It changed our financial future
My husband and I have recently found ourselves being sought out for financial advice. Now we are not experts, have no formal training or special initials following our last name. Our qualification did not come from a school at all, really it came from life. Life and the book that completely changed our lives The Total Money Makeover . We will help out anyone who asks by meeting with them, giving them the book and helping them create a budget with a goal. It is our passion to see people win with money. People just like us who are ready to say no to debt and yes to living like no one else so that later they can live like no one else!
Brent and I are financial opposites he is the free spirit spending money freely and I am the natural nerd trying to tell every dollar that comes in where to go hoping a few stick around. I loved making budgets, making sure the bills got paid and the groceries were bought. Brent loved shopping, buying what he wanted and justifying the purchase because it in some way benefited both of us. We accumulated stuff rapidly buying the things we thought we needed at the time never really thinking about what we might need down the road it was all for the here and now. We were barely surviving no to be honest we were drowning. From the day we got married we were drowning in debt. But the bills got paid and the groceries were rotting away in the fridge because we often ended up eating out instead of eating the food I stocked our pantry with every week. The credit card company was making a killing on us because they caught the overflow that my budget could not handle.
Babies came, I quit my job and we quickly realized just how much debt we had. Of course we had no idea how to fix that problem except to run to the bank and get more credit. I have lost track of how many times we rolled one credit card debt to a personal loan just to run up another credit card. We rolled two vehicles into one, then another, then another. I still had my budgets written out every month and every month I was robbing Peter to pay Paul because those budgets were destroyed the first chance Brent got. It was not his fault I never really shared my budget with him. I took care of all the bills. Brent worked and assumed that money was there for him to spend. We avoided the elephant in the room so perfectly we both forgot it was there.
When we got orders to PCS from Colorado to Oklahoma about two years after we were married we decided to buy a house. Now I know you are reading this and laughing but you can stop right now because I bet you had credit card debt, personal loans and auto loans when you bought your house too. It really is not that uncommon. Oh did I mention we had zero savings ha saving money was not in our grasp because we had no money to save! So thanks to the wonders of a VA loan we were able to buy our first house with no money down and a minimal payment. We had excellent credit. I always made those payments on time even though we had to use the credit card to buy the groceries I always made sure it was paid. I should mention now that oh about a year after we moved in a man showed up saying we just had to refinance. All the VA loan holders were doing it. We were then introduced to the wonderful world of adjustable rate mortgages!! What a nightmare! Halloween scream, hands over my eyes, heart skipping a beat nightmare. Do not ever refinance to an adjustable rate ever that rate will go up and you will be pulling your hair out every year waiting for that letter telling you just how much you are going to pay for your mistake.
So there we were home owners with all the debt and responsibility that goes along with it. We moved in with one child but quickly added our second, third and then fourth. At that point we were slowly putting a dent in our debt but I was still handling all of the finances on my own. Still robbing Peter to pay Paul every time the budget just did not work. We were getting some money saved though and had succeeded in paying off all of our personal loans. We had one auto loan and one credit card that we seemed to constantly yo-yo and then we had our mortgage.
When Brent deployed for the first and second time I cut our living expenses down to nothing and chucked everything at our debt and savings account. I was determined to dig us out of the hole we always seemed to find ourselves in. When Brent went remote I did it again and succeeded in paying off all of the credit card debt! Just in time too because we were moving. We had lived in Oklahoma 6 years and Brent finally got orders out of there. We were moving to North Carolina and yes we were yet again buying a house. This time we had learned a few lessons. It felt good knowing the credit card debt was gone. We had some money saved up to keep us on our feet and that felt good to. We put our house on the market and prepared to sell. Well it didn't. We moved to North Carolina and bought our second home while still paying the mortgage on our first home in Oklahoma.
Panic set in. I traded in $5000 of credit card debt for $108,000 in mortgage debt on top of the first mortgage of $50,000 and the auto loan which was about $19,000. This was in May 2009. We had about $10,000 in savings but with Brent home and still uncontrollable in his spending there was no way of knowing how long that would last. $6000 of that was actually set aside for a family vacation to Disney. By June we were pregnant with out fifth child and I was desperate to get out from under the mountain of debt that was sitting so heavily on my chest I could barely breath.
