Ashley's Tip of the Day?

Ok, I must also apologize. Working, cooking, cleaning, buying a house, and planning a wedding is no excuse for not blogging. I think I’m better at the Facebook thing, because most of my wisdom comes better in small doses!

So, I’m putting the task of coming up with tips to YOU! Yes, dear werenothere fans, it’s time for you to share your tips! What’s in it for you? Well, for every tip that we get from now until we close on our house, we will plant a tree. Leave a tip (or two or a hundred) in the comment section or email us and we will post them on the main blog.

There are no rules for the type of tip, but keep it family-friendly. Just think of something that you do to make your life easier. It could be a great recipe, a better mousetrap, a coupon code. We're not here and we're not picky!

So in advance, thank you for your assistance!  Email your tips to dave@davesnothereman.net or ashley@davesnothereman.net.  We'll be looking forward to them.  

Ashley's Tip of the Day

Today's tip is not mine. My honey washed my car for me and it looked so good, I want to copy and paste and go riding in my lovely Infiniti (her name is Harper!)

So straight from citydata.com and a post by a member who also knows how to copy and paste: Mr. Cat in Triangle, VA.

How does road salt destroy cars?
Although road salt is necessary for safe transportation when snow and ice accumulate on roads and highways, taking active steps to protect your car from road salt is necessary to avoid rust and corrosion and general loss of your investment.

History

Salt was first used in snow and ice control in the 1930's to make roads safe and passable by creating a lower water freezing temperature. Salt is the most available and cost-effective de-icer and is easy to store, handle, and apply.

Car Washing

When salt is on the road, washing your car is the major factor in combating corrosion and maintaining the value of your car. Salt that remains on a vehicle surface and undercarriage for any length of time can;

• damage your car's clear finish.
• promote rust.
• affect the mechanics of your vehicle.

Preventing Salt Damage

• Wash your vehicle every 10 days or less.
• Wash your vehicle whenever the temperature reaches 40 degrees F. or higher.
• Wash your vehicle during the day to allow it to dry completely before freezing evening temperatures begin.
• Immediately after washing the vehicle, open and close all doors, the trunk, and other parts of the car with locks several times before parking it to prevent locks from freezing.

Snow and sleet contain corrosive road salt and rain and snow collect pollutants in the air and drop them as acid rain which can damage the cars protective finish.

• Wash your vehicle as soon as possible after a snow or rain shower.
• Wash the underside of your car often during the winter months in a car wash that does not use recycled water.
• Avoid driving through large puddles of standing water where road salt collects.
• Repair paint chips that are larger than the tip of a pen to avoid corrosion.
• Wax your vehicle every six months or less to give your vehicle a strong protective coating.
• Wax your vehicle before winter to protect your paint from corrosive salt.

Vehicles are one of the biggest investments we make in our lifetimes and protecting them from the ravages of the environment, such as salt and rust is important. Certain vehicle problems are inevitable, but rust from road salt is one that can be prevented.

Some of the areas of vehicles that are most affected by rust are body panels including doors, fenders, the hood, and tailgate. The reason for this is that they inherently have areas that retain moisture. Depending upon the model of vehicle, there are many other areas that can retain moisture as well. Certain cars retain more moisture just due to the way they are designed, so you have to be especially careful and vigilant with them. Some factors that you have no control over include the environment in which you live. If you live in a coastal area you are exposed to more salt air for example. If you live in an area where there is snow and ice on the road, the authorities usually use salt on the roads which can result in rust on your car's undercarriage.

Rust prevention tips to help prevent rust formation on your vehicle:

1. Keep your car clean and coated with a finish protectant at all times.
2. Keep the underneath of your car rinsed continually when you are in an area where a lot of salt is present as mentioned above.
3. Keep your tires and wheels clean and polished and free from moisture holding material like leaves.
4. Make sure any drainage holes in the frame, floor, and the bottoms of the doors so that any moisture can get out.
5. Always open your doors after washing your car to allow any accumulated water to drain out.

Ashley's Tip of the Day

I certainly hope you're not reading this because you want more opinions on who the new coach should be. Because I'll vote for my niece every time! She'd have to drop out of High School to do it, but at least she'd whip those football playing pansies into shape!

