Reworking the budget and coming up short

**Cricketlegs** · 01-18-2012, 07:30 PM

So, I wanted to payoff 4 debts this year and went into the budget to try and get a good snowball rolling but it just isn't working out!

It really frosts my cookies when I hit a wall when it comes to money.

I went off this months bring home numbers(which I think were a little lower than normal as 2 of dhs 4 checks are commision based) and my dh does start his new position which is a promotion on the first so what ever will happen we will see on the 15th but I don't count the chickens before they hatch.

When it comes to the budget I plan the bills a little higher and the pay a little lower so there are no surprises.

I'm $414 short. Blerg bkach and patooie!

I should say that I by no means have to follow this new plan. I have the money to pay my bills and put money into savings. We eat well, we have all the bells and whistles we could ask for and then some so I am not going to start doing things like getting rid of cells and tv providers and what have you. This is strickly a get rid of 4 debts fast plan.

So my questions are this: $600 of my "new" budget is savings. I could drop the savings down to $200 a month and make this plan work to pay off the debts but I would lose $4800.00 in savings for the year.

The debts that would pay off total $6817.00 although if I went with the savings options all but the $2618.00 would be gone just from my normal monthly payments with no snowball.

Normally I would pay the debts and scimp on savings but with this economy I am feeling the heat of wanting cash on hand.

We do have the baby EF plus about $1000 in one account. $400 cash and then $200 in another savings account. The $2000 is pretty well spent on an emergency though so I pretend it isn't there.

What to do, what to do!

I am so ready for dhs promotion! I need the money lol!

**nodmicks** · 01-18-2012, 08:13 PM

Is dh's job rock solid secure?????? If so I'd do half to ef and half to savings. If it is not rock solid I would go for a 3 month EF first.

**mombottoo** · 01-18-2012, 09:08 PM

Rather than pulling your hair out you could wait for your dh's new position to kick in and see what you'll have to work with then.

But, if the debts have a higher interest rate than you would earn on savings...I'd pay them off, then worry about the rest of your savings goals.

**Cricketlegs** · 01-18-2012, 11:40 PM

Originally Posted by nodmicks

Is dh's job rock solid secure?????? If so I'd do half to ef and half to savings. If it is not rock solid I would go for a 3 month EF first.

Yes we are now very secure with dh's job and he will get a pay increase on feb 15th.

We have at this time $2000 in savings.

**Cricketlegs** · 01-18-2012, 11:48 PM

Originally Posted by mombottoo

Rather than pulling your hair out you could wait for your dh's new position to kick in and see what you'll have to work with then.

But, if the debts have a higher interest rate than you would earn on savings...I'd pay them off, then worry about the rest of your savings goals.

One debt -the camper will pay off in Feb
One debt--credit card will pay off in Feb
the next debt has zero interest

The 4th debt on the snowball I want to get rolling is 6% but will go down 2 points in 10 months. It is a small student loan for oldest dd.

I would like to take the camper payment and the credit card payment and roll them into the 3rd debt and have that done in July with no interest and then roll those 3 into the student loan and having it be done at Oct or November.

That would be all I would have time for this year.

BUT, I really want savings and after talking with dh tonight his feelings is he will go along with how I want to do it but he really wants to increase our savings.

The waiting is the hardest part and whatever ends up happening, the first 3 debts will payoff this year. Savings will increase as planned, and I will continue to make on time payments on dds student loan.

**frugalwarrior2** · 01-19-2012, 12:09 AM

I would not play it too tight this year.
We are struggling much the same. our mortgage is at 2 more years. But if I pay 500. extra each month them $4000. at the end of this year. I sure would like to dump that. $1000. less due every month would bw DIVINE. Its so hard to know what to do.!

**Cricketlegs** · 01-19-2012, 12:17 AM

Originally Posted by frugalwarrior2

I would not play it too tight this year.
We are struggling much the same. our mortgage is at 2 more years. But if I pay 500. extra each month them $4000. at the end of this year. I sure would like to dump that. $1000. less due every month would bw DIVINE. Its so hard to know what to do.!

I just have this strong desire to get some money in the bank. I feel antsy and need a security blanket.

The frugal gungho woman in me says debt bad kill debt grunt grunt grunt.....

If we were to not change our standard of living and needed 6 months expenses we would need $34200.00 in savings. Yeshhh, Why is it I never have any booze in this house?

**Cricketlegs** · 01-19-2012, 12:28 AM

okay here's the plan as it sits now given I don't know whats up with dhs pay as of yet.

Cancel the debt snow ball.

