Money Gal Coaching: Balancing act of paying down debt, keeping an emergency fund

Kelly Blodgett started Money Gal Coaching after paying down nearly $50K in debt in 18 months.
Author:
Publish date:

Kelly Blodgett launched Money Gal Coaching with a goal of serving people who, like her, were burdened by debt. You can get her tips for paying down debt on a regular basis at Bring Me The News, in addition to the Money Gal Coaching website and Facebook page. In her words, these are tips and tricks that she used to pay off debt. 

Emergency funds are always a wise choice, but how should you balance your emergency fund when you have boatloads of credit card and student loan debt to pay down?

I think when we have a large emergency fund sitting in our bank account we can become complacent and we actually pay less towards debt each month.

Let me explain!

Before I started paying off my debt, I saved up $2,000 for an emergency – a baby emergency, if you will. I wanted to know that I could throw all my extra income towards debt, while maintaining the ability to avoid worrying about a flat tire. 

But as I started making progress, only having $2,000 in the bank scared me. I was constantly thinking about possible emergencies and I would be screwed.

Sponsored: Money Gal Coaching special offer for friends of Bring Me The News.

The ironic part is that I never had an emergency fund before. It was strange, really. The journey that I was on to pay off my debt made me more aware and responsible with my money. The truth was that the $2,000 was not a baby emergency fund, it was the only emergency fund I had ever had.

I wanted the full emergency fund because I wanted to know that if something happened, I was prepared. If I lost my job (which unfortunately we all know too well right now) I had time to find something I loved versus being forced into any job just to keep a consistent paycheck coming.

Bottom line: It's important to keep some money saved while you're paying off debt. 

A starter idea for you to consider: 

  1. Save $1,000 for each member of your household before tackling debt.

  2. Once you have your baby emergency fund, focus on your plan to pay off debt.
  3. Once you are debt-free, save 3-6 months of expenses and set it aside in a high yield savings account for a higher interest rate.

My point: If you want to pay off your debt and attack it full-on, save the $1,000 per person initially before you start making extra payments to your debt. Once your debt is gone, you can save up 3-6 months worth of expenses that experts say we should all do.

Not sure how to get started with a plan to get out of debt? Group coaching starts in a few short weeks. Click here to learn more about the program and reach out anytime with questions during your journey. Bring Me The News readers get a discounted price of more than $50 off, click here to join at the discounted rate.

Disclaimer: Bring Me The News will receive a portion of the proceeds from readers who purchase a service from Money Gal Coaching via our articles. 

Next Up

Kirill Kaprizov / Minnesota Wild

Watch: Kaprizov's OT winner lifts Wild into 2nd place in West

Kaprizov's goal gave the Wild a 3-2 victory over the Ducks.

Byron Buxton

Buxton placed on IL, Trevor Larnach called up

Buxton could be out "for weeks" with a hip strain.

A bald eagle perched on branches.

USFWS confirms 2 bald eagles were shot dead

The agency is offering a reward for information in the case.

A newborn baby, wrapped in a blanket with its mother.

Most popular baby names includes one not in top 10 for 100 years

But Olivia and Liam once again led the way for girls and boys.

Minnesota Lottery

Names of big Minnesota Lottery winners to be kept private thanks to new law

The Minnesota Legislature passed the bill unanimously and Gov. Tim Walz signed it into law this week.

FLickr - COVID-19 vaccination - Commander, U.S. Naval Forces

All 8 state COVID-19 vaccine sites now accept walk-ins

Adults can get a no-cost vaccine without making an appointment.

Wilf

Report: Vikings owners nearing purchase of Orlando City MLS franchise

The Wilfs reportedly attempted to buy the Minnesota United expansion franchise years ago.

bemidji paul bunyan

Video shows the moment someone broke the Paul Bunyan statue's arm

Police are asking for the public's help to identify those involved.

bridgeman's food truck duluth

Last remaining Bridgeman's Restaurant is launching a food truck

The Duluth restaurant is the only remaining full-service Bridgeman's in business.

FLickr - electric drive vehicle charging - Open Grid Scheduler

Minnesota can move ahead with Clean Cars program, judge says

She recommended the proposed rules be adopted.

Related

Screen Shot 2021-02-02 at 10.45.39 AM

Money Gal Coaching: Free tools for you to start a debt-free journey

Kelly Blodgett started Money Gal Coaching after paying down nearly $50K in debt in 18 months.

BMTN 900x450 (8)

Money Gal Coaching: You should be earning cash ... on your cash

Kelly Blodgett started Money Gal Coaching after paying down nearly $50K in debt in 18 months.

grocery shopping

Money Gal Coaching: 15 money-saving tips you should consider

Kelly Blodgett started Money Gal Coaching after paying down nearly $50K in debt in 18 months.

paying bills

Money Gal Coaching: Living check-to-check? Do these to get ahead

Kelly Blodgett started Money Gal Coaching after paying down nearly $50K in debt in 18 months.

Family Dollar

Money Gal Coaching: 12 things you are wasting your money on

Kelly Blodgett started Money Gal Coaching after paying down nearly $50K in debt in 18 months.

Screen Shot 2020-12-04 at 11.00.30 AM

Money Gal Coaching: Habits of a millionaire, just in time for the holidays?

Kelly Blodgett started Money Gal Coaching after paying down nearly $50K in debt in 18 months.

BMTN 900x450 (3)

Money Gal Coaching: 6 reasons you are still in debt

Kelly Blodgett started Money Gal Coaching after paying down nearly $50K in debt in 18 months.

credit card, payment

Money Gal Coaching: Bouncing back after living your best life

Kelly Blodgett started Money Gal Coaching after paying down nearly $50K in debt in 18 months.