Total Money Makeover

[MEM]

PALibraries are not so good. They only had one book, the old Financial Peace. I like to keep and reread so I wanted to buy. ALso, I didn't know about the free shipping over $25 for Amazon. Thanks all!

I hope you are not making a blanket statement about Pennsylvania libraries state-wide, but in your part of the state only? I am a native of Western PA and I know there are networks like einetwork that link 80 libraries in Western PA alone. I certainly understand the desire to re-read but I tend to borrow first and then decide if I should buy.

 

[RichNKatHolly]

Just remember with Amazon, you have to click the super saver shipping option when checking out.

I had a revalation! Read the book through step 3. We don't have debt, but no savings and we do contribute to my DHs 401K. Next month we will start on the road to the $1000 in emergency fund and then toward putting 3 months income aside in the fund.

If I cancelled my upcoming trip to Disney we would be all the way through Step 3. I just can't get myself to do it though. I'm not looking for opinions on what you think I should do, because I'm just not cancelling and upsetting the kids or myself, BUT, how do you guys deal with decisions like that once you start the plan?

I know that shortly after we return from vacation we will have the $$ to complete up to Step 3 anyway (tax refund in Feb will cover the 3 mos. income). Just feeling a little guilty now since I've been reading the book. Feel like I want to do it all NOW!

Don't get me wrong, the vacation is fully paid for and it hasn't "hurt" us, but was just thinking about it lately. Is this plan going to make me a super cheapy??

 

[C.Ann]

Is this plan going to make me a super cheapy??

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No.. It will put you in a position where you can pay cash for the things you choose to buy/do without worrying that some major catastrophe will come along that will leave you unable to pay off those credit cards that everyone insists they will "always" be able to pay off before the end of the month..

What it will "buy" you is total peace of mind and the ability to go to sleep EVERY night knowing that you don't owe ANYONE anything - not even for "30 days"..

 

[DMRick]

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No.. It will put you in a position where you can pay cash for the things you choose to buy/do without worrying that some major catastrophe will come along that will leave you unable to pay off those credit cards that everyone insists they will "always" be able to pay off before the end of the month..

What it will "buy" you is total peace of mind and the ability to go to sleep EVERY night knowing that you don't owe ANYONE anything - not even for "30 days"..

Keep in mind, that for some, the peace of mind comes by knowing if you buy something and there is something wrong with it, you have the backing of your credit card. That means a lot to me, and it gives me the same ability to sleep every night, knowing I'm protected.
I will continue to insist that I will "always" be able to pay off the credit card at the end of the month. I've been doing it for almost 40 years.
It may not work for you, but many of us have the control and desire to put aside spent money and do that..while enjoying the many perks a credit card can give you. If you don't have that control, or are afraid you will spend too much, than by all means go all cash. Of course you lose some great protection.

By the way, I thought of you all while in DC. We ate in the hotel restaurant, and it was late when we finished. The only way we could pay by cash, was if the various waiters and bus boys could come up with change (they couldn't). The cash draw had been emptied a couple hours before (which I thought was stupid..but they said everyone charges it to the room..which I didn't want to do) LOL. We could have charged it to our room (again, I didn't want to), but to do that you had to have a charge card on file, which wouldn't work for those who pay cash. We just used our CC..heck I wanted the extra 5% back anyway LOL.

 

[C.Ann]

Keep in mind, that for some, the peace of mind comes by knowing if you buy something and there is something wrong with it, you have the backing of your credit card. That means a lot to me, and it gives me the same ability to sleep every night, knowing I'm protected.
I will continue to insist that I will "always" be able to pay off the credit card at the end of the month. I've been doing it for almost 40 years.
It may not work for you, but many of us have the control and desire to put aside spent money and do that..while enjoying the many perks a credit card can give you. If you don't have that control, or are afraid you will spend too much, than by all means go all cash. Of course you lose some great protection.