No, Ashley's Tip of the Day's and her posts in general are usually football free. I'll leave the sports, TV shows, and video game posts to the boys and focus on the less important things in life. Like money and food!

Today's tip is going to be "share an experience" tip. As you may or may not know, Dave and I are scheduled to be married in the near-future. We have gone back and forth on "when and where". But we finally narrowed the reception to a local restaurant that is located in a hotel that we are staying in for the first leg of our honeymoon. This particular Popsicle stand is listed with restaurant.com. Right now, if you go to their website and enter the code INDULGE, you can save 80%. We got a $100 "coupon" for $8.

What's the catch? Well, it has to be used on a $200 purchase and 18% is added.

BUT....

We will easily spend $200 on that day and this deal gets us $92 off our dinners!!!

Do you have to buy a $100 GC? No, you can get a $25 GC for $2 with the same code. There are different restrictions (I bet it's a $35 minimum and 18% gratuity) but it's a great deal right now, if you have to eat out!

Ashley's Tip of the Day

tips for the best deals & steals


The treasure hunt
Shopping off-price is a treasure hunt - try not to limit the experience by being too specific. Sometimes we get great deals on items that we didn't know we *needed* until we find it! If you go looking for a specific item, you may not find it. Keep an open mind and your flexibility will pay off.

Shop often
The number one way to discover the best deals is to come often. At most stores, there’s always something new.

Early bird catches the deal
Stores get busier as the day goes on so shop as close to opening time as possible to avoid “competition.”

SNATCH IT UP
If you see something you like, buy it. More than likely, it won’t be there when you come back.

Buddy system
Bring a friend. Another set of eyes increases your chance to spot a bargain.

Going, going, gone
Shop clearance sections for even bigger savings.

Tip: it's actually easy to remove those seemingly permanent price tags off a picture frame, vase, etc. Rubbing alcohol, nail polish remover, mineral spirits (a solvent available at hardware stores) or Goo Gone® easily do the trick.

Ashley's Tip of the Day!

Baby steps 1-6 are all about getting your financial house in order, paying off debt, and then planning for the future. Step 7 looks at what Dave Ramsey likes to call the "Great Misunderstanding". The misunderstanding, in Ramsey's eyes, is the mistaken belief that many people hold that the way to have more, is to hold on tightly to what they have. In reality, it doesn't work that way, generous people tend to be more prosperous. The reason? Giving to others makes you less selfish, and less selfish people have more of a tendency to do better in both relationships and in wealth building.

He gives an example to think about the concept – if you take your money, and close your fist around it, you have that money and it's not going to get away. On the other hand, you can't receive more money in your hand either, it's closed up tight. When you freely give with an open hand, however, your hand is already open and is ready to receive blessings as well as give.

The idea of holding money with an open hand might seem to violate common sense. We feel that if we don't hold on tightly to our money and our relationships, they will lip away. I'm not saying literally hold your money with an open hand – it represents our attitude toward money. When you give, you open yourself up. You allow the dollars to leave and the freedom to enter.

Giving works because it is in your personal blueprint to be a giver, and you unleash good things in your life that you will never see until you learn the art of unselfish giving. Giving lifts us out of ourselves; we take our eyes off our rights, our problems, and our stuff. The new view gives us renewed vision and hope. Giving is powerful. – Dave Ramsey

So once you've reached the point where you have all your debts paid, and you're blessed enough to be building surplus wealth, do yourself a favor, and start giving to others. You'll be surprised at how freeing and wonderful it can be! Not only will you be giving blessings to others, but you'll be receiving blessings in return (and not always in a monetary sense).

There are men who gain from their wealth only the fear of losing it. –
Antoine Riverolli

Surplus wealth is a sacred trust to be managed for the good of others. –
Andrew Carnegie

When you talk about giving, there are a lot of good reasons why we should do it.
Here are a few:

* As a Christian, I believe that everything is God's, and as a result, we
are only stewards of everything we have. Psalm 24:1 says "The earth is the
Lord's, and the fullness thereof". We need to be good managers of what we've
been given, using it for the good of others. The fact that that the money is
someone else's (God) make's it easier to give away too, doesn't it?
* Giving makes us less selfish people. Giving makes us more Christ-like.
* We are designed in God's image, and because of that we are happiest when we are serving and giving. Ever notice how fulfilling it is to serve others?
* Giving can be praise and worship in which we show our gratitude to God for everything he has given us.

