Dave Ramsey Group?

mrsmacgiver
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We've been trying the cash method for a few months. It's not quite working for us. I'm starting to hate it.
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I was in the Dave Ramsey group.
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Verrine
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admin wrote: Tue May 29, 2018 11:19 am I actually have no idea about what the DR method is, or how it works. Care to enlighten me?
(Set up and use a budget. I really like You Need a Budget. It's online. There's a steep learning curve but after that, it's great. https://ynab.com/referral/?ref=6ZchVrF- ... r_referral link for each of us to get a free month )

Make sure that you have $1000 in an Emergency fund. Somehow there are fewer emergencies when you have one.

The debt snowball is well worth doing. Regardless of the interest rate, you pay off your smallest debt first. Then you take the amount of that monthly payment and add it to your next smallest debt. The momentum builds up. There are several apps where you can see the big difference between making the regular small payments and doing the debt snowball.

After that you are supposed to save up 3-6 months living expenses in a real emergency fund.

It is great to jump start your debt free journey with Financial Peace University https://www.daveramsey.com/fpu#in-progress=1 but you can borrow the book from the library if you're really frugal.
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Verrine wrote: Thu May 31, 2018 5:34 pm
admin wrote: Tue May 29, 2018 11:19 am I actually have no idea about what the DR method is, or how it works. Care to enlighten me?
(Set up and use a budget. I really like You Need a Budget. It's online. There's a steep learning curve but after that, it's great. https://ynab.com/referral/?ref=6ZchVrF- ... r_referral link for each of us to get a free month )

Make sure that you have $1000 in an Emergency fund. Somehow there are fewer emergencies when you have one.

The debt snowball is well worth doing. Regardless of the interest rate, you pay off your smallest debt first. Then you take the amount of that monthly payment and add it to your next smallest debt. The momentum builds up. There are several apps where you can see the big difference between making the regular small payments and doing the debt snowball.

After that you are supposed to save up 3-6 months living expenses in a real emergency fund.

It is great to jump start your debt free journey with Financial Peace University https://www.daveramsey.com/fpu#in-progress=1 but you can borrow the book from the library if you're really frugal.
I actually use YNAB :D
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Verrine
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I cannot imagine doing this in today's marketplace. 40 years ago, yes.

We pretty much do everything through our Southwest credit card (yes credit cards are evil -- we actually use our SW miles). A few things are directly from the bank account. I reconcile it with the YNAB budget.

Cash is like water through DH's hands. We tried accounting for how he spent it and it really wasn't working or worth the effort. I don't care how he spends $5, just that he does. He now gets $300 every 2 weeks. He uses it for beer or snacks or a game or saves it. It's easy for me to budget and he's happier.
mrsmacgiver wrote: Wed May 30, 2018 11:50 am We've been trying the cash method for a few months. It's not quite working for us. I'm starting to hate it.
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mcginnisc wrote: Wed May 30, 2018 7:51 am Basically, he has 7 baby steps..
They are as follows:
Baby Step 1 – $1,000 to start an Emergency Fund
Baby Step 2 – Pay off all debt using the Debt Snowball
Baby Step 3 – 3 to 6 months of expenses in savings
Baby Step 4 – Invest 15% of household income into Roth IRAs and pre-tax retirement
Baby Step 5 – College funding for children
Baby Step 6 – Pay off home early
Baby Step 7 – Build wealth and give!

He also suggests getting play money every month ( whatever amount is decided upon), using cash for everything or his envelope method ( we don't do this as we use our debit cards and cc), cut up all cc, use sinking funds and a budget.

We did Financial Peace University through our Church several years ago just to see what it was all about. We already had step 1 as we have always had a savings account with well over his amount in it.. We had no debt except for our mortgage, we already had step 3 as well and hit about 20% for investments while taking the course. We skipped #5 and went to #6. We now owe $45K on our home and should have it paid off in a couple of years. Once we pay off our home, we will start socking away those payments into the kids' accounts. We use our debit cards and credit cards..we pay off cc monthly. We do budget and have sinking funds ( money put away every paycheck for things like car repair, insurance, clothing, education, car replacement, house repair...things like that). We have paid for 2 cars in cash since we started using his principles a few years ago. It is very nice to only have a mortgage and no other debt since we use his principles and save cash for big purchases like vehicles.





admin wrote: Tue May 29, 2018 11:19 am I actually have no idea about what the DR method is, or how it works. Care to enlighten me?
Wow I’ve been using the DR method for years and never even knew it lol

I haven’t had a credit card in about 10 years, and my credit union doesn’t issue debit cards so I’ve always paid for things in cash or checks. I do have a paypal account but that’s linked directly to bank account (no line of credit) and I mostly used it to collect payments. When I order something online I use a prepaid card so it’s basically like paying in cash.

