Jan
2012
Les Finances : Backup Funds?
When 2011 started I didn’t have in my resolutions to work on my finances, to stop using credit cards and to get rid of debt. Then I was introduced to Dave Ramsey and that all changed. I even shared several personal financial posts on this blog.
This year, even though my 2012 resolutions didn’t necessarily include money… it’s still part of my debt free progress and my goal to be debt free by my 30th birthday (1.5 years to go). I will continue to share my journey with you and pick up where I left off. If you missed my financials posts, you can find them here :
- Organizing ma vie : Les Finances Pt 1
- Organizing ma vie : Les Finances Pt 2
- Organizing ma vie : Les Finances Pt 3
- Organizing ma vie : Les Finances Pt 4
Due to the holidays and the “business days off” my paycheck hasn’t arrived as it should every thursday. I know it will arrive but still, I have automatic payments that will go through my account and I have no backup funds.
I remember when I was younger my mother always told me to kept 1 month of my bills in an account in case anything were to happen. Since I’ve been so caught up with paying off debt I haven’t really had the extra in case money. Sure I have an emergency fund of $1000, which is Step 1 of Dave Ramsey’s Baby Steps, but I don’t want to touch it, because it isn’t really an Emergency… and that having 3-6 months of savings in an account is Step 3 and only when I’ve completely paid off debt.
So I was curious to know how you manage your finances. Do you have an extra payment of your utilities, mortgage/rent in an account? Has the no paycheck ever happen to you?
Jill
January 6, 2012 at 10:02 (501 days ago)I would think if your auto-withdrawals are going to make you go into overdraft, that is an emergency since it’s a delay of a paycheck – not because you decided to go out and buy a new TV. I would move some of that emergency fund to your checking account. Cover yourself until you get paid. Then pay yourself back as soon – AS SOON – as you get paid.
I did Dave Ramsey, as well. I had over $18k in debt and paid it off with a lot of hard work and struggling. I had my personal $1000 emergency fund that I just combined with my husband’s money when we got married. We now have a joint emergency fund that we are building since I paid off my debt. We keep that money accessible in case of a situation like the one you’re in.
Kelly | Glamour This!
January 6, 2012 at 10:07 (501 days ago)My paycheck finally showed it’s face this morning. After the post published. I get what you mean that in my case seeing my mortgage is an automatic withdrawal it’s considered an emergency, but luckily my bank (ING CANADA – who I love so much) has a “Whoops” Program that allows up to 250$ in the red with no fees.
I can’t wait to get rid our our debt! The hubs and I combined were (as of May 2011) 48K in debt. That includes his brand new car, our credit card debt and loans. If we work hard at it… by May of this year, we will have paid off 18K. I really hope I can reach that goal! BUt that also means we have another 30K to go. (and in 2012 starting may, i will be on mat leave so income is very low)
Catherine
January 7, 2012 at 00:15 (501 days ago)We both only get paid once a month so we have to be good about our budgeting. We pay all our bills and ourselves first. We also overpay our mortgage every month. I did a post on how we budget. Hope it helps.
http://fortytwentyfour.blogspot.com/2010/08/budgeting-forty40four-style.html
Lindsay
January 7, 2012 at 12:31 (500 days ago)I make an extra payment on my car loan each month. I bought a used minivan (who-hoo mom car!) about a year ago, financed it for 4 years, but am going to aggressively pay it off in 2 years by making double payments each month.
I appreciate it when people write posts like yours… it’s inspiriting! Some people say “it’s taboo to talk about money” but to ignore that financial security is important and that you have to WORK to achieve it is totally unrealistic. So thanks for sharing your journey!!
I hear a ton about D.R. and maybe I should read his books one of these days.
Kelly | Glamour This!
January 9, 2012 at 09:21 (498 days ago)Making an extra car payment is awesome! Talk about a great way to clear the car debt. We have my husbands car financed too. A little over 4 years left and once we get rid of all our other debt (approx. 14 000$) we will start doubling payments as well (maybe even tripling some months)
It’s nice to hear that people like financial posts. I know it’s such a taboo subject (and I never understood why) so if I can give hope or help someone along the way it makes it all worth it. If you don’t have time to read the “Total Money Makeover” book, theres also an audio book and podcasts (of his daily radio show) He has seriously changed my life and the way I see my money.
I have to admit I still have some learning to do (because I don’t always do a budget at the beginning of each month, but our debt is going down) 2012, I will start budgeting, and meal planning. That will make it much easier once bebe 2 arrives in May!
Keep up the good work!
lindsay
January 9, 2012 at 11:30 (498 days ago)I’m glad I read this post when I did. I re-looked at my debt payoff spreadsheet that I created a while ago, and I have 3.3 years until mine is paid off.
But reading over some of your previous posts, I realize I can probably knock off a few more months by looking for other ways to save money.
This post (the series of posts, really) definitely got the wheels turning in my head!