Wednesday, March 19, 2014

Finding out what you really owe...

I sat down today and found out what I really owe in debt. It was scary at first, but then it gave me a sense of relief. I think we avoid things, hoping that it will be easier. In the end knowing gives you a sense of power. This weekend I will take that information and combine it with hubby's, to come up with a goal length of time to becoming debt free.

In the mean time, I went ahead and did our budget through the summer. I wanted a budget based on when we get paid and not just monthly. I love Mint.com for letting us know how we are sticking to our budget. You select what amounts you have in your budget to pay that month and it tracks your expenditures for you. I just needed to come up with the budget itself.

I love spreadsheets. I work in them everyday and I am really good at formula's and doing all the pretty stuff. In the end I had a spreadsheet that allowed me to see what gets paid each week and how much I need to keep in reserve to pay the next weeks bill. I know that Dave Ramsey teaches the zero balance monthly budget. However, when you are behind, you need to get a little creative. For example, with rent. While we are getting caught up we have to pay rent using the last paycheck of the month and the first paycheck of the next month. After reviewing the numbers, I have us becoming current with all bills by June. This is huge for us.

We have known for awhile that we need to move to a cheaper place to keep our end goal of becoming debt free. In order to do that we have to save up money for the move. You may say that it will be cheaper to just stay where you are. But when our lease is up, we will have to pay about $2500 in deposit and moving expenses. Moving into a rental house that is $400 a month less, we will be able to break even in less than 6 months. We plan to live in the new place for about 3 years, so that is well worth the expense now.

In order to save enough money to move in September, we are having to cut our budget a little more. We will cut our Friday takeout to twice a month instead of every Friday. I will have to make sure I get a certain amount of hours on each paycheck. ALL non-necessities will have to wait until after we move. Or at least until we have saved up the deposit and movers fund. I am going to get even more creative with meal planning. Groceries will be cut to bare minimum. I know we can do this!

I will also be going through the house and selling what ever I can part with. I know I need to go through the baby clothes and stuff, but that is so hard. I hate getting rid of it...but that is for another blog.

I will keep you updated on our progress. Love and prayers to all of you.