When you're giving, you don't always have to wait until your financially secure because giving doesn't have to be related to money. There are a lot of ways you can give of yourself and your time that are just as valuable. Here are some ways that you can give, both with money, and without!

* Help a single mother buy groceries or pay a couple of bills.
* Volunteer time at your church serving others.
* Give an extra large tip to a waiter or waitress.
* Spend time with people at a local nursing home, talking and listening to them, playing music for them or just playing games with them.
* Pay for someone's meal behind you in line at the fast food restaurant.
* Serve meals at a local food shelf, and eat with them when you're done serving.
* Give to a local charity.

Those are just a few ways you can help. Your own giving is only limited by your creativity. So get started!

Ashley's Tip of the Day!

After having saved for your retirement and putting money away for your children's college expenses, the next thing Dave Ramsey suggest doing is paying extra on your mortgage, and paying off the home early.

To start with, Ramsey suggests getting no more than a 15 year fixed rate mortgage, that is no more than 25% of your income. If you don't already have a 15 year fixed mortgage, now may be a good time to refinance your home. A 15 year mortgage may mean higher payments, but it also means you'll be paying the loan off earlier, and you'll be paying less in interest. Pay it quicker that 15 years, and you'll save even more because most of the interest is paid at the front end of the loan period.

By paying off the mortgage early you're also going to be giving yourself a huge peace of mind knowing that your house is paid off, and if the worst happens, you'll be able to get by on a whole lot less. After all, the house is paid for!

There are a lot of arguments surrounding this baby step, and whether it really is the best thing to do psychologically and financially.
Points in favor of paying off the mortgage early:

* Interest Savings: You'll be saving thousands of d0llars in interest payments on the mortgage. For example, on a 200,000 dollar mortgage over 30 years, with an interest rate of 6%, you'll end up paying over $250,000 in interest. Cut that to a 15 year mortgage and you're only paying $115,000 in interest. The faster you can pay the mortgage up front (when you're paying the most interest), the less interest you'll pay!
* Less Risk: By prepaying your mortgage you'll have less risk in your life because you'll have a paid off house. When you have a paid off house you have a lot less to worry about because you know you'll at least have a place to live as long as you cover the few bills you have left. Plus, trying to beat the the benefit of pre-paying the house by investing the extra money instead means added risk because investing isn't a sure thing.
* Peace Of Mind: Having a paid off house means having peace of mind. I don't think the importance of that can be underestimated. Having debt of any kind can really be a extra weight on your shoulders, and it can weigh you down. Don't underestimate the psychology of personal finance, and that burden is very real. Remove it and you will feel a lot more free to save, invest, build wealth and give!
* Less Stress: You'll have less stress when having to deal with a job change, or wanting to have a spouse stay home to raise the children. Because you have a paid off house you'll only have a few small bills to worry about. You'll have walkaway power – power to walk away from any job you don't love or enjoy because you only have minimal expenses!
* It's Like Getting A Raise: Without having to pay that large bill every month, it's like getting an instant raise! You can take the extra money every month -and start investing!

Take someone who is in his mid-thirties and paid his mortgage off completely. This allowed his wife to quit work and stay at home to raise their three children. They have no other debts, and he recently took a lower paying job because it brought him more satisfaction at the end of the day. He wasn't trapped by an enormous mortgage, or saddled with other debt. Being debt free allowed his family to make these decisions to live the life they want to live, not live the life they are force to live to just to repay debt.

Being debt free brings freedom, and sometimes that's better than a few extra dollars made through investments.
There might be a good argument against paying off the house. Some of the better ones:

* Liquidity And Flexibility: By not prepaying your mortgage and instead investing the money, you are more liquid in your holdings. Your money is more accessible if it is in investments as opposed to in a house. This can give you some flexibility if you need the extra money. Of course, having your 3-6 fully funded emergency fund should preclude needing any large amount of money right away.
* Investing Returns Could Be Higher: If your expected returns on your investments will be higher than the interest and money saved by pre-paying, investing instead of repaying may be the better choice.
* Inflation Works With You: As inflation goes up by 3-4% annually, by not prepaying you are in essence paying less for the house every year. You pay the same in 2040 to live in your house as you are in 2010. So basically you're getting more for your money as time goes on.
* Lack Of Diversification: One could argue that paying off your house first means you're investing in only one type of asset, and unnecessarily means more risk. Better to invest in good mutual fund where your holdings are diversified, instead of investing in only one thing, real estate.

