FREEDOM!

We completed Baby Step #3!

and we did it in less time than we thought we would!

It was tough work, we have to say "NO!" to ourselves a LOT. Especially me. We have to budget every dollar, every month. But, it's worth it to be debt free and have our emergency fund in place.

Now, on to Baby Step #3b..... saving for a new house down payment. I'm sure there will be another refrigerator chart coming soon :P

Killing Baby Step #3

We're following Dave Ramsey's "baby steps." They are as follows:


Baby Step 1: $1,000 to start an Emergency Fund

An emergency fund is for those unexpected events in life that you can’t plan for: the loss of a job, an unexpected pregnancy, a faulty car transmission, and the list goes on and on.

Baby Step 2: Pay off all debt using the debt snowball

List your debts, excluding the house, in order. The smallest balance should be your number one priority.

Baby Step 3: 3 to 6 months of expenses in savings

This is kind of revisiting #1. Now that your debts are paid off, it's time to build the emergency fund to "fully funded" (3-6 months of expenses)

Baby Step 4: Invest 15% of household income into Roth IRAs and pre-tax retirement

When you reach this step, you’ll have no payments—except the house—and a fully funded emergency fund. Now it’s time to get serious about building wealth.

Baby Step 5: College funding for children

By this point, you should have already started Baby Step 4—investing 15% of your income—before saving for college. Whether you are saving for you or your child to go to college, you need to start now.

Baby Step 6: Pay off home early

Now it’s time to begin chunking all of your extra money toward the mortgage. You are getting closer to realizing the dream of a life with no house payments.

Baby Step 7: Build wealth and give!

It’s time to build wealth and give like never before. Leave an inheritance for future generations, and bless others now with your excess. It's really the only way to live!

We've been slacking the past few months. We've been debt free since November 2009... and don't have a lot to show for it. We have a budget and stick to it, but we always have a surplus at the end of the month which seems to magically disappear before it makes it into our savings account.

We really buckled down the past two months. I'm so proud of us! I created a chart and put it on the front of our refrigerator to keep us motivated...

Do you like my ghetto picture? :P I really like having this chart though. It keeps me motivated wanting to color in more blocks.

We are almost halfway done with baby step #3! Don't tell Dave, but we've been contributing to our IRA since 2007. Which technically isn't until baby step #4.... shhhhhh.

Budgeting is tough and requires a lot of self discipline. It's a constant struggle, but I know in the end it's going to benefit us and our family. Baby steps....

I am so proud of myself! Philip and I have really been working on sticking to our budget to kick out the rest of our debt. I've been trying to pinch pennies, but still buy the things we need.

We've been wanting a digital video camera for a long time. I don't want Cooper's life to fly by without capturing it on video! We found a certain camera we like. We shopped around different stores Saturday, trying to find the best deal. We tried to get places to price match, Philip bargained, tried talking them down.. etc. Well, no luck. The lowest we could get the price was $127 and that was for the DISPLAY. No thanks. We left after an afternoon of shopping with nothing. Which took a LOT of discipline to not go ahead and buy it. Today I found the exact camera on eBay bundled with a tripod. I bid on it and won for $87! Whoo-hoo! The waiting paid off. I was really proud of us.

Also, I've been looking for a halloween costume for Cooper. There is one particular one I want... but it's $50 + shipping EVERYWHERE... even eBay. I found one today on diapers.com $49 and free shipping. Not a super deal. Well, they also had a 30 oz can of Cooper's formula for $19.99 (regular $29.99). If you bought formula or diapers you could use this 10% off coupon code for your whole purchase. :-D Then I got coupon happy and started searching the interent for online coupon codes. I ended up finding some and getting $80 worth of stuff for $60 annnd FREE SHIPPING.

Today Philip, Cooper and I went to Target. As we were checking out, I pulled out my FPU envelope system to pay. The cashier noticed and said, "Dave Ramsey huh?" I said, "Yeah we're working his plan, doing the best we can." She was quiet for a moment then said... "So I guess I won't ask you if you want to sign up for a Target credit card then." Bahahaha!