Money
>> Wednesday, August 12, 2009
Since I had a frustrating workout, I came to work and opened up my budget spreadsheet. Crunching the numbers and seeing how far we've come always makes me feel good and I really needed a pick me up. (Not that I'm in a peachy mood, but I'm in a better mood than I was 10 minutes ago. )
I was reading through the Dave Ramsey's forums and someone asked what percentage of their income went to their debt snowball each month. This got me thinking...
Our average monthly snowball payment from December - August is $3,857. WOW right??? Here's the list for each month:
DEC $4,795
JAN $4,400
FEB $1,272
MAR $6,000
APR $3,775
MAY $2,200
JUN $4,710
JUL $3,712
AUG $3,850
$3,857 is 63% of our net income.
We send 63% of our income to our debt every month!!! Holy cow!!! I knew it was a lot, but that really is a huge shovel.
The cooler side of this coin is that it also means Michael and I live off only 37% of our income. One of the 3 principles of personal finance is to spend less than you earn. We spend less than half of what we earn!! One of us could lose our job today and we would be fine.
There are so many feelings I have when I look at these numbers:
A sense of accomplishment
Relaxed and not at all worried
Pride
Self-control
Maturity
Responsibility
A feeling of financial peace
...the list goes on and on.
I'm curious, what % of your income do you live off of? All of it? How much do you save and how much do you spend?
6 comments:
Prior to having a friend move in to rent a room in my house, I was probably living off of 80% of my income. Now, I think it is between 50-60%, with the help of the extra income from rent. I would like to get it lower, but right now I have been traveling more and enjoying my single years. I only have a few thousand dollars debt (besides my house), so I am a happy camper!
I love reading about your success. Travis and I have a hefty debt load (thanks to my student loans) and we're working hard to always live below our means - I've been reading through Ramsy's books and we're gonna start working harder to get out of debt quicker - totally inspired by you and your updates.
I love looking at the percentages. It's a blast to be able to say, we only need xx% of our income to live off of - the rest is gravy - then it pisses me off that I'm not able to use that money as "fun" or savings money b/c it has to go to student loans, etc. Right now we live off of about 22% of our income (minus debt) with debt payments it's closer to 60%.
Hum. My numbers are ok. I'm sending 27% of my take home pay to student loans and savings. Meaning I live off 73%.
I know I could scale back my expenses, but I'm honestly not disciplined enough to do it at the moment. Plus with the knowledge that I will pay off my student loans by the end of the year and still have a considerable amount of money in my savings, I'm not gonna to make any major changes at the moment.
But I honestly did think I was putting a higher percentage than I am.
Very insightful post. You made me check... we live on 65% and are sending 35% to the snowball.
The opposite of you guys.
This is me sticking my tongue out at you!
Cheers,
the Dad
Haha, no way in hell I'm putting my numbers up here next to yours! I will say though that our monthly budget for a family is 4 is comparable for what you guys set your budget at per month.
we have an income problem not a debt problem, tee hee :)
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