WELCOME TO 105.1 THE BIG TALKER

When my husband and I had first learned about Dave Ramsey and the Total Money Makeover, we had little idea what kind of financial trouble we were in. We were newly married, and indulged frequently in many of life’s little extravagances (shopping without limits, eating out several times a week, buying new cars, etc.) When we went to church, we rarely would put anything in the collection basket. We lived frivolously and didn’t realize the dangerous path we were heading down. We had moved from Iowa to Illinois in our first year of marriage. We rented ourselves a cheap townhome and had planned on buying a home shortly after we got to know the area. It was Christmas of 2005 when we received the Total Money Makeover book from two of our dear friends. After reading it, I was so excited to get started on a budget (the typical “nerd”). My husband, the “free spirit”, was a little more reluctant, but agreed in order to “keep the peace.” We started off 2006 with $130,000 worth of student loan and new car debt. It was then we realized we were in no place financially to buy a home. When I wrote our first month’s budget, I had put $60 into our grocery fund! Looking back, I obviously had no clue where our money was going. We had multiple arguments that first year over the budget. I wanted to squeeze every last penny and put it towards debt, and my husband wanted us to at least enjoy life “a little bit.” I think my husband was sick of me preaching “but Dave says…”With God’s grace and hard work, we were able to work through our differences. I learned that I needed to give up my constant control over the budget. My husband learned to control his “buying impulses.” He even sold his beloved truck for an old Honda Civic with no air conditioning and no power “anything.” I think there were tears in his eyes when his friend drove off with his truck. We continued to live in cheap apartments in order to save money for a down payment on a home and pay off our debts. In 2008, we were blessed with a new baby boy. One week before I was to return to work from maternity leave, we closed on our first home with a 20% down payment. On our way to the closing, my husband was in a car accident. Luckily, he was not injured. However, the car was totaled, we were moving into our first home, and we had a 3 month old child to care for. I was not stressed in the least, however, because I knew we had our emergency fund in place and exactly what we could afford when getting us a replacement vehicle. Fast forward to 2012…Two children, ages 3 ½ years and 20 months old, a 15 year mortgage instead of a 30 year mortgage, and still working on paying off that last stubborn student loan. It took me 6 years of doing the budget to realize that in order to receive, that I also needed to give. At first, it was very difficult for me to start tithing, as I wanted so badly to FINALLY be out of debt. But I soon realized that the more we gave, the more God blessed us. My husband and I talk about the budget without fighting anymore. I will be able to go down to part time in June to spend more time with my two children. My husband found a job that he loves. We give more than we ever have, and we give cheerfully. And on May 6, 2012, 6 years after starting the budget, my husband and I were so proud and blessed to be able to finally say “We’re debt free!!”

Dear Dave, It has been a year now since we first shared our story with you about our journey through Baby Step #2 (What Baby Step #2 Really Looks Like). I wanted to write to you and let you know that my husband and I still continue on your plan; we are weird and in it for the long haul. As of today, May 7, 2012, we are finally on Baby Step #4. My company offers a very competitive 401K plan where I am allowed to invest up to 14% of my salary with a 50% match. My husband’s company offers a less impressive plan, but we are taking advantage of those “free dollars.” We will both be fully vested by the end of this year. The rest of the money we need to save to hit the 15% retirement savings is now being socked away into a Roth IRA. We’ve been researching mutual funds like crazy on Morningstar.com to decide what to invest in. Before this step, I don’t think I could have given a good explanation of what “fully vested,” “mutual fund,” or “IRA” even meant. In our original story, I shared with you that we were expecting our first child. Good news, he is here and he is a healthy happy little man. His crib, highchair, bouncer and clothes are all gently used; his baby food is all homemade; and his diapers always are purchased with a coupon. I could also easily write a book about the things that are on the market that babies don’t need. After all of the saving, scrimping, and bargaining, he’s just as happy as those babies with the designer clothes and brand new $1,000 cribs. Luckily, we were able to finish our savings in Baby Step #3 before our little man arrived. We did such a good job at being “gazelle intense” that we were able to pay his medical bills in cash. We were happy to find out that when you pay in cash even the hospital will give you a small discount! We anticipate starting Baby Step #5, saving for our son’s college education, before the end of the year through a Coverdell ESA. I don’t want him to repeat my mistake and find out too late that school loans aren’t actually “good debt.” We have been so tempted to start on Baby Step #6, paying extra on the house, instead of saving for retirement, but hearing you talk about eating Alpo during our golden years has kept our priorities in check. So, what does this side of the fence really look like? A lot like before. We still take our lunches every day to work, date nights consist of staying home with a red box movie and we don’t think we will ever own something with a lower case “i” in front of it. We’ve shared our story with everyone who seems interested and we’ve purchased copies of your Total Money Makeover book so we can share the plan with others. During this half of the program we’ve been solicited to buy a lot of things ranging from a whole life policy for retirement savings to co-signing for a family member’s new car loan (we don’t even drive a new car). A lot of people assume since we are through Baby Step #2 that we have a ton of expendable cash (no, it’s not like we won the lottery), which is not the case for our family at this point. After saving for retirement, paying for healthcare and taking advantage of my employer’s FSA for dependent care, my paychecks are the same size as my first “adult” job 8 years ago. This helps us avoid the “We deserve it” mentality. I know a lot of people see your plan and focus so hard on getting through Baby Step #2 that they are ready to quit once that is done. I wanted to write in and encourage others to stick with it. Yes, in general, things haven’t changed much after Baby Step #2, but there are so many wonderful gifts that God has given our family through the plan: • He has given us peace of mind that at the end of the month all of our bills will get paid, and also for 3-6 months after that • My husband and I, not the bank, OWN EVERYTHING in our house and in our garage • Extra clutter in our lives was graciously donated or sold • We know exactly how much we need in retirement to maintain our current lifestyle • When quality giving opportunities come into our lives, it is easy for us to make donations • I didn’t need to pay for a mommy boot camp membership since we still don’t have cable and continue to watch our grocery budget • Holidays feel more meaningful when celebrated with love instead of gifts that need paid off later • Money fights don’t happen as often when you have a solid budget • Good friends/people will help you with your goals if you let them (Thank you to so many of our marriage, mommy, and financial mentors…you know who you are) The best thing that came about from your program, Dave, is that I am leaving my son with a good example of what hard work and knowledge can do to change a family tree. I suppose he will be happy if I leave him a little cash and a paid for education too. Congratulations to all of you, who have powered on through Baby Step #2 before us, and keep up the great work to all of those who are just getting started. Together, we can change not only our lives, but the lives of the next generation. Have faith in God, Dave and the plan…they have faith in you. Lori, Bobby, and Baby Logan Feilmeier Omaha, NE May 2012

