Dave Ramsey, debt, credit cards, retirement, etc

[SuperJETT]

Thanks everyone, maybe this will help me get my $ staitened out. Ive never had trouble paying my bills but I end up spending more than I should on things like wetsuits, tools, fun electonics, ect. and then skimping on important stuff like my grocerys.

darin, Im impressed with how you have your layout! I would like to do something like this but dont have excel. is there someplace I could download it? I dont really want to spend the money to buy it.

how much EXTRA pricipal do you guys add onto your mortgage payments? I realize it differes depending on how much extra you have for the month, just wondered what the average was if any.

Use Open Office instead, the best free office suite there is, or sign up for Gmail and use the spreadsheet function in there.
www.openoffice.org

On the extra for your mortage, it depends on where you are with the rest of the stuff, emergency fund, retirement, etc.

As early as you're starting, you could be very wealthy by the time you're 40 if you get serious.

 

[kingnothing3]

As early as you're starting, you could be very wealthy by the time you're 40 if you get serious.

Thats the plan:biggrin: just want to point myself in the right direction.

thanks again darin, downloading openoffice now.
Jamie

 

[romack991]

i've had a budget made up and from what my spending report shows from my debit card, it is pretty close to what i plan. but i think this month i'm going to start using the evelope method to really monitor and limit my spending. Currently I run over somewhere but usually under somewhere else, but i am finding that it isnt always the case and im not paying down my premium on my truck loan as much as i want to. Hopefully I'll be able to enforce my budget better. i'm growing tired of renting and would like to have my truck paid off so i can start saving for a down payment on a house.

 

[Snackem]

The wife and I did the envelope system for a couple of months but have not done it lately. I'd really like to get back to that. I know that we fudge in some areas and if we had envelopes we would be forced to stick to our guns a little more.

 

[kingnothing3]

I think the envelope thing is a little to enforcing for me. I like to have freedom with my money but I want to be able to monitor where its going.

 

[thrllskr]

I think the envelope thing is a little to enforcing for me. I like to have freedom with my money but I want to be able to monitor where its going.

I do my budget in Excel and have a budget and actual column. Each time I spend money, I update the actual column for that budget line. For example, I already spent $118 of my alloted $180 for groceries. So it will be raman noodles for the rest of the month :haha:

 

[kingnothing3]

180 for groceries seems low. I set one up alot like snackems based on the last two months. ill keep with it, should help alot.

 

[douglee25]

I usually set up my expenses based on known expenses first. These typically are mortgage, car loan, electric, gas (natural gas), water, school loan, cell, internet, cable, sewer, car insurance, 401k, etc. I get a total from that, and then I add in varied expenses like food, gasoline, entertainment, and credit cards.

As a side note.... as of this month, I am credit card debt free!!!! I paid off over $10k this past year since Feb. 2006. I put a good balance on my card after I bought my house to do home repairs right away to make it liveable. Wahoo!!! :smile:

Back on topic, I then take my monthly income and subtract out the known expenses. This bottom line I spread out to the varying expenses. I usually budget $100 a weekend for entertainment/food/blow money and $50/week for food (when I'm in the office that is). If I'm traveling for work (as I have been a lot lately), work picks up the tab for everything. I for one know I could save some by cutitng down my $100/weekend line item.

This usually has worked well for me. I haven't saved a ton over the years per say in a savings account, but my 401k has been well on it's way, that's for sure. It's the first few years of getting established that are very hard (at least for me anyway). I figure once the car is paid off (1 year to go!), I will have a good portion to start saving away.

Doug

 

[thrllskr]

180 for groceries seems low. I set one up alot like snackems based on the last two months. ill keep with it, should help alot.

It's usually around there. I only buy things when they are on sale (except for milk pretty much). I usually buy store brand except for things like cereal and I try to only buy stuff like that when its on sale AND I have a coupon. It's amazing how much money you can save when you shop smart. :arms:

Plus, being single and only have to feed myself helps. :woot:

 

[Snackem]

The envelope system really isn't that restrictive. If you budget the items right then it's no more restrictive than keeping the money in your account. However what it does make you do is stick to you budget because you can see if you have any money left over in that category or not. If you don't have any money left in your "blow" envelope then you don't "blow" any more money. If you run out of money in the food envelope then you eat beans, rice, and ramen for the rest of the month.

Basically the Envelope system makes you stick to your budget.

 

[SuperJETT]

$7000 in debt left, we'll be done this year for sure!

 

[kingnothing3]

does that include your house payment?

 

[SuperJETT]

No, I wish. That's 7-10 years down the road.

 

[Snackem]

I think that's about where we're at. We should be done with the house about 7-8 years after I finish school which will take another year to year and a half. Keep up the good work Jett.

 

[freestylegeek]

No, I wish. That's 7-10 years down the road.

Explain to me again how the house pay off thing works when it's going to be difficult to hit the 15% into retirement step...?

I don't see anyway that we'll be able to pay our house off early while putting 15% into retirement, and saving for kids college. Remember, Dave says those have to be hit first before paying off the house. I can see bumping our mortgage principal payment up an extra $200/mo, but I think that will only shave about 8 years off of it.

I get frustrated when I try to think about the future baby steps. I'm just gonna keep intensely focused on baby step 2 until it's done.

BTW, nice job on hitting the $7K mark!

 

[SuperJETT]

Explain to me again how the house pay off thing works when it's going to be difficult to hit the 15% into retirement step...?

I don't see anyway that we'll be able to pay our house off early while putting 15% into retirement, and saving for kids college. Remember, Dave says those have to be hit first before paying off the house. I can see bumping our mortgage principal payment up an extra $200/mo, but I think that will only shave about 8 years off of it.

I get frustrated when I try to think about the future baby steps. I'm just gonna keep intensely focused on baby step 2 until it's done.

BTW, nice job on hitting the $7K mark!

Nice job, but sad that we've already paid off $23,000 to get there.

We're going straight to step 7 baby, here we come Powerball!!!

 

[Mile9c1]

I can see bumping our mortgage principal payment up an extra $200/mo, but I think that will only shave about 8 years off of it.

Shaving 8 years off sounds pretty sweet to me :biggthumpup:

But college ESA's and 401K's grow tax free. I'd definitely work on these before paying off the mortgage. It's a no-brainer. These "should average 12% a year" according to Dave and it's all tax-free. Your house is an investment so it's not bad debt, and it has a significantly lower interest rate that is tax deductible.

 

[freestylegeek]

...here we come Powerball!!!

LOL!
I heard Dave talking about the statistics on Lotto's the other day:

You're 12 times more likely to DIE in a car accident before you get a winning ticket. Plus, if you somehow manage not to DIE, and get the winning ticket, there's a 70% chance you will be broke, in jail, or dead within 5-7 years of winning.

:haha:

 

[kingnothing3]

LOL!
I heard Dave talking about the statistics on Lotto's the other day:

You're 12 times more likely to DIE in a car accident before you get a winning ticket. Plus, if you somehow manage not to DIE, and get the winning ticket, there's a 70% chance you will be broke, in jail, or dead within 5-7 years of winning.

:haha:

I like those odds!:Banane01:

 

[SuperJETT]

I don't know about you guys, but I work in a manufacturing plant, and every time the Powerball gets over $100 million, they start walking around taking money for ticket pools. If you glance at the sheets, you'll see people putting $20 or $50 in, and those people spend money every week on the regular lottery too. Here's an idea, take that $100 you waste on the lottery every month and invest it.