Should I dip into my baby emergency fund??

**susan_yong** · 12-11-2010, 12:36 AM

Hi

I am following Dave Ramsey's Baby steps. I am currently at baby step 2. I only have $2000.1 left on my debt.

I have been on beans and rice for the entire year to clear all my debts. And I can pay $1739.77 by the end of Dec 2010. I am still short of $261.33 This is after scouting and saving and going without.

I am so SO tempted to use my baby emergency fund ($1000) to pay off the balance $261.33 so that I can be debt free by 2010. And start afresh for 2011!

This is a totally emotional decision as I know I can pay off the last part of the debt by late Jan.
What do you think?

Should I?

**Palooka** · 12-11-2010, 01:00 AM

I'm from the old school and I would take that small amount out of savings to pay off that debt. Peace of mind.

*tin hat on*

BTW, good job.

**pollypurebred39** · 12-11-2010, 02:00 AM

Me too! Without question.

**Darlene** · 12-11-2010, 07:50 AM

I'd do it (others may disagree but like you that fresh slate sounds mighty good. Only use what you need though) and WTG on living like no one else. Keep up the good work in 2011!

**lisa0069** · 12-11-2010, 08:30 AM

I would do it also because the next step is to save up the 3 - 6 month's so put the 261 back next month and carry on. Just give a little prayer that no EMERGENCY happens till you get it back in there.

PS If it were more I would say no don't do it.

**ladytoysdream** · 12-11-2010, 08:35 AM

My feeling after reading your post, is that it would be a good thing for you to go ahead and pay off all your debt by end of this year.
From what you have been doing, I think you can have the money back into your EF real soon. By finishing it up this year, it is like getting a gold star on the way you handle money.

I hope you post more and maybe share with us, how you did this for the past year. It is really hard to go without and make ends meet, in the quest to make a money goal.

We have been pinching pennies since May of this year because that is when my partial UE ended. My goal was to practice making ends meet on just his low income paycheck. Our bills are all current and our big year end, property tax bill looks to be on target for paying on time. Our goal next year is to get his truck paid off early. Then I go after our final bill, the fixed HEL on our house. I am SOOOOO tired of paying interest to the bank.

**khaski** · 12-11-2010, 08:40 AM

Yes, I would, and am. We have only $240ish left this month on my hubby's subaru payment (will be paid off 2.5 years early), it comes out of our credit union account, usually we put in the full payment amount monthly,. this last month we're letting it just come out for a few reasons....
1) It's less than the usual payment
2) still leaves us a good chunk in there (it will be less than $1k, but added in with my ING account we've got over $1k)
3) we're in a 'slump' with hubby's private business.....that point where no checks are coming in. They will end soon, he is working on jobs (machine shop) right now, it just takes a month or so to get paid, and we're in that slump of 'no paychecks' a few more weeks., but we're fine.

While it's no 'emergency', I find dipping into the EF to pay off the last little bit of a debt is worth it- provided you have a plan to refill the EF shortly, and it doesn't drain you down to nothing or close to it. Gives you a sense of accomplishment somehow with the calendar ticking away towards 2011. CONGRATS on knocking that debt down and away!

**gmarie** · 12-11-2010, 12:37 PM

Do it. I trying to be credit card debt free by the end of this month also and would do the same thing if it were just a few hundred dollars.

**madjen** · 12-11-2010, 01:19 PM

I think you should but only as long as you get the emergency fund right back to $1,000 as soon as you can!

**LuLuBleen** · 12-11-2010, 02:18 PM

I'd do it too. There's such an emotional boost to paying off that last debt. And with a fresh start in 2011, the first order of business can be replenishing the BEF. It should be a cinch because you'll be debt-free!

**dcompton** · 12-11-2010, 02:57 PM

Absolutely! That's a great way to start a new year. Congrats on the wonderful job you have done.

**mamachop** · 12-11-2010, 04:11 PM

Do it! You'll have peace of mind knowing it's paid off, there's no better feeling than being debt free and not owing anyone anything!

**Momto5RN** · 12-11-2010, 04:46 PM

well since this is posted on what would be considered the area that is a dave forum i would say dave might say no .
i know i pretend the BEF doesnt even exist when it comes to things like that

i could possibly use my BEF along with extra money i hope to have by end of month to pay off the CC i am working on now and although the temptations there i think OK what if a 900$ car repair/ heater repair comes up - i dont have enough in EF and i have to put it on credit ( or have no car or be cold)

i think the one issue with following the emotional aspect is that emotional aspects are also what often got some into this place in the first place ( emotional spending or keeping up or denial etc )

i would probably just put my original goal aside and finish it in jan 2011 . one month is just one month but once one breaks daves rules just a little -it gets easier to break one the next time.

but thats just me - i am quite abit away from paying off the last bit that built up over the years i was sick and not working - so my whole tune might change of i was under 300$ away from being able to be dept free lol

**lparker** · 12-11-2010, 04:58 PM

Go for it! I can't think of a better way to start the new year than being debt free...and then sticking to the plan....

**nuisance26** · 12-11-2010, 06:26 PM

~I wouldn't. That's too close to the edge in case of an emergency.
The New Year is just an arbitrary date/number that people attach significance to. You can start with a clean slate any day, any month, any time!
Paying it off in a month or two and keeping your EF intact is the wiser choice.
Good job on what you've done so far!~