Ashley's Tip of the Day!

Now that you've got you're out of debt, and saving 15% towards your future retirement, it is time to start thinking about saving up for your children's education. Remember, you don't have to go into debt for your child to go to college. Start saving for their education once you've finished baby steps 1-4! Encourage them to get good grades, and help pay for their education through grants, scholarships and other free money.

Here are a few good options of ways you can save for your child's education:

* Education Savings Account (ESA): You may save $2,000 (after tax) per year, per child that grows tax free! Beneficiary must be under 18 years old. Money must be used for education purposes only. Otherwise, a 10% penalty and taxes will apply. Money must be used or rolled over to a qualifying family member by age 30 or a 10% penalty and taxes will apply. Singles with an income over $110,000 – or Married couples with an income over $220,000 are not eligible. * 529 Plan: If you do not meet the income limits for an ESA, or if you want to save money above an ESA, you can use a certain kind of 529 plan. You can save up to $12,000 per year, per child in a 529 plan. The money must be used for higher education only. Otherwise, a 10% penalty and taxes will apply to the gains only.
* UTMA/UGMA Plans: UTMA (or UGMA) stands for Uniform Transfer (Gift) to Minors Act. According to Dave Ramsey, while this is one way to save with reduced taxes, it is not as good as the ESA or 529 plans.
While the above plans are highlighted as good ways to save for college, Dave Ramsey also lists several ways he would NEVER suggest using to fund your child's education. Be wary of these things:

* Insurance
* Savings bonds (only 5-6% growth)
* Zero-coupon bonds. (only 6-8% growth)
* Pre-paid college tuition (only 7% inflation rate)

ESAs, 529 Plans and UTMA/UGMA Plans are the way to go!
Many people will get upset at the notion of funding their children's college fund only when they've reached step 5. They think that by not funding their child's education until they have all their debt paid off or retirement funded that they're in some way being selfish or harming their child. Your kids can always help pay for their own schooling or get scholarships, grants or loans. But if you don't get rid of your debt and start saving for retirement you may never be able to catch back up, and who knows if you'll be able to rely on social security for anything in your old age. Better to get your financial house in order first, and then help where you can.

Here are a few reasons why education funding should come only after you've gotten out of debt, saved up your emergency fund and invested for retirement:

* Taking the time to make sure you are secure in your retirement first takes a burden off of your children later on.
* Being responsible in getting rid of debt and saving for retirement sets a good example for your children, helping to lead them down the right path.
* Allowing your children to take on even a part of their school costs helps build character and makes their education mean more.
* Encouraging children to get good grades and participate in helping pay for their own college will help promote responsibility.

Even if you are able to pay for your child's schooling outright, it's a good idea to have them participate in paying for their own schooling. They can do that either by saving up for college through after school jobs, getting good grades that lead to grants and scholarships, and by going to in-state schools that cost less.

Here's a quote from Dave Barry speaking to the idea of encouraging our children to succeed:

I believe that we parents must encourage our children to become educated so they can get into a good college that we cannot afford. – Dave Barry

* Realize and enforce the value of education even when the children are younger. Encourage them to succeed to help pay for their own schooling
* Encourage in-state schools, or for some technical schools (not everyone is going to be a doctor or a rocket scientist!)
* Help where you can by saving in an ESA or 529 plan, but don't give a free ride!
* Realize that going to college doesn't have to mean going into debt. Save for them, have them to save some on their own, and encourage them to succeed in school.

Ashley's Tip of the Day!

This is the step where you really start to save and build wealth for your future! You've finally paid off your debts (except the house) and built up your big emergency fund, and now it's time to save for your retirement!

Ramsey suggest saving 15% of your household income in good solid long term investments. No more (for now) and no less.

