Cleaning up the Fiscal Mess we made
As I’ve noted in a few earlier posts(here, here, here, and here), my wife and I are making an effort to partake in a Total Money Makeover. It’s been interesting as we’ve learned quite a bit about our money and where it actually goes. Further, it’s given us a better perspective of where we were, are and will be.
Where we were: In a fiscal dump. While we kept a register of our checks and pretty good details on all of our accounts, we just couldn’t seem to get ahead or keep even. We constantly were using up all of our overdraft protection and paying anywhere from $100-$600 in Check defender fees ( a program that keeps you checks from bouncing but you still get a $25 per item fee). Consider taking your monthly finances and draining $100-$600 out of them each month. It hurts. Especially when you don’t gain any benefit or goods from it.
Where we are: Better. After getting a decent tax refund this year, we used it to get ourselves ahead a little and have completely eliminated the Check Defender fees so far this month. We have also completely paid off the Overdraft protection. We’ll still be dipping into the OD protection at the end of the month, but in comparison with previous months, we’ll be able to quickly pay it off as soon as we get paid on the 30th. We have a budget. Our budget balances to $0 each month. We have also discovered that we have plenty to learn about our finances still. All the little things that have come up that will have to be addressed in coming months. Nothing that will break the budget too much. Besides a pending root canal of course.
Where we will be: Ultimately, we want to be debt free. Our immediate goal is to be in total control of our finances and paying off debt each and every month. Our next goal is to have everything paid off except for a couple of our larger student loans and our mortgage. Of course once everything else is paid off, it shouldn’t take long at all to pay those off either so we’ll be completely debt free rather quickly at that point. We’ll have the freedom to take a vacation and be able to afford it. We will be able to pay cash for used cars instead of needing a 3-5 year loan. In short, we’ll be independent from any of the typical debt related constraints.
I have to admit that going into this, I scoffed at Dave Ramsey when, in the Total Money Makeover book, he said that getting started on this plan will give you a feeling of freedom. And after the short two weeks that we’ve been doing the TMM, I have to admit that he was right. We’re not even in complete control of our finances yet, but I already feel so much better about our situation. It is working for us and I plan on recommending it to as many people as possible.
P.S. I still haven’t heard from anyone who has done a TMM yet. I’d like to feature a few guest articles here on other peoples experiences with the Total Money Makeover. If you’re interested, use the Contact form and let me know.
Technorati Tags: total money makeover, tmm, dave ramsey, money makeover, budget
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susan said,
Wrote on March 26, 2007 @ 8:42 pm
I was where you are 10 year ago. Had not heard about dave then but did my own version of the plan (smallest to largest). When I heard about him, I did the $1000 emergency plan. Made a big difference. My car broke down and I freaked until I realized that I had the money and it was just an inconvenience. Now I have no debt only a do-able mortage and was able to stay local (2 other people in my group travel constantly) by having a flexible schedule. My company pays me a minimum of 27 hours a week when things are slow (very often in my business) to working 40+ hours when necessary. Life was difficult for a while but DEFINTELEY worth it now. You GO! The budget and only cash spending make the big difference.
Rogers Place said,
Wrote on March 28, 2007 @ 1:12 am
Sounds like your doing good to eliminate uneccesary debt. We will all have debt like mortages that will take time to pay. As you eliminate those smaller debts and pay with cash instead of credit everything seems to be cheaper. That $2.00 soda is now only $2.00 instead of $300.00. Keep up the good work and good luck in your venture.