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Thursday, April 5, 2012

Total Money Makeover [Week One]

My husband and I have decided to take the Total Money Makeover challenge and change our lives. We've decided to live like no one else so later we can live like no one else! If you read the book The Total Money Makeover: A Proven Plan for Financial Fitness by Dave Ramsey you will find that Dave uses that slogan quite often and what he means is this:

If you are willing to change your spending habits and sacrifice for a short period of time, eventually with hard work and dedication you will be debt free and making your money work for you which allows you to live like no one else! 

So we have discussed our desired goals and what we would like to accomplish, and we've come up with a plan that will work if we make it work. Tomorrow will be our first day putting our plan into action, and I am very excited for us to be on our way to accomplishing those financial goals. I split our monthly bills up into four weekly payments which we set aside each week so at the end of the month we have accumulated all the money needed to pay our bills.

Here is what our budget currently looks like: 
(Keep in mind yours will be different because I'm sure our bills are not identical)

Weekly Bills-
Mortgage payment 
Car Payment
Cell phone
Home phone
Netflix (We have given up cable to save money)

Gas to go back and forth to work
Gas for leisure and errands

We have chosen to work on building our emergency fund first therefore the money that remains after setting financial limits for each bill and necessity will go into a separate savings account which is designated solely for our emergency fund. We plan to make this budget work by being very strict. 

We have found that it will take us close to 5 weeks to save our initial emergency fund of $1000.00 which is quite well because at the moment we have no emergency cushion! I believe it will help to ease our minds once we have built this small cushion. 

So that is what week one looks like, I will post later in the week for an update on how it is working out.

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