Dave Ramsey - Love Em' Hate Em'

Over 2 years ago, Kevin and I were living a completely different life. We were what we fondly call 'Dinks'. That's 'dual income, no kids' for those who have never heard the term. We lived on a loose budget, but knew that it was time to get serious about our finances. The more you look into your finances, the more you realize how badly we all spend our money. We discussed, researched, and came to the conclusion that Dave Ramsey would be our main man. If you don't know who he is (then you must live under a rock) then you should look up his website at http://www.daveramsey.com. Dave's ideas are not always the popular ones and to live on his plan is a hard way. His motto is "if you live like no one else, later you can live like no one else". The basics are no credit cards, live only on basics and within your means, and no debt.

(1) Start a $1000 savings fund and get on a budget. We'll neither of us had credit cards to give up, and we already had a good savings fund started. We've always lived on a budget, so the first step was no step at all.

(2) Pay off ALL debt. For us, we were once again very blessed on this step. No credit cards, equaled no credit card debit. First we finished off Kevin's student loans, then his Ford Explorer, last and most painful was my Impala. Life took a swing of events, and we found out we were pregnant with Clare. We realized our 'dink' lifestyle was coming to an end quickly. Every month we trimmed the budget more. $200 here a $100 there. No more cable t.v., no more expensive home improvements, no more home phone line, less new clothes, and way less eating out. We were determined to get on a one income budget and pay off our last debt before Clare was born. Just two short months before she rocked our world, I signed the check on our last car payment. Like all the excited callers on Dave's radio show, we were able to yell out, "WE'RE DEBT FREE"!!!

(3) Save up an Emergency fund of 3 to 6 months savings. Now I have never met anyone who started on Dave's plan who have actually gotten past this step, so I knew it would be a hard one. Here was our fledgling family, who once lived high on the hog with two incomes, now down to only one. Kevin had been laid off for a few months when I was pregnant with Clare, so we know how important this emergency fund is, especially now that he is the only bread winner. We agreed to err on the side of caution and not stop saving till we hit our 6 month mark. Months seem to crawl by when your at the beginning of a new step. $200 here and there make it hard to hit a 5 digit number. I'm proud to announce, that with the help of our tax refund, we have finally hit our savings goal last month! I never thought I would ever see a number that big in our banking account. At this point, it is hard not to get swept up with "Joneses" and see that money as a new vacuum, weed eater, or even a van. All those things are things we want, but do not qualify in Dave's plan as a emergency. That little nest egg is there to stay and not be touched. We pray to God that Kevin doesn't get laid off so unexpectedly ever again, but we can sleep well at night knowing we will survive 6 months of job searching if it comes to it.

(4) Invest 15% of your Gross Income into a Roth IRA. I don't know why I was naive enough to think that at this point in Dave's plan, things would get easier and not harder. Just last night, Kevin and I researched what it will take to start our own Roth IRA. With an already too tight budget, we have to shave more money out of it to put into our retirement. I tried to think that Dave's plan was too ambitious, so I researched on our Bank of America Retirement planner to see their numbers. Much to my sadness, they were the same. I hate getting a reality check when it comes to money. I much prefer to live in the la-la-land that Kevin's 6% 401(k) will see us to our golden years. The reality is that today out of 100 people age 65, 97 of them can't write a check for $600, 54 of them are still working, and only 3 are financially secure.

The next steps are:
(5) College funding for Children
(6) Pay off home early
(7) Build wealth and give like never before

I make no promises to myself that I'll ever finish step 6, but I do know my reality for now. No cable t.v., no expensive groceries, no more fancy cruises (that was not part of Dave's plan b.t.w.), and no big van till we save up and are able to pay for it all in cash! In the mean time, we try to focus on what we have instead of what we want. I have a wonderful small house, great husband, lovely child, fridge full of food, bank account full of money, car full of gas, and no worries about our future. We can't live high on the hog right now, but that doesn't mean we don't live high on life.