Tuesday, June 30, 2009

The Perot Financial Plan


With the recession and instability that's going on with our nation's finances, Joey and I decided it was about time to whip our personal finances into ship shape. We decided to start the Dave Ramsey plan. I really didn't know much about the plan itself other than that it viewed financial management from a Biblical perspective and that he was big on having zero debt at all times.

I guess we started the classes a little over a month ago. There are about 20 people in our class of all ages. Some fresh out of college and others with a fresh AARP card. Single people, newlyweds, married with small kids, and some with grandkids. Bankers, engineers, stay at home Moms, doctors, etc. It's a rainbow. The reasons vary as much as the people. There are a few like us who are looking to set out on the right financial foot, some that are beginning to have to think about ways to put their kids through college, and those that are heavily in debt and are desperately ready to get out from under its thumb. The Class Debt is somewhere in the neighborhood of $580,000 and this is not including mortgages. Wow, right?


We sit at round tables each week and start the class by announcing any financial success stories from the past week. "We paid off our first debt!", "I was able save $$$ by budgeting!", "We stuck to our budget!" "We achieved Baby Step #1!". "We negotiated our insurance rates down $$$ per month!" Then we recap last week's lesson, followed by the current week's lesson with Dave Ramsey via video. The topics so far have ranged from The Basics, How to Tackle Your Debt, How to Budget the Dave Ramsey Way, Getting Through the Insurance Maze, Understanding and Negotiating Creditors, Buyer Beware, Marketing Scams, etc. These are my own titles from what I can remember about learning the past few weeks. We have learned a lot.


Here are the Baby Steps:



  1. Save up $1000 Emergency Fund

  2. Pay off all non-mortgage debt using debt snowball

  3. Save up 3-6 month's living expenses

  4. 15% of income into Roth IRAs/pre-tax retirement plans

  5. College funding

  6. Pay off home early

  7. Build wealth and give

    The hardest things are strictly budgeting every single penny you have before your monthly money ever reaches your bank account and paying with cash. More on the latter in a later blog post. So far, we are loving it despite the fact that it's tough. It's nice to both be on the same page pressing toward the same financial goals. In general, just having a financial plan and established goals takes a lot of the guesswork out of decisions. We are enjoying working as a team toward our goals. Usually the one to be very Don't-Think-About-It about financial plans, this has given me a lot more confidence and knowledge about managing our money. We'll keep you posted on our progress. For more info, you can visit www.daveramsey.com.




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