creating a debt free life

Posts tagged ‘tired of being broke’

The true key to getting debt free

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We have been working on getting debt free for a while now, and we are doing good, some steps forward and back, but now that our move is complete that should be done and it should be all forward now.

The importance of having that emergency fund has become very clear to us this past few weeks and we are going to make sure to get that in place again.  But sometimes an emergency fund does not help if you are not thinking.

The key I am going to get to starts with an experience we had this past weekend.

We were on our way to our grandaughters third birthday and were supposed to stop for ice. We wanted to wait until we were close to get it and found a store not far and on the way. My husband gets out of our truck to go buy the three bags of ice and does not even get around the front of our truck and comes back a bit panicked,  ” I forgot my wallet !!! “”

He had changed into new pants and forgot to put his wallet into his pocket. This is completely out of charactor for him.

I jump out to use my card , we get the ice, get to the counter and then I remember, oh crap, I lent my debit card to Cam  ( our collage age son, just moved home and tight the week he started a new job after the move which broke him. I gave him my card to put some gas in his car to start his job. He is delivering pizzas so would have cash each day after that one fill to take care of it.

I remembered then that when the new credit card came for the one I cut up, I put it in my wallet in case of emergency as we have no savings right now, and I got it out and paid for the ice and we went on our way. No problem I will pay it off when I pay the bills next week, it is only 8 bucks.

So, I get online today, and pull up my balance and I am shocked …. 68 bucks, ?   WHAT  ???

So, I start searching the site and then I find it, a 60 dollar fee to have the card. What in the heck was I thinking to pay that per year the last few years, I was not happy .

I called, canceled the card, paid the 8 bucks and the card is getting added to my wine glass.  Cut up smaller than this, but it is a start, but this time it is a truely dead card. No way to use it and no new card coming.

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So, pay attention, the cards are out for thier benefit, not ours. The banks make a great deal of money on us just on interest, and yet, they feel the need to add fees to that pile they already make.

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They could not do it if we did not agree to it and pay it.  I do not need that card, I do not want the debt and I will not pay it.

So, look at your accounts, even if you cut up your cards and make sure , I would have gotten a bill for 25 bucks if I had not made that purchase and went to the site to pay it.

No one cares about your money like you do ,

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So, what is the key in my title you ask ?

The key to getting debt free is paying attention.  We need to pay attention to all the little things we do that add up. How many people have more than one card with a fee ? They could be paying hundreds a year. This sixty bucks was for a small 600 dollar credit card, that is insane. I consider myself an intelligent person but have not been acting very intelligently when it comes to money and credit.

So, my advice is to check out all your cards. Get rid of the ones with those fees even if you are not getting rid of all your cards. Shop for a better card to transfer any balances too and then cancel that card and be done with the fees.

There are many cards with no fees and in fact,  Capital One, the card I canceled has many cards without fees, so I could in theory find another Cap 1 card that does not have a fee and apply for that, but I want to be debt free and that is not an option for me.

So, just be smart with your money and pay attention. It is so easy to nickle and dime those fees and over time it really adds up to a lot. Although 60 bucks IS a lot.

Thanks for stopping by, I would love to hear your thoughts on credit card fees !!

Stephie

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What does wealth mean to me /you ?

 

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Another blogger posed the question, what does wealth look like, or mean to  you. I did not have to think long. She suggested some things, among them nice cars or house, but to us, that is not what we are going for.

 

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Wealth to us, my husband and I means security. Freedom. When you owe money, you are in many  ways, working for the  company you owe. You work for them, not yourself. You have to plan your life around work you have to do to pay those debts every day. Now, I know there is money you make that does not go to them. But  if you have substantial debt, you have a lot of hands held out each month and often times, when you include your mortage, they get a lot more  of your check than you do. Period the end.

We have dreams of course. We want to pay off our house and we want to buy a building downtown to start a business. With no mortgage, that is possible. With a mortgage, possible but stressful and not probable.

Retirement for us  has never meant to stop working and just play golf and sit around be lazy. Quite the opposite. We want a business to run, something we love to do when he retires from where he works now,  so we keep active and busy . We want reasons to get up every morning. A purpose. We want to be part of the community and get involved with community events and enjoy being out in the world.

David will never retire from working. He is very vocal about that. He saw his own father retire and sit in a recliner and die. He refuses to own a recliner. They are not allowed in the house. He will retire from the company he works for between 70 and 75 years old.. What age depends on where we are on this plan. How much is saved, do we have our building already, how much security do we have in place.  We have just over 18 years until he is 70. We cannot waste any time. We have  to get our debt and house paid off asap so we can make the  decisions that affect the quality of our golden years. Now a days  you can expect to live into your nineties and maybe even 100 and that is our goal, we joke we want to live until at least 110 , and we will try to do that , but we want to live until the day we die, not  be in a  nursing home or sick, so we are working on our health as well.

