Goals for 2018: Food & Finances with Dave Ramsey’s Baby Steps

I’ve actually had a great start to my first goal: eat food that is alive. I’ve read enough articles that indicate that good bacteria in your gut is correlated to everything from disease prevention to mood to actually take that big step in improving my diet. For my birthday (in January) a dear friend taught me how to brew kombucha, bake with a sour dough starter and make sauerkraut and kimchi! I’m proud to say that operation eat more probiotic foods is going well. I was really nervous to delve into all of this food chemistry, but I actually really like having ‘kitchen pets’. I’ve also started soaking and sprouting lentils and nuts to unlock their full potential before I eat them. I’m keeping it pretty simple and trying to keep sprouted lentils around to add to salads. The last chapter of eat more lively foods will be to plant more native edible plants in my backyard. It’s pretty small, our entire city lot is .15 acres to begin with, so it’s a manageable size to landscape. I’ve enlisted the help of a friend with a great deal of knowledge on medicinal and herbal plants to help me put together a plan for the backyard.

So while I’ve been able to jump right into my dietary uplift, I’m still trying to figure out where to start with my next goal. Last year I wrote about how I wasn’t prioritizing paying off my student loans because I was investing in a new line of work, my wood print business. I think I’m at a place where the revenue will cover the cost of booth fees and inventory moving forward. I’m feeling reasonably confident that we’re in a good place with our income sources and potential. Meanwhile, I’ve arrived at a mindset where I’m neutral about my student loans. In the past, my student loans have carried an emotional stigma. Now I’ve arrived at a place where I’m not attaching any emotions to the financial reality of the remaining balance.

Because we are self employed and have variable income, we feel compelled to stash money for future months. If towards the end of the year we are ahead financially, we face a lot of decisions about what do with our earnings. Put it in an HSA or an IRA? Do we owe it to the IRS? Do we have home or vehicle maintenance to address? Do we make an extra payment on the mortgage? How about an extra payment on my student loan? How about a little lifestyle inflation! Well, we don’t make enough to do all of the above. Which is why it was a relief to¬†finally read Dave Ramsey’s Financial Peace. I’ve read a lot of personal finance nonfiction, but I had been avoiding Dave Ramsey’s books because they were so popular and I guess I have to be contrarian? Or maybe I just wasn’t ready to hear the message about debt and Baby Steps. Here are the Baby Steps in my words:

  1. Create an emergency savings of $1,000
  2. Pay off all of your debts except the mortgage.
  3. Save the rest of your emergency fund of 3-6 months of living expenses.
  4. Save 15% of your gross income in retirement plans.
  5. Start college funds for your children
  6. Pay off your house early
  7. With no payments and an emergency savings in place, roll over that house payment into aggressive saving!

Seeing this list, brought about peace. I needed help setting priorities. And I now buy into the idea that we need to pay off my student loan and pay off our mortgage as soon as possible. Because we feel compelled to age our money (not spend what we earn and save it for a rainy month, yes BS3 is accomplished), we always aim to keep our monthly household expenses minimal. This means we don’t pony up extra cash for our mortgage and student loans to get ahead. I think our only chance to really build wealth is to eliminate our debt payments to others and then roll that money over into paying ourselves. Because we are self-employed, we are not going to use our emergency savings towards my goal of getting this loan paid off. So I’m scrutinizing our budget and trying to figure out where we can trim back and how I can earn extra revenue to accomplish that goal faster. My current balance is $23,006.07. Stay tuned . . .

Pictured here – sauerkraut, kombucha and sour dough starter in my kitchen