Money ... Money ... Money ... Strategy and Goals

Bella thought it might be good to share with A Budget Bella Readers the state of her personal finances. This week she finally finished paying off a $14000 loan (this took three years). Thankfully, this has freed up $400 a month to start paying off the rest of her personal debt. Bella has recently researched the Dave Ramsey method and feels this would be a great place for her to start (in particular the "snowball method"). As Bella has said in previous posts, a strategy is a must in order to have success. So here are Bella's goals for the remainder of 2009 and all the way into 2011:

1. March to July pay off the MasterCard $2000 (this then frees up an extra $50 a month);
2. August to September pay off dental bill $800 (this now frees up $27 making $477 to snowball);
3. October to December pay off Best Buy Card $1300 ($20 freed, but the student loan payment starts again so she now has, $327 to snowball).

In 2010 the plan will be:

1. January to May pay off Carpet $1800 ($57 freed, now $384 to snowball);
2. June to December pay off furnace $2800 (also a loan finishes so this frees up $201, now Bella has $585 to roll).

In 2011 (eek! - that seems so far away!):

1. January to April pay off Visa Card $3200 ($67 freed up, $652 to snowball);

The above plan and figures do not reflect at this time the extra money sometimes brought into the home. Normally, an additional income of $5000 to $7000 is earned, but this can go up and down. Should fate be on Bella's side, she and her husband hope to have climbed virtually out of "bad" debt by the middle of 2011.

Bella has really had to reflect on her finances, especially with two children. They were planning on selling the house this year and relocating back to Bella's country. This would be foolish to attempt right now. She has come to terms that instead of doing this immediately they may have to set a 5 to 10 year plan to do this. Had it just been The Husband and Bella, they would have charged the airplane tickets, cut their losses and gone. But these times, are a must for sensible actions. So (sigh) for now Bella is at peace with this, with a strategy and goal, hopefully in 2012 they can start planning for their dream.

We'd love to here your comments on Bella's plan or if you are trying to /managed to snowball debt. Do you know of an alternative method? Be sure to check out the Budget Life tab at the top of the page for more of Bella's ramblings.