Saturday, July 28, 2012

My Total Money Makeover

I've been in debt ever since I started working.  My first job, selling high-end western wear, was the summer in-between my freshman and sophomore years of college.  I babysat here and there in high school, but always pissed the money away.  When I started earning real cash, I had already spent it, on mainly an expensive computer that I couldn't wait to have.  I naturally lack patience.  I want everything to happen this instant.  I've been getting better over the past several months, due to my own spiritual growth, but when it came to buying things, I didn't have much will power.  I easily spent money I didn't have on trips to see friends, concerts, technology, food, clothing and other "essentials".  I am now 28 years old with $16,000 in debt.  I have the job of my dreams, but it's entry-level, so I only take home about $26,000 per year.  I've never lived on a budget. EVER. A budget for me was making sure I had enough money to pay my credit card bills, but still used credit cards elsewhere.  It was a classic situation, and a vicious cycle.  My debt has forced me to live in a home with 3 other young women, all trying to make ends meet.  At times I get very frustrated and impatient, upset with myself over getting into this situation.

If I were debt-free, I'd be able to live on my own comfortably.  I dream of owning my own ranch and film studio.  It's a far cry from what I have now, but I have to dream to stay motivated.  My first goal once I'm debt-free is to buy a two-bedroom condo.  I love the idea of having guests come and stay with me, but living in a "sorority" house isn't cutting it.  My other goals for being debt-free are spending money on healthy, organic produce and cooking.  I'm somewhat obsessed with living a healthy lifestyle, and that's usually where I spend what little money I have.  Someday, I'd even like to have enough space where I can grow fruits and vegetables in my own garden.

The whole money thing has stressed me out for quite a long time.  I've been paying myself back ever since I started working.  I've never lived debt-free. Well, when I was 18 and didn't have a credit card, I was debt-free, and boy, I felt so free.  I felt like I could accomplish anything!  Recently, I was out on a walk and there was a voice that spoke inside my head, and it told me that I should get a finance book.  I had heard of Dave Ramsey's books, but I never got around to getting one.  The next day at work, I bumped in to a couple of coworkers who were switching offices and had to box up all their stuff.  One of them had come across Dave's book Total Money Makeover.  She had remembered that I was struggling with money and interested in reading more about it, so she gave me the book.  I knew in that moment that it was a blessing from the divine, and immediately went home and started reading.

Not many books have changed my life.  A few have helped me awaken to my life's purpose and live more in the present, and receiving this book came because I was spiritually ready.  I accepted it with open arms, and while reading, it brought me to tears several times.  It not only changed the way I thought about money, but it has encouraged me to sell some stuff I no longer needed to help build my initial emergency fund.  Something I had never attempted before.  Another thing I had never attempted before was living on a budget.  It was really freeing to go through what I had coming in and actually designate an amount to different necessities.  I literally felt lighter, knowing that I had a plan to get to step one, and as soon as that was done, I could start attacking my debt once and for all.

I also cut up ALL my credit cards.  I don't even know how many there were, but it was more than anyone should have.  I put the pieces in a ziplock bag and pinned it to my bulletin board.  My parents were concerned that I didn't have a back-up for emergencies.  But honestly, it feels good to know that I don't have a choice.  I HAVE to have the money in order to pay for ANYTHING.  I now have $500 in my emergency fund, and I am living on a budget. I'll be able to get to $1000 within the next couple weeks.  And then it's on to the debt snowball.

If I can live on a budget and pay off my debt while only bringing home $26,000 a year, I  can only imagine what I'll be able to accomplish when I start earning more.  My personal mantra is "Debt-Free by Thirty!"  It's going to take a lot of work, but it will also require a lot of patience.  I can wait to buy things until I have the cash.  Oh and cash is so much fun to pay with.  I use my debit card only to withdrawl cash from the atm.

Dave has taught me that if I am willing to live like no one else.  I'm talking no more new gadgets, no matter how cool they are, I'll someday (soon) be able to live like no one else.  The most important thing is to dream about what I will do with that money.  Where would I live?  Where would I travel?  Who will I share it with?  How would I invest it?  How will I enjoy it?  How will I honor it?

Thank you Dave, for writing a life-changing book!  And thanks to my co-worker who found it useless, and then handed it over to me.

I'm on my way!!!