There are a lot of really good ways to begin to get your finances in order. From books, DVDs, website and blog there is really good (and also some Really bad) information out there.
So at the end of September when I looked around for a format that I thought could work for not only me, but my wife and kids as well, I weighed a lot of variables:
- Was is clear and consise? Lower amounts of wiggle room are best for me, because I "justify" my way back into old habits.
- Was there a way to involve everyone in the family? Didn't want to have to be the budget police. I always end up giving in.
- Was there a path post-getting out of Credit Card debt? OK I paid everything, I guess I could charge them up again...
Weighing all of these points and others I personally gravitated to the Dave Ramsey debt snowball.
For me these were the keys:
- The use of cash. Even using Debit cards we were spending too much. With cash when it is gone it is gone...like our Entertainment money right now!
- We could give areas for each of us to be in charge. She runs a lot of the cash envelopes; like for Groceries, Entertainment and Dining. She feels involved, cause she is! Those envelopes are 100% her call. If I want to buy Season One of The Office (which I do) I have to lobby her, just as the kids do for Harry Potter (HP won, damm Wizard!) Having real control over areas keeps people involved without one partner having to be the Budget Police
- Quick Wins. Although it is better financally to pay off debt in order of Interest Rates (as many blogs have pointed out) psycologically it felt nice to pay things off, real tangible change since you no longer have to pay the bill. This really helps me because I can lose focus and become disillusioned pretty quick
So how is it going?
I will give a full update at the end of the month, but so far we have paid off some smaller bills, stayed pretty much on budget (sometimes beating it) and kept everyone in the boat. Due to this our debt snowball is growing and we actually have a bill that we are actually paying more than the minimum on!
While I don't agree with everything Ramsey says, with a quarter of a year nearly under our belts, we are at least taking away from the pile instead of adding to it.
Can't wait to get our snowball to the size of a snowman. I think I will name it Dave...