I’m ditching my debt.
I signed up for a debt management course called Financial Peace University. I realize the irony in spending a hundred dollars to be told how to get out of debt, but I have a personal guarantee from a friend who recommended the program that it would be the best hundred I ever spent and that if I didn’t get any benefit she would personally refund my money. Sounds good to me. Plus, I can take the class as many times as I want for the rest of my life.
My mom and friends have expressed skepticism, saying that they’re sure I can just find this information online and do it myself. Well yeah. Obviously I know things about budgeting and debt. I’m staying afloat. The problem is that I have no one watching me and keeping me accountable, and that’s something I personally need when it comes to money. I need a buddy. This class is going to help me.
The local class starts September 16 but I am not wasting any time trying to get my finances under control. I crunched some numbers and found that my biggest pitfall – no surprise – is food purchases. I spend entirely too much on groceries and I eat out more than I can really afford to do so. I know that the program uses a cash system, using cash instead of cards because people spend less when they have to buy with cash! So, to start September off on this idea of using cash instead of cards, I will be taking $150 CASH out of the bank for two weeks in the end of August, to give me the entirety of September’s grocery budget. My other biggest pitfall is not planning my money carefully. All of my bills come due in the first 15 days of the month. Naturally, those first two weeks are pretty tight. When low on cash, I’ll transfer money out of savings (bad!) and then forget to put it back in (worse!), enabling me to spend more money LATER on crap I don’t need (Chipotle!). So my savings is super low and disappoints me every time I look at my account balance. NO MORE.
I’m paying future-me NOW (like it’s a bill that MUST be paid) so she can buy some groceries LATER. I am very optimistic about this system. I think the cash will help a lot. In college, I budgeted my cash using envelopes, and I was able to save up $1200 in a short amount of time. Working 8 hours per week. I can totally rock this!
My grocery budget is $300 a month, which is more than average but we all know I am very persnickety when it comes to food. I have allotted $100 for meat and eggs (assuming 8 dozen eggs, 2 steaks, 2 pounds of ground beef, 3 pounds of bacon, and two whole chickens). Another $100 for fruit and vegetables. The third $100 for nuts, fats, grains, and “other” or overflow spending (like if I want to get salmon, which isn’t in the standard meat budget). My goal is to spend not a penny over $300 for the month’s groceries ($75-80 per week). My hope is to spend around only $200 (about $50 a week), by using coupons and strategic meal planning. (And probably buying less meat than that, I just estimated big). I will be paying close attention to the grocery budget for September to see what I can realistically budget. I know that $300 is a very liberal budget for a single person (with a cat). It should also be noted that the grocery budget includes cat food, cat litter, and non-food things like toilet paper.
I also figured that if I do six hours per week freelancing and apply that income to debt repayment, I can afford to pay off my smallest student loan (which is loan B, if you’ve been following along since I paid off the first smallest loan in my “snowball” plan) in ONE YEAR. One year! Not four! ONE!
The average family participating in Financial Peace University pays off $5,300 in debt and saves $2,700…
in the first ninety days of the program.
Being single and not a “family” I am sure those numbers will be different for me, but I am very optimistic about this program’s ability to help me wade through the chaos of debt management.
I’ll be updating weekly about the classes once they start. I hope you’re ready to learn a lot about money. I know I am, and I hope to impart wisdom to my readers experiencing the same things!
Have you ever used FPU, read Dave Ramsey’s books, or done another debt program? Tell me all about it, I want to know everything!