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Budgeting Dumping Debt Saving Money

Reduce Your Sinking Funds to Hit Your Goals Faster!

Sinking funds were a vital part of my debt free journey and when I became debt free I over doubled how many funds I had because I had all this extra money. I went from having 7 sinking funds that consisted of Christmas, car, gifts, vacations, wedding, medical, car insurance, and electric bill roll over; to SEVENTEEN sinking funds adding spontaneous giving, laptop, new car, building fund, home improvement, renters insurance, per diem roll over, phone repair/upgrades, Jayme’s desk and YouTube taxes. I truly felt that having all of these sinking funds meant that we were going to reach all of these goals and be a great use of our extra money.

After my husband and I got married and combined finances I realized that we had a lot of money left over at the end of each month because we didn’t have any debt and we weren’t saving money for the wedding anymore. That is why I made all of the extra sinking funds. I thought it was the best way to go and hit all of our goals. 

It was going great until a viewer on my YouTube channel noticed that we were focusing on one main goal, buying a new (to me) car! A Chevy Equinox, my dream car, one that I can hopefully fill with kids someday! This sweet viewer asked why I wasn’t using the “snowball method” for my sinking funds. I thought in my head “because that’s for debt… duh”, but kindly replied back that I would run the numbers and see how it worked for my husband and I. 

Guys, it worked! My husband and I have enough money left over that if we need to buy a gift or something for someone that we can just cash flow it and we don’t need a sinking fund for it. That month I didn’t fund 6 sinking funds and was able to put over $2,000 to the car fund!  

It was a huge aha moment for me that the principle of the snowball not only works for debt but any big financial goal you are trying to reach! It’s the same laser focus discipline with paying off your debts, if you are putting little snowflakes of payments to all of your debts you won’t make as much progress on them than if you were to pay minimums and put all of your focus on your smallest debt until its paid off and then roll that money over to the next smallest debt, until you are DEBT FREE. 

We are currently saving CASH for the Equinox that we will purchase in the next couple months and then we will roll over that money towards the house building fund! 

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