And so it begins

*disclaimer: This post has actual fund amounts from my actual financial accounts. If the thought of personal information on the internet makes you queasy, you should probably just skip this post. If however, you are a bit of a financial voyeur and would like to see just how terribly I mismanage my money, enjoy!

I have started my part one of my Total Money Makeover (TMM) with Dave Ramsey. He says to cut up your credit cards right away. I will probably cut up my Store credit card because that is the one where the most money slips away anonymously (say goodbye to that 5% discount!). My Bank credit card, however, I will freeze in a block of ice (thanks to Mom for the idea).

Okay, I am going to be honest, the first thing that Ramsey says to do is establish a monthly budget. I kind of have one already on Mint.com but it's not super specific. It's kind of just a guideline. I am going to refine it tonight on paper.

The second thing to do is get caught up on all your late payments. I thankfully do not have any (but probably came closer this month than I'd like to admit).

Then you save a $1000 emergency fund. Done. I have more than that saved, so kudos to me I guess.

Next you pay off all of your debt. Umm, okay, so when I first decided to read this book I thought, "I don't have any debt so I will just work on the budgeting part." Well, I decided to actually use the debt snowball chart and guess what.... I owe more money to more parties than I thought!

Here is the breakdown:

$20.00 to Dad for May texting charge
$60.00 to Auto Insurance
$68.09 to Electricity bill
$150.00 to voice instructor (Ruth Ellis, she is fabulous, you can Google her if you are in the market!)
$227.19 $317.17 $342.17 to Store credit card
$913.08 to Bank credit card

And yes that is all just one month! Keep in mind I am one single person renting a townhouse with two roommates. AND I already paid my Bank credit card bill once this month. I should not owe $1553.34 to anyone.

Now. How do I pay off all my debts when all I have in my checking account is $208.62? I use my non-retirement savings except for the $1000 emergency fund.

Sooo... I just transferred everything over to my checking account. After I pay off my debts I will have $238.72 left in real cash (again, excluding retirement and the emergency cash). Plus the change in my piggy bank.

Kind of depressing. But hey, payday is in a week and I won't have to worry about how long to put off paying the next credit card bill because it will already be paid and down to $0. I will, instead, look at my very specific budget and pay the excess funds back to my savings until I have those six months expenses covered.

Then it's time to save for a house! :-)