Home Sweet Simple Home

Dave's thoughts on the stimulus package

Here's Dave Ramsey's thoughts on the stimulus package.
Did you read it?
I'll wait until your done.
Back already? Okay--
I happen to wholeheartedly agree with Dave. You need to have a plan on how to use this money and you need to plan now- before the money is in your hot little hand.
And for heaven's sake, don't spend the money before you get the money! I remember way back when . . . . Mr. Steady and I would do our taxes and I'd have that tax rebate spent (using my handy-dandy credit cards dontcha know) before it even hit the mail. Doing this is simply setting yourself up to fail in a big way. Do you know how many times I actually took that rebate check and put it towards the credit card debt I had accumulated in my grand plan? Well, it wasn't quite zero but it wasn't ever the whole amount I had already spent.
You just can't spend what you just don't have. Things happen- life happens. A spending plan is quite different from spending the money. A spending plan gives you Plan A. When the money actually comes and you find out you need 4 new tires on your car you can adjust the Plan, but if you spent the money (that you didn't even have yet) there is no way to adjust the plan- you just totally blew up the plan.
This was one of the many ways I messed up our finances and dug our debt hole deeper and deeper.
What's that saying, "Failing to plan is like planning to fail"? Or something along those lines.
So what's your plan?
My plan is simple, we are putting the money towards eradicating our debt. I can't imagine going out and "blowing" the whole wad when we're still sitting on a pile of debt. I've learned to take delight in seeing that dollar amount we owe get smaller and smaller. Some day, some sweet day, we will have a wonderful celebration- a celebration dinner that celebrates getting out of debt. I look forward to that day and so it makes it that much easier to forgo using a bit of that money for a dinner out now . . . .

Hello!

3:25 PM, 2008-Feb-15 .. Posted by Anonymous

We became debt-free this month. All but the house:)

I am hoping to put our money in the bank. We have everything we "need". I used to have my money spent twice before we ever received it:) We also used to think the check was bigger so we over spent a lot.

Now that we won't be paying off 200.oo in finance charges (that was for only one bill) We hope to be able to learn how to keep a budget and save some:)

Thanks for all the hard work put into your posts:)

* Have you ever told us your monthly budget?

Many Blessings to you!!!!

Untitled Comment

8:33 AM, 2008-Feb-16 .. Posted by Lynne

Amy,
I was contacted by our one credit card we use this week, the Visa card. They sent a letter saying our credit card information had been "compromised" and that they were sending a new card with a new account number. They said we could keep using the old card until the new ones arrived.
I called them and told them to immediately cancel the old card. I wonder if this is really some trick to issue us a new card with a higher rate or something like that.
Anyway, I told my husband about what I had been reading about the tricks the CC companies are pulling to basically extort fees, and I told him I wanted to get a debit card from our bank and use it instead of the CC that we pay off each month.
He was ok with it. I went to our bank and applied. I don't quite understand this, but the bank teller told me to say "credit" when using the card instead of "debit". She said if you say credit, the money is deducted from our checking account with no fee. If we say debit, it is still deducted from the checking account, but a fee is charged for each transaction. Apparently the reason for this is that you can buy your groceries and get cash back with the debit card, but not when you say "credit".
My only concern was that I know my husband will use the debit/checking account card and forget to tell me what he has spent, so I also signed up for access to our checking account by computer. With this I am told I can access our account and see each debit anytime I want to check. I'll let you know how this all works out.

From Amy W

12:00 PM, 2008-Feb-16 .. Posted by YPAmy5

To Lynne- Some banks charge a fee after a certain amount of debit transactions per month. We changed banks because the “free” checking wasn’t really free. We can make unlimited withdrawals (debits) and purchases (like credit card) and check writing. I would tell you to have your card run as a credit card instead of a debit card for a different reason- first, you won’t have to put in a PIN and risk the chance that someone will be watching and 2nd- You get the protection of the card company on your purchases (see the fine print)- which is why their logo is on the card!
Very good idea to sign up for online banking- if possible, daily check the status of your account(s) that way you will not only keep up on transactions you may not have recorded but also to keep on top of identity theft.
It is amazing to me that your credit card company felt the need to call you because your card was compromised but yet told you to keep using it?! That would send off alarm bells for me as it did for you. I would have immediately canceled the card as you did. Let me know how things work out!
And to Anonymous- Congratulations on being debt-free! God is good!
As for posting my monthly budget- I am very hesitant to post such personal information online. I could give percentages though- so I’ll have to look into it. If someone wants to know specifically what I pay for something per month- (like I can tell you I spend $160/month on groceries and try to set $10/person aside for clothing needs- which doesn’t always happen) they are free to email me.
Amy W

Untitled Comment

8:27 PM, 2008-Feb-17 .. Posted by Laura

It's funny you mention this - because hubby just mentioned it today! I was wondering what to do with it, because we are also paying down the debt we accrued last year after buying our house. We are back on track with Dave Ramsey again, and should be able to fully fund our emergency fund ($1000) within 6 weeks (woohoo!). Then we have a plan in place for our debt snowball (28 months or less to debt free, aside from our mortgage).

I thought we'd spend the rebate on debt, since our new budget includes money for clothes and homeschool stuff - but hubby surprised me today when he said he wanted to buy the kids a swingset with the money. They've wanted one since forever, and every time we get close to buying one, something else comes up. I know the swingset won't cost as much as the rebate, so I think we'll spend the balance on our debt. Otherwise, they won't get one for another 28 months, and our oldest will have almost be too old for one by then.

BTW - a friend of mine has been doing Dave Ramsey since I told her about him in June of 2006, and she just told me that they are three payments away from being debt free except for their mortgage and her hubby's student loans! For them, this is huge - it includes paying off a car and all of their credit cards. It will give them almost 1/4 of their monthly income back - how exciting! I can't wait until I'm in their shoes, too... :-)