Dumping Debt: The Sacred Money

Last week you all got a glimpse into the situation my family found ourselves in as we went through the Recession. My hope was that it would give anyone struggling the chance to say, “Whoa, maybe we aren’t that bad off” or, if you are, that you can see you’ll be all right.  It’s tough, but there is a way out.

We talked about wanting to change…more than anything.

When you finally have the fire in your gut to change your future, it launches you into another atmosphere.

So you’ve committed to changing your life.  Now what?

The first step we took was out of Dave Ramsey’s playbook….we threw an emergency fund together of $1000.

You do this as fast as possible.  You sell items (more on that next week).  You work another job.  You don’t buy clothes that month.  Whatever.

I’ve heard people call this “Oh  #!@$*! money.  When the thousand dollars are in you fund, you start throwing all the other extra money that comes along at your debt, tackling the smallest amount first.  The $1000 dollars gives you a buffer between you and your credit card.  You don’t touch your credit card.  When the car needs new tires, or an unexpected expense comes,  you can dip into your fund.  Then you stop paying down your debt, you build up the emergency fund to $1000 dollars again, and keep going.

I hadn’t started my business at the time we started our journey.  Dave was  unemployed self-employed, and it was crucial to have this money. It still is. There are so many times that checks just don’t come in when you expect them.

There was an area where we deviated from the Dave Ramsey plan:  we didn’t do cash….the envelopes or the emergency fund. We tried it the first month, but I found it to be more of a hassle than it was worth.  Seeing the numbers come off of our checkbook was enough for me.  However, I would say try it.  It might be what you need (go here to find out more).

There was also something else that happened I would like to share. It changed my perspective even more.

It had been a few years since we hit rock bottom.  We had eliminated a lot of our debt.  It was that “slog” time, where it seems like we’d been budgeting and chipping away at the debt  forever.

Then my dear, sweet Grandmother passed away.

{Grandma on her farm in Afton}

If ever there was a rock of a lady, it was her. She lived an exemplary life of courage, unwavering devotion, and quiet strength.  She had been a widow since 1989, and she had enough time before she passed to get her affairs in order.  I’m amazed at how all 14 of her children have worked to keep her dreams alive.  Even after she passed, they kept working on her wishes for her estate.

One of those wishes was to leave each of her grandchildren with some money.  It wasn’t much, but when my mother handed me the fat little envelope filled with different kinds of dollar bills, I suddenly felt like I was holding something very sacred.

A woman had spent her life saving those dollar bills, some in shoe boxes and others in drawers, for me.  For all 96 of her grandchildren!

We used that as our emergency fund the rest of the time up until this point.  It was so sacred to me, I think it spurred even more motivation and the feeling that I could do as she did….make a difference for my future and family.

At the end of our life, we can say that that money was what started the path to my children finishing college and working to stay/become debt free themselves.  We’ll explain what a legacy a small, white haired woman left for them.

So this is my challenge to you:  don’t just put an emergency fund together.  Consecrate your effort by naming it something special….”for so-and-so’s college fund”, “for being able to help such-and-such”.  You get the idea.

You might be looking up at the huge mountain in front of you, wondering how to begin.  This is your first step, and it’s for a cause that’s worth all of that climbing.  You’ll see the summit soon enough.

Now over to you.  What would/will you dedicate your emergency fund for?  Why is this journey so important to you?