While at home over the Thanksgiving break I started reading my dad’s copy of Total Money Makeover by Dave Ramsey. I couldn’t put down the book, and thought it was insightful and funny.
As a result of reading that book, I’ve started the Total Money Makeover. Dave (we’re on a first name basis) outlines a series of baby steps, and I’m on number one! This means that I need to save $1000 in an emergency fund before I begin Baby Step 2- The Debt Snowball.
I also created a pretty decent budget and outline of where my money should go every month. I’ve tried to be strategic about using direct deposit to help with this. For example, I have two checking accounts and two savings accounts. One of my accounts is at a bank in KY and one is here. I’ve set it up so that certain things go to the KY account that is used far less often. My auto insurance, travel and gift funds all are directly deposited in that account monthly. My auto insurance is automatically paid monthly from that account. This way, I’m not keeping a wad of cash all year until I need it to travel, and when I do need it I can easily transfer it to the other bank, or just use that debit card. Plus it’s far less tempting to dip into those funds, since I kinda forget that account is there. I’ve also set up a recurring deposit to my savings account from my paycheck. My money is managing itself!
I’m going to blog about my process through this makeover. If you are interested, you can track my progress through the interactive chart on the right!