As I listened, I tried to pay attention for something for which to write about for my last post of the month. In lesson 4, dumping debt, Dave says that he knows that he can often identify callers who “have it”, and those that don’t. Those that “have it” are angry, and ready to get out of debt. They find no excuses, have no reason to delay it. They get on board, and they get on board quickly. I would be one of these callers. J would not. He’s a bit more inclined to not own up to things right away. He needs to be knocked around a bit before he sees things accurately, which is why we’re a perfect match. For every bully, there is a wimp.

Our Baby Emergency Fund has a little gremlin that we call Dave Murphy. Any time it gets funded, something happens, and he takes all the money out. We’re 4 months into our Financial Peace journey, and are back to Baby Step 1.. re-again. We’ve had 2 yard sales, we’ve sold a jet ski, cut out our retirement, sold our van, gone to the bare bones for insurance, cut out trash service. We’re still holding onto our cable services. I’m in my final semester of my graduate degree, and internet service is a necessity for us at the moment based on our circumstances. But we have to dig deeper. We have to find a way to get it funded again. We’ve been trying to sell our hot tub, and hopefully, since hot tub weather is nearly here, it will sell. So, I’m going to cut the price again, and all but give the thing away to get our Baby Emergency Fund re-re-funded.

J has a meeting with the manager of the local Domino’s tomorrow. He’s to take in his driving record, and we suspect he’ll be hired on the spot. That will certainly help in getting it funded. We’re also looking to sell Jason’s truck to knock out the 8k debt, leaving us with only one left from the medical bills of our daughter.  My comprehensive exams are next week, and once that is over, I’m going to see about getting a job at Kohl’s as a seasonal employee.  We’re starting to prepare for July. In July, my student loans will come a knockin’. My girls will definitely not graduate from college in debt. Through FPU, I’ve learned about ESA’s, and as soon as we complete Baby Step 3, we’re going to start funding these college funds. Current law allows a 2k year contribution. Our oldest is 2, which seems awful young, but each year we aren’t contributing is a year that her fund will miss out on the compounded interest that would make the 2k per year starting at age 0 until age 18 nearly 200k. There are many steps to get from here to there, but it is important to keep an ear to the ground to be ready, to have a game plan.

One thing that Dave said in the same lesson about those that are going to “make it” is that when your broke friends are making fun of you, you know that you’re doing it right. Some family members have been a little worried, accusing us of joining a cult and such, but I guess I have great taste in friends, because my broke friends are checking out Dave’s books, they’re funding emergency funds. I’m such a convert, so determined to get out of debt as soon as possible, that I’m going to be co-teaching FPU starting in November. It’s offered through my church, but anyone can attend. The next session is going to start on the tail end of a sermon series on debt- in anticipation of the holidays. It is my hope and prayer that my broke friends will join me at least for the FPU. It’s the best $93 I’ve ever spent. 10 years from now when I’ve changed my family tree, and I’m giving like no one else, in the memory of my daughter, I’ll be even more thankful of the small investment. After I’ve co-taught a lesson, then I’ll start teaching my own FPU courses. The lessons learned during the 14 weeks don’t end at the 14 weeks. After listening to the DVD’s (which come with the $93), I’ve learned more, and I know that as I do the course as an instructor, I’ll learn even more. J and I are a bit deficient in the life insurance part. I have none. Nada. Zip. What he has is what is offered at work.

Very quickly, before I close, in speaking of the Holiday’s, I noticed that the Coinstar at our grocery store doesn’t charge if you get an Amazon,com gift certificate from your coins. So, we’re emptying Piggy Banks. We got… ha… $93 out of one. No trips to the mall. It eliminates impulse purchases, and “gotta have its”. We’ve got 2 more to empty so that we can go get plastic stuff for our kids.

The last thing that I re-heard, not for the first time, but I was like “Oh yeah”, was that Prayer really does work. It does. It does. I’ve no doubt that God led me to Dave Ramsey’s program because I prayed for help with finances. If there are any two people that are a testimony to how much things can change in 14 short weeks, it is us. I can’t even begin to tell you of the denial that I was living in, and of the lengths J was going to hide it from me. After 14 weeks, J and I are caught up on our bills, and are working with one another, not against one another. More importantly, is that Jason has become a Christian. The promise and the proof that he was seeing after doing it God’s way, not only financially, but in every aspect of our lives was the evidence he needed.

~Manda

I think the topic of financial freedom is work discussing, don’t you? Stop by and contribute!

money.crowdvine.com (Financial Peace Community)

I have to say I like the new look a lot better than the last version. It looks clean and more up-to-date as far as the look and feel of the promo video and the cd-rom info. They also sent us a new T-shirt that is way cooler than last years shirt. My husband actually wears the new one.

