fpu Archives - Live Debt Free

Is Financial Peace University Worth It?

12.16.2011 by Matt Jabs //

This is a topic I hear come up every now and again, so let’s discuss it to help those contemplating FPU.

In case you are unfamiliar, Dave Ramsey is the host of the nationally syndicated personal finance radio show The Dave Ramsey Show.

He is the New York Times best selling author of Total Money Makeover, Financial Peace Revisited, and The Money Answer Book.

And among other things, has developed the incredibly popular debt relief system Financial Peace University.

Today let’s focus on FPU and whether or not it’s worth the initial investment of $100, or whatever the going rates are these days.

Is FPU worth the money?

Some people argue that they wouldn’t, or couldn’t, attend Ramsey’s Financial Peace University if they wanted to because it costs too much money; and since they can’t afford their bills, they’re not about to shell out $100+ for some stupid debt book. Others say FPU is the best thing that ever happened to them and that the financial stuff was only a smidgen of the blessings they received from attending. Still others may rant about how Dave Ramsey is rich enough already, how he has built an empire off the chronically indebted, and that he should be ashamed of himself.

Before we get to far into the discussion let’s be sure to evaluate what the cost of the program truly amounts to. What is $100 actually worth anyway… what can it buy? A month, maybe two months of cable television. A month, maybe two months of a mobile phone contract. One week’s worth of groceries… maybe?

You get the point. Before we let the sticker shock of a cool Benjamin cloud our perception of value or worth, it is imperative we patiently evaluate the costs and benefits of the purchase.

What do you think?

My history with Dave’s programs officially began in November of 2009. At that time I had already been running Debt Free Adventure for 11 months and was fully immersed in everything personal finance. So why did I enroll in the class? To get my wife and I on same page financially. And it worked. In fact, it worked incredibly well.

Was the experience worth the $100 cost of a life long membership in the program? Uh… yeah, without a doubt. The value of the FPU program will be paying us back for the rest of our lives. Because of that fact… I recently decided to give back to the program. A few weeks ago I signed on as a volunteer FPU class leader, and have already watched God bless us amazingly because of it.

Is Financial Peace University worth the $100 you’ll have to spend to get it? Yes. It absolutely is. And Dave Ramsey – just like you, me, and everyone else – fully deserves to earn money from his honorable labor. After all, what is $100 compared to a life of financial ruin anyway? Hardly a drop in the bucket I’d say.

DIY FPU?

Is it possible for a group of financially struggling people to form a strong PF community on their own? Yes, but I’m sure the rates of success would be much lower. I don’t have any stats to back that statement up, but consider this… if it were easy to do this on their own, wouldn’t people be doing it in droves?

The truth is, starting from scratch to build community, formulate debt plans, and work those plans through to completion is doable for some, but not for many. For everyone else there is FPU and other programs like it (Crown Money Map, etc.)

In closing

If you have been on the fence about trying FPU because you’re reluctant to pay the money… go do it, I am willing to bet that you will not regret your decision. After all, what is $100 compared to financial peace?

If you’re the one still whining about not having $100 to take the course, I have a solution for you. Call your service provider and cancel your TV service for a month, and use the $100 to get your financial life in order.

Without sacrifice there is no benefit, and the small sacrifice of $100 is nothing compared to the dividends FPU enrollment will pay for years and years to come.

So is Ramsey’s FPU worth the sticker price? Well… I guess you’ll never know until you go see for yourself.

https://debtfreeadventure.com

How To Save Money (at least $100) Fast

11.30.2011 by Matt Jabs //

I wrote this article to help people save $100 quickly so they could afford to attend Dave Ramsey’s Financial Peace University.

Whether you’re in need of financial help or just trying to save money fast, these strategies will help make you successful. Read through them with an open mind.

Saving money takes purpose and action so be ready to change and ready to work hard – your effort will be rewarded.

How to save $100 fast

Let’s define “fast” as occurring within one month from today. Follow these steps and 30 days from now you should have at least $100 saved.

1. Spending moratorium.

A moratorium is nothing more than a suspension of activity. Stop spending money. Period. Make sure the basic necessities of life are covered (food, shelter, warmth, etc.) then stop spending.

2. Freelance or land some other temporary job.

Nothing makes saving easier than earning additional money outside your normal budget. If you have skills of some sort you should be able to land a few gigs/month which will enable you to save at least $100. w00t!

