Making the switch to the DR plan. Accountability list

[Greebo]

Last night we started setting up to convert over to the DR plan (modified). I've posted elsewhere about our current financial set up. This is what we'll be doing or have already done this week.

• Closing Mrs. Greebo's accounts. She has about 2k in 2 accounts. 1 will become the BEF (we're using a larger BEF because of the higher income bracket), the other will go to the joint account.
• Converting my account to a joint savings account for the EF only.
• Growing the BEF a little every payday even though its already funded. I know DR doesn't recommend this but we feel its important to keep growing it. - Change submitted
• All paychecks for both of us will go into the existing joint account which will become our primary account. Used to be our household expense only account. - Change submitted
• Terminating any subscriptions we don't need. Moving all other subscriptions/payments to come out of joint. - Done
• Closing all but 2 CC's. 1 is for my business travel, and only gets used for that. The other is a VISA tied to the now EF (previously my) account. I can't convert it to a debit card, but Mrs. Greebo now has that card so I can't use it. It has $900 of debt left on it that will be paid off as part of the account reorg. Closed yesterday: JC Penney, Sears and WAMU cards.

Here is our debt list:

• $900 - Sole remaining CC debt. Dies this week
• $3000 - Cataract surgery for one of the dogs (not really a debt)
• $21,000 - Her Prius
• $23,000 - My Highalnder (hybrid, so back of, greenists!)
• $46,600 - HELOC
• $92,000 - Rental Property Mortgage
• $183,000 - Our Mortgage

The HELOC will be in the snowball. The rental property, once rented, will cover itself.

The cataract surgery is for our 10+ yr old, blind, toothless rescue Sheltie. She's such a sweetie, we have to fix her eyes.

This list has been posted to help keep me accountable. I'm the free spirit spender in the family, so I'm counting on everyone here to slap me if I get stupid! (AND ONLY IF, so no jumping ahead. I know SOME of you wish you could! )

[frugalfriend]

Congratulations on getting on board! You are well on your way to debt freeeeeedom!!! Keep listening to his show for motivation, inspiration, and as you know, lots of laughs . . .

[Greebo]

Congratulations on getting on board! You are well on your way to debt freeeeeedom!!! Keep listening to his show for motivation, inspiration, and as you know, lots of laughs . . .

Its funny, I watch/listen to DR, and I *know* what he's going to say just about every single time.

It just floors me when people call up and have got such total denial about their debt. I've got no illusions about mine - but I used to think it was acceptable risk. Listening to the horror stories has convinced me that I needed a UN in front of acceptable.

Thankfully, this change won't require beans 'n' rice, because we're in the black on a monthly basis right now, but if the worst happened tomorrow, I'd have the cars up on Craigslist in minutes.

[dancar3]

Yes, congratulations for getting on board w/ DR! I know for most people it works, and for others they tweek it a bit but it still works for them. The most important part is that you have a plan!

So my question for you is............since you know pretty much what Dave will say on his radio show, what do you think he will be saying about the Prius and Hylander??

[Greebo]

So my question for you is............since you know pretty much what Dave will say on his radio show, what do you think he will be saying about the Prius and Hylander??

He'd probably say sell them.

And if I sold the Highlander, I could pay off the note plus some, based on Kelly Bluebook. Ditto for the Prius.

But he also says at one point in the book, IIRC, sell any car you can't pay off in 2 years, and I believe we can pay off the Prius in one, and the Highlander within the 2nd.

And I *LIKE* my car. So I'm being a little childish about it. However, we're on the same page, DW and I, so DR will just have to deal this time.

[missmanny]

LOL we have a childish car too, but we plan to keep it for many years to come and have both promised ourselves that it will be the last one we ever finance.

I also know that if worse came to worse we could sell and it stiull get about $15K back after we paid out the loan.

I too am on a DR modified version, and I too still continue to put a little bit every pay towards my BEF, it's only small - $100 a month and the rest goes on debt but it works better for me that way, and if I ever change my mind I could take the extra out and knock off some debts (if it ever gets to be so that it would cover a whole debt!).

Good on you for being adaptable and being prepared to try something that you think will work better.

[Greebo]

Status update. I thought about starting a blog for this, but - meh, I can keep recycling the same thread, more easily.

Paid off the sole remaining credit card yesterday. However, we've set up our accounts so that my old credit union is our escrow account, Schwab checking for our EF (good interest), and bank of America for our joint account because they have atms EVERYWHERE.

Well, when ceashels moved her money into the consolidated accounts, she put it into BoA. The Visa payment goes to the CU, and BoA has to mail a check. So - it will be 7 days or so before the payment posts.

I sent the 'payoff' amount, and hopefully it will take, but if it doesn't, there will be a few pennies of interest left to pay in a week or so. But that's no big deal, so I'm marking the credit card as PAID in my book, and btw, that account has been closed too. That makes 2 visas and 2 store dept cards closed now.

Hehhehe - my fico score is gonna crash and burn.

Oh - we decided to reclassify the cataract surgery and instead of snowballing it, we allocated a fixed amount each month for basic living (mortgage, food, utils, etc), and if we stay under that amount, the extra will go to fixing Preciouses eyes.

[Greebo]

Revised debt list:

• $862.97 - Sole remaining CC debt. Dies this week PIF
• $21,457.80 - Her Prius
• $23,257.80 - My Highalnder (hybrid, so back of, greenists!)
• $46,599.36 - HELOC
• $87,131.97 - Rental Property Mortgage
• $182,739.41 - Our Mortgage

[Moonblossom]

Your correct DR does say if you can pay them off in 2 years keep them and I would too since both are hybrids I refuse to get rid of my Jeep it will be paid off in 2 years We have been on DR. plan and love it, amazing how much extra money you seem to have every month when YOU tell your money where to go. We have talked about selling one of our cars just to get done very quickly.

Oh BTW my security gland makes me have more in EF then the 1K DR recommends so yes we have tweaked our plan somewhat

[Buckeye5]

Good job, you seemed focused and on your way. Graet job.

[dolphin]

You really have a good sturdy plan and I totally agree that for most people they should have much more than $1000 in the EF especially if you're in the higher income bracket.

Congratulations on keeping yourself accountable and motivated!

[Greebo]

Your wife needs to keep an account in her name.

And why does my wife need to do this?

[Ceashels]

I don't understand the need to keep an account in my name if he doesn't have one in his. Can you elaborate gg?

[Moonblossom]

DR doesnt recommend spouses having separate accounts he feels all monies should be agreed upon and spent together via one budget.

[ansley]

DR doesnt recommend spouses having separate accounts he feels all monies should be agreed upon and spent together via one budget.

I agree. Dh has caused me much grief over money but we have 1ck acc and 1 sav acc and they are in both our names. It has taken 7yrs and he is just now working with me but so worth it.