I suppose we will have to have our church purchase new material since they have also changed the books. I am not exactly sure if the content is any different but I know the videos have changed. I am excited about these changes though. In my experience change represents movement which is usually a good thing.

The new promotional material is awesome. Check it out > Coordinator Resource Center

Tags: dave+ramsey, financial+peace, fpu, financial+peace+university

A listener asks if he should he do a variable universal life policy if he has no debt except the mortgage and has maxed out all retirement savings.
ANSWER:
No.  You should pay off your house before you do any additional investing and make sure you’re only investing 15% in the retirement savings plans.

The variable universal life policy (VUL) is the latest version of a cash-value life insurance plan.  It’s a mutual fund snuggled next to an annual renewable term life policy (ART).  ARTs go up every year based on your age, which means it is one of the most expensive ways to buy term insurance.

When you’re paying for both a mutual fund and the ART at the same time your insurance is too expensive and the money that’s supposed to go to your investment goes through the insurance company first.  This means you’re paying tons of unnecessary fees.

It’s an expensive, high-fee way to invest.  Just buy the mutual fund instead.

What I am about to say is not something I think Dave Ramsey would not agree with but I find it the only way I can keep from letting my existing credit card debt take over my life. Despite Dave Ramsey’s suggestion of canceling all credit cards we had decided to leave some open.

The reason we have decided to do this is because banks are cleaver and will find any way they can to get as much money from you as they can. Most credit cards now offer some great interest rates that are worth taking advantage of if the purpose is to transfer an existing balance. However if you happen to be late just one time that great interest rate will no longer exist. Not only will it not exist you will have to live with the high interests rates that are in the 20 percent range.

So what happens when your interest rate is now in the 20 percent range? Your payments jump to 2 to 3 times (maybe more) larger than they were before. Guess what happens when you go from a $200 a month payment to a $400 a month payment? If you are like us there is no way you can make the payment which means the cycle of becoming delinquent starts. The high payments making it impossible for you to pay the entire amount as well as the late fees and overdraft fees you can’t afford to pay either. If you become delinquent on the credit card then you risk getting bad credit scores as well.

At this point any hopes of snowballing your debt becomes almost an impossibility. You are struggling just to make the minimum payment that will never pay your debt down with the high interest rate. So what if you had kept a few credit cards open so that if this scenario where to happen you would be able to transfer your debt to lower interest rate card? If you keep your credit good then you are likely to get a good rate on another card or cards.

We are all human and from it’s possible that one month we forgot to make a payment on time. It’s unfortunate that credit card companies penalize you so heavily for just having one late payment but they do. They do this because they want to get as much money out of you as they can. We can keep from becoming delinquent or paying high interests rates just by playing them at there own game. If you can avoid it don’t let your credit scores get bad so that you can opt to transfer balances when needed.

Now, I am not a personal finance counselor or professional so take my advice with that understanding. I have just found this works for my family. I am not interested in paying the highest interests rates possible on my credit card debt so by keep a few cards open and maintaining good credit I am eliminating that potential.

Remember this is not a “keep credit cards in case of an emergency” situation. We have not used credit cards for purchases in two years and don’t plan on ever doing so. If you are using your credit cards for purchases then STOP. You don’t need credit cards anymore. You need to change the way you are handling your money. But if you keep a few cards open don’t hesitate to get the best interest rate possible so that you can pay that debt off.

At this point I think I can only display one video at a time so I will probably update them weekly and then sometimes add my thoughts on the videos in a post.  Feel free to click on the embed button and use these videos on your site as well.

My teenage daughter predicted I was going to blog about a conversation I had with my neighbor today about money. She was right but it was my daughters suggestion that prompted me to write about it .

My neighbor was talking about some improvements she wanted to make to her house and said “The money tree stopped growing money”. I thought this was very funny and proceeded to tell her we never had a money tree and that we are still trying to grow ours.

I think we all wish there was a money tree. We may not have the ability to plant a physical seed and grow a physical tree but we can grow money. Proper handling of money and smart investing is a way of growing money. My response to my neighbor may have been good for a laugh but it really did have truth to it once I thought about it. I am still growing my money tree. At this point my tree is still a seed under ground but eventually it will take root, sprout and grow into a tree as long as my husband and I stay focussed on nurturing our seed.

