Stopping Debt snowball, Switch to emergency mode.

I was hoping that my car would make it till after we were done with baby step 3, but it has bit the dust. It had 217,000 miles and the transmission and clutch are not needing mechanical work. Rough trade in for my car is $250 - $600 dollars according to Kelly blue book. We have decided not to put any more money into the car and to junk it. The bad thing is we just put new tires on it over the last couple months. Luckily we have a spare vehicle, which is an old 1992 dodge Dakota. It runs and was our vehicle to pick up materials for our home improvement projects. I will be driving it until a new gas getter is found to drive to work.

So we have decided to put our debt snowball on hold and go into emergency mode. We are going to stop saving for everything, except Christmas. We are not going to pay extra on debt or do any home improvement. We will pile up some cash so we can pay cash for a car.

We have our $1000 dollar emergency fund, some vacation money saved up that we could use on a car. We have decided not to touch our savings that is allocated for property taxes and house insurance, since they are bills that need paid when they come. But the vacation fund is not a need.

This month with our savings and money we freed up in our budget we came up with around $3500 to pay for a car. We have been looking for 4 door, that gets around 30MPG and has less than 150,000 miles. But car with those qualities are not that cheap. So we have decided to wait till December, by then we may have enough to buy a $5000 - $6000 car. December is a 6 paycheck month for us instead of the usual 4. So we will have extra money in our budget in December that will help with a car purchase. As soon as we buy a car we will go back and built our emergency fund back up, and then start the debt snowball again.

Oct. 2011 summary

I had one week of vacation that I took in October. I used to do some needed clean up around the house. We had some money saved up in our home improvement fund, and used it to get a 15 yard dumpster. I spent a lot of my week off cleaning up all the material straps that we had piled up in the garage. Working on the house produced a lot of trash to big for regular trash pickup. So we had piled it up in the garage. Now we could finally get rid of all the trash.

We had the material already bought and laying around to replace the old galvanized water pipes with PEX tubing. It took me 2 days to replaced all the pipes, move the hot water heater to the garage(out of the cellar), and remove all the old pipes.

I also switched the remaining electrical circuits over to the new breaker box and removed the old breaker box. I also got the furnace in the garage ducted up to our new rooms upstairs so we will have heat upstairs in the new part this winter. The Garage is now clean. We will now be able pull our vehicles inside in the winter.

All and all a busy month with a lot of accomplishments. We ended up spending more that I would have like on home improvements but it needed done before winter. We had an extra $400 to pay on debt.

We're still working the plan.

I haven't wrote anything for a couple months, so I'll give a short recap.

August was a low income month. Not much overtime at all. Also the Wife and I took a short Camping trip out of state for about 5 days. We used money we had saved for vacation that we had left over. It was nice to be able to get away just me and her. After the month was over we only had an extra $400 to pay on our last debt.

September was a busy month. Lots of overtime, so we had some extra room in our budget. Good thing, cause the wife's back tire had a plug come out where I had repaired it. The hole was so big I couldn't even get two plugs to stop it from leaking. So we bought 2 new tires for her SUV. Also we used some the extra money to finish the upstairs bathroom. We bought the toilet, Vanity, and mirror, to finish the room. It is so nice having two bathroom now.

Still after September was over we still had an extra $1000 to pay toward our debt.

I was hoping to be done in two years. It is looking as if it will be more like 26 to 28 months. But we will make through baby step 2 on our Total Money Makeover.

Paid off Fourth Debt!!!

July had a lot happening with our budget. I Paid the Second and last payment for our property taxes and also paid our house insurance. We had saved all year for both and came in almost perfect. We were only $90 short, which we just added to July's budget.

We had the opportunity to work a lot of overtime which helped this months budget. At the end of the month we were only a few dollars short of paying off our fourth debt, the last 401K loan. So we moved some stuff around in our budget and saved a little less in a category and was able to pay off the 401K loan. We ended up paying 2193.75 extra on our debt in July.

It felt good to pay it off and only have one debt left. But if you look at our bank accounts they don't look too good right now. After spending all we had saved for taxes, insurance, and vacation this year. The bank accounts are look very small. Having money in the bank just makes you feel more secure. Oh well, that is was we saved it for, and the process of saving worked out great. Now it's time to start saving for next years Taxes.

The Last Couple months

May wasn't a good month. There hasn't been any overtime, so not extra money in the budget. It reminds me how tight our budget is without extra income. In May, the amount we spent on Gasoline was getting close to double. For the month of May was only made about $6 more than our lowest income month since we started the Dave Ramsey plan. Overall the budget didn't have much room, and we were only able to pay an extra $293.26 on our debt.

June was a little better. We didn't have any overtime either but, we ended up with 5 paychecks instead of 4. We also took our vacation, which was saved for. This let us have one week of the month where all our gas and dinners were paid with our vacation fund, and help ease our monthly budget. Everything was looking good for the month, till we got home from vacation. We had a tree next to the house loose a large section of limbs. When I was chain sawing it up. I noticed the tree was split down the trunk. The tree needed cut down before it fell on our house. So it ended up costing $800 to get the tree removed. There went some of the extra money we had in the budget. After it was all done and said, for the month of June we paid and extra $1200.79.

It looks like I'm going to get a little overtime next month. We'll need it to get us back on track to be debt free by the end of the year.

Aprils budget.

April was our highest income month this year. We were able to Cash flow some of the home improvements that we had done. That way, were use less of our money we had saved. So we still have money saved, which will hopefully buy carpet. Then the house should be mostly done.

