Nick and I took a financial peace class at church last quarter. It was very informative and one of the most enjoyable Bible classes I've been through in a while. It's so refreshing to share something like financial woes with people you trust and share goals with. You can build each other up and figure it all out together.
Since the class my husband has become the budget Nazi. He created his own budgeting spreadsheet on his laptop and we've been working on our debt snowball so we can get our debt paid off. We didn't have a great deal of debt, but we did have some so in order to remove it from our lives we've been snowballing. It's a good thing my husband has taken charge. He's a lot more strict about it than I am. We already had an emergency fund in the bank and had begun a big emergency fund, which even though I know it's against the debt-snow-ball-Dave-Ramsey rules, we've been continuing to fund both accounts, however slightly.
We have paid off what was left of our Home Depot card, the smaller of the 2 Visas, and our mattresses so far. When we began our snowballing, these 3 debts totaled around $1000. It was pretty exciting to watch them disappear, one at a time. We were also paying on my PRK surgery from last year (at 0% interest until September), my Versa, and the larger of the 2 Visa cards. My surgery started off at $2400, the Visa at its highest was $2200, and my car was purchased last fall brand new and after February's statement the balance was $16,573.92.
By the end of this month, the PRK will be paid off, as will the Visa. Woo-hoo! This is also the month that I begin sending in extra on the car. Starting next month all the money we spend towards servicing our debt will go towards paying off the car, which means that each month I will send in 2 checks: the regular payment plus an extra payment of $879.20. Holy cow! I know; it sounds crazy. I feel weird sending in over $1100 for a car payment....especially for a Nissan Versa! However if we stick to the snowball, the Versa will be completely paid of by October of 2009, which means we saved an additional 4 years of car payments and we'll both be driving vehicles that are totally paid off.
Then we can throw all of that money per month into our big emergency fund. We're hoping for around $30,000 by the time it's all said and done. That should give us about 6 months worth of living expenses. Nice. I'd also like to build the small emergency fund up to about $3000. It just makes me feel better.
Why did I share all of this today, you might be asking? I don't know; just because I was sitting here paying bills and looking over things and it made me want to talk about it with someone. Since the dog and cat don't really care, I decided to blog. If you'd like to figure up your own debt snowball and start getting rid of your debt, check this debt snowball calculator out. It's very useful!