Dollar Diary: Sioux Falls woman who works in banking follows Dave Ramsey plan

Dollar Diary is an inside look at the spending – and saving – habits of your fellow 605 residents.

It’s sponsored by The First National Bank in Sioux Falls, which is ready to help you no matter what your financial goals. If you’d like to keep a Dollar Diary for a week, email us at info@pigeon605.com.

In today’s edition, we meet Cassandra, a 56-year-old who works in banking in Sioux Falls.

Age: 56

Occupation: Banking

Salary: Approximately $98,000

Do you get income from anything else? Side hustle? Passive income? No.

Neighborhood/living situation: I live in a home with no mortgage.

Do you own your car or have a payment? We have two cars, with no payment.

How about debt? Anything you’re obligated to pay each month? No.

And now, the diary.

Here’s what a week of spending looks like:

Monday: $0.

Tuesday: I got a haircut for $50.

Wednesday: I filled a prescription for $21.06.

Thursday: I bought essential oils online for $38.07, movie tickets to the State Theatre online for $26, and Amazon auto-billed me $9.95 for a bottle of supplements.

Friday: I made an Amazon purchase for $30.60, but $26 was paid from a gift card.

Saturday: I spent $123.54 at the dog groomer, $23.73 at Walmart, $59.81 for hair care supplies and did two Amazon orders for $19.98 and $10.10, but I applied a $16.68 gift card to one. And then I went to Crate Deal and spent $52. It was $5 day, so I found three packages of our vacuum cleaner bag, and each package held eight bags. They normally sell for $23 per package, and I paid $5 per package. In the past, I’ve found a $65 game for $5, a quilt for $7 and many other games, toys, kitchenware. You name it, I’ve probably purchased it. Cellphone cases, charging cords and books are $1 every day. For me, it’s just as much entertainment as it is savings.

Sunday: I got the Popeyes chicken No. 4 meal, spent $8.87 at Qdoba and bought gas for the snowblower for $20.

What I learned: Nothing really. We are pretty intentional when it comes to our spending.

What’s next for Cassanda?

What big purchase are you saving up for? A new kitchen countertop and new carpet.

How would you describe your broader financial goals? Do you feel like you’re on track? We are — wish it wouldn’t take as long as it does to save, but we are going in the right direction. Our budget is different from most because we follow the Dave Ramsey plan — no debt, not even a mortgage. We put some money into investments this week, too, which I didn’t include in the diary.

And, finally, retirement. What’s your approach to planning? Do you think it’s working for you?

We have Roth 401(k)s, and we save 15 percent of our income every month for retirement.

The expert’s take

Of course, it’s just one week, but Cassandra’s Dollar Diary gave First National Bank’s chief wealth management officer, Adam Cox, a high-level look at her budget and financial goals. Here’s his take:

It’s impressive that Cassandra has no debt — not even a mortgage or car payment. Not many people can say that. That Dave Ramsey plan is really paying off! Also, it’s clear that Cassandra tries to be frugal with her money, which is one of the most important aspects of accumulating wealth, along with putting that extra cash into investments so it can grow over time.

It looks like Cassandra has prioritized savings and doesn’t let her spending reduce her 15 percent target savings goal, which is great. By automating our savings habits, we remove the temptation to spend and then just save “what’s left” at the end of the month. That can be especially difficult to do when also trying to save for large purchases. Good habits are crucial to achieving financial freedom.

With retirement on the horizon for Cassandra, I would like to see her prioritize planning and optimize her retirement savings strategy. At this stage, it’s critical to know your numbers. If 15 percent is what’s needed to fund Cassandra’s lifestyle in retirement, then she’s all set! If not, the time to make those adjustments is now — before turning off her income and retiring. Finally, I would encourage Cassandra to consider spreading her savings out across pre-tax, Roth and after-tax buckets to make sure she can manage taxes efficiently in retirement.

If you’re nearing retirement like Cassandra, be sure to check out our podcast, “Common Cents on the Prairie!”™ In the latest episode, “Retirement Planning is More Than Just Numbers,” we talk with financial advisor Roger Whitney about in-depth retirement planning. Watch the episode below, or stream any of our episodes wherever you get your podcasts.

And if you find yourself looking for a little extra help with your retirement planning, reach out.