In light of all the recent events around market fluctuations, mortgage crisis, and scares about the state of the economy, it’s not surprising that so many people have begun focusing on their personal finances.  I feel a little ahead of the curve because I actually started doing this myself in February, but I’ll try not to gloat.

The fact that I did begin functioning on a budget, living on less than I make, and throwing as many hand grenades of cash at my debt as I can find has given me an alarming amount of peace during even these trouble financial/economic times.

As we all know, the government has been busy bailing out the mortgage industry and Wall Street (something which pisses me off to no end).  I, on the other  hand, would rather the mortgage industry and Wall Street clean up their own messes and leave our hard earned, taxpayer money out of it.  I have to clean up my own mess, why shoudn’t they?  Then again, we’ve managed to breed a society that in general doesn’t like to take personal responsibility for their actions.  They’d rather get a divorce, file for bankruptcy, or just run away.  When the going gets tough, the tough all turn into pansies.

I think that taking ownership of your mistakes and missteps is one of the things that grows you.  Turns you into a stronger person.  Humbles you.  And, in my Christian world view perspective, teaches you to lean more on God.

I kicked off 2008 annoyed, which really was the best place to be.  I find I can only really affect change in my life when I get to a point where I’m just ready to go ape on something.  I had been examining my financial state only to find that, after paying off debt with my bonus from the previous year, I had just managed to wrack it up again over the course of the previous 12 months…and this wasn’t the first time.  I’d had enough.

Today, I am happy to report that, although my 401(k) is struggling and I may be looking at a decrease in bonus for the coming year, I (with the help of Dave Ramsey) have broken the vicious financial cycle I’ve been more or less stuck churning in.  I may begin 2009 with a lower net worth due to my retirement accounts, but I am anticipating that my overall debt will be down at least 40% from where it was at the start of the year.  Yay!

So my personal bailout plan?

  • Be on a written budget (”on paper, on purpose before the month begins”)
  • Live on SIGNIFICANTLY less than I make
  • Maintain my $1,000 starter emergency fund
  • Continue my Debt Snowball until it becomes an avalanche
  • Be debt free by the end of 2010 (WAHOO!)
  • Build up my fully-funded emergency fund of 6-months of expenses
  • Breathe easier!

Naturally it goes further than that (see Dave Ramsey’s Baby Steps), but for now, this is what I’m focusing on.  More than anything, I want to dig myself out of this mountain of debt I’ve managed to all-but-bury myself in…but I don’t need (or want) the government to bail me out.  I can work.  I can budget.  I’ve got Dave Ramsey as a coach.

I got myself into this mess, and now I’ve got God helping me get out.  I’m pretty sure we can handle it.