It was around that time my old church in Oklahoma announced that they would be holding Financial Peace University. I was interested granted I now lived several states away but I wanted to know more. I tried to get information from the church but never heard back from anyone. Normally that would have been enough to stop me dead in my tracks but not this time. I searched, I looked up books and I drooled over them on the internet. I really wanted those books! I had no way to get them though money was so tight I did not even have the $15 bucks it would have cost to order it. I looked at the library and of course they were all checked out. So I read what I could online, read about the baby steps and worked those over in my head. I liked the concept but the thought of taking our savings down to $1000 scared the crap out of me. Then I mentioned some of this stuff to my dad and guess what?! He had an old copy of the book sitting at his house. He bought it used a while ago started reading it never finished and just set it aside for another day. I pounced!! I wanted to get my hands on that book so bad. He agreed to send it to me and a couple weeks later it was mine. Ok not mine, but I could keep it as long as I needed.
I opened The Total Money Makeover and did not put it down until I finished it two days later. I was hooked. Here was the answer I was looking for. Common sense! Who knew? It was so simple, so easy, so exciting! We could be debt free! We could be millionaires! We could be on the same page with our budget! We oh hmm I guess I do need to let Brent in on this huh? So I poured everything I had read out to Brent. Brent was ok with it. He agreed to follow the steps as long as he got to have a say in it, ya know put his two cents in every now and then pretty much he still wanted money to spend. I took that and ran with it.
I wrote up our first official budget with a plan and our journey to being debt free began in September 2009. First we took everything in savings down to the $1000 and put it on the van loan. Then Brent decided that my worn out pregnant self could not handle going to Florida two months before my due date so we took that money and put it on the van loan too. I was not thrilled about that decision at the time but he was right. Then miracle of miracles our house sold! This was October and November. By December we made the final payment on our van!! We were DEBT FREE!!!! Our only debt was our current mortgage. Now that was exciting. Brent was fully on board by this point. I showed him the part in the book that explains how the average Joe could retire a millionaire and he decided this Dave Ramsey guy was not half bad.
So we had completed Baby Step 1 Save $1000 and Baby Step 2 Pay off everything but the mortgage in record time just 4 months! Baby Step 3 was next saving 3 to 6 months of expenses. We felt comfortable with $12,000 so that became our goal. We kept our budget and I do mean OUR budget tight as could be and put every extra penny in the emergency fund. Our fifth child was born the end of February 2010 but we still kept saving. I was awarded my new disability rating through the VA and that back pay helped us reach our goal. That was right around March and in April Murphy's Law hit. The roof on our new house sprung a leak. Upon inspection we found out the entire roof needed to be replaced along with several of the boards underneath that had been rotted through. We quickly kissed $8000 of our emergency fund good-bye and had to start over. Fortunately when you have no debt dictating where to put your money it is easy to save it. Tax season helped a lot too! Murphy has hit us a few more times over the past year but we have handled it just fine. We are still growing our emergency fund with a new goal in mind $24,000 it might take a little bit to get there but I see the finish line not to far off now.
We were at Baby Step 4 within a year of getting our Total Money Makeover started. Baby Step 4 is investing 15% of your income towards retirement. And that is where we are now although we are getting ready to go on to the next step soon. We are actually skipping Baby Step 5 which is save for college. It was a tough decisions to make and not one we made lightly. With five kids there is just no way we can save enough to send them all to college. We do hope that they will qualify for grants and scholarships once the time comes but mostly we plan on teaching them about hard work. We know and we want them to know that they can easily work their way through college and have zero debt in the end. So that is the plan for Baby Step 5. Baby Step 6 is to pay off the mortgage. I am very excited to get started on this step mostly because step 7 comes right after it! Baby Step 7 is to build wealth and give. Who would not want to reach that point in their lives? Currently Brent and I do give it is the very first thing on our budget but we look forward to being able to give more.
If you are interested in creating a budget with the goal of becoming debt free then check out Dave Ramsey's budget forms here
I have created a budget that is very simple that we fill in each month and it looks like this
November 2011
Income
1st $---
15th $---
= $--- You need to know your total coming in and your total going out minus the outgo from the income and that should be zero every month.
Due on the 1st
Give $--- This is where we write in how much our tithes and offering will be or how much we are giving to charity that month
Mortgage $---
Water Bill $--
Phone Bill $---
Food $--- This is our food budget for the entire month
Restaurant $-- This is where we decide how much we are willing to pay for meals out once it is gone it is gone!