Too many of us musicians and artist-types have used a credit card to buy a guitar. Or an amp. Or groceries. And too many of us have been burned. Case in point: I was once foolish enough to buy a guitar amp with a credit card. (I get extra bonus stupid points for doing this at a pawn shop.) Of course I couldn’t afford to buy the amp. (Roland Jazz Chorus 77. Mint.) I was a starving college student. I was also 19 or 20 years old, and I’d recently received five or six credit card applications in the mail. I thought this was FREE MONEY! Being young and ignorant, I responded accordingly, applying for every card I could get my hands on. And every card I received felt like a blessing. How wrong can a guy possibly be? Anyway, back to the amp… after taking it home, playing it for a few months, and using it to earn a grand total of exactly $0.00, I decided I was in love with a woman. I took the amp back to the same pawn shop and hocked it for a diamond ring. Two months later, when the relationship ended and I took the ring back to the same pawn shop, they were happy to buy it back from me. For 50% of what I’d paid for it. They still had the amp, and I wanted it back. But I didn’t have the full amount. And guess what… they only would accept the minimum $15 payment OR the full amount. After a few months of minimum payments, I realized I would never get the amp back. So, in conclusion, I lost the amp. I lost the ring. I lost the girl. But I got to KEEP all of the credit card debt! That’s how this game works. So here’s my rant. Using credit cards = being in debt. For life. It means sending part of every paycheck to a credit card company. It means living life in debt. In contrast, being DEBT FREE = walking down the street with a smile. It means not worrying about how the bills are going to get paid. It means abundance, wealth, joy, and the ability to GIVE. I lived all of my adult life (from age 19 to age 41) in debt. Then I woke up, paid off all of my debt, CUT UP ALL OF MY CREDIT CARDS and closed every credit card account, built up an EMERGENCY FUND of six months worth of expenses, and now my wife and I are saving for a house. (Say it with me: We won’t even THINK about signing a contract until we have at least 20% down, and the terms will be a 15 year fixed mortgage with monthly payments that equal no more than 25% of total income. Until then, we wait, we work, we save, we stay in GRATITUDE for all of the abundance in our lives.) (NOTE: My wife and I both work for non-profit agencies. It took us almost two years of constant effort to get ‘debt free’. It was NOT the overnight cure that I’d hoped for. Much to my surprise, I’m finding that nothing worthwhile in my life IS a quick fix.) What’s happening today? When I get my paycheck each month, I don’t worry about “minimum payments” or “late payments” or “missed payments” to any credit card company. I laugh all the way to the bank. When I want to rent a car or buy an airline ticket, I use my DEBIT CARD. (If a company doesn’t accept my debit card, I don’t USE that company.) I like to pay CASH for things. I don’t owe anyone ANYTHING. Especially not a credit card company. And with all of the energy and passion that is freed up by releasing debt-related fears and worries, I have more energy for my music, for communing with nature, for connecting with my colleagues, family, friends, and loved ones. My life is simply fuller, richer, and more delicious than ever before!