Our only debt is our house but we only have about $50,000 left to pay since we have been making extra payments to pay off the principle faster.

We have a good amount of money stashed away from selling off some websites and have ira investments for the long term. Dh has one of the few jobs left that offers a pension and he puts a little extra in that.

We also have no debt besides our house because we pay for everything in cash.

I never realized that was what Dave Ramsey was tbh, I always heard people talk about it but never actually looked it up.

I went from a credit card junkie to all cash and it has been a huge weight off my shoulders. I much rather have my communal cash box that we can dip into when we need some spending money than have a handful of credit cards with outrageous interest rates. Dh even pays all of our bills except the gas and mortgage in cash lol. He just goes around to the different utility companies and pays in person with cash on payday.
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mcginnisc wrote: Wed May 30, 2018 7:51 am Basically, he has 7 baby steps..
They are as follows:
Baby Step 1 – $1,000 to start an Emergency Fund
Baby Step 2 – Pay off all debt using the Debt Snowball
Baby Step 3 – 3 to 6 months of expenses in savings
Baby Step 4 – Invest 15% of household income into Roth IRAs and pre-tax retirement
Baby Step 5 – College funding for children
Baby Step 6 – Pay off home early
Baby Step 7 – Build wealth and give!

He also suggests getting play money every month ( whatever amount is decided upon), using cash for everything or his envelope method ( we don't do this as we use our debit cards and cc), cut up all cc, use sinking funds and a budget.

We did Financial Peace University through our Church several years ago just to see what it was all about. We already had step 1 as we have always had a savings account with well over his amount in it.. We had no debt except for our mortgage, we already had step 3 as well and hit about 20% for investments while taking the course. We skipped #5 and went to #6. We now owe $45K on our home and should have it paid off in a couple of years. Once we pay off our home, we will start socking away those payments into the kids' accounts. We use our debit cards and credit cards..we pay off cc monthly. We do budget and have sinking funds ( money put away every paycheck for things like car repair, insurance, clothing, education, car replacement, house repair...things like that). We have paid for 2 cars in cash since we started using his principles a few years ago. It is very nice to only have a mortgage and no other debt since we use his principles and save cash for big purchases like vehicles.





admin wrote: Tue May 29, 2018 11:19 am I actually have no idea about what the DR method is, or how it works. Care to enlighten me?
The snowballing method is nothing new... my parents did it, my DH and I have done it before and we're doing it again since circumstances after he lost his job last year have created some issues for us. It works really well as long as you can be disciplined with a budget. I'm even looking for secondary work to add to the amount we're able to dedicate to paydown every month.
mrsmacgiver
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We got ourselves into a bit of debt when we bought this house and everything started going wrong. I'm having a lot of buyer's remorse with this house. We should have gotten something newer. And the other day, the AC was leaking so we have yet another part of the ceiling to cut out and replace. UGH.

Anyway, we were making a list of our debt for the debt snowball this morning. And I'm worried about our emergency fund because we just did our taxes and it's going to eat the whole thing up. We need to start doing quarterly. I'm a little overwhelmed.
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I love Dave Ramsey and listen to his show often. I think he helps a lot of people. We would never do his plan though. We make thousands of dollars a year between cash back and new card bonuses. We’re not giving up our credit cards!
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mrsmacgiver wrote: Sat Jul 14, 2018 1:33 pm We got ourselves into a bit of debt when we bought this house and everything started going wrong. I'm having a lot of buyer's remorse with this house. We should have gotten something newer. And the other day, the AC was leaking so we have yet another part of the ceiling to cut out and replace. UGH.

Anyway, we were making a list of our debt for the debt snowball this morning. And I'm worried about our emergency fund because we just did our taxes and it's going to eat the whole thing up. We need to start doing quarterly. I'm a little overwhelmed.
Are you both self employed, or just one of you?
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