Gas Brent $-- Since we drive separate vehicles we have two different gas budgets. Brent gets all of his on the 1st but I still get mine on the 1st and 15th
Gas Sarah $--
Gym $--
Kids commission $-- Our kids earn a commission instead of an allowance
Brent Blow $---
Sarah Blow $-- Brent and I still enjoy spending money in our own way which is why we both get our own blow money
Family Blow $-- This is money spent having fun as a family or it also helps cover miscellaneous expenses such as stamps at the post office
Karate $--- We currently have four of our kids in karate
Date Night $--- The most important category in our budget
Dave Ramsey Books $-- Brent and I give away these books to anyone who needs one. It changed our life for the better and we want to see it change yours as well.
Due on the 15th
Retirement $---
Electric Bill $---
Gas Sarah $--
Family Blow $--
Sarah Blow $--
Netflix $-- We do not have cable so we enjoy having Netflix streaming
Kid Accounts $- We set up savings accounts for each of our kids that we put a small amount into each month. They choose what they are saving for and add to it as well.
Home Repairs $-- This account is a goal savings account. It is there to catch any repairs or maintenance that we may need to make to our home.
Furniture $-- A goal savings account set up to help us replace furniture as needed over the years.
School & Karate $-- Goal savings to cover the expenses that come with having school age children . It also helps cover the cost of karate gear as needed.
Car $--- Goal savings, It covers Tire, Oil, Repairs, Insurance, Tags and taxes
Clothes $-- Same deal goal savings to buy clothes as needed
Gifts $--- Goal savings. Christmas and birthdays always happen on the same day every year this way we aren't caught off guard when they do
Terminex $--- Oh my gosh have you seen the size of the roaches in North Carolina!!? This account is a must!
Death Insurance $-- We all die right? So why not make sure your family is taken care of when you do.
Race Fund $-- Brent is a mud race fanatic. So we added this savings account to the budget so he can save up to pay for the registration fees
Vet Bills $-- We have a dog. Dogs go to the vet. I think that says it all
Vacation Fund $--- Goal savings account so that some day I can get a break!!
Emergency Fund $--- Goal $---- Current $---- No matter what step you are on you should always be saving money. The first $ is where you put in how much is going into that account this month. The Goal $ is where you write in your current goal for that account and the Current $ is where you write in how much you currently have saved up in that account.
It does not matter which budget format you use all that matters is that you have a budget and a goal! Thanks for reading.
Brent and I are financial opposites he is the free spirit spending money freely and I am the natural nerd trying to tell every dollar that comes in where to go hoping a few stick around. I loved making budgets, making sure the bills got paid and the groceries were bought. Brent loved shopping, buying what he wanted and justifying the purchase because it in some way benefited both of us. We accumulated stuff rapidly buying the things we thought we needed at the time never really thinking about what we might need down the road it was all for the here and now. We were barely surviving no to be honest we were drowning. From the day we got married we were drowning in debt. But the bills got paid and the groceries were rotting away in the fridge because we often ended up eating out instead of eating the food I stocked our pantry with every week. The credit card company was making a killing on us because they caught the overflow that my budget could not handle.
Babies came, I quit my job and we quickly realized just how much debt we had. Of course we had no idea how to fix that problem except to run to the bank and get more credit. I have lost track of how many times we rolled one credit card debt to a personal loan just to run up another credit card. We rolled two vehicles into one, then another, then another. I still had my budgets written out every month and every month I was robbing Peter to pay Paul because those budgets were destroyed the first chance Brent got. It was not his fault I never really shared my budget with him. I took care of all the bills. Brent worked and assumed that money was there for him to spend. We avoided the elephant in the room so perfectly we both forgot it was there.
When we got orders to PCS from Colorado to Oklahoma about two years after we were married we decided to buy a house. Now I know you are reading this and laughing but you can stop right now because I bet you had credit card debt, personal loans and auto loans when you bought your house too. It really is not that uncommon. Oh did I mention we had zero savings ha saving money was not in our grasp because we had no money to save! So thanks to the wonders of a VA loan we were able to buy our first house with no money down and a minimal payment. We had excellent credit. I always made those payments on time even though we had to use the credit card to buy the groceries I always made sure it was paid. I should mention now that oh about a year after we moved in a man showed up saying we just had to refinance. All the VA loan holders were doing it. We were then introduced to the wonderful world of adjustable rate mortgages!! What a nightmare! Halloween scream, hands over my eyes, heart skipping a beat nightmare. Do not ever refinance to an adjustable rate ever that rate will go up and you will be pulling your hair out every year waiting for that letter telling you just how much you are going to pay for your mistake.
