Our Life on a Budget...

This is a pretty personal story, but I am happy to share it if it helps or motivates anyone else…

My husband and I were making what should have been a very comfortable living - But we could NOT figure out where it was all going! Days before our next paycheck, we were out of the "green stuff", so we did what many people do and turned to our credit cards. We turned to them again...and again... and again... You get the point! It was absolute madness! My thought was always, "We make enough to pay it off so it's not a problem." But the truth is that it WAS a problem! A BIG PROBLEM! 

I don't want the credit cards to take all the blame for the stupid we're guilty of, there's more, and in the interest of full disclosure, here it is: 

I bought a beautiful, NEW, $55,000 truck (did I mention she was beautiful) off the lot in 2013. I knew better. I have NEVER bought a vehicle from a dealership before and always prided myself of my ability to find good trucks or SUVs for great prices and then sell them (never traded them in) for a small loss- I even MADE money a couple times! I broke my rule on this one because "we could afford it". By that I mean, we could afford the payments, which, by-the-way, were $900 a month. No that wasn't a typo. Do I need to say more or do get the point? It was DUMB. We also acquired about $13,000 in student loans to fund my husband's bachelor's degree and in the midst of all of this, we racked up about $7500 in taxes that needed to be paid. 

So the grand total of stupid was a whopping $80,293... That's eighty thousand, two hundred and ninety three dollars!!!! 

In August of 2015, I had ENOUGH of not having money when we make a wonderful living! We had been squandering money for over a decade and it was time to stop. I could feel in my heart that something drastic had to be done in order to save my family. 

My husband is an AMAZING man and wonderful provider. He never likes to say "no" to me or our two daughters. He gladly drove his 1997 truck (paid off) so I could have the gorgeous new truck (have I told you guys how beautiful my truck was?), but I know deep down he knew we shouldn't have bought it. Basically I have been the main spouse to handle the finances and he was more than happy to let me, after-all, he really doesn't enjoy it. I had spent a few days silently squirming about our financial situation before I allowed myself to burden him with it. At that moment in this turning point, that was how I viewed it, not because he got angry or anything, just because I didn't want to worry him. I ran all the numbers a hundred times and I knew what had to be done. We needed a financial intervention and I knew right where we had to start... Remember my truck? The beautiful, expensive, BEAUTIFUL one I mentioned earlier? Her name was "Pearl", by-the-way. Well, I decided to sell her. I must pause here for a moment of silence............. Ok, I am better. 

Yes, Pearl had to go and I had to explain to my husband that this had to happen. Let me tell you, he wasn't happy when I first approached him about it. He wanted me to be able to have it and not keeping it hurt him because he thought it hurt me. But here's the deal- On any given day, in any given city, there are thousands of new trucks for sale! Besides, I actually want a bigger on in the future anyway! ;-) Although this decision stung a little bit, and yes, I did have a few spoiled tears, it was the RIGHT thing to do. The truth is that we could afford to make the payments, but we could not afford the truck if we were going to turn this money train around. We were beginning to look at things in a whole different light. It was at this time that I asked my husband for help with our finances. I no longer wanted to have all the responsibility of paying bills and "budgeting" (I put that in quotes because it was FAR from that in reality). I needed his help and his level-headed nature to get this train moving the other direction. He gladly agreed and we moved ahead… We gritted our teeth and got in this fight- TOGETHER. 

Like I said earlier, this turning point came at the end of August of 2015 and on September 16, my beautiful truck went to live with her new owner. He promised to take great care of her and he paid what I was asking. That was a rough two weeks and a great two weeks at the same time. In my heart I knew it had to be done, but sacrifice was not coming easy. During this time I kept crunching numbers, praying and talking with my husband. Although it was bittersweet, I have to say that it felt good! We had a written game plan and that made it easier. I read "The Total Money Makeover", by Dave Ramsey and decided THIS was the perfect plan for us. If you haven’t read it, you NEED to! Head to the library and check it out (that way it's free)! 

Here were the steps we needed to take, but make sure you study up on the "Seven Baby Steps" Dave Ramsey suggests! 

