rate than the original. I am then using the monthly payment freed up to tackle my highest rate card/loan. I am anxious to read but hopefully that somewhat complies to what they say.

 

[erinb]

I am just refinancing our house and combining our mortgages and both combined will be at a lower rate than the original. I am then using the monthly payment freed up to tackle my highest rate card/loan. I am anxious to read but hopefully that somewhat complies to what they say.

That is a very smart choice and works very well as long as you have the discipline to make sure that the extra that you save from your mortgage does go toward the cards.

 

[katie0128]

I'd love to refinance, but it doesn't make sense for us just yet because we have such a low interest rate (like 5% or something). But I did sign up for the automatic payment plan with my mortgage company... they take out 1/2 of my payment every other week, so I end up making 13 payments a year. Since it is through the actual mortgage company, everything is paid on time and we should have our house paid off in about 17 more years... not bad for being here only 4 years with a 30 year mortgage!!! The four years of on-time payments for my mortgage have really helped boost our credit rating!!!

I've also opened a couple checking accounts just for making automatic payments. I have a certain amount of money transferred to the accounts each payperiod and then have the payments withdrawn a few days later. It all happens automatically, so I never see the money and don't end up missing it... AND my bills get paid on time. WHAT A RELIEF!!!

 

[jwpamp]

Does anyone have a coupon code for his site? I wanted to buy some products and see that there is a "coupon code" area to save $$$.

TIA!

 

[janetupnorth]

Janice - see if these still work:

2CDBP09
&
2VHBP09

 

[janetupnorth]

Hey, for those doing this, explain the envelope system.

Is it putting your montly budget for an item in an envelope in cash and then only purchasing out of there?

 

[jwpamp]

They didn't work for me. I want to order one of the "specials". It's only $40, I guess I can splurge for it....

 

[janetupnorth]

Sorry, it was worth a shot...don't know what any current ones may be...

 

[hperschnick]

Hey, for those doing this, explain the envelope system.

Is it putting your montly budget for an item in an envelope in cash and then only purchasing out of there?

Yes, the envelope system is budgeting money for things like groceries, clothing, gas, eating out, and your spending or "blow" money then putting that amount in a labeled envelope then only using cash for those items. The theory is that it hurts more to actually pay with the green stuff and you know exactly where your money is being spent. The envelopes are for budget items that you may have a tendency to overspend in more easily. If there isn't any money in the envelope you either don't get to purchase that or you have to take money away from something else. It's working for us.

 

[khergatt]

Hi! We are doing this, too.

We are currently on Step 2 and almost finished!!! WOOHOO!

We are planning to save for a down payment on a house as soon as the bills are paid off. I am really excited about it!

 

[janetupnorth]

So, another question, does step #2 EXCLUDE your mortgage?

I consider that debt, but it sounds like that is excluded and that is in a later step...

 

[katie0128]

Here are the "Baby-Steps" from Financial Peace University...

1. $1,000 in an Emergency Fund ($500 if income under $20,000 per year)

2. Pay off all debt utilitizng the Debt Snowball (except the house)

3. 3-6 months expenses in savings

4. Invest 15% of household income into Roth IRAs and pre-tax retirement

5. College funding

6. Pay off home early

7. Build wealth (mutual funds/real estate)

 

[tabnat80]

Sob Sob. We were doing so well, and the came December. We didn't dip into savings to buy Christmas but we did have to dip into it to pay for doctor bills and wedding bills. My son and I both were sick almost all December and my best friend got married. So, I had to buy medicine, pay for a dress, throw a awesome shower, and pay for travel expenses to and from grandmaw's for Christmas. So, needless to say, our peanny little step 1 savings is dwindled down to 90 bucks. But I do have faith that we are going to restore it. Income tax time is around the corner and we are getting back some $ and plan to build our savings back up and pay off the few cc's we have.

 

[katie0128]

Regardless of where the Emergency Fund is now... you learned two things...

1. You can't plan for everything - thus the Emergency Fund
2. You CAN do it.

Now, don't forget that building the Emergency Fund comes BEFORE paying off the credit cards. Otherwise, when the next emergency hits, you won't have the $$ in the bank and you'll end up charging the cc's again.

 

[DebbieJ]

Here are the "Baby-Steps" from Financial Peace University...