By the way, I thought of you all while in DC. We ate in the hotel restaurant, and it was late when we finished. The only way we could pay by cash, was if the various waiters and bus boys could come up with change (they couldn't). The cash draw had been emptied a couple hours before (which I thought was stupid..but they said everyone charges it to the room..which I didn't want to do) LOL. We could have charged it to our room (again, I didn't want to), but to do that you had to have a charge card on file, which wouldn't work for those who pay cash. We just used our CC..heck I wanted the extra 5% back anyway LOL.

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You forget that the majority of the posters here are not in the same age group as you are.. They don't have a fully funded retirement fund to fall back on; pension checks to fall back on; 40 years of saving to fall back on.. These are mostly 30-somethings (or younger), so your particular situation doesn't necessarily apply..

As for the restaurant situation, I'm sure a Visa debit card would have worked fine.. I've never had one turned down yet..

 

[RichNKatHolly]

Yes, the debit card would have done it. We use the debit to check in at hotels, etc. You can use it to rent a car too - not in NY though. We do have one CC that we keep for car rental but everytime they try to up my limit I give them a call and say "no thanks, please keep it at $xxx." When we do use that we pay it off at once.

Thanks C.Ann for the info. I was joking about the super cheapy part, I just could not believe that I of all people would consider cancelling my vacation!!! Of course, I will not do that since it is paid in full (and yes, I did use cash from my debit card) BUT my opinion of money has changed. Reading the book (mind you I didn't even finish it yet) has put me on the fast track. I want my 3 mos. living expenses in an emergency fund yesterday.

I am glad I purchased the book instead of lending from the library, because I know that a few days or weeks from now the feeling will fade, I'll see that nice pocket book or jacket, etc. and I will need some motivation.

I do agree, that this thread has alot of people that really should not have a CC. It would defeat the purpose of trying to get ahead and not fall back on old ways.

 

[arminnie]

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As for the restaurant situation, I'm sure a Visa debit card would have worked fine.. I've never had one turned down yet..

I don't know how expensive that meal was but most Visa debit cards do have a daily maximum. I couldn't buy a tv once with my Visa debit because it was over the daily limit.

My ATM/Visa debit card had a $300 maximum withdrawal on it until it was recently raised to $500. I'm not sure what the max is now for Visa debit purchases - I never use mine except at Sam's.

It doesn't matter how much money you have in your checking account if there is a daily limit the bank is not going to approve a transaction bigger than that.

 

[C.Ann]

I don't know how expensive that meal was but most Visa debit cards do have a daily maximum. I couldn't buy a tv once with my Visa debit because it was over the daily limit.

My ATM/Visa debit card had a $300 maximum withdrawal on it until it was recently raised to $500. I'm not sure what the max is now for Visa debit purchases - I never use mine except at Sam's.

It doesn't matter how much money you have in your checking account if there is a daily limit the bank is not going to approve a transaction bigger than that.

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LOL.. First of all, I wouldn't be eating a dinner that was so costly that a debit card wouldn't be sufficient to cover it.. That's just a waste of money as far as I'm concerned..

Not sure what your particular limits are, but I have used my debit cards (have 3 different kinds) for purchases well over $800 in one day - and of course when I'm traveling, I also carry travelers checks and cash..

Do people really spend $300 on dinner? I'm so glad I live a simple lifestyle..

 

[TNKBELL]

Just remember with Amazon, you have to click the super saver shipping option when checking out.

I had a revalation! Read the book through step 3. We don't have debt, but no savings and we do contribute to my DHs 401K. Next month we will start on the road to the $1000 in emergency fund and then toward putting 3 months income aside in the fund.

If I cancelled my upcoming trip to Disney we would be all the way through Step 3. I just can't get myself to do it though. I'm not looking for opinions on what you think I should do, because I'm just not cancelling and upsetting the kids or myself, BUT, how do you guys deal with decisions like that once you start the plan?

I know that shortly after we return from vacation we will have the $$ to complete up to Step 3 anyway (tax refund in Feb will cover the 3 mos. income). Just feeling a little guilty now since I've been reading the book. Feel like I want to do it all NOW!

Don't get me wrong, the vacation is fully paid for and it hasn't "hurt" us, but was just thinking about it lately. Is this plan going to make me a super cheapy??

