Please train me to be $$ smart!

**Studentmom** · 11-04-2007, 12:17 PM

Hi everyone,

I love reading your posts, but in many ways I feel I am missing the basics. DH and I have been saving the last few months for our own house. We have a 6.25% interest rate secured for a $107K home. The house is going to need some work - namely a new roof this summer and

new windows installed (we're hoping the seller will agree to our request that HE buy new windows and we install them). We have $4100 in CC debt (3500 on one and 600 on the other) and $1200 due for this semesters insurance (family of 3). We payed off our two other cards last month

. We have $3223 in our account and we have $1589+$1000+1200 still coming that are owed to us from work/school. We also have $4000 in a mutual fund, $400 in my own MMA and $700 in my husbands Canadian account. We are hoping that by Dec 31st we will have ~$20000 in savings, but it is looking a bit dismal. We make $3000/mo from school and an additional $700-$2000/month running a homeless shelter. When we move - Jan 5th - we will stop getting payed by the shelter and $$$ will be very tight --- so we've also started doing a home business which is slowly starting to make us $$$ ~$200/month our first month. What is a good book/training manual for us?

We are trying to just stay out of debt, but we're also worried about have EF for us and for the house! We would love a breakdown on what to focus on and what type a budget we should be preparing for. We've been running the shelter for 3 1/2 years, so we haven't paid a grocery bill, rent, utilities, phone etc. for quite awhile. HELP!!! I don't want to get into trouble as soon as I get the house.

**PrairieRose** · 11-04-2007, 12:34 PM

My best suggestion (well the easiest I should say) is to buy Dave Ramsey's book Total Money Makeover and follow his steps as closely as you can. Noone can tell you exactly how to spend your money but it's best to fund your EF's first, even if it's just $100/mo. and then pay off those credit cards, snowballing then with other debts. You can be debt free in 3-5 years, including your house, making the money you make now, making the payments you make now by simply snowballing the payments you presently make.

**staceyy** · 11-04-2007, 12:41 PM

Typically when you buy a house in the US, as part of the contract you make the seller responsible for replacing the roof and windows if they are in disrepair at the time of sale. Most lenders will not approve a mortgage if these things are not done prior to settlement.

**Studentmom** · 11-05-2007, 09:25 PM

Thanks for the message. I will definitely look for that book! As for the roof and windows. The guy told us not to ask us to ask for much because we are already getting the house at least $20K below market value...it's a really good deal!!! So we are asking for the windows as the roof can't be done until the spring/summer anyway (it's too cold up here already - it's already snowing).

Any other hints/suggestions? How much should we set aside for our EF? How many EFs do we need (ie house EF, travel EF [all of our family is out of the country or far away - so a family emergency sends us packing], etc)?

Any advice for getting our interest rates down? How do you do it?

**PrairieRose** · 11-05-2007, 09:41 PM

You need at least $1000 in an EF to begin with for the small things but you should really get Dave's book....he goes into detail about it and it's a great guide.

**frugalfarmwife** · 11-06-2007, 03:30 AM

Hi neighbor, don't you just love living in the snow belt up there? My inlaws are up there and deal with it yearly

I also agree with looking into Dave Ramsey, great books to use as a guideline for a budget.

Everyone has individual plans and ways that work for them. I personally use ING for savings and have a few different emergency funds, one basic one with $1,000, a truck emergency fund for repairs that I fund with $20.00 a week and a set of rolling CDs that get funded monthly and roll the first 10 days of each month.

Don't forget to check into tax rates if they won't be included into the mortgage payment, this is another thing I save for monthly. And also check into what the current gas and electric bills are on the house, oh and water.

It's exciting to be a home owner, and scary at the same time!

kj

**Studentmom** · 11-07-2007, 10:49 PM

Thanks for all the advice. We get his response to our requests tomorrow! Also, quick question... where did you learn about "rolling cds" etc. and where to put your savings and EFs?

Thanks again!!!

**frugalfarmwife** · 11-08-2007, 08:02 AM

Originally Posted by Studentmom

Thanks for all the advice. We get his response to our requests tomorrow! Also, quick question... where did you learn about "rolling cds" etc. and where to put your savings and EFs?

Thanks again!!!

The rolling CDs are just 6 separate 6 months CD, I use ING online banking for them, they have no minimum to start one which I LOVE. I also keep all the EF money there, the regular savings earns 4.2% right now LOADS better than regular banks.

kj