1. $1,000 in an Emergency Fund ($500 if income under $20,000 per year)

2. Pay off all debt utilitizng the Debt Snowball (except the house)

3. 3-6 months expenses in savings

4. Invest 15% of household income into Roth IRAs and pre-tax retirement

5. College funding

6. Pay off home early

7. Build wealth (mutual funds/real estate)

Yes, those are the baby steps, but I would like to make 2 clarifications. First Dave recommends tithing 10%, even as you're working the first few steps. We are on step two and continue to give to our church and other organizations. Second, step 7 is build wealth and GIVE. You are gathering money like crazy, but also giving plenty of it away.

Just wanted to make that clear because it is a HUGE part of Dave's philosophy.

 

[janetupnorth]

He-he - I used to do an emergency fund, but DH always finds SOMETHING he needs or something breaks and it is too easy to access (even though I control the money usually). So, I found the best "out of sight - out of mind" solution for us. I transferred our emergency fund into two chunks into the kids savings accounts. They can keep the interest earned off of it...and eventually when we get to a further step, they can just keep it. To access it I have to make an effort to transfer back rather than just quickly accessing it.

 

[janetupnorth]

Well, I don't have his materials, but I'm on Step #2 as of today - YEAH!

 

[tabnat80]

Hey Janetupnorth. I just wanted to let you know that your bible verse on your closer helped me through my show on Thursday. So many times, I am reminded of that verse when I'm going through major life changes. When I changed my major in college, a friend of mine showed it to me and it's stuck with me ever since. I had a show on Thursday night, my first non-friends and family show. I had never met this lady, she called me out of the blue. Well, I got on here before I left to see if i needed any more info or fliers for my show and I saw your bible verse and it calmed me down so much. I already had my family and friends praying for me but just reading that verse, I had a calmness come over me and wasn't nervous anymore. Anyways, thanks for the encouragement even though you didn't know you were encouraging me!

Well, I don't have his materials, but I'm on Step #2 as of today - YEAH!

 

[janetupnorth]

Hey Janetupnorth. I just wanted to let you know that your bible verse on your closer helped me through my show on Thursday. So many times, I am reminded of that verse when I'm going through major life changes. When I changed my major in college, a friend of mine showed it to me and it's stuck with me ever since. I had a show on Thursday night, my first non-friends and family show. I had never met this lady, she called me out of the blue. Well, I got on here before I left to see if i needed any more info or fliers for my show and I saw your bible verse and it calmed me down so much. I already had my family and friends praying for me but just reading that verse, I had a calmness come over me and wasn't nervous anymore. Anyways, thanks for the encouragement even though you didn't know you were encouraging me!

Hey - SO GLAD to hear that! I have the reference engraved in my DH's wedding band (his nice one) - his one he wears daily has our wedding date engraved (yes, I married a guy who cannot remember his anniversary is 9-11-99!!!!)

Anyway, those are my favorite verses, but I always tell people and my AWANA kids, you cannot have verse 11 without verse 13!!!!

 

[DebbieJ]

Janet, I'm still working on getting stuff mailed to you. DH STILL hasn't burned those CDs for me. Grrr!!!

 

[janetupnorth]

Janet, I'm still working on getting stuff mailed to you. DH STILL hasn't burned those CDs for me. Grrr!!!

No problem - I'm very appreciative!!!! But definitely not sitting idle waiting! I'm just working on the Dave method combined with the Janet method for now!

 

[sfdavis918]

The van is sold!! I was sad, but now we are only 6 months from finishing babystep 2! Yahoo!!!! Now I've got to get some shows on the calendar so that we can get it done even faster!

 

[janetupnorth]

The van is sold!! I was sad, but now we are only 6 months from finishing babystep 2! Yahoo!!!! Now I've got to get some shows on the calendar so that we can get it done even faster!

Yeah for you! I'm going to have to figure out how long step #2 will take me but it will be heck of a lot longer than 6 months!!!!

 

[katie0128]

Yes, those are the baby steps, but I would like to make 2 clarifications. First Dave recommends tithing 10%, even as you're working the first few steps. We are on step two and continue to give to our church and other organizations. Second, step 7 is build wealth and GIVE. You are gathering money like crazy, but also giving plenty of it away.

Just wanted to make that clear because it is a HUGE part of Dave's philosophy.

Thanks for adding that. I was just transcribing from the FPU book and since we tithe regularly, sometimes I forget that one... I'm going to rename that Baby Step "DUH" for Christians. For those of us that profess to be believers, NOTHING else will work untill we do step "DUH"!