15% is usually going to be more than adequate to get you to where you need to be. 10% may not be, depending upon how much of your previous income you want to live on, and how much time you have until retirement. The longer you have until retirement, the bigger the gains you'll see through compounding interest! Play it safe and start saving 15%. You won't be sorry!

Another caveat – if you're older and have less time until retirement you may need to be investing a higher percentage than 15%. You started late, so you have some ground to make up! Starting earlier? You might not need to invest all of the 10%. But why not do it anyway!

Dave Ramsey doesn't suggest investing more that 15% because the extra money will allow you to complete the next two baby steps – paying for your kids college and paying off your home early. Stay tuned for those baby steps in upcoming posts.

Once you've decided on how much you want to invest, the next step is to decide on what types of investments you should be holding. Ramsey suggests:

If you receive a company match in your 401(k), 403(b), or TSP; invest in those plans, up to the match, first. Once your contribution equals the company match, fully fund a Roth IRA for you and your spouse. If you've maxed out your contribution to your Roth IRA and still have money to invest, invest the rest in your 401(k), 403(b), or TSP.

So the order is:

* Company 401k or other plan up to the match
* Roth IRA for you and your spouse
* Back to the 401k or other plan

In your company 401k, Roth IRA or other investment, Dave suggests allocating your investments with a good mix of mutual funds. His preferred plan is to allocate 25% to each of the following types of stocks in your funds:

* Growth
* Growth & Income
* Aggressive Growth
* International

Ashley's Tip of the Day!

Baby step 3 builds upon the baby emergency fund you established in baby step one, and takes it to the next level. In step 3 you are building a fully funded emergency fund of 3-6 months of living expenses. The reason for building up this reserve? With this reserve you're building your safety net against major life events so that you never have to go into debt again.

When you have your 3-6 months saved there aren't very many things that can happen that you can't pay cash for outright. Lose your job? You'll be able to cover the mortgage long enough for you to find a new job. Have to get unplanned surgery? Your emergency fund will cover your portion of the bill (make sure you have good health insurance!).

Emergency funds help you to get rid of the risk of unplanned for events, and prepare for the future.

Often times people think it's just a waste to build an emergency fund that is so large. It just seems to be overkill. Why not use the money for something else?

* Things Happen: Unexpected expenses WILL come up, and it's better to have planned for it than to stick your head in the sand. If you don't plan for those things they'll end up happening at the worst possible times. Your heat will go out in the middle of winter, or you'll end up in the emergency room for an unknown allergy. I've realized more and more over time that emergency funds are necessary because life happens and small unexpected expenses WILL come up. When you have the money saved these things are an annoyance, but not the end of the world.
* Manage Stress: When you have an emergency fund saved, life is a lot less stressful. You don't have to worry about what you'll do if a negative event falls in your lap. You just pay to get it fixed.
* Risk Is Reduced: When you have an emergency fund (along with other things like health insurance, disability insurance and life insurance), you have a lot less risk of having a bad situation turn into a catastrophe. A medical problem won't turn into bankruptcy, and a job loss won't turn into a foreclosure. In other words you're making sound decisions to plan for problems, before they happen. You manage the risk that comes along with those major negative events, and stop them from turning into life changers.

How Much Is Enough?

The decision of how much money to save in your emergency fund is one your family will need to talk about. The amount may vary depending upon your living situation, number of children, job stability and other factors. The baseline that Dave Ramsey speaks of is 3-6 months of expenses.

So if your family has a minimum of $3000 in expenses every month after cutting out all the unnecessary bills, your 3-6 months of expenses would come out to anywhere from $9000-$18,000.

How many months you save will be dependent on your situation.

* If you're single and have a relatively low level of needed income every month, you may be able to get by with only 3 months of expenses.
* If you're the only bread-winner bringing home an income for a family of 5, then you may want to err on the side of caution and keep a buffer of 6 months of expenses (or more).
* If you're expecting a major life event in the near future (layoffs,surgery), you may want to start stockpiling cash in advance, and save even morethan the 6 months if possible.

Where you save your emergency fund is really up to you; make sure that you put the money somewhere that you can get at it right away if you need to.