Some things are out of our hands, but we are grabbing  what we can control. We are working to get thinner and healthier. Can we prevent anything from happening, no, no one can, but we are thinking positive and planning for a long full life. We CAN pay off all our debt. We CAN save up a huge nest egg both for emergency and retirement. We CAN walk and eat right. So, we CAN do a lot. We also CAN plan and plot and come up with a great retirement business that will keep us alive and happy and excited to get up every morning.  Something we can do together.

So, this is step one, which is very critical. Pay off our debt.  Every single dime, including the house. Then save. Save money like squirrels save acorns.

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Once we have an 8 month emergency fund and have enough money going into the 401k, then we start saving again for our business. There is nothing romantic about our plans. Nothing edgy. It is just staying the course and making sure we do what we need to do to make things happen the way we want them to happen.

We recently read a quote that said something to the effect of , dreams without plans are wishes. I have no clue who to give the credit to, but it is so true. If you dream, but never make a plan for that dream, it really is just a wish. It will probably never come true.

Things happen and that is okay. As long as we have our emergency fund, it is all good. Occasionally our savings will be  redirected to emergency to rebuild if something like a blown water heater, or air condiioner malfunction happen, but then we just rebuild what we had to spend and, once done, back to where we were at. Simple. Easy to follow.

Lets face it. Budgets and diets are both alike in many ways and people resist them for the same reason. It is more fun to not do them. Eating and spending what you want sounds like fun, but is it really ? At the end of the day you are fat and/ or broke and that is certainly not fun.

We had  50 grand in the bank once. Years ago.  An inheritance. What an amazing feeling that was. But getting laid off and being out of work for months before he had the job he has now,  and having to do major overhauls on two baths that were close to unusable, and some foundation repair and put up fences, and and loaning to our grown kids who were in need at the time, who did pay back every cent within a few years, just kind of ate it up. Very sad.

I want that feeling again. It was so fun to walk into a store and KNOW y ou could buy anything you wanted cash, but are choosing not to. It was fun to know we could pay cash for a car, but did not !! We loved that feeling and cannot wait to have it again.

So, we know how it feels, so we are working toward that feeling  of security that money gave us at the time.  Wealth to us is many things, but not fancy cars and houses. If we have those one day great, but they are not high on our list no matter how wonderful they are !!

So, what does wealth mean to you ? How do you define it ? It can be a very defining question !!!!

Hope you enjoyed my scrabble piece and chain  play and my modge podged acorns, I love playing and making things to put on my blog !!!

Thanks so much for taking the time to come by, it  means a lot to me !!!

Stephie

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In the day to day of it all now

I am sorry I have not been posting much here. Not too much to report, just waiting for the insurance money from our accident to come in so we can pay some bills off.

We are in the day to day of the plan now. Not much exciting to report, just doing what we are supposed to be doing.

I have been working a lot on my jewelry and bloggin over at  www.stephiesbeadsandbaubles.com pretty often and working at filling my Etsy shop. That has been keeping me pretty busy.
I also have posted on my other blog www.timetobeme.wordpress.com , it is just what it says, my journey to find myself. I love to hear other people stories, so please drop by and leave me a comment if you like what you read, or even if you don’t !! . I need to spend more time on that one, but the jewelry fills up my days pretty good !!

So, I am keeping busy and doing what I am supposed to be doing. It is not very exciting, but it the goals  we have are exciting and that is all that matters !!

On a more financial note, I will be paying off a few things tomorrow, a very old electric bill and a recent large doctor bill, so that is very exciting !! Any extra overtime we get, or jewely money I make, paying down the debt !!

I will be sure to check in more often !!  Thanks for stopping by !!

Stephie

updates

Been off line a full week  because of a week of visting grandkids.

This week we start our official first week on our new budget. Robin,  one of our debt coaches set up our new budget and we have a set plan for every dollar. Our spend every penny plan. S E P .  This past week we took the first bit of money from our car accident  accident and paid off our first card of our debt snow ball. How exciting to finally see one debt gone. I will be paying another hundred today on the second bill and  will be chipping away until it is gone, which when we get some more insurance money  should take care of it, and number three. I am so thrilled to see the snow ball starting.

So, starting  this week it will be tight, but we are not the least bit upset about the tight budget, we are so excited to see this process starting . We look so forward to seeing the debts disapear !! Once the bills are paid off, what freedom we will have !! We are determined to get there as fast as we can !!

So, as we go along I will share what we learn and our progress here. It was hard to be offline for a week, but I am back now and excited to be seeing the debt snowball start !!

