Cut up my credit cards that is! A friend/coworker invited me to join her for week 4 of the Dave Ramsey's Financial Peace University last week. That week discussed his method for "snowballing debt". I've heard great things about Dave Ramsey in the past and was excited about attending the class. Ever since then, I've been on get out of debt mode! I've learned how to make a budget and to make each month end with $0 by putting anything extra towards debt reduction.
I'm starting my emergency fund (which for my income will be $500). If nothing crazy comes up then I can have that done within 3 months. I'm planning to offer to some sewing things and crafts for sale to declutter my stash and all of that money will go towards the emergency fund so hopefully I can build it up in less time. Then after the EF is up to $500 I will start chunking money towards the debts. DR's method has you paying off the smallest debt first and then adding the min. payment of that debt to the min. payment of the second highest debt balance to pay it off quicker and so on down the line. I'm totally revved up about it and took the scissors to the plastic tonight!
I'll have to change some habits for sure. No more eating lunches out during work and no more emotional spending. I will have to learn how to cook more from scratch to stretch the grocery budget (which I am going to set a high goal for $300/month for the 5 of us including paper goods) And I'm going to sell anything that isn't being used that I can to pay down the debts.
I am hoping to be able to attend the rest of the FPU classes. I'm just waiting to hear from the coordinator. My friend Andrea is going to try to get in touch with him. I'm really excited about it.
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