Sunday, October 14, 2007
Taking the First Step
| By Lynn Forgy To work towards the goal of becoming debt free, I believe the most important thing to promise yourself is to not incur any new debt. I know how hard this is. Cutting up the credit card can seem so drastic. In the back of your mind, you may be thinking "What if I have an emergency? How will I be able to pay for it?".  As I mentioned in my first post, I first started following the steps in Crown and have also been a follower of Dave Ramsey for the past year. The two plans are similar, however, there are some differences. Each have steps that are followed that will, in the end, lead to a debt free, financially independent life. Whether you follow one or the other is not my point, rather my point is that if you choose to start down this path (and it is a choice) you will have to make some temporary sacrifices. You may have to do without, gasp, cable or some other modern convenience that we are convinced we cannot live without. Planning and writing out your monthly budget should be your first priority. Each and every dollar you have coming in must be accounted for. Nothing should be spent that is not in the budget. Following this, the first step is to save for your emergency fund. This is true in both plans mentioned above. My emergency fund (EF) is $1,000 and I accomplished this step some months ago. I do not use the EF for such things like a new outfit, birthday gifts, etc. These expenses can be planned and placed into my budget. Your EF could be placed in a savings account where it is handy in the event of an emergency, but not too convenient or where it can be a temptation.  I will be posting more in the coming week regarding the next steps, so stay tuned. Below are some links that I have found helpful in writing out my budget, working the steps, and general support. I also belong to several yahoo groups dealing with finances and becoming debt free. Crown Financial Tools Dave Ramsey and Budgeting Bankrate's Budgeting spreadsheet Our Nation's Debt - Totally disgusting My Technorati Profile: Technorati Profile Labels: budget, Crown, Dave Ramsey, emergency fund |
posted by Krista at 3:07 PM