3. Cancel TV and/or Internet service.

If you tell me you cannot save $100 and I come over to your house to find you watching Entourage, I’m gonna put the smack down. Quit whining and cancel your cable/satellite TV service. While you’re at it, cancel your Internet service too… unless you depend on it for income, or something else that is necessary to the functioning of your household.

As mentioned above… you can save money on entertainment every month by signing up for a Netflix free-trial for TV shows & movies, and a Gamefly free-trial for video games rather than renting at a local video store and paying late fees.

4. Stop drinking/smoking.

Much the same, if you’re partaking in either of these expensive and potentially destructive pastimes while complaining that you can’t save $100… smack down. Get your priorities in order and knock it off.

5. Stop eating out and/or going to the movie theater.

One of the first things me and my wife did after embarking upon our debt free adventure, was to eliminate our seemingly insatiable appetite for dinner and a movie nights. After calculating it out we discovered this dirty little habit was costing us around $500/month. Ridiculous. How much are you spending? Write it down, and stop doing it. (Tip by @ericabiz)

6. Start liking beans, rice, and tuna fish.

Rice and beans actually taste really good, and tuna fish is considered a luxury by some, and it’s all quite good for you to boot. How much do you spend on groceries/month? I’m guessing you could save $100 easily by adopting this little nugget of wisdom. For good measure, go ahead and throw and apple in there once/week.

7. Stop buying gifts for others.

If you cannot save $100 in a month then the last thing you need to do is buy gifts for other people. Trust me, they’ll understand.

8. Apply the Pareto Principle to your possessions.

The Pareto Principle suggests that we use 20% of our stuff 80% of the time, and if you’re anything like me you have entirely too many clothes and other possessions. I’m willing to bet that you wear 20% of your clothes 80% of the time, and the ratio of use is probably similar with your other possessions. Instead of storing a bunch of stuff you don’t need, take the clothes to a consignment shop and trade ’em in for a cool Benjamin – hundred dolla bills y’all! (Tip by @2CFC)

9. Sell something on eBay, CraigsList, or Amazon.

Take some of the other non-clothing stuff from step 7 and sell it online. Even if you don’t think you own anything worth selling, go through your entire house, I guarantee you’ll find something.

10. Cancel your home phone.

Unless you need it for business or emergencies, cancel it. Especially if you have or someone in the household with a mobile phone.

11. Lower your mobile plan and/or drop your data plan.

I know, it’s nearly impossible to live without “your precious” but if Schmiegel can do it, so can you. Again, do not cancel the service if you need it for business.

12. Drop your gym membership.

Whether you bought your membership and never go, or if you go every day, cancel it. There are plenty of work out routines you can do around the house for free. Don’t worry, your pecs, abs, and delts will be fine with push-ups, sit-ups, and pull-ups respectively. (Tip by @amabaie)

13. Ride your bike for a month.

If you’re a wuss you can take a break on days when it rains, just kidding, you don’t have to be a freak about it and ride your bike every day, but do ride it whenever possible. Doing this will help give you the exercise you lost by canceling your gym membership while helping you save money and save the environment – what a deal!

14. Donate sperm and/or plasma.

Personally there is no way I would sell my sperm, I don’t believe in it and I don’t want a bunch of my offspring running around out there without me knowing anything about them. But if this sounds like something you could do… I heard there is decent money in selling the lil’ fella’s. Selling plasma is a little less controversial, and while it might not pay as well as sperm, you can still make decent money parting w/this life giving fluid.

15. Go couchsurfing on business trips.

Go couchsurfing when on business trips instead of paying for hotels. Sure, people might consider you weird if you tell ’em about it, but who cares? If you believe in it, the for Pete’s Sake… do it! It won’t work out every time, but it will to work out sometimes; and the more you travel the more you stand to save. What a blessing.

Have you tried all these ideas?

Chances are there is at least one idea above you could use to save $100 fast so what are you waiting for? Without sacrifice there is no reward so muster the courage, step outside your comfort zone, and start saving ASAP.