1. I needed a vehicle. Remember, my beautiful truck was gone now. I sold her using a free ad on craigslist (in case you were wondering). I went back to my old ways of buying vehicles which seriously made my kinda nerdy-happy. I found a steal of a deal on Craigslist and got a 2009 loaded Toyota Camry (leather, heated seats, navigation, Bluetooth) for $7000 from a PRIVATE seller (which means no tax and is the only way you should buy a car unless you're a millionaire). Yes, it was a car. I don't drive cars, well, I didn't use to anyway. Here's the hitch - I only had $4000 in cash (another reason I had, had enough!). We were committed to never turning to a lender again so this was a problem. Luckily we have amazing family and my sweet (and thrifty) younger sister lent me the $3000. I knew that we would be able to pay her off in no more than two months, but luckily it ended up only taking one month, almost to the day! I included that $3000 in my debt total. So there I was, driving my paid off CAR with a smile on my face. I have named her “Snowball Ramsey” (You should be able to figure out why by the end of this!) and I love her! She gets 30 miles per gallon (Pearl got 15), I was able to register her for TWO years with what was left of six months of Pearl’s registration and I even got a $55 refund on top of that AND our insurance went down $50/month! Yes, I LOVE “Snowball Ramsey”!
2. All credit cards were cut up!! NO MORE DEBT!! There were no exceptions.
3. We got on a written budget. I have tried these before, but never like this. We do a budget at the beginning of each month now, which was new to both of us. Each month is different so you need to plan accordingly. For example, Christmas, weddings, birthdays, oil changes, clothing needs, salon visits, etc. all vary from month to month. None of them should surprise your budget. I like Dave Ramsey’s envelope system and have paired it with how my brother-in-law budgets (he is also great with money and has been a wonderful mentor). Cash is KING now. I pay our bills using “Bill Pay” from my bank and everything else is in CASH. When the cash is gone, it’s gone! 
4. We needed to increase our income, even though our full-time jobs pay really well, we have pretty easy schedules and could take on more. My husband is a really generous guy and a serious workhorse. He was constantly fixing vehicles for people for free and that had to change… He is still fixing vehicles for people, but he charges now. People still save a lot of money using him and the work is done to perfection. I am able to give horseback riding lessons and have done spray tanning on the side since 2008 so I generate more money that way.
5. We needed to cut back the money going out each month so some sacrifices had to be made. Dish Network ($90/month) was cut and we now use Hulu and Netflix ($20 total/month). We no longer eat out, which we use to do often. Again, there really are no exceptions to this! I now grocery shop once a week and 95% of what I buy is at Walmart. I don’t love shopping there, but the savings are HUGE. They also have a new app call “Savings Catcher” which has given me back $45.00 on a gift card so far (I redeemed it today so it really works). There really is not trick to it, you scan your receipt and they compare your purchases to all local stores and pay you back the difference. I also price-match when I know someone has a better deal. I even got on a coupon website and print coupons for things I am buying. I never buy something just because I have a coupon! Meal planning has become a family affair and is crucial to saving money! I could write an entire blog about that… Maybe I will! Stay tuned! We are a family of four and I spend about $150 a week to buy food and household items.
6. We saved a $1000 emergency fund. This might scare some people who like to have more on hand, but it is part of Dave Ramsey’s “Baby Steps” (this is Step One) and we are committed. This money is in a checking account that I do NOT have a debit card attached to. In other words, it takes some effort to get the money, but it is there if we need it. Don’t have it in cash! You WILL spend it.  
7. We laid out our “Debt Snowball” (another Ramsey term) and began to work it. Basically you list your debts from smallest to largest (interest rate doesn’t matter unless you have two with the same balance, then the higher one goes first). You pay minimum payments of ALL of the debts but the smallest and you attack that one with everything you have. You then roll what you were paying on it to the next one and so on…hence the “snowball” reference. There are people who will tell you this is dumb and mathematically doesn’t make sense… I would ask them this- Are you a millionaire with NO DEBT? If yes, than maybe listen to them, but there is a 99.9% chance they are not so…. I will be doing what Forbes says is PROVEN to work! Besides, research shows paying your debt off is more about behavior than the math. You will see how this plan is paying off for us shortly. *You don’t include your mortgage in the debt snowball… Paying that off early comes later. ;-)
8. We involved our kids. Our girls are 9 and 11 and are old enough to understand some of this. We have involved them in a lot of ways. The girls have their own little budgets and jobs for which they earn money. We teach them to save some, spend some and give some. Dave Ramsey has another book called “Smart Money, Smart kids” which has great ideas in it. I enjoyed it, but knew much of it from my time as an elementary teacher and mama, but it did make me think more seriously about teaching the girls the right way to handle money.
9. We say, “No” a lot more often… No more going out with friends to do things that cost money…. No more trips… No more buying things just because we want them. The only things we spend money on right now are legitimate needs. Our friends have been awesome about this and some are even doing it along with us! Truthfully, anyone who tries to sabotage you needs to be shown the door for many reasons! We know these are temporary sacrifices and have made them with happy hearts. Our family is closer than ever because we do more meaningful things together. Today we packed a picnic lunch and went out on an adventure and last night the girls trick-or-treated in homemade Halloween costumes! Having no extra dinero makes you get creative!
10. We sold a LOT of stuff! In addition to my beautiful, gorgeous amazing truck, we sold everything else we could including another broken down truck the husband had plans for, a rifle, a laptop and clothes. This brought in a good amount that we put towards our debt snowball.
11. We give thanks for EVERYTHING we have. We help everyone we can. We volunteer our skills and time to people in need and we LOVE OUR LIVES!

So that’s where we are in our “ENOUGH IS ENOUGH” journey. To date (September to November), we have paid off $51,853 and should be completely debt free by June of 2016. Dave Ramsey’s third baby step is to increase your $1000 emergency fund to included three to six months of expenses and our plan/goal is to have that done by January of 2017!

Update: We are DEBT FREE as of August 2016!!!

Important note: One thing that we realized more than ever before is that MONEY is not what makes you HAPPY. Faith, family and friends are what we live for and what puts the smile on our faces! Having your basic needs met provides comfort and anything on top of that is a bonus. LOVE YOUR LIFE!!!!!

*Disclaimers: I am not perfect, nor do I claim to be. I am certain we will stumble, but we will be ok! You might make more than us, you might make less, but make this about YOUR financial goals, not mine. We are all very different and this is what worked for us! Next- we will pay off our house!