Hey ya’ll! So last week I introduced you to the infamous “get out of debt” plan of Dave Ramsey. I gave you a bit of a summary and promised to get into more detail as well as give you my take on each step. Well here goes week 1!
The first baby step is simple, save $1000 for your starter emergency fund. Let me just tell you right now there is nothing simple about it! It is hard, and I mean hard and probably the hardest step of all. We have it completed, but we have completed it several times and each time it was difficult.
FIrst let me explain the reasoning for the step. The thought is that you get some money in the bank for emergencies. Not a shopping spree or dinner out but a true emergency; like a flat tire that is preventing you from getting to work. By having this savings put back when you do have that emergency, and you will, the money is there to help cover the expense. No putting off a bill because of it or putting the cost on a credit card. No that’s the whole point we want to get all of our bills paid off!
Now to the hard part. Maybe some of you think oh it’s only $1000. You are right, it is, but if you are reading this it’s probably because you want to better manage your finances and I’m betting that $1000 is A LOT of money to you! I know it is and was to us! So the reason it’s so hard, well again you are here because you want to learn to better manage your finances. This means you probably spend money well and save money badly.
If you have committed to getting out of debt then the first thing you’ve got to learn is that you have to be disciplined. You are going to need to take every extra penny you have and put it towards this fund. Have some things you don’t need that you can sell? Great, sell them and put the money in your EF. Didn’t spend all of your grocery budget this money? Great put the extra in your EF. Any possible way you can think of, get the money in there. Skip the coffee before work, skip the dinner out, skip whatever you can and save, save, save!
I said earlier we completed it several times, let me explain why. We first started on this plan on August 1, 2018. When we did we had NO idea we’d be moving to North Carolina on October 1st. A great opportunity came along and we decided to take it; and thanks to our EF we were able to do that. As soon as we could we built that EF back up to 1k though.
Fast forward to December and a momma who was missing her babies and home and we decided very quickly to come back to Virginia. Again our EF made that decision possible. Also again we had to rebuild our EF which we did in January. Now mind you we could be much farther ahead in our journey if we’d not made those two moves. BUT, if we’d not started the journey at all and had the EF we’d not have made the moves.
You may find this step super easy and if so that is great! Complete it and move along! But if it’s hard for you please don’t get discouraged. Keep reminding yourself of why you are doing it and keep pushing through to get it completed. You will actually be amazed how it feels when you are able to say you completed the step. I know for David and I it makes us feel great that we accomplished it, not once but several times, and that we have the cushion there if we need it.
So that’s the first step, are you ready? If you are then let’s jump in! I love sharing our journey with people because I know first hand how hard handling finances can be I know what it’s like to live paycheck to paycheck; and to wonder if you are going to have everything you and your children need in between those paychecks.
Something I didn’t mention is that in order to start this step all of your monthly bills needs to be current first; in addition you need to be sure your housing and food are covered. If you aren’t in that position then apply what I said above to getting that taken care of first, put everything you have towards it.
If you have any questions about this step or the rest of the journey please reach out to me, I’d love to help guide you. Have a great weekend everyone!
~Carla~
Arise and Glow 