**********

photo by rachdian

Dave Ramsey’s 6 Steps For Dumping Debt

10.26.2011 by Matt Jabs //

I first attended Dave Ramsey’s Financial Peace University in the winter of 2009; ever since I’ve been leading FPU in our local church and strongly recommend the program to anyone interested in dumping debt. Yesterday our class reviewed the week 4 lesson titled “Dumping Debt” which highlights Dave’s six steps to getting out of debt. Let’s list the steps and analyze them now.

1. Quit borrowing money

How do you get out of a hole?

Stop digging – You have to stop overspending before you can reduce debt and build savings.
Lose the shovel – Whatever your “shovel” is, lose it. If you have a problem with credit cards – close em, shred em, and forget em.
Start climbing out – Now that you’ve stopped digging and lost your shovel you need to climb out of the hole. You’ll learn how in the steps that follow.

The bible says, “The rich ruleth over the poor, and the borrower is servant to the lender.” Proverbs 22:7. If all your extra money wasn’t going toward debt, what would you do with it? Would you save more, give more, enjoy it more? Think about this a bit before moving on to step 2.

2. Start saving money

Building an initial Emergency Fund is fundamental. While you are forming your budget you must set money aside for budget busters – unexpected things happen to everyone, so they’re not really unexpected are they? Be prepared for emergencies or be continually caught off guard and financially vulnerable… it’s your choice. Don’t worry about saving a ton, focus on building a temporary cushion that suits your situation. Dave recommends $1,000 as a starting point, me and Betsy saved $3,000. Do what works, just make sure you do something (save at least a $1,000).

3. Prayer works

What can your God do? Hopefully you answered, “Anything.” God promises to intervene for those who love Him and obey His commandments. Need to polish up on His commandments? Make bible reading – and prayer – a part of your daily routine. Doing so has given us peace of mind and increased blessings. Remember that God is righteous and we are not; to receive His blessings we must approach Him on His terms… He’s waiting for us.

“Ask, and it shall be given you; seek, and ye shall find; knock, and it shall be opened unto you: For every one that asketh receiveth; and he that seeketh findeth; and to him that knocketh it shall be opened.” – Matthew 7:7-8

Prayer is powerful, start tapping into it.

4. Sell something

You may think you have nothing valuable. I wager that 99% of the people reading have something of value to sell, you just have to put your mind to it. Selling stuff is hard for most people, and the first item is always the hardest. The more you sell the easier it gets and the lighter you feel. Start with an item of decent value that you want to keep but seldom use; for us it was our kayaks. In Michigan the summers are short so our boats would only see the water a handful of times. We made the hard decision to sacrifice wants for needs (financial security), created the Craigslist ad, and ended up selling them to friends who live on a river. We recouped our initial investment, gave the boats a loving home, and padded our bank account. Subsequently we sold our pop-up camper to a happy home for the same amount we paid for it. Next up, my scooter.

The point is, you have things you can sell. Focus on turning infrequently used items you want into the cash you need. I promise getting rid of stuff feels good afterward. I challenge you to prove me wrong.

5. Make extra money

To make extra money you can take more hours at work, get a part time job, or start a business on the side. There are many ways to earn extra money but I encourage you to do something that excites you. When first digging our way out of debt me and Betsy were both salaried employees so picking up extra hours wasn’t in the cards. I’m not huge on trading time for money so I opted instead to start a side business focused on work I had to do once that would continue to pay us far into the future. Do what works best for your situation, just be sure to do something.

Aside from making extra cash, developing multiple sources of income is wise because it diversifies your risk of job loss. Be creative and don’t be afraid to fail. Who knows, you even may find a new career.

6. Use the debt snowball

Last but not least is the debt snowball. Whether you decide to follow Dave’s FPU plan of paying debts in order from smallest to largest, or opting instead to pay the highest interest debts first… just make sure to put your snowball in place and follow through with the plan.

The debt snowball is as simple as listing your debts and prioritizing their repayment in a way that works best for you. Dave recommends paying debts in order from smallest to largest so you have “little wins” along the way. To specify, you pay minimums on all debts except your smallest, which you throw any extra money toward. Once it’s paid off you move on to the next smallest debt adding all extra money to its minimum payment, then the next, and the next. The amount you pay gets larger and larger (like a snowball) as you pay each debt off. Eventually you are out of debt which means you can actually keep the money you make and use it however you wish. I recommend using it to save more, give more, and experience more.

What will you do when you’re out of debt? It’s a great question to ask yourself often as a source of motivation to continue dumping debt!

****