Deal With It, Simply!

Sunday in our Financial Peace Class we talked about “credit card sharks in suits”  Here are a few of the key points we learned.

• Always set your priorities by your “four walls”

1. Food                                     2. Shelter

3. Clothing                           4. Transportation

Ramsey said when you have food, shelter and transportation you don’t feel so broke and are in a better place to pay down debt.

1. Debt collectors can only call you between the hours of 8am – 9pm.
2. If they are calling you at work you need to send them a letter stating your employer prohibits it.
3. Ramsey also said don’t be afraid to answer the phone. Let the creditor know you will talk to them and you want to pay your bill and are working on a plan.
4. The creditor only job is to get money from you and rightly so, you do owe the money. One tactic is to make you mad so you will just pay it off. This has happened to me. When Randy and I were first married he had a student loan and they called and I don’t even remember what they said, but I remember being ticked and paying it off with an inheritance from my grandpa. What I could have done with they money if  I would have had the right tools. It would have been paid off by now and I could still have my little nest egg!

• What if you can’t make the minimum payments on you credit cards? A Pro-Rata plan is when you figure how much debt and pay a percent to each bill with the money you have left over. Dave said to sent the creditor a letter with a copy of your budget and let the creditor know what you are doing.
• You need to organize! I have my budget, folder for bills as they come in, and when they are paid. We even got the great idea today to have a folder for paid off bills, then we can calculate exactly how much debt we have paid off. The creditor may not be happy with the amount, but it is something and they won’t take you to court.
• Get a copy of your credit report from Annual credit report.com (This is the free one once a year)  Dave commented that you can get one from each agency once a year. BEWARE of Freecreditreport.com, If you have heard the jingle about free credit report.com telling you it is a  free credit report, turns out it  isn’t free they trick you into paying for an extra service so it isn’t free. Another Valuable Lesson!
• Some debt collectors will take a settlement for less than you owe. Always get it in writing and hang on to the agreement and never give them you banking information because you may find they have taken out the total amount and not your settlement amount.
• We have really been trying to stay with the program, but I wish I could pay off things more quickly. I know it takes time and we have to “live like no one else do we can live like no one else!”

Have a blessed day, Candy

This week has been great and now we are in full swing of our financial Peace. We had to stop by the grocery store last night and I wanted a few extra’s not on our list when Randy said “what would Dave say?” We laughed, but knew we have to stick with the our plan if we truly would like to be debt free.

1. $1000 in Emergency fund √ – we now have our emergency fund. When you have an emergency fund you have the security knowing if something breaks down you can take care of it and not use a charge card.
2. Debt snowball- This paycheck we are paying off our son’s cello and Kohl’s =$188.52

Use cash- Did you ever notice when you use cash you think a little more about your purchase. I usually buy less when paying with cash because I don’t want to go over my amount – saving embarrassment at the checkout. Now that most of use debit cards we are spending more. In our class it was stated McDonald’s is taking debit and credit and their average bill has went up from just over $4 to $9. Smart thinking on McDonald’s part, but now people charge their dollar meals. Something has to change!

My parents had their own business when I was a kid and the income wasn’t always steady. My mom had an envelope system, she would stick cash for bills and when they came due she would have the money. I asked her, how did you not use it for other things? she said “I just didn’t”  My mom always found a way for her family… she still does. Randy and I are also starting to use the envelope system.

Randy said yesterday it is funny now that we have a plan he doesn’t want to spend except for debt reduction and he wishes he would have listen to me sooner. The thing I am realizing about Dave Ramsey is he is teaching me things I know or have seen before, but just never put into practice. What was I thinking? I guess I wasn’t, but now I am!

God’s blessings on you day, Candy

You may think I am a little crazy when I tell you this, but I am getting excited for our bills to come in. Now that we have a plan I am excited to go on our debt diet. In our class we were told the average person is out of debt in 18-24 months. Yesterday I spent the morning listing all our bills and due dates on a calendar and organize my file box. What a great feeling taking the time to do it.

I have said it before but will again for those who are new to the site. Our debt was small we have always been pretty frugal and I have only asked my dad for help once when Randy was out of work. The debt we have acquired  is from our closed business and we are  “holding the bag”  another valuable lesson learned. Many have said “just walk away from the business debt” It would have been easy to do that, but it wouldn’t be the right thing to do. We are slowing digging out.

The Dave Ramsey’s Financial Peace University teaches using baby steps and we are only on #2

1. Start a $1000 emergency plans- If you make under 20,000 a year start a $500 emergency fund. Put what you can in the bank.  How wonderful knowing you have a little in the bank. We would always think about starting a savings and just never really did it. I would tease Randy and say savings what is that? Well now we are and so can you!
2. Start your debt snowball plan- Like we talked about yesterday. Start with you smallest bill, when paid put the money you would have paid on the paid off bill on the next bill along with what you pay on that bill and work you way up. Crossing off debt…crossing over into a debt free life!