Let me begin by saying that I really like Dave Ramsey. I think his no nonsense approach to getting out of debt is really helpful, and forces you to be accountable for how you got to where you are, and the choices and actions you will need to take to get out of debt. Whenever I finally get comfortable enough with someone to talk about my debt, the first thing they ask me is, “Are you doing the baby steps?” For the record, I’m not. Not really. Let me explain.

Emergency Fund

I do have a $1,000.00 emergency fund. While Dave recommends that you not have any more money in savings while you try to climb out of debt, as I was getting ready to make a cross country move, that was just not possible and I created a small separate savings called “transition funds.” Once my move “settles” and I have paid rental deposits, car registration changes, have my first couple of paychecks, etc. I will throw any remaining transition funds to my debt.

Smallest Balance to Largest Balance

Dave will be the first person to tell you that his method is not the most mathematically efficient. That his method is designed to address the emotional reasons that people have difficulty paying off debt. I think that is the right attitude. My emotional trigger is just a bit different. While some people might get frustrated by paying on a large balance and not seeing it go down and give up, I get really frustrated, and my shame is magnified, every time I make a payment and see how much money goes to interest. It is so discouraging. For that reason, I am attacking my loans based on how much interest goes out each month. While I am open to reassessing this if I feel like I need a “quick win,” I think this will work best for me for the moment or at least until I can get my balances low enough to qualify for a desirable refinance.

Beans and Rice

While $685.00 for an apartment including all utilities is pretty cheap, I could have gone even cheaper if I was willing to live with someone. I think I could easily have saved an additional $100.00 per month which is $1,200.00 per year. So why didn’t I do that? Because I won’t be out of debt in 2-3 years. If I am really lucky, I will be out of debt in 5-6ish years and there is no way I would be able to stick out intense debt repayment, and all of the sacrifices I will need to make, if I am miserable or unhappy with my living situation. Now, I’m not saying my happiness justifies me doing other extravagant things, but if $100.00 per month means I am not miserable, and that I actually cook at home because the kitchen is clean, and I’m not worrying about sharing my space with others, then I believe I will be able to stick to the plan for longer and be more successful.

I think Dave Ramsey is great and he and his team have done a wonderful job inspiring millions of people to climb out of debt. I think his plan is also great. It’s just not the right plan for me. For now.