We must not forget to water it (pay down debt), keep the soil fertile (spend wisely), offer it sunlight (save for the future) and prune it when necessary (have self-control and say no to impulse buys). As we watch our money tree grow we need to be sure we are not neglecting any of it’s needs because it only takes a short time for a tree to die, especially a money tree .

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I was reading a story to my son the other day out of his school literature textbook and it reminded me of myself and how I view life at times. The story is Eleven and was written by Sandra Cisneros. In the story there is girl who just turned eleven but doesn’t feel like it. In fact she throughout her birthday she experiences the feeling of being all the ages she already went through but not eleven. She goes through a somewhat traumatic experiences while she was at school on the day of her birthday. The teacher tells her to take home an ugly smelly sweater that wasn’t hers. She tries to tell the teacher that it’s not hers but the teacher basically ignores her. The teacher even tells her to put the smelly sweater on.

This is when I wish I wasn’t eleven, because all the years inside of me – ten, nine, eight, seven, six, five, four, three, two and one -are pushing at the back of my eyes when I put one arm through one sleeve of the sweater that smells like cottage cheese, and then the other arm through the other and stand there with my arms apart like if the sweater hurts me and it does, all itchy and full of germs that aren’t even mine.

The story goes on to say that she couldn’t control her emotions any longer and she starts to cry uncontrollably. Not just tears rolling down her face either.

I’m eleven and it’s my birthday today and I’m crying like I’m three in front of everybody. I put my head down on the desk and bury my face in my stupid clown-sweater arms. My face all hot and spit coming out of my mouth because I can’t stop the little animal noises from coming out of me, until there aren’t any more tears left in my eyes, and it’s just my body shaking like when you have the hiccups, and my whole head hurts like when you drink milk to fast.

Strangely enough I could completely to relate to this story. It’s been a while since I have cried from embarrassment like the girl in the story but many times, in fact probably on a daily basis, I feel as though I am a child still. Sometimes I don’t want to be thirty-something. I just want to be six or thirteen or even eleven again. I don’t want to have to pay bills and have stress over life’s worries. I don’t always want to do house work or any type of work for that matter. Lying in bed all day with a favorite blankie sounds strangely comforting . Then I have to remind myself I am an adult.

I am an adult with responsibilities that are important for myself, my family my country and even the world. Life was never promised to be easy and even though I may feel like reverting back to a child I can’t so I might as well start thinking like an adult. With regards to handling money, I have to remind myself as an adult I should be able to say no to certain buying impulses. I have to say no to laziness and selfishness.

Fond memories of childhood are good but these memories should stay memories and not turn to actions. I do realize there will be times throughout my life that I many not be able to keep those childhood years from coming up in tears or mini tantrums but I should alway making being an adult who I am. Especially since there is no chance of me ever being a child again.

Right now you are either thinking I am insane or you can totally relate with me. Either way the moral of the my story is to grow up and take control of your finances. Don’t let the child inside you run your life.

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Tags: debt, debt+freedom, borrowing+money, credit+cards, financial+advice

There is usually at least one person in the family that likes to spend money. Some husbands have to deal with a wife that won’t stop spending as well as some wives have to deal with a husband that won’t stop spending. Usually in this type of home one spouse is off doing one thing as the other is trying to keep things together. Is this type of home at all capable of gaining financial freedom? I say no. Not unless someone is will to make some changes.

As a couple the journey toward financial freedom needs to be something you do together. It is extremely difficult and even impossible for one spouse to get out of debt when the other is creating debt on weekly shopping sprees.  Strangely enough neither my husband or I are a spender. Sure we would both like to spend money but by nature we are more of the thrifty types. Though neither of us had to adjust our spending habits in a dramatic way, we still had to learn how to join together as husband and wife and change our spending habits.

As I have said many times before, getting out of debt is not easy. It takes deciding your are going to change and acting on those discussions. I encourage you to sit down with your spouse, whether they are the spender or saver, and talk about your finances like adults. By “like adults” I mean, don’t play the blame game. You probably both got yourselves into this mess so it’s now time to talk about how to get out of it.  Of course you probably already know I recommend Dave Ramsey for sound financial advice.

People were designed to be social and encouraged by other people. So when we are talking about trying to do something that is difficult to do then it is best to find others going through the same struggles. Not only those going through the same struggles but those that are actively participating in achieving the same goals.

I heard about Debt Consolidation Care community forum a few months ago. Though I don’t have very much time these days to be an active member of a forum, I have read some of the discussions taking place. Some of my favorite topics are the stories of real people deal with debt – see My Story.

So, if you are needing advice on anything related to being in debt and encouragement from others going through the same thing, check out Debt Consolidation Care Community.