Our goal this year is to become debt free. Except the house, of course, unless there is a huge windfall that comes our way. Hopefully it will not, because windfalls usually happen when someone dies. Anyways.

We have the following debts:

- Credit Card (this happened over the last few months, though we do pay it off every month, it has kind of turned into our backup fund).

- Jetta (will be paid of in December anyway) PAID OFF EARLY IN JULY! WHOOOOOT!

- Pilot (we wouldn’t have this if we didn’t have our car totaled in June from a crazy lady) (if Jetta $ is allocated towards Pilot, will be paid off July 2009).

- House (which isn’t going to be paid off)

If we work really hard and don’t spend any money on anything “fun” we can pay the Jetta off early (with the help of income tax returns) and then we can start to put that payment towards the Pilot. Which could be paid of in December. It would be a year without vacations or buying fun things that just take up space in the house. But the thought of having no more payments except the house & utilities is so exciting that I think we can do it!

We’ve been listening and reading to Dave Ramsey since we’ve been married, yet we’ve never really gotten hard core about it. We’ve had budgets, never opened more credit cards, never bought anything we couldn’t pay cash for, so that helps alot in our situation.
Dave says that if you live like no one else now - you can live like no one else later! While everyone else is up to their eye balls with debt, we’ll be living the sweet life and be able to GIVE GIVE GIVE. Which is what I long for.

As a stay at home mom, I’m not really bringing in an income. And while my heart wants to give people all my money and my time, I have to remind myself it’s not my season to do that yet. But with the help of Dave, we’ll be able to do that someday (soon)!

The steps that we’ll follow are called Baby Steps.
1. $1,000 to start an emergency fund
2. Pay off all debt using the debt snowball
3. 3-6 months of living expenses
4. Invest 15% of household income into Roth IRAs and pre-tax retirement
5. College funding for children
6. Pay off home early
7. Build wealth and give!
Invest in mutual funds and real estate

This is exciting! We will already pay our home off in 2019 (that seems so far away!). I’ll be so excited to have the house payment gone too!

Dave is always quoting the debtor is slave to the lender.
And it’s true. You miss a payment, forget a payment (which is so easy to do when you have babies running around all the time!), then you realize you’re paying stupid tax on a payment you had the money for but just didn’t get to in time.

We shall see…

Posted: 01|25|08 at 4:58 pm. Filed under: Life Stuff.
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