Putting Dave's plan on hold.

**lovestolaugh** · 01-30-2009, 04:14 PM

We have a lot of credit card debit and 2 mortgages. We have diligently been paying our debt down over the last 2 years. We have followed Dave Ramsey's plan to this point and it has been working! However, with the state of the economy and the constant fear of layoff I have decided to put Dave's plan on hold for awhile and throw everything I can into savings. We have our $1000 EF only. I got to thinking that if worse came to worse and we had to walk away from our house and debt and live with family, (This being a very very long shot, but still...) having cash would be the most important thing. When you get down to it, the only things you need are shelter, food and clothing. If we had to, we could survive along time this way. I have family that are having to move in with parents because of job layoffs. Who really cares about your "credit rating" if you can't put food on the table? I know I will feel safer with more in the bank and stuffed under my mattress!!

Anyone else doing this?

**Persimmon Lace** · 01-30-2009, 04:18 PM

Dave's plan always allows for stormclouds so you really aren't putting his plan on hold, you're just putting your snowball on hold! I think this is a wise thing to do.

**MomToTwoBoys** · 01-30-2009, 04:55 PM

You have to remember that a lot of employers, rental agencies, etc look at your credit rating. While it's a double-edged sword, a credit rating is going to be a deciding factor in whether someone wants to hire you or someone who has a more pristine rating.

By the sounds of it, it might work for you. Good luck!

**Wendy99** · 01-30-2009, 05:21 PM

In times like this everyone needs to do what makes them comfortable ... if you and your family feel secure doing that, then thats the right thing

I can understand your reasoning and it makes sense to me. Food on the table is very important !

**pinetree** · 01-30-2009, 06:38 PM

I started stashing money awhile back, just paying an extra $10 on the bills. It made more sense to me to have some back up money to have if I needed it.

After things settle down you can start snowballing again.

**frugalbabe** · 01-30-2009, 07:44 PM

No, we still feel getting rid of our debt is our priority right now. That being said I have $2,000 in our EF instead of the recommended $1,000 an I am still adding to that very slowly but right now the debt is getting the majority of our money. But in our case dh's job is pretty secure (nothing is 100% I know) and we do have a funded 401K and all of that but for me I feel if I stop my intensity I will never get it back and end up in the same stupid boat so for us right now the best thing is to keep our eyes on the goal of getting that last debt gone.

**rowdy35** · 01-30-2009, 10:34 PM

i understand your concerns. I have an EF of 5 K. it could get wiped in a heartbeat if something unexpected happened. you have to do whatever is gonna make you sleep better at night. good luck to you and hopefully you won't need that extra cushion, but it is nice to have.

**Debbie-cat** · 01-30-2009, 10:37 PM

I agree with rowdy. Do what is going to help you sleep at night. The economy is worrying everyone and we need to have a cushion to fall back on. Good luck!

**mikandmari** · 01-30-2009, 11:20 PM

I had this exact same feeling a few months ago... when the bloodbath of layoffs started. I had been snowballing for 2 years (off & on!) but now I'm working on paying ahead the installment loans: the car payment and mortgage. If we have to drop to one income, at least we'll be paid up a few months on the big stuff! I also have an EF, but I need to beef that up a little too.

I figure, saving---paying down debt---paying ahead bills---spending as little as possible.... it's all good, right? We're still doing the right thing and in the long run, it will show!

**Ilovesewing** · 01-31-2009, 08:56 PM

Well, I disagree with not worrying about your credit rating. Too many companies check it - think employers, insurance companies etc - to not worry about it. That said, we are doing exactly the same thing and throwing all our extra money in savings. If one or both of us gets laid off then not having any savings isn't going to do a thing for us whether we have debt or not! So yes, we are doing the same as you

**elphie** · 01-31-2009, 10:58 PM

As long as you are still making your minimum payments on time I think this is a good idea until you get your EF where you want it. I would suggest a target amount for when you will start paying extra on the debt again. For example, perhaps when you get to 2k you will then put 1/2 of extra income in EF and 1/2 toward debt- or something like that.

**kaurand554** · 02-01-2009, 01:38 AM

I agree everyone has to do what makes them sleep comfortably at night.

As for comments on credit ratings; I think this will become almost a non-issue with the current economic down turn being so wide spread. Mind you, in no way am I suggesting you not pay minimum amounts to the credit card (provided you can keep a roof over your head, food on the table, and transportation to your employment or to look for it), but based on the past few years of credit card companies over extending credit, predatory lending etc. It will become hard to find many credit histories that have not been affected by this crisis.

Obama was in the news today relative to bank lending to consumers and business owners. I wonder if he will initiate another form of guidelines... major bills paid on time, etc. as opposed to score?

Time will tell.