As someone who was “riding clean” in a GMC Yukon (nothing wrong with nice cars, if we can afford them by paying with cash) I completely understand the complications of letting go of your ride and getting into a vehicle that doesn’t take away from your paycheck. Once we let go of the urge of being comfortable in a nicer/expensive ride and we can become more comfortable in a ride that can get the job done, then you will really start to see the momentum building towards seperating yourself from being a “slave to the lendor.” Proverbs 22:7

here’s my email to request a budget template. (I know, that sounds sophisticated). We can walk through the early stages on building your game plan that will set you up nicely for the near future and long term. But it will start by getting a new ride, unfortunately. Get you a 2002 chevy colorado or a F150, Honda accord, etc. but look at something that has around a 100k miles and that will last you 4, 5 or 6 years. Obviously the more in-expensive truck/car you find will be a quicker route to getting debt free but regardless find something that is in the $5-8,000 range (i’ll explain more below on what to do with your truck). More then likely you’re not bad with money and most people we’re friends with aren’t bad with money, we just don’t have a GAME PLAN aka budget. Let’s look at this the same way as we look at a body builder when he/she is training for a show, they have to follow a strict plan. When a electrician is doing his/her job on a small house or a big commercial building, they also has to follow a strict plan. And for people to execute there goals, we need a PLAN. We have to tell our money where it’s going instead of wondering where our money is going every time we swipe our card.
Another reason why I know you’ll love this plan is because of how you already enjoy GIVING. If you notice on the budget, the first line item is “charitable gifts.” In our budget we will GIVE %10 away every month. I can’t speak for you but my “giving” used to be based on, “Oh, I need to drop this 20 bill in the offering plate today and I’ll feel better for tithing.” Yes, the intentions are good but the word tithing means “is a one-tenth part of something.” And after being more disciplined with my GIVING this past year I am convinced it is very therapeutical in flexing our tithing muscle aka it really does feel good to give. Everybody does there “charitable gifts” different meaning sometimes I give my money to something outside of the church. aka a youth person wanting to go to a summer camp or just a person that I feel like could use the money that week. But enjoy that “charitable gift” line item just like you will enjoy your “blow” line item and don’t think about, “man if i didn’t give money away I’d get out of debt faster!” Yes, mathematically you’re right (see more in the “how to attack your debt” section below) but again it is very healthy to workout your giving muscle.
Your way of transportation. Check out online the trucks/car at your local car dealer in town and see what’s on the market. If you find something you like, go test drive it (be prepared to feel really awkward if you’re used to riding in nice leather lol) and when you find something trade in your truck for it. You’re immediately going to shave off around $20k of your debt depending on how much you owe. Obviously, your truck payment will decrease but don’t let your foot of the gas. By using the budget template you will instantly be spending less money each month because when your cash is gone from your entertainment, miscellaneous, blow and restaurant envelopes you will find yourself watching a good red box dvd and/or doing something with friends or by yourself that doesn’t cost money. i.e. going to beach or bike riding or shooting some hoops. (I know, those sound so horrible. ; ) But because of you telling your money what to do and knowing where it’s going; you will have money for grocery, bills, etc. but you will more importantly be able to aggressively attack your debt with a vengence.
With all that said, start with this. Begin filling in your budget for June. (It’s going to take you two or three months to get an accurate budget) and make sure you cover all your expenses. If you “take home” $600/week then you should have every single dollar of that $600 allocated to a line item. If you already have $1100 cash in savings then you will not need to add any money to your “emergency fund” line item, at this point (assuming you have debts). If you don’t have the cash then save up $1100 dollars for your emergency fund before you throw additioanl money at your debts. While we get out of debt your “restaurant” envelope needs to be next to nothing. The only time you see the inside of the restaurant is if you’re working. The more aggressive you attack your debts, the quicker you will be relieved from making debt payments and begin building wealth. I recommend putting in your numbers for each week. i.e. if your grocery budget is 400/month, put away 100/week in your grocery envelope. Once your budget is set for each week, go bye you some envelopes and construct you an envelope for each line item. On Monday of each week, withdrawal your cash from the bank for that week and go stuff your envelops to match whatever your budget says. I recommend only carrying around your blow, restaurant, misc. and gas envelopes. Keep all your other envelopes at your house. So now you have a plan for your spending each week and your giving and attacking your debt simultaneously.
How to attack your debt? Like I mentioned above mathamatically you could breakdown that by giving away 10% it will take you longer to get out of debt. True. You could also say, “I need to pay off my debt that has the highest interest rate since that’s costing me more?” Just avoid making it complex and simply ATTACK your debt from your least amount of debt to your greatest date. If your credit card balance is $1200, your new truck is $6,000 and your student loan is $10,000 then list your debts in that order, least to greatest. ATTACK your least amount of debt the most agressively while you are making the minimum payments required on your other debts. (If your truck payment is $220 then just pay $220 until your truck is your least amount of debt). Using this example, once you have completed paying off your credit card then you will throw whatever amount you were paying on your credit card and add that to ATTACKING your $6,000 truck note. So now you have the amount you were paying towards your credit card plus the amount that you were previously paying towards your truck. Yea you got it, once your credit card is paid off (AND CLOSED AND CUT UP!) and your truck is paid for then you will throw all that money you were paying towards those debts to aggressively ATTACK your student loan. This process will take some time, discipline and self-control (especially if you have a partner! lol) but training for anything else you have to have those some characteristics. Once your debt’s paid off you will have no obligation towards any lendor and then your savings is kicked into high gear! It’s like a huge pay raise. All the money that one time was paying towards debt is now applied to savings/investing! I’m going to stop for now but I’m going to summarize the TWO phases we just went over below. There is a total of six phases in your plan you need to adopt and we will go over those phases next time. As always stay in touch with any questions or concerns (850-685-0631). Much Love.
Phase 1: Save $1100 CASH.
Phase 2: ATTACK debt from least to greatest until eliminated.
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  1. Great buddy! I’m right there with ya…

  2. Leslie says:

    Prov: 15:22 – Plans fail when there is no counsel, but with many advisers they succeed. Thanks for your counsel David.

  3. Becky Cosper says:

    You have inspired me! Keep them flowing!

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