First Steps First

Today's post will be all about goals. Like in weight loss, you have to have a goal and, just as importantly, the appropriate time to achieve it. You can't lose 40 pounds in 2 weeks, just like you can't scrounge up a $50k downpayment (unless you win the lottery/have liposuction).

So the first thing to do is to figure out what your goal/goals are. If you have a significant other, sit down with him/her and talk about what you all wish to achieve. For D and I, we wanted to have all of our debt paid off so we could save for a house. This included:

• approx. $2000 in medical debt
• approx. $3000 in credit card debt
• over $6000 in D's car loan left
• around $3000 left of my car lease, plus yearly taxes on the car that I haven't paid
• over $32,000 in student loan debt

As you can see, that is quite a bit in "the hole". We knew we wanted to see some daylight and eventually fill our hole and start building a mountain! So the first thing we did was schedule an appointment with D's local bank branch's financial counselor. We did decide to join accounts, but that is not for everyone. That took a lot of conversation and a lot of agreements and we had to come to an understanding that if we are going to combine our money then it was truly going to be our money. 

With a joint account we decided to create a budget. We wrote out everything we had to pay each month, about how much we used in gas each month, then decided to give ourselves an allowance/fun money. We took this budget to the appointment with the financial counselor and he really liked what we had done. He told us that the best thing that we had going for us is that our income is more than our outgoing, but it could be better. We decided to take a look at what we could cut. He also agreed with our goal of getting our debt paid off and introduced us to the Dave Ramsey's Debt Snowball. We took the debt that we owed and put in smallest to largest order. We started putting all of our extra money towards our first debt (which was really only a small $100 bill owed to an old hospital visit). It is a marvelous plan and I am glad we decided to go with it!

Next post, I will show you how I created our household bills and budget folder. Thank you so much for reading my ramblings, and I hope it can be of some help to you!