For all you Dave Ramsey fans out there, I know people going through the Total Money Makeover are supposed to have “gazelle-like” intensity. Modifying is frowned upon. I am a gazelle like you wouldn’t believe!
The thing is that my cheetah is $114,000 big! And I’m making approx $30,000 a year, in a temp-to-hire position from which I haven’t yet been hired, and Mr. Micah is making another $7500 through his teaching. $5000 this fall and $2500 this spring (so he can finish his dissertation).
This thing is going to take a while. We fall into the camp of 5-or-more years people and so we’re going to have to modify things a bit.
First, while doing our debt snowball, we’re also putting some into a Roth IRA. Why? Because I’m quite young and don’t want to miss out on the time value of money. We’ll be snowballing lots and lots, but we’re saving some. We’ve also got a $3k emergency fund instead of $1k because we know there may be an emergency this summer (more on that later).
Second, we may have to stall our snowball over the summer. It’ll depend on my employment and Mr. Micah’s. He’s going to be looking for a teaching post next year, in the area, but we’re not sure how soon he’ll be able to find one. So we may just be on my income. In which case, there’s $1k of emergency money specifically designated to meet things in case my income can’t–like keeping current on accounts and handling our rent (which will rise $100 in June).
If he can’t find a job by fall, Mr. Micah’s going to have to find some other temporary employment…but I think he should have the whole summer to look. We’ll see what happens.
Now here are two good moves I made today to help get things going.
First, I e-mailed my contact at the temp agency (I plan to negotiate for $35k if she gives me the go-ahead):
I wanted to check in with you about my job. I like it a lot, am learning new things and really getting confident in some of the stuff I found harder at first. With others, I’m still improving but definitely making process. Friday, Bobbie had the day off and I did quite well in her absence. In sum, I would like to work full-time for [company].
Would it be appropriate and wise (since you’ve been in conversation with her) to discuss my future at [company] with Bobbie? Is this something that it would be better for [temp agency] to bring up?
Please let me know.
I’ll let you know what she says. If I get the job and make $35k, the raise will be split between car payments, retirement, and emergency fund…probably 40%, 40%, 20%. We can live on what I’m making now.
Second, I worked out a plan for how to allocate Mr. Micah’s teaching money. We’re living entirely off my salary, so his can go into other things.
I found out that we have enough money for current expenses, $2.8k emergency, and to pay the credit card bill off entirely. So we’re going to do that before the 30th.
Then we’ll be putting a total of $400 into the emergency fund (over the fall), $1800 towards the car payment, and $1600 to retirement fund. That assumes just under $4k take-home from his $5k position. There should be more, I think, but I’m being conservative. Any extra will go to the car.
After the fall, then, we should only owe $6200 on the car. Possibly less. If Mr. Micah gets a full-time professoral job this summer, then I’ll devise a plan to get it paid off by the end of 2008, or so.