Stephie

 

A fresh new financial start

This is how my  husband David and I feel today. We are being given  a fresh new start !!  We had such a great conversations with our debt coaches . Jeff and Robin at Debt Free Squad, I hope everyone interested in getting debt free will check out thier site, so many awesome videos and information there, LInk is to the right of this post.

The hardest instruction to follow so far, was no debt talk Sunday. Sorry, Jeff and Robin, we tried so hard, but we broke that rule about ten times yesterday, we woudl catch ourselves and say, oh, we are not supposed to talk about debt today but then , we would do it  again !!

We are so excited and full of hope and energy to get started, it was hard to not talk about this new journey we are on !!

So, what we have done so far to help break up with debt is,

Start writing down every single penny we spend. , no excpetions except for our blow money, more about that in a minute.

CUT UP  CREDIT CARDS !!  We were told we could keep one, until our emergency fund is where it needs to be, but the rest, all c hopped up and I picutred them on one of my first posts here !!

No debt talk Sunday, okay, crashed and burned on this one, but we will get there !! I have a feeling if we have to be bad at one, this is the one to  mess up on !!

Read the first two chapters of Dave Ramseys, Total Money Makeover, I got my reading done, we had our grandkids over and David was only able to read chapter one but will do chapter two today.  We got these instrucions on Sat evening in full swing with the kids, but next two chapters will be read on time.

Watch our weekly videos for the 30 day challenge every monday, get to watch number two today, can’t wait, somethign new to learn I am sure !!

Down load the spread sheets and learn to use them, Robin has emailed me some hard copes, which I will print out and use today, David should be able to get the program pulled up we need to use them online in the next day or two and then we will transfer that info on the hard copies onto our pages on the computer.

Jeff and Robin explained that we have to tell every penny of our money were it is to be spent, no exceptions, groceries, savings for certain categories, vacations, car expenses, Christmas, not just the obvious bill and expenses !!  As they explained, these things do not sneak up on you, Christmas is Dec 25 every year, your cars registration is due, the same day every year, and so is your inspection, at the very least, the same month.  Vacations are rarely just taken on a whim, you plan ahead so you need to plan the money part too. If you do not have enough money saved, you simply do not take your vacation. They explain it as your vacation following you home, and that is never fun !!

So, we are going to be  allocating money into differant categories so we can save for vacations, doctor bills, car expenses, and eventually more for clothes and other things, Christmas and … wait for it..

groceries, entertaiment and what they call,  blow money.
yes, you can plan some entertainment into the budget When I questioned it, Jeff said, you have to, or you will spend it anyway. So  with thier help we decided on a very modest 100 a month for entertainment, 25 a week, but that is plenty. Enough to have a date night meal together once a week if we are really careful, or enough to go out to a few thrift stores or yard sales, one of  our favorate things to do, but now we have a limit. Once that money is gone,  We are done, no more spending. so, we need to think carefully before we spend it.

Blow money, a small amount, will get a bit more as time goes on, but for now, five bucks a week each. Not a lot. but it is money for a diet coke for me, or a cup of coffee for David or any little thing, no questions asked. My blow money is mine, Davids is Davids. The entertainment is both of ours, we have to decide that together, but my blow money is the money I have that I do not have to explain. We can save it up, and then have a bit more put away if we have something a bit more expensive we want to do, or we can blow it as we get it. Love that !!

I have to admit that David and I have never fought over money. Really never.  In 32 years, we have had a few arguements,of course,  but never over money.I cannot explain why, but we do not fight or argue often anyway, but if we ever argued about money, it had to have been rare, neither of us ever remember a money fight. I have been in charge of the money, Davids choice, he worked, I was home with the kids, I had the time to make out bills and all that, and so he gave it to me. A couple of times I tried to get him to do it, but it always came back to me. Neither of us were better at it than the other, I was a bit more dilligent, but I had more time. As dilligent as I am, we are still way in debt and for many years paid bills late and had poor credit scores. We often had more month than money and have lived check to check for pretty much our entire 31 year marriage.

I am not sure what really woke us up, but we did wake up. I think buying our new car and finding out the reason we did not get a interest rate of half what we dened up with, was because we have too much debt. Our credit score is good, but your debt to income is a huge part of your score, I believe it is 30 percent. So, you can see how, even a great score can be pulled down a lot by having a ton of debt.

It is a vicious cycle of debt and high interest rates and seeing the balances going up and up every year. It is ironic to us that the people who can least afford high interest are given high interest and those who  can afford it and have more income and less debt and need that loan the least, get low interest rates. It makes it seem impossible to get ahead , and it is, until you get a plan. The other ironic thing is, once we pay off our debt, our  interest rate will go way up, allowing us access to the lowest interest rates, but we will not be taking advantage of them for anything else but refinancing our car down and refinancing our house payment down. Once the car and house are paid off, and Oh yes, those are in our future plans, no paying off the house 26 and change years from now as the mortage says, no refi and pay off asap.  We want to live in a world where we are completely debt free !!

