and ramblings on everything in between
My Dave Ramsey Debt-Free Journey started in February 2011. A guy in my Bible study group handed me a copy of the Total Money Makeover – what prompted this, I don’t remember – but I was stuck in a 15-month stint of being severely underemployed and I needed guidance to get myself back on my feet. And out of my parent’s house. Apparently God knew this is exactly what I needed.
Cue life-changing experience here.
I was blessed with a full-time job in February 2011 (and moved out of my parent’s house. Score.), just one month after devouring Dave’s book. God’s timing is often laughable, isn’t it? I was $14,000 in debt due to student loans and determined to start obeying God with my finances since I was making good money again.
I was already ahead of the game when I started. Baby Step #1 is: Get $1,000 in an Emergency Fund fast. I had more than that in my savings account, so I transferred the difference to checking (with a memo that said, “Because Dave Ramsey says so!”) and put the cash toward my student loans. Baby Step #2 is: Pay off all debt using the Debt Snowball. It was time to see how serious I was about this.
I spent precious time calculating a budget, setting dream goals for when the debt would be paid off, and deciding what I would live without. Dave’s motto is, “Live like no one else, so you can live like no one else.” This translate to: start saying no to lots and lots of stuff. And I said no to lots and lots of stuff.
In January 2013, 23 months after agreeing to live like no one else, I made my last student loan payment. I did a happy dance in my kitchen, called the “Life is Good” segment on a local Christian radio station to pat myself on the back, and turned my focus to Baby Step #3: 3 to 6 months of expenses in savings.
However, I had to modify this goal. I created Baby Step #3A: Pay cash for a car. At this point, my car was well over 10 years old and nearing 170,000 miles. I knew this expense needed to be taken care of before I worked on a fully funded Emergency Fund.
I saved and saved and saved…and feared I’d never make it. Watching my debt balance go down felt fast. Watching my savings account go up felt slow. May 2014 led to my epic fail. The transmission went out in my car and I made the quick and panicked decision to buy a new car, even though I only had enough cash to cover half of it. After handing over the cash I had saved, I took on $8,000 in debt.
I cried about that decision. A lot. But thinking about it now, I don’t know if I would change it. It taught me a lot about what happens when you don’t listen to God’s nudges. He definitely was not nudging me toward that new car and I chose to ignore Him.
So I was back at it – a slave to my debt. Saving stopped and payments started. I climbed that hill month after month, and in October 2015 I did the debt-free happy dance for the second time. It was humbling; this time around I understood how quickly my situation could change if I wasn’t fully committed.
My attention, thankfully and gratefully, turned back to saving 6 months of expenses for my Emergency Fund. I decided to go with 6 months instead of 3, 4, or 5 since I am single and don’t have another income to fall back on when the road gets rocky. And because more money makes me feel more safe. I’m ashamed to say that, but it’s the truth.
By the grace of God, no disasters or mishaps have happened since October and I’ve now conquered my Baby Step #3B: A Fully Funded Emergency Fund! I feel better – and definitely sleep better – knowing I have a buffer between me and life, whether that be an unexpected job loss, a medical emergency, or a dying transmission.
These past five years have been quite the journey. It has taken much longer to get to this point than I originally dreamed. It has taught me more about myself than I anticipated. And it has changed my life in ways I couldn’t have imagined.
I’m here today to say it’s possible. Whatever your dreams are for your finances, it’s possible. The road will look a lot different than the map you’re given to follow. You’ll have to change your priorities, change your goals, and change your outlook many times along the way.
But none of those changes mean you have failed.
Learn from them, grow from them, and then get back at it each and every day. I’m confident you’ll achieve it, despite running into boulders in the road. Commercials, loved ones, situations, and creditors will try to tell you otherwise. But luckily, you’re just enough off your rocker to confidently ignore their “advice.” After all, you must be a little crazy to agree to live like no one else. Hats off to you, my friend.
Now I’m starting a new leg of the debt-free journey, tackling my Baby Step #3C: Save a Down Payment for a House. I’m back to the dreaming and hoping and calculating stage to determine when I can comfortably achieve this step. December 2018 is the goal. This would happen a lot faster if I stopped traveling, but every loon has her limits. And that is what I draw the line.
Seriously, I can’t say enough about this man. Regular readers are probably tired of me brining his name up, but I am proof that this plan really does work. To learn more about Dave Ramsey’s crazy ideas on living a debt-free life, visit his website or pick up a copy of Total Money Makeover.
PS The book that was given to me in 2011 has made its way into the hands of 3 other people since then. The friendly gesture of an acquaintance keeps getting paid forward…