Don't put your emergency savings in things like real estate, investments or other things that could be tied up for a while without you being able to get at the money. Keep it liquid!

Ashley's Tip of the Day!

We looked at Baby Step 1, saving up an emergency fund of $1000. You're saving up that money for a variety of reasons, but mainly because you know you're going to have little "emergencies" popping up all the time, and the baby emergency fund will help keep you from going further into the hole while you're on the way to paying down debt.

Now that you've got your $1000 emergency fund saved, it's time to move on to step 2, paying off all your debts using the debt snowball. This step could easily be one of the longest in your 7 baby steps. If you're dealing with a lot of debt from school loans, car loans, credit card debt and other things you may be in baby step 2 for a couple years or more. If you only have a few small debts, you can be out of baby step 2 a bit quicker. Remember, the key here is that you are paying off your debts – because it is the right thing to do. You made those obligations, and you need to stick by them. Bankruptcy should only be entered into in a worse case scenario – and you're probably not there.

The wicked borroweth, and payeth not again: but the righteous showeth mercy, and giveth. Psalm 37:21

So how does the Debt Snowball work? First things first – if you have done your quickie budget as we talked about last time, you'll probably have a good idea of where you're now standing in relation to your income, expenses and debts. If you haven't done that yet, take the opportunity to do it now!

Once you've got all of your income, expenses and debt listed, follow these steps to get rid of your non-mortgage debt. (Mortgage debt is paid off separately in another baby step, so exclude it for now)

The Debt Snowball:

* Put all your debts in order from the smallest balance to the largest.
* After your necessities are paid, pay the minimum payments on all of your debts.
* Put any surplus money towards paying off the smallest debt first.
* Pay off your smallest debt, get a psychological boost from knowing you're one step closer to being debt free!
* Once the smallest debt is paid off you roll the money you were paying on that debt over to the next largest debt.
* Wash, rinse, repeat until all your debts are paid off!

Pretty simple, right?

Over the past few years there has been quite a bit of controversy surrounding the debt snowball. The reason? There are those that say that Dave Ramsey is bad at math and that the debt snowball isn't the best mathematical way to get out of debt. They say if you were to do it the BEST way, it would be to list your debts in order from the highest interest, to the lowest interest. Once they're in order you pay the minimums, and put any extra money towards the highest interest debt. Some have called this the debt avalanche.

Mathematically their way IS the best way to get out of debt. Dave Ramsey has even admitted that the debt snowball isn't the best mathematical way to get out of debt. But he still pushes it as the BEST way to get out of debt. The reason Ramsey believes the debt snowball is still better is because it takes into account the psychology of debt reduction.

His theory is that since you're paying the smaller debts off first you're getting a series of "quick wins" that give you that psychological boost you need in order to keep you motivated and keep you paying down your debts. The problem with paying the debts another way is that you don't get that psychological boost from the quick wins. Too often you'll end up burning out and giving up on debt reduction.

The debt snowball is more sustainable, and gives you the best chance of succeeding. You may end up paying a little bit more interest, but they've found that you're more likely to actually succeed in paying off your debts with the debt snowball.

I know there are those that will still prefer to use the debt avalanche or another similar hybrid debt repayment scheme. The important part to me is that you take control of your finances and start getting out of debt. Whether it is the debt snowball, the debt avalanche or some other method, just get started on getting out of debt. Whatever works for you!

As Dave Ramsey says, "You can't go wrong getting out of debt".

If your debt snowball is going to be effective, you need to make sure you don't go into new debt, and continue paying down the old. Here are a few ways you can do that.

1. Quit borrowing more money. No new debt!
2. Cut up credit cards, and become credit card free. I know it may feel weird at first, but it's freeing!
3. Sell stuff. You have more than you need or use, so sell it and put the money towards debt!
4. Get an extra part time job. Take side jobs and earn extra income to accelerate paying off your debts. You won't be doing these jobs forever, they can be temporary.

Get serious about paying off your debts, and take any extra money you have coming in, and put it towards your debts. You'll have them paid off in no time!

Ashley's Tip of the Day!

You need to be ready to change your lifestyle, be ready to commit to no more consumer debt, and know that people are going to think you're a little bit strange. But that's OK because being normal means you're broke!

