For those doing T. Money Makeover ???
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| Mon, 01-30-2006 - 9:35am |
Were you able to part with your car? Did you stop putting money towards your 401Ks
I read the book this weekend, and i have to admit i would have a hard time doing either of these things, but I am thinking about it. Our newest car is a 2004 Toyota Corolla, our oldest is a 1999 Corolla. We cannot make do with just one car. We have three years left of apyments on the 04 (at 1.9%)
As far as the 401k thing, I would be able to talk myself into this, I just have been happy that we have been putting 5% away since May, and we have close to 4K in it now.
There are lots of other suggestions in the book that I have no problem with..i am hung up on these two. (When we bought our corollas, we bought the cheapest, most reliable cars we could find : ) ) Of course i totally see where he is coming from with the financing, though...and I would be likely to try to pay cash for our next vehicles.
just looking for others' input : )
Heather

I'm not doing the completely Ramsey thing, but I do like many of his principles (like putting $1000 in a savings account before starting to pay down debt). We thought, and talked, and considered selling one of our cars, and ended up not. The reason at that time was that the car that was paid off was not a safe car for kids (a 1994 Geo Metro), and if we sold it instead of our 01 Subaru, dh would spend more money on gasoline going to and from work. So we felt that for safety, and financial, reasons, we were better off with two cars.
Of course, if we had been a bit more desperate, we might have sold the Subaru and just tried not to drive around with the kids in the car more than necessary.
As for the 401k, we did stop contributing for a while, but when dh got his current job and they offer 100% matching up to 6% of your pay, we felt that was too good to pass up. 100% guaranteed instant return is about as good as it gets, and we felt like we'd be throwing money away if we didn't do it.
But, like I said, I think people who are in dire circumstances sometimes need to make those changes in order to get back on their feet, and we would have made those changes if it had been necessary.
Dh's first 5% is matched 100%, too, and I just don't have it in me to pull the plug on that right now. We have the $1000 taken care of, though, and we have started snowballing..in fact, I knocked out one debt this morning. As far as selling stuff, we wil have a garage sale once we move in ths summer, but i am too busy to be bothered with ebay. i have a few items that could easi;y catch $400, but I am not ready to part with them yet (though the demand is there so I easily could if needed to) I finally got dh to hop on board with the cash system...he was threatening not to help with the shopping, which I need help with sometimes. (we will still use debit for our gas, though..too much of a pain here in snowy Wisconsin, but it is not like i am going to impulse buy at the gas pump, LOL)
Thanks for sharing your experiences with the system. Things are turning around for us : )
Heather
Hi Heather - I've read the book, and I appreciate many of the principles.
All my best,
Danni
I agree with Danni. I think there are lots of good ideas from lots of different authors. We have to take what works best for us from each of them and at least do something. I just recently got the TMM CDs. At first, I wasn't sure I would be able to listen to him that long- but after a while he grew on me. As far as acting on all of his ideas, it's just not practical for us. I did learn more about our future planning from him than I have anywhere else. His thoughts on insurance and savings for the future is very interesting.
The one MAJOR thing we did decide to try is to take a break from the retirement contributions (DH was putting in 8% with a 5% match). It was a hard decision, but we thought we would at least give it a try for 6 months, then reevaluate. If it's working for us and we're close to paying off the credit cards, we will continue until they are gone. But if not, we'll start the contribution back up again and try something else.
Have you been to the forum www.livinglikenooneelse.com? It's not affiliated with DR directly, but it was created by/for his "students" as a place to discuss, solve problems, etc. I've seen some really good advice and support over there so far.
I haven't read the book but thought I'd throw in my 2cents worth on the 401k issue. I am currently doing 10% into that and my company matches 50% of the first 8%. I have traditionally taken the attitude that at least 1/2 of any salary increase (pretty sure I threw the whole raise against it my first year in this job) goes to 401k immediately. This was my dad's theory and they retired with a nice little nest egg. This year, in light of my debt reduction plans, I intend to skip that plan and move that money into my regular spending so that I can get enough breathing room to actually follow through on the plan.
I need to think about the 401k vs. Roth thing. I can see where it might be more lucrative to do the Roth but I am so happy with the automatic nature of the the 401k. There is NO WAY I would've saved 20k in the last 3 years without it. I guess the challenge is to find some way to get the Roth thing set up so it is automatic.
Peg
DH has a Roth, and we make automatic contributions from the checking account every month. In fact, they are about impossible to have canceled (have to call 15 business days in advance or some such thing), so it is really a forced savings.
As for 401k's, I think it is silly not to contribute at least up to the matching amount. With 401k's and SIMPLE IRA's, there is the tax savings as well. Plus, even by making small contributions you have the power of time and compounding on your side. And you are keeping good habits. I would have a real problem with that part of the program, I think! :)
-Sarah
Sarah
Mom to Gina & Tony
DH and I finished Finanical Peace University in December.
We kept both of our cars and kept contributing to our 401k. We live in Texas and it's just not feasible to have one vehicle.DH is an Territory Manager and I work FT. As for the 401k, I think it's important to prepare for the future while taking care of our debt. It is "automatically" deducted from our checks, as suggested by David Bach. I also looked at the 'Cost' of not contributing and weighed our options, I feel it's worth it for us to keep our monthly amounts going in.
Susan
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I did contribute to the 403B (same as 401K, but for teachers and such) -- we have stopped for now to try to pay down debt -- the school district doesn't match anything anyway. I have noticed that we really have hardly any more in the 403b than what we have paid in -- so I don't feel so bad taking a holiday. We have 32,000.00 in credit card debt which is pretty awful.
Megan