I have never had so many 2nd thoughts about cancelling a vacation! And now with gas prices and looming thoughts of hurricanes dancing in my head!! As crazy as it sounds, as much as it would be hard disappointing the kids, I would be devasted if we had to cancel!! I have been planning for months and it would be a great let down if we cancelled!! Dh & I both decided that we have that money set aside specifically for this vacation and we deserve a vacation. Sometimes I feel selfish for being this "attached" to the idea of a vacation. You are ahead of me on your steps, if that helps, our tax refund will pay off our last credit card and then we need to start saving for our 3-6 months income savings, which will probably take 2.5 years!! Anyone have anything to say about cancelling or not cancelling a vacation? Pros and Cons??

 

[arminnie]

I am glad I purchased the book instead of lending from the library, because I know that a few days or weeks from now the feeling will fade, I'll see that nice pocket book or jacket, etc. and I will need some motivation.

I have the three Tightwad Gazette books and love to get them out and re-read them. They are a little out of date because of computers and the internet, but still lots of good ideas and more importantly motivation.

I still haven't figured out if the Dave Ramsey books would be worth it to me. I am also one of those older DISers without debt and with liquid funds and retirement assets. I just don't like to spend any money that I don't have to. I'm cheap which is why I'm not in debt and have savings.

 

[RichNKatHolly]

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LOL.. First of all, I wouldn't be eating a dinner that was so costly that a debit card wouldn't be sufficient to cover it.. That's just a waste of money as far as I'm concerned..

Not sure what your particular limits are, but I have used my debit cards (have 3 different kinds) for purchases well over $800 in one day - and of course when I'm traveling, I also carry travelers checks and cash..

Do people really spend $300 on dinner? I'm so glad I live a simple lifestyle..

I just had this problem when I booked our vacation. I tried to put through $2500 but it was denied. I called my bank and was told my daily limit is $2000. I could write a letter to them asking for it to be raised to whatever amount I desire. I just had the TA put through $1500 one day and $1000 the next. Worked out fine.

Oh, and the limit is only for signing transactions. We have unlimited PIN transactions, and a $500 cash withdrawl limit. So far, it has worked for us. I'm sure if some situation occurred I could call customer service and have something worked out. It is, after all, your money and you should have access to it!

As for dinners, my most expensive neared $200 but that was many years ago when DH and I were a double income, no kids type of family. Boy, how times have changed!!!

 

[RichNKatHolly]

I have never had so many 2nd thoughts about cancelling a vacation! And now with gas prices and looming thoughts of hurricanes dancing in my head!! As crazy as it sounds, as much as it would be hard disappointing the kids, I would be devasted if we had to cancel!! I have been planning for months and it would be a great let down if we cancelled!! Dh & I both decided that we have that money set aside specifically for this vacation and we deserve a vacation. Sometimes I feel selfish for being this "attached" to the idea of a vacation. You are ahead of me on your steps, if that helps, our tax refund will pay off our last credit card and then we need to start saving for our 3-6 months income savings, which will probably take 2.5 years!! Anyone have anything to say about cancelling or not cancelling a vacation? Pros and Cons??

ARminnie - Hey, I look back now and WISH I was this cheap years ago. Then I wouldn't need Dave Ramsey and he wouldn't have $13 of my money!

TNKBELL - so long as you are not causing financial hardship elsewhere I see no problem with going forward with your vacation. I was just thinking, wow, if I cancelled my vacation I'd have $5000. BUT, we have been planning for months and the kids and my sister are so excited. I do love to travel, but this will be our last Expensive trip. We will go full steam ahead with getting that $7000 in the bank the minute we come home. I will not charge while we are away as I don't have charge cards (well, just one for the car rental, but I will prepay my bill before we leave). You do deserve a break, and the way things are going in this country we may not be able to afford to drive to the grocery store next month so do it and have fun!

I'm sure alot of other people will not agree here, but as long as you pay cash, even Dave Ramsey would be fine with it.