Since it was a high income month we decided to budget ourselves a little more blow money. And we budgeted more for entertainment & dining.

Our automobile fuel costs were $150 extra dollars. Our phone expenses were higher because I added minutes to my Tracfone.

When the month was over we payed an extra 2101.42 on our debt.

We also had my Wife's and Son's birthday's this month. But with our Envelope system, we had been saving up money for Gift's every month. We had enough to buy all the presents and still had money left in the envelope. All in all a good month.

Gas Prices are bad for budget.

My wife and I both live about 30 miles from where we work. So in our normal monthly budget our automobile fuel is about 10% of our budget. The recent increase in gas prices is really hitting us. It will be closer to 15% of Aprils budget.

My Wife's vehicle gets around 15 MPG and my car gets around 30 MPG. The bad thing is, my wife's vehicle is the only one the whole family can fit in. So it is used for everything except me going to work. We are trying to minimize how much we use her vehicle, minimize number of trips in general. Hopefully the month of May won't be as bad on our budget.

Finally a Day off!!!

This is my first day off since March 6th. In my job we have 1 or 2 times a year we work a lot of scheduled overtime. This year it should only be this time, and won't have much scheduled overtime till next year. Since it might be a while till we have a boost in income again, I volunteered to stay on overtime an additional week, which I just finished.

I have done a quick comparison of March 2010 to last month. After you ignore money we spent on home improvement, and the extra we paid last year to fix the car. The rest of the expenses come out to almost the same. So no major differences from our normal expenses from last year to now.

During last month we had people come and finish our drywall and paint in our addition on our house. We were able to pay them from the extra income and still paid an extra $1298.33 on our debt. The money we had saved for home improvement we will still keep saved for future work.

Paid off our Third debt!!!!

February was a better month that January. We didn't have any major changes to our Budget. We were able to pay off our third debt, which was a 401K loan. This loan normal payment was $130 every two weeks from my paycheck. It will be nice to see the extra money back in my paycheck.

We were able to save for all our future expenses that we save for, and still pay an extra 966.42 on our debt. Only Two more Debts to go. 1 more 401K loan, and our Travel Trailer.

January's Budget was hard to keep balanced!

We worked all of January trying to get all the drywall hanged in the new part of the house. We worked everyday after work, and the weekends we didn't have our kids, cause they were with their other parents. We didn't work any overtime in January, so we had more time for work on our house. This made January our second lowest income month since we started our total money Makeover.

We thought we might have to dip into our emergency fund for the first time, but we just got by. We had Car repairs and not enough money saved for them, so we cash flowed the rest of the repairs out of January's budget. We also had higher costs for automobile fuel. I believe this was due to the fact of Hauling Drywall for our project.

Now that we have been on the total money makeover for over a year. I can start comparing our monthly budgets to the Prior year's monthly budgets. Here are some of the Big differences in this January as compared to January last year.

1. Automobile Fuel was $100 higher in 2011
2. Automobile Insurance was $50 Less in 2011
3. Our Income was $750 Lower in 2011
4. We don't have a Car Payment ($356) in 2011
5. Clothing we spent $80 Less in 2011.
6. Automobile Service was $155 higher in 2011

Things that were the about the same as last year.

Utilities (within $5)
Vacation Fund
House Insurance
Dish Network

At the end of the month we cut clothing out of our budget, since we got some new clothes around Christmas. And we had enough extra in our budget to Pay 171.97 extra on our debt. This month wasn't a great month. But we are happy to have paid extra on our debt, saved for future expenses, and did not use our emergency fund

Snow, Ice, and more Snow!

The last week has been crazy. We Live in the midwest, and was hit by a large ice storm where we live. Then it was followed by snow, and we got more snow yesterday.

As we are proactive in our finances we also were proactive for this storm. We heard the news about the storm and went and got food, candles, and water two days before it struck. I was working the evening of the storm, and night shift came in and said the stores were empty, and most supplies and food were sold out. Good thing we were proactive.

Some people I worked with ended up loosing power for 3 days, and had to stay at relatives houses. We only lost power for around 24 hours, and we stayed at our house. If the power didn't come on when it did we were thinking about going to stay with family.

We like to camp, so luckly we had camping stuff we could use when the power was out. We had a propane stove and a propane lantern setup in the garage to cook on, so we could still have hot meals. But, we didn't have anyway to heat the house. The house had gotten down to the lower 50's by the time the power came back on.

Looking at the bright side, I was able to pick up some extra hours at work because of the weather.

Car Problems

We have had a few car problems so far this month. My wifes SUV started running bad so we took it a local shop to have it looked at. Luckly we had an extra vehicle, its a 92' old but it runs. So I took the old truck and the wife drove my car. Then more bad luck happened when my car refused to even attempt to start when the wife went to leave work one morning. Now we were down to 1 vehicle. I wasn't sure what we were going to do?

Thank goodness the garage got to my wifes car earily and called us two days before they were scheduled to be looked at it. So we got the vehical back just in time.

We didn't have enough saved for Auto repairs so we will have to make it up in this budget or have to dip into the emergency money.

Happy with our progress

Our first year on the Total Money Makeover is complete. We have had a written budget every month this last year. We have paid extra on our debt, and also saved money each month for future expenses, each month. In December we paid an extra 1849.95 on our debt, which brought out total paid off to over $28,000. Overall it has been a huge success. We hoped to complete baby step 2 in two years, and we seem to be ahead of schedule. I hope we can this pace up.

We still haven't got a WILL written. Also we still need to buy some extra life insurance on me. We will hopefully have these goals taken care of soon.