Last month was the first time since the beginning of our Total Money Makeover that I neglected my monthly update. I forgot my online banking password, and since we didn’t make any payments, I knew it wasn’t going to be very exciting. However, I knew I needed to keep track of our progress because it’s a key to staying encouraged on our path to debt freedom. Plus, nobody likes to be a flake.
In the past two months, we’ve paid off 0.8% of our debt and we have 70.7% remaining.
I’m excited that even without extra payments, we should be under 70% by the first of the year. This month, any surplus will be going to refilling our emergency fund after we used funds from it in September to repair our car. I’ve also recently started a side business (details coming soon!) which has required some financial investment. Finally, because of our house fire, we’re eating out every night and having to buy more convenience foods for lunches because we’re still living in a hotel. Our insurance company will repay us for the eating out, but we don’t know when that will be, so we need to plan for that to be covered in the cash flow this month.
Thanks for all of your thoughts, prayers, and kind words in regards to our fire. We feel so blessed to have so many friends and family who care about us.
Thanks to Dexter getting three paychecks this month instead of two, we were able to recover from last month’s spending spree, refill our emergency fund, and make a big extra payment on Debt #3. The first digit (biggest place value) in Debt #3 dropped by two this month, which is exciting for me as I look for any glimmer of hope as I calculate our debt each month.
Our day-to-day spending wasn’t as good as our big payments. We ate out more than we should have this month, and I definitely didn’t update my checkbook every day like I promised. I also gave myself permission to only use envelopes for groceries. This wasn’t very effective, because I kept forgetting about my envelopes altogether and used my card anyway. We’ll be back to the envelope system next month. We only use our bank card for the ATM, gas, and online purchases. I’m trying to devise a way to leave my bank card at home so I’m not tempted to use it or don’t accidentally use it. I wonder if I can use gift cards to pay at the pump at any gas stations? Then, as long as I get all my cash ahead of time or by going inside the bank, I shouldn’t need my card.
I was thinking about buying a refill of Dave Ramsey envelopes and reinforcing them with packing tape, but they’re currently out of stock. I like that they’re bound together, but they didn’t last long. I’d also probably cut the flaps off the envelopes because it takes too long to find my envelope and open it when I’m checking out. (It doesn’t seem like a legitimate problem, but I felt so slow when I used it before!) I also found this template for cute tabbed envelopes. I’m still deciding if it’s worth my time to make these when I can just use the plain white standard envelopes I already have. Maybe it would give me some inspiration to get back on track with my envelopes!
In summary, we paid off 1.8% of our debt this month and have 78.6% to go. We hope to pay off the rest of Debt #3, almost 8% of our total debt, this summer. Then we’ll just have two (miserably huge) debts to go!
Tune in next month for the one-year summary of our Total Money Makeover!
If I were to choose a month for Dave Ramsey himself to swing over to my blog to check up on how we’re doing, I would not choose this month.
I didn’t use envelopes. We used money from our emergency account for a definite non-emergency. Gasp! (We bought a camera and fixed the car. I’m going to pretend the car stuff was a surprise so it will count as an emergency.) We bought lots of Christmas gifts and didn’t pay any extra on our loans.
I really loved not using envelopes. I’m so tempted to stop.
I promise I would update the budget on the computer every single day.
Any thoughts? Do you think cash is worth the hassle? When I first started using it, my grocery spending dropped by 1/3. I’m hoping I’ve just developed wiser shopping habits and that I’ve been trained to spend sparsely.
As I predicted last month, we didn’t make monumental progress on our loans this month. Without making any extra payments, we paid of 0.8% of our debt this month and have 80.4% remaining.
Next month, we’ll refill our emergency fund and resume making extra loan payments. Funding for my after school job was almost cut entirely, but thankfully, I’m still able to be paid for 5 days of tutoring a month. I’m looking forward to having a little more planning time after school while still getting to work with my students once or twice a week.