 

[lisajl]

Ok--you all convinced me! I went to the website, listened to an excerpt of his show and and got the book from the library today.
I am fired up people!!! I am ready to get totally out of debt (with exception of the house right now). We don't have that much debt, a little here, a little there, but it sure adds up.

I had today off and started reading and planning. Got so excited about being debt-free, called my DH. He thinks I am crazy!!

I would love to pay for everything in cash! WoW!


Congrats to all of you that have been doing this for a while and are debt free!
I can't wait.
Lisa

 

[Kay7979]

I just listened to a report on one of the news shows. They said many people in Mississipi, Alabama, and Louisiana could not afford to evacuate because it was the end of the month and they wouldn't get paid until after the 1st; they didn't have enough money for a tank of gas to drive to safety. Some asked to borrow gas money, and it sounds like no one would lend it to them, or perhaps the people they asked were similarly cash strapped. I know, in theory, that some people live "paycheck to paycheck," but I can't fathom it being so litteral that there's not enough cash on hand, and no money in the bank to buy one tank of gas. I don't understand how anyone can live that way without finding some way to reduce costs, rework the budget, get a second job, SOMETHING, so that they would never be absolutely penniless. It brings home the point that people who are working to get out of debt and develop more savings are doing the responsible thing for themselves and their families, and they should be commended for "getting the wake up call" and doing something constructive about their financial situation.

 

[C.Ann]

I just listened to a report on one of the news shows. They said many people in Mississipi, Alabama, and Louisiana could not afford to evacuate because it was the end of the month and they wouldn't get paid until after the 1st; they didn't have enough money for a tank of gas to drive to safety. Some asked to borrow gas money, and it sounds like no one would lend it to them, or perhaps the people they asked were similarly cash strapped. I know, in theory, that some people live "paycheck to paycheck," but I can't fathom it being so litteral that there's not enough cash on hand, and no money in the bank to buy one tank of gas. I don't understand how anyone can live that way without finding some way to reduce costs, rework the budget, get a second job, SOMETHING, so that they would never be absolutely penniless. It brings home the point that people who are working to get out of debt and develop more savings are doing the responsible thing for themselves and their families, and they should be commended for "getting the wake up call" and doing something constructive about their financial situation.

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I was thinking about this myself.. And I'd venture to bet that in a situation such as this, CASH would talk much louder than a credit card..

Think about all of the middle income folks who have lost EVERYTHING -their homes, all of the contents, their cars, AND their jobs.. Will they be able to pay off their credit card bills in that magic "30 day" window? Not likely..
Just another burden to carry on their shoulders during an already devastating time..

 

[RichNKatHolly]

I just listened to a report on one of the news shows. They said many people in Mississipi, Alabama, and Louisiana could not afford to evacuate because it was the end of the month and they wouldn't get paid until after the 1st; they didn't have enough money for a tank of gas to drive to safety. Some asked to borrow gas money, and it sounds like no one would lend it to them, or perhaps the people they asked were similarly cash strapped. I know, in theory, that some people live "paycheck to paycheck," but I can't fathom it being so litteral that there's not enough cash on hand, and no money in the bank to buy one tank of gas. I don't understand how anyone can live that way without finding some way to reduce costs, rework the budget, get a second job, SOMETHING, so that they would never be absolutely penniless. It brings home the point that people who are working to get out of debt and develop more savings are doing the responsible thing for themselves and their families, and they should be commended for "getting the wake up call" and doing something constructive about their financial situation.

It is terrible, but unfortunately it is not that unheard of. Especially in some of the areas that were hit by the hurricane. Many low income families do not make enough to save, let alone pay the month to month bills. Alot of it has to do with the country. Everything is getting so expensive, yet not many people are making enough to live. Yet, they make too much to be eligible for any type of aid.

 

[DMRick]

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I was thinking about this myself.. And I'd venture to bet that in a situation such as this, CASH would talk much louder than a credit card..

Think about all of the middle income folks who have lost EVERYTHING -their homes, all of the contents, their cars, AND their jobs.. Will they be able to pay off their credit card bills in that magic "30 day" window? Not likely..
Just another burden to carry on their shoulders during an already devastating time..