So, I do  know at times we were upset over our money, or lack of it, but we never told it where to go, never budgeted for future expenses and certainly never saved any money for emergencies, which is the next thing,

Start an emergency fund, get at least 1000 up to 2000 into asap. We will have the first thousand stashed in the bank this week.

Debt snowball. Once we get that emergency fund set up, then we take the first debt on our list. Robin and Jeff recommend smallest to largest and we agreed that made sense. . A lot of people recommend highest interest rate first, but I think paying off the smaller balances first is much more movtiating and helps free up money toward the next. So we will pay min payment only all all credit bills but the smallest, and then any extra money we have gets thrown at that bill until it is gone. Then that minimum payment plus any extra goes to the next on the list !! Very easy to understand and motivating !! Once we see that first one disapear, that will be so exciting !! I can imagine as they each are knocked off, it will be more and more exciting to progress down the line.

So, anyway, this is what we are working on this new , fresh week. We have a plan in place to attack the debt and I will keep track here and record as each debt bites the dust.

I probably missed something, but I will be writing a lot more on all of this as we go !!

Thanks for stopping by !!

 

Breaking up with debt !!

Welcome to my new blog site. I have been blogging on my beading blog for a while and I am having fun there and will still be blogging there and working on my jewelry but I am starting this blog because I want a place to come to document our journey to being debt free.  My husband and I have gotten to the point in our lives where we want to be free of debt. We are tired of being broke because we have too many bills. It is a stupid way to live and we need to address it while we still have time . We are tired of living check to check. It is a rotten way to live. We do not want that to be our future, we want it to be our past.

We are in our early fifties and  have less than  twenty years until my husband will retire from his job. He has said for years he probably will never retire completely. He will retire from this job, but he and I both want to start a business and find something to do together to make money and keep us busy after he retires. We have to make sure we are debt free to have a secure retirement .

So, we decided to break up with debt. We are cutting our relaxtionship with debt off. We have cut up our cards and are going to take every penny we can make and throw it at this debt until it is gone. We are choosing to live a debt free life.

Can we do this overnight. Nope. In fact we have new debt to deal with. We recently bought a car. We had one car and I want a job so we bought a car. Did we need to buy as expensive a car as we did, 19 grand, but we bought a safe, certified used car, a service car only owned by the dealer ship and we wanted a safe, reliable car. Our payment is pretty high and honestly that is what kicked us in our back sides and got us looking at our debt. We have more month than money and we cannot live like this anymore.

We are very intelligent people, so why do we make such dumb decisions with money ? I do not know the answer. We pay all our bills and have a good credit score, which would be great if we were debt free. It is eye opening to be told you could have had a 2.25 percent car loan if our debt was paid off, and instead we have 4.8.  Good news is, get the debt paid, we can still get that great rate, so that got us going.

We are pretty typical . Some credit cards, a car loan, a signiture loan, furniture loan. Our debt is beginning to grow and once we really sat and looked at it, we got a bit worried. We are okay right now, but on the edge, it would not take much to topple us off that edge. That is no way to live.

So, we were lucky and got debt coaches and they are going to help us. We cut up our credit cards

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into tiny little bitty pieces and put them in this wine glass. I will keep them on display so I know every minute what I am working for. I even added a green wine charm  I made and even drew a money sign on with a gold sharpie  to symbolize our money  !! We are going to go at this debt with everything in us !! It does not stand a chance !!

We are going to be writing down in a notebook every dime we spend. Every single penny !!  We started that two days ago and have two entries already. Gasaline and a few groceries. Wrote them down, wrote they were debit card purchases and put the reciepts in a manilla evelope tucked into that notebook.

Starting this week on pay day we will take out cash for groceries and any spending money. Gas money is moved to a checking account we  use just for gasaline so my husband knows how much gas money he has for the week. All recipts go into the envelope and any purchases made written down in that book.

We have a lot to still learn. We have to sit down and talk to our coaches and will see what they advise us on our debt and emergency savings  and then go from there. We are just starting and taking baby steps. But cutting up our cards, writing it all down, and using cash that is predetermined for the weeks expenses is a start.

I will write about what we learn and the progress we are making. I will also write a post about our debt and what we owe but not today, I just want to get things started and get this blog up and public.

I hope to find other people out there who are paying off thier debt and  learn everything I can.

To quote Dave Ramsey,  Broke is normal, be weird,

We look forward to being werid !!