I will pay off debts 1 and 2 in Feb. I will start making $350 a month payments on debt 3. It should be done in December 2012 so I still meet my 12/12/12 challenges. I will strive to continue my $600 a month savings goals all year. All student loans will (groan) get the minimums and I will start hitting them in Jan of 2013.

All this can happen without me changing anything in my budget or needing any pay increase.

**nodmicks** · 01-19-2012, 08:45 AM

I think still saving Cricket is an awesome idea as someone who drained a FFEF. You just never know what can happen. We would have went into serious debt without the FFEF with the huge med bills we got hit with and the structure damage to the house. I seriously thought we were set having all that $ in the bank. I am very glad we had it and sure hated to see it go or we would have been well over 20K in debt. It sure takes a long time to save but can sure go bye bye fast when the sh!t hits the fan.

You are still meeting your goals so all is good!

**Wendy99** · 01-19-2012, 10:47 AM

Do what makes you feel the most comfy, if savings in the bank will make you sleep at night do that, if paying off your debt makes you sleep do that. There is no one plan suits all. Personally I want both debt gone & savings in the bank (we have our $1000 BEF, but that's it). The time of being debt free will come, but in the meantime I am going get that savings number up, even just a couple hundred higher, as that savings in the bank will help me sleep. As long as you're being responsibe do what works best for you.

**rachelj** · 01-19-2012, 11:06 AM

On the other thread you said that between you and your dh, you have $500 in "blow money". Could that be rearranged to allow more towards debt? For me personally, that is a lot - especially when there is still that much debt....

**krbshappy71** · 01-19-2012, 11:25 AM

The waiting is the hardest part

Isn't THIS THE TRUTH. I don't care what's on paper, I want action! I want things moving and shaking NOW!!

But I know that it takes time and focus. You can do this, I agree with the others as far as do what helps you sleep at night. Shoot for a small quick-win, sometimes those can go a long way in helping to keep the motivation going. If that means dipping into the lifestyle a tiny bit it might help you to stay on course. Especially if you knew it was only temporary to hit a small goal.

**Cricketlegs** · 01-19-2012, 08:02 PM

Originally Posted by rachelj

On the other thread you said that between you and your dh, you have $500 in "blow money". Could that be rearranged to allow more towards debt? For me personally, that is a lot - especially when there is still that much debt....

I can see how you would see it that way! It does seem like a lot to see it there in print but really it's only $8 a day each! Considering
that my dh makes around $350 a day brings it into perspective.

The allowances are the smartest idea we ever had. When you don't have a cash allowance the check card gets whipped out and the budget goes straight down the tracks to Crazytown.

I really don't feel like my debt is that out of control. I pay all my bills with enough money to put $600 up for savings each month.

The Camper I will have paid of 13 months early. Paid of next month.

The Credit card is just stupid debt but it to is going away. Paid off next month.

The 3rd debt will be gone by the end of the year. It has no interest.
I want to hit it hard which is why I asked what was of more value, faster debt reduction or savings for when someones head catches on fire!

I have under $8000 in student loans for my oldest daughter which will be next on my list. I did consider paying these before the 3rd debt but it will be slower and I want the $350 from the 3rd debt to go on the student loan snowballs so it makes sense to do the smaller no interest loan first and then roll.

Who knows what will happen with dhs pay, I only know it is going to go up.

The car debts, boat, and house I won't address until the student loans are gone. I am 8 months ahead on payments on the student loans.

About the allowances:
My dh eats lunch, buys his beer and whatever else he wants with his. I go out to eat, shopping, and fun with my dds with mine. Since it is in the budget written and deducted each month on the columnar sheet there are zero surprises. I do not want to have to get on my bank account and find we are way past the $500. It is so easy to overspend. With cash you have what you have and no more, not so with the magic plastic.

I do value all the responses I am getting and I love to hear and see everyones unique view on the subject. I like to get a nice round picture of why people think and do things the way they do.

**forHISglory** · 01-19-2012, 10:01 PM

If loan #3 is interest free, I wouldn't hurry to pay it off. Let it run it's normal course. Plug away at #4 as much as you can. As far as mad money, $500 is huge money to me, but I know we all come from different circumstances. However, if it was me, I would forego my portion of the mad money for 2-3 months and put it toward savings, to build up that account faster. Personally speaking, I would derive greater pleasure from knowing my savings were solid than from eating out and entertainment. Just my 2c worth!!

**frugalfranny** · 01-20-2012, 01:46 AM

Think I would go for the saving too.........just a 'security blanket'.......and like the saying goes...you just never know....

You have to do what is right for you..........and won't keep you awake at night.

How about cutting "some" of the blow money.......for X number of months? Then it would be like a little 'reward' at the end when it went back to normal amt.