Comments on My Money Game: The Debt Snowball to Financial Freedom

Man on a Mission,Thanks for reporting in and leavi...

2007-02-08T13:39:00.000-08:00

Man on a Mission,

Thanks for reporting in and leaving me a comment. Sounds like you have your plan of action in motion. I'm so glad to hear you are making progress with your debt reduction.

Was also happy to hear I was able to influence you on your decision of paying the highest APR interest rate off first. Once you realize the Magic of Compounding interest on those credit cards you can see why you will be dollars ahead in the long run. Stay focused on your goals and before long you will be debt free. :)

Sherry, you did influence my decision and as you c...

2007-02-08T12:43:00.000-08:00

Sherry, you did influence my decision and as you can see (if you are still following my blog) I am working hard to pay down the debts before beefing up my savings.

I do plan to get $1k in a baby emergency fund just to cover the small emergencies until I get debt under control.

Big Buddha, Thank you so much for your comment and...

2007-01-31T16:59:00.000-08:00

Big Buddha,
Thank you so much for your comment and opinion. I totally agree with you, a one months worth of expenses for an "emergency fund" is fine.

Having a large sum of money in an "emergency fund" is too easily accessible, especially for a person who does not have self-discipline.

Satisfaction will come once you see those credit card balances decrease each month. Methods of handling money are a personal decision based on what makes you feel most comfortable during this process of debt reduction.

I've made a similar comment on "man with a mission...

2007-01-31T14:56:00.000-08:00

I've made a similar comment on "man with a mission".

I think using your credit cards as your potential "emergency fund" can be alittle bit dangerous and just fuel the cycle of personal debt.

I've known and dealth with many people who for various reasons amasses large credit card/personal debt.

Most would try to pay the cards down in large chunks going very well for a while until "bam" some large bill/expense comes through unexpectedly ... life goes that way sometimes ... and because they don't have sufficient savings they must once again draw on there credit card to bail them out and they effectively go back to square one with the debt levels.

I think it's important to at least have 1 months worth of expenses as a buffer to these "cashflow bumps" in the road, the buffer will help smooth things out and enable you to resist "dipping" back into your credit card and avoid getting back into the debt cycle.