So there we were home owners with all the debt and responsibility that goes along with it. We moved in with one child but quickly added our second, third and then fourth. At that point we were slowly putting a dent in our debt but I was still handling all of the finances on my own. Still robbing Peter to pay Paul every time the budget just did not work. We were getting some money saved though and had succeeded in paying off all of our personal loans. We had one auto loan and one credit card that we seemed to constantly yo-yo and then we had our mortgage.
When Brent deployed for the first and second time I cut our living expenses down to nothing and chucked everything at our debt and savings account. I was determined to dig us out of the hole we always seemed to find ourselves in. When Brent went remote I did it again and succeeded in paying off all of the credit card debt! Just in time too because we were moving. We had lived in Oklahoma 6 years and Brent finally got orders out of there. We were moving to North Carolina and yes we were yet again buying a house. This time we had learned a few lessons. It felt good knowing the credit card debt was gone. We had some money saved up to keep us on our feet and that felt good to. We put our house on the market and prepared to sell. Well it didn't. We moved to North Carolina and bought our second home while still paying the mortgage on our first home in Oklahoma.
Panic set in. I traded in $5000 of credit card debt for $108,000 in mortgage debt on top of the first mortgage of $50,000 and the auto loan which was about $19,000. This was in May 2009. We had about $10,000 in savings but with Brent home and still uncontrollable in his spending there was no way of knowing how long that would last. $6000 of that was actually set aside for a family vacation to Disney. By June we were pregnant with out fifth child and I was desperate to get out from under the mountain of debt that was sitting so heavily on my chest I could barely breath.
It was around that time my old church in Oklahoma announced that they would be holding Financial Peace University. I was interested granted I now lived several states away but I wanted to know more. I tried to get information from the church but never heard back from anyone. Normally that would have been enough to stop me dead in my tracks but not this time. I searched, I looked up books and I drooled over them on the internet. I really wanted those books! I had no way to get them though money was so tight I did not even have the $15 bucks it would have cost to order it. I looked at the library and of course they were all checked out. So I read what I could online, read about the baby steps and worked those over in my head. I liked the concept but the thought of taking our savings down to $1000 scared the crap out of me. Then I mentioned some of this stuff to my dad and guess what?! He had an old copy of the book sitting at his house. He bought it used a while ago started reading it never finished and just set it aside for another day. I pounced!! I wanted to get my hands on that book so bad. He agreed to send it to me and a couple weeks later it was mine. Ok not mine, but I could keep it as long as I needed.
I opened The Total Money Makeover and did not put it down until I finished it two days later. I was hooked. Here was the answer I was looking for. Common sense! Who knew? It was so simple, so easy, so exciting! We could be debt free! We could be millionaires! We could be on the same page with our budget! We oh hmm I guess I do need to let Brent in on this huh? So I poured everything I had read out to Brent. Brent was ok with it. He agreed to follow the steps as long as he got to have a say in it, ya know put his two cents in every now and then pretty much he still wanted money to spend. I took that and ran with it.
I wrote up our first official budget with a plan and our journey to being debt free began in September 2009. First we took everything in savings down to the $1000 and put it on the van loan. Then Brent decided that my worn out pregnant self could not handle going to Florida two months before my due date so we took that money and put it on the van loan too. I was not thrilled about that decision at the time but he was right. Then miracle of miracles our house sold! This was October and November. By December we made the final payment on our van!! We were DEBT FREE!!!! Our only debt was our current mortgage. Now that was exciting. Brent was fully on board by this point. I showed him the part in the book that explains how the average Joe could retire a millionaire and he decided this Dave Ramsey guy was not half bad.
So we had completed Baby Step 1 Save $1000 and Baby Step 2 Pay off everything but the mortgage in record time just 4 months! Baby Step 3 was next saving 3 to 6 months of expenses. We felt comfortable with $12,000 so that became our goal. We kept our budget and I do mean OUR budget tight as could be and put every extra penny in the emergency fund. Our fifth child was born the end of February 2010 but we still kept saving. I was awarded my new disability rating through the VA and that back pay helped us reach our goal. That was right around March and in April Murphy's Law hit. The roof on our new house sprung a leak. Upon inspection we found out the entire roof needed to be replaced along with several of the boards underneath that had been rotted through. We quickly kissed $8000 of our emergency fund good-bye and had to start over. Fortunately when you have no debt dictating where to put your money it is easy to save it. Tax season helped a lot too! Murphy has hit us a few more times over the past year but we have handled it just fine. We are still growing our emergency fund with a new goal in mind $24,000 it might take a little bit to get there but I see the finish line not to far off now.