Baby Step 1: $1,000 To Start An Emergency Fund

Once you're current with your creditors, the first of the baby steps that Ramsey talks about is to save a $1000 emergency fund. What's an emergency fund you ask? An emergency fund is your umbrella for when those rainy days come. Rainy days could include a good number of things:

* Car repair
* Emergency room visit or other unplanned medical incidents
* Unplanned travel expenses (funerals, weddings, etc)
* Job loss
* When you don't have enough for occasional expenses (like car insurance, property taxes)
Murphy's law says that "anything that can go wrong, will go wrong". Dave Ramsey likes to say that an emergency fund will help keep those "little murphies" from turning into new debt, especially while you're trying to get rid of old debt.

Ramsey quotes a statistic about unplanned expenses on his site:
Money magazine says that 78% of us will have a major negative event happen in any given 10-year period of time.

Ok, let's look at that figure again. 78%! A majority of us will have a major negative event in any given ten year period! Even if you haven't had that major negative event, I'm sure probably 100% of us have had those minor negative events pop up from time to time.

When it comes time to save up the emergency fund a lot of people wonder if $1000 will really be enough. My opinion is that it is. Most small emergencies will be covered by $1000, and only some major life events or other problems won't be covered. Some people will still opt to save up a bit more.

Figure out for your family if you think $1000 will be enough. Look at your circumstances, how many children you have, job circumstances, etc and decide on a number. Just make sure that you don't set too large a number for the baby emergency fund because you can start short-circuiting your debt reduction plan if you try to save too much.

When it comes to where you should put your emergency fund, I think it's a good idea to make sure that you're keeping it in a place where you'll be able to access it quickly.

The key here is to keep your money accessible and liquid, in case you have one of those emergencies where you need to get the money quickly.

Places I would not suggest putting your emergency funds include CDs, stocks, real estate, or other investments. Keep it somewhere you can get to it in a short period of time. The purpose of this money isn't to gain a ton of interest, but instead to insure you against unplanned events.

After deciding to change, and starting on your emergency fund, it's probably a good idea to do your first budget. John Maxwell said: "A budget is telling your money where to go, instead of wondering where it
went." That quote is so true. If you're not telling your money where to go (into an emergency fund), it will just disappear. Do a quickie budget, figure out what your income and expenses are, and then assign every surplus dollar a job.

At this point in the baby steps you should be paying the minimums on all your debts, and then saving as much money as you can towards your $1000 emergency fund.

If you need to sell things on ebay, get a second job, or sell your sacred comic book collection, just do it! Crank it out and get that $1000 saved! If you need a good template to do your first quick budget, try out the one at Dave Ramsey's site: http://www.daveramsey.com/media/pdf/fpu_qbudget.pdf

Ashley's Tip of the Day!

Today's tip of the day is better than a tip. If you haven't heard of Dave Ramsey, it's time to come out of the cave! I've known about him for at least 10-years, but I didn't get serious until about 4 years ago. Since then, I paid off all my debt, bought a house and paid cash for a lovely car a few weeks ago. We are saving about 75% of our income now. The idea is simple, but the execution is hard.

For the next week, I'm going to break down what Mr. Ramsey calls the Baby Steps. But before I even get into the 7 Baby Steps, I think it's important to start out by talking about just how key it is that you sit down, talk with your significant other and actually make the decision that you want to change. A lot of people talk about how to change, but never touch on the fact that if you or your spouse isn't ready to change, it isn't going to happen. You have to want to change.

Getting to the point where you want to change might mean that you've hit bottom or it might just mean that you're sick of not saving enough towards retirement. It's a different point for everyone. But when you
get there you'll know.

Once you've made a decision to change, you need to be able to begin the change immediately and make a decision as a family that you aren't going to incur any more consumer debt. Credit cards and home equity lines of credit are off limits now. No more high interest auto loans! If you want a new TV or new kitchen countertops, you're going to have to save for them. No more store credit cards to buy clothing at ridiculous interest rates!

Cut up your credit cards, and draw a line in the sand. No more debt!

