For those who don't know, the Seven Baby Steps are:
Baby Step 1- $1,000 to start an Emergency Fund
Baby Step 2 - Pay off all debt using the Debt Snowball
Baby Step 3 - 3 to 6 months of expenses in savings
Baby Step 4 - Invest 15% of household income into Roth IRAs and pre-tax retirement
Baby Step 5 - College funding for children
Baby Step 6 - Pay off home early
Baby Step 7 - Build wealth and give!
All year we've been putting money toward Baby Step #2. And this month we got a HUGE and unexpected blessing and we were able to complete Baby Step #2!
I cannot even tell you the amount of peace this has brought -- even though our debt was not high interest. It's a giant weight lifted.
We've also put aside a chunk of change to buy a second car, which we will likely need very soon (we've been living with one car for over two years since the Mr. has a company car).
Now we're on to Baby Step #3, and well on our way to building up that emergency fund.
I know a bunch of you are on Baby Step #2 -- it's HARD -- but worth it. Even if you're just making one or two extra payments a month on that car loan or student loan, keep at it! Little payments can add up big.
Is anyone else out the making progress on the Baby Steps?
36 comments:
We'll definitely be on baby step #2 for a couple of years. Not because we have a lot of debt, we actually don't, but mostly because the Mr is working on furthering his career, so our income isn't what it will be in a few years.
CONGRATS!
We finish baby step #2 back in Feb, and it was a HUGE relief!!
So happy for you guys I know what an awesome feeling that is. Cheers, to a speedy step #3!
Perfect timing.
We are in the process of moving to Bible college. We need $3000 by the end of July. CRAZY !
I am so nervous about school loans. But God is good and He is way better at handling money then I am.
That is AWESOME! We are so so close to paying off our college loans. I cannot wait to say they are GONE and out of our lives forever!
Congrats!!! I think I might step on board with these plans!! They seem great!!
We are still on step #2. I'm so excited for you guys!!! What a huge accomplishment!!!
Congrats!! We plan to finish baby step #2 this year!! Dave Ramsey changed out lives and I couldn't be happier :]
we are still on Step #2... we got a nice tax refund back this year, so that will take away one of our debts, then I'm snowballing the heck out of the other two until they are gone! My goal is to be down to just one debt by the end of the year.. it is slow and painful, but I know that payoff will feel so wonderful. Good job to you and your Mr!
That's awesome! We paid off a credit card recently, after getting a huge unexpected surprise, and it is a WONDERFUL feeling! We still have student loans, but it is so nice to be free of that credit card!
Congrats!!! I know it is a AMAZING relief! We are on baby set #3 and hoping to move it baby set #4 before to long :).
We're also stuck on #2, but making progress... I think we will have to throw a party when we complete it; I'm so jealous of your debt-free status!
XO
Carly
All This Grace and Charm
http://allthisgraceandcharm.blogspot.com
Forget the pat on the back, I'm giving you a huge hug right now! Congratulations! So excited for you!
Just the encouragement I needed today!
We are currently on Baby Step #2! Oddly enough, we are loving this program! Congratulations on becoming debt free!
According to the DR plan, we are currently on #2 and will be moving on to step 4ish and 5 this year. We didn't follow exactly and actually already completed #3 and nearly step #4 as well. Our plan is to skip #5 and move on to #6 by the end of the year. :) Congrats on such a big accomplishment! Every time we knock another one down, the burden gets a bit lighter, its such a great feeling!
We are 2/3's through baby step #2, less than a year since starting! We hope to finish baby step #2 by September 2011!!!! Then I am not sure if we will start baby step #3 or start saving for a downpayment for a home....not sure what D.R. would advise!
We don't have this exact list. But we do have a "goals before the baby comes" list to finalize. As of right now we are doing really good. Not quite the amount we were wanting in the emergency fund though. But for the most part we are ready! Your very right though, its hard to save up.
congrats on completing step 2! we've been on step 2 for a couple of years, we've had a few setbacks and we have a lot of debt, but we have a looooong way to go before we'll be done with step 2. and i lost my job at the end of january so our emergency fund, and the amount we are able to snowball, is quickly dwindling. life is just like a roller coaster and i just remind myself to enjoy the ride :)
Very interesting. I had never heard of these steps and one of my biggest fears about having a child is the financial aspect. Thanks for sharing!
Congratulations! So, so awesome! We, like you, received a very generous surprise while we were in the midst of Baby Step #2, so with that generous surprise, we were able to finish Baby Step #2 & #3, and cruised right on into Baby Step #4 & #6.
Now, of course, we're backing off of Baby Step #6 & will be starting Baby Step #5 in the next few months.
I can't wait until we can move on to Baby Step #7!
One word of advice--stick to the plan and don't be tempted to open a CC account or charge on any CC's...cash, cash, cash! We watched a couple friend of ours follow the DR plan to financial freedom, only to be swallowed whole by "rewarding" themselves with brand new luxury car purchase--on credit :( It started them right back into charging & falling into a black hole of debt.
You guys are awesome!!
Congrats!! We're still on baby step #2 (darn grad school!). Are you calling in to Dave to scream "we're debt free!" :)
You are perhaps the first blogger that has spoken about dave ramsey! I'm a follower now:-)
Congratulations!! That's an amazing accomplishment! You deserve to celebrate :)
Congrats! =)
Congrats!! I love me some Dave Ramsey!! But seriously, way to go - definitely a big step to making all of your baby steps reality!
We completed steps 1-3 already but the rest will have to wait a few years until my husband finishes residency. We hope to save enough money to buy our home with cash.
My office just announced they are sponsoring this program so I was considering it - so glad I read your post, I think we'll do it! Love your blog, BTW. :)
That's so great! Someone loaned us the CDs and I listened to them in a few days--it was so helpful! Yay for living debt free :)
Still on #2! Lots of student loans but watching the balance decrease every month is very satisfying! Congrats!
Congratulations! That is so exciting and motivating to hear about! We just started DR this year, and we're very early on baby step 2. We've got a long road ahead of us, but it's great to hear about people making it through and progressing on to the full emergency fund.
I am so proud of you both and sooo excited for you! You deserve this big weight to be lifted right now, and should be so proud of all the hard work and dedication it took to get here. We're in Step #2 right now ourselves, but with 1 income and the Mr's MBA loans coming in, it's going to be a LONG ride... haha I'll keep your hard work in the front of my mind as we get through it! I hope you treat yourself with something wonderful and Dave-approved, like some ice cream :) Big xoxo !
Yeahhh!! Way to go!! We are on Step 4 and it feels awesome. It's a struggle each month to remember to pay ourselves first (after bills) before we fritter our paycheck away, but it is so worth it to watch it accumulate!
I'm so happy for y'all!!! And PROUD of you! This is huge!!!!
We're still on #2. While it feels like we'll be there forever, at least we're doing it!!!
That's awesome!! Congrats!! That's such a huge accomplishment and so rewarding. I've been working for the last few months on my finances and it's rough but I know in the end being debt free will be an amazing feeling.
Congrats, that's awesome news!
How exciting you two are debt free! Congrats! I can only imagine how happy you must feel.
We're almost done with our FPU course. Honestly, we haven't been very active in it which I am ashamed to say. We just got married and came back from our almost two week long honeymoon so we're trying to get settled now. We need to bite the bullet and go over all of our material again and really stick to it. It's hard but it will definitey be worth it!
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