We were at Baby Step 4 within a year of getting our Total Money Makeover started. Baby Step 4 is investing 15% of your income towards retirement. And that is where we are now although we are getting ready to go on to the next step soon. We are actually skipping Baby Step 5 which is save for college. It was a tough decisions to make and not one we made lightly. With five kids there is just no way we can save enough to send them all to college. We do hope that they will qualify for grants and scholarships once the time comes but mostly we plan on teaching them about hard work. We know and we want them to know that they can easily work their way through college and have zero debt in the end. So that is the plan for Baby Step 5. Baby Step 6 is to pay off the mortgage. I am very excited to get started on this step mostly because step 7 comes right after it! Baby Step 7 is to build wealth and give. Who would not want to reach that point in their lives? Currently Brent and I do give it is the very first thing on our budget but we look forward to being able to give more.
If you are interested in creating a budget with the goal of becoming debt free then check out Dave Ramsey's budget forms here
I have created a budget that is very simple that we fill in each month and it looks like this
November 2011
Income
1st $---
15th $---
= $--- You need to know your total coming in and your total going out minus the outgo from the income and that should be zero every month.
Due on the 1st
Give $--- This is where we write in how much our tithes and offering will be or how much we are giving to charity that month
Mortgage $---
Water Bill $--
Phone Bill $---
Food $--- This is our food budget for the entire month
Restaurant $-- This is where we decide how much we are willing to pay for meals out once it is gone it is gone!
Gas Brent $-- Since we drive separate vehicles we have two different gas budgets. Brent gets all of his on the 1st but I still get mine on the 1st and 15th
Gas Sarah $--
Gym $--
Kids commission $-- Our kids earn a commission instead of an allowance
Brent Blow $---
Sarah Blow $-- Brent and I still enjoy spending money in our own way which is why we both get our own blow money
Family Blow $-- This is money spent having fun as a family or it also helps cover miscellaneous expenses such as stamps at the post office
Karate $--- We currently have four of our kids in karate
Date Night $--- The most important category in our budget
Dave Ramsey Books $-- Brent and I give away these books to anyone who needs one. It changed our life for the better and we want to see it change yours as well.
Due on the 15th
Retirement $---
Electric Bill $---
Gas Sarah $--
Family Blow $--
Sarah Blow $--
Netflix $-- We do not have cable so we enjoy having Netflix streaming
Kid Accounts $- We set up savings accounts for each of our kids that we put a small amount into each month. They choose what they are saving for and add to it as well.
Home Repairs $-- This account is a goal savings account. It is there to catch any repairs or maintenance that we may need to make to our home.
Furniture $-- A goal savings account set up to help us replace furniture as needed over the years.
School & Karate $-- Goal savings to cover the expenses that come with having school age children . It also helps cover the cost of karate gear as needed.
Car $--- Goal savings, It covers Tire, Oil, Repairs, Insurance, Tags and taxes
Clothes $-- Same deal goal savings to buy clothes as needed
Gifts $--- Goal savings. Christmas and birthdays always happen on the same day every year this way we aren't caught off guard when they do
Terminex $--- Oh my gosh have you seen the size of the roaches in North Carolina!!? This account is a must!
Death Insurance $-- We all die right? So why not make sure your family is taken care of when you do.
Race Fund $-- Brent is a mud race fanatic. So we added this savings account to the budget so he can save up to pay for the registration fees
Vet Bills $-- We have a dog. Dogs go to the vet. I think that says it all
Vacation Fund $--- Goal savings account so that some day I can get a break!!
Emergency Fund $--- Goal $---- Current $---- No matter what step you are on you should always be saving money. The first $ is where you put in how much is going into that account this month. The Goal $ is where you write in your current goal for that account and the Current $ is where you write in how much you currently have saved up in that account.
It does not matter which budget format you use all that matters is that you have a budget and a goal! Thanks for reading.
Wow. I am so happy that I am coming to see you tomorrow! I swear I just read my own life story, only difference is we are still struggling! Thank you so much for all that you do for others. :)
ReplyDeleteI am excited too! I really hope it helps you guys :)
ReplyDelete