When you're starting on the road to financial freedom you need to brace yourself and realize that it isn't always going to be easy getting out of debt and building wealth. There will be bumps along the road, and there will be times that you'll want to quit. Your family and friends may even think you're a bit odd for all the "strange things" you're doing – like not using credit cards, not incurring debts to buy nice cars or not upgrading your house. You'll seem abnormal, but that's ok. Normal is being broke. Being debt free and financially sound IS strange. So you want to be strange.

Ashley's Tip of the Day!

Since I stopped eating meat, I've been trying to cut out dairy and egg usage,
too. I found that soy flour is a great substitute for eggs in baking!!

I bought a tiny bag (24oz) at Walmart for around $3. So for the cost of 2 dozen
eggs, I have a small bag that I keep in the freezer (but it can go in the
pantry) that takes up about 4 sq inches of shelf space. You use a rounded
tablespoon of flour and 2 extra tablespoons of liquid in the recipe in place of
each egg. It should substitute about 90-eggs and stay fresh on the shelf.

The financial benefits are obvious, but the health benefits are great, too. Soy
flour have the same benefits as soy (because it is ground up soy beans!) and
even though *they* haven't decided if eggs are bad for you or not, that's one
less worry you have when you bite into a delicious vegan cake made of natural
sugar and soy flour instead of egg! You cannot taste a difference, and your
product will be just as good.

If you do a lot of baking, you can probably find it in bulk and save even more!

Ashley's Tip of the Day!

Barb asks: "do you plan your menu a week or month ahead of time or wing it?"

Well, Barb, I probably don't do things right. I go to the grocery store and wing it. I pretty much buy the same things over and over and a few "this and that" if it's a good deal. If something we usually get is on sale, then it's embarrassing how much I get! The pizzas we usually get for $5 were on sale for $3 and we got at least 10 of them, saving ourselves at least $20. Don't worry, we will eat them all eventually!

I always keep rice and a variety of beans around. Frozen vegetables. "Fast food" like frozen pizzas.

The day after I get home from the store, I use the receipt to enter what I bought into a spreadsheet. Then I separate everything into columns "Main, side, dessert". Then I start a new spreadsheet and see how many meals I can create with what I have on-hand. I date them, but I don't follow it to the letter. Life can screw up the best laid plans!

Once I have 14 meals in black and white, it's very easy to say, "Ok, what are we in the mood for tonight?".

If you're planning a meal around meat, this gets a little trickier. If you pull meat out to thaw and then don't use it, throw it in the crock pot to cook anyway. If you still don't get around to eating it, you can re-freeze it after it's cooked.

Ashley's Tip of the Day!

It's hard to believe, but tomorrow is my Mom's birthday. Yes, she gets "the shaft" with a lot of "this is for Christmas AND your birthday" presents. But it's always nice to be able to buy her a gift for 50-75% off!

This is the time of year to finish your Christmas shopping and holiday decoration buying. That roll of wrapping paper that you bought on December 23rd last year for $4/roll is now on sale for $1/roll. Don't you feel silly now? Buy all the chocolate Santas you want to. Then put them in the freezer, because I don't care how cheap they were, you can't blow your New Year's Resolutions on chocolate Santas. But some time between now and the day after Valentine's Day (when you stock up on chocolate hearts), when you want to bite someone's head off, make it Mr. Frozen St. Nick. Or use him in recipes. Either way, he's still yummy.
Repeat on February 15 and April 5.

Don't try to gift chocolate that has been frozen for a year. It has a funny color and everyone will know what a cheap-o we've turned you into.

Ashley's Tip of the Day!

Buy a giant jar of spaghetti sauce. I get the huge (HUGE) jug of Prego for $1/lb and store it in the fridge. I use it for spaghetti (duh) and to make home-made pizzas. It's also handy for a dipping sauce. It stays good in the refrigerator for a long time but it can also be frozen and thawed as necessary.

Ashley's Tip of the Day-Lotion

I'm going to try and start doing a tip a day on the blog so here's my first one. An alternative to lotion that most every kitchen has.

Last night, I thought I'd scratch my legs until the skin came off! My skin was dry. D-R-Y dry. In desperation, I slathered olive oil on my legs and they immediately calmed down and didn't itch again! After my shower this morning, they were still soft and so far so good! I think I'm going to find a small bottle to keep olive oil in by the bathroom. Such a great product for skin!