Many of them don't have their cash..it's not a matter of it "talking louder"..they just can't get to it. Some may never see it..those who had it hidden at home. Most people don't carry around all their cash. I think it's silly to equate the "30" day window to something as catastrophic as this. Credit card or cash..these people have nothing. Trying to prove cash is better than charge at this point in these people's lifes is just plain silly. Believe me the credit card companies are not going to be dunning for bills at the end of 30 days.What would be the point. And most people who use their charge cards exclusively, and pay each month, don't have large charge bills due..and even if they did, their money should be in their checking accounts when they can get to them...no different than if they had paid cash..it's the same money out each month. Bills will not be paid in NO if the people had cash or charged. I doubt they are thinking right now.."gee, I'm glad I paid cash for my couch, now I don't have a charge card bill this month" (in reality, how much better might it have been if they had charged it and now would have some cash). As the guy on the news just said in an interview..his bank isn't even available right now, no idea when it will be...he has less than a dollar..and no where to spend even that. This is just so ridiculous a subject. Good grief, surely there is a better way than this to try and prove not everyone can pay in 30 days.

 

[DMRick]

It is terrible, but unfortunately it is not that unheard of. Especially in some of the areas that were hit by the hurricane. Many low income families do not make enough to save, let alone pay the month to month bills.

ITA. A lot of these people had nothing much before this, and even less now...or I should say nothing. Eating was on a lot of people's mind in the back areas..not saving.

 

[DMRick]

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You forget that the majority of the posters here are not in the same age group as you are.. They don't have a fully funded retirement fund to fall back on; pension checks to fall back on; 40 years of saving to fall back on.. These are mostly 30-somethings (or younger), so your particular situation doesn't necessarily apply..

As for the restaurant situation, I'm sure a Visa debit card would have worked fine.. I've never had one turned down yet..

I haven't always had those things. I have them now, because we put the max in our retirement for matching, and we have always bought carefully, worked hard, and made sure we didn't overextend. It's called common sense. If we couldn't afford a vacation, we didn't take one. If I couldn't afford a new car, I didn't buy one. However, if I did buy one, and bought it on credit..it's up to me to decide if the payment was the smart way to go. Having a car payment is not neccesarily a bad thing.
I have no problem with people having savings, being careful..I do have a problem with someone acting like a cc is a sinful thing to have, and trying to convince everyone there is no reason to use a cc. It's not a bad thing. It's a different choice than you have. It's entirely up to how people use it. There is nothing at all wrong with using it to pay every bill you have, take full advantage of the points, the extended warranty's the protection, etc. If you feel you can't have one, because you would not put aside the money to pay it off monthly, then don't..but there is nothing wrong with reponsible use of a cc card. By the way, my kids are in that younger age group..and they reveal in how much benefit they get from their credit card. My daughter actually bought her car on one. It was zero interest, when the car places weren't offering such. As soon as one card reached the end of the 0 interest, she transferred the balance to another that offered it...often using a card that gave an incentive to transfer. She never paid a dime of interest. It's all in responsibility. Many many people do stuff like this. I've earned thousands this way (I love to make my best deal and then plunk down over $4,000 on a car..all free money..do you get that by just using cash? Nope). . All extra money. But it's all about being responsible.
Heck some people would not do like you did, and have both a house and a camp for years..we all make different choices, and what you consider a simple way, someone else would think is extravagant (yes, I know you live there many months now, but I'm talking when you didn't, before you decided to sell your main home)..doesn't mean one way is a wrong way, just a different way. So what works for you wouldn't be a thing I would want.
I like the "free" money. And what I spend on my card, is sitting in the checking account waiting to pay it off. Can't do that? Then perhaps a cc and all the benefits isn't for you. Want the protection and benefits a card gives you? Then don't be scared of using a credit card.

 

[DMRick]

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Do people really spend $300 on dinner? I'm so glad I live a simple lifestyle.

Oh, and by the way..a dinner in DC for 10 people can get pricey. Ah..but I do get 5% back from my cc on the total including the tax and tip .....and that would be if it was $300..yeah, another free $15 LOL!!