How to save money while paying off debt.
To be blunt.
Such a dirty word to me these days. I feel like I just broke Hubpages TOS agreement just talking about it. It's about as abhorrent to me as someone using a nasty four-letter word. Oh wait, it is a nasty four-letter word! I apologize ahead of time for the foul language in this hub.
Okay, now that you've gotten the point of how I feel about (expletive deleted), I'll give you a quick rundown of my personal failure and triumph over this Monster!
Raised in Normality.....
Like the majority of people in this country, I was raised to believe that The-word-that-shall-not-be-named was a good thing, even desirable to have. "You have to get credit somehow", was what I'd been taught by society. I mean, without good credit it's excruciatingly difficult to get a cell phone (with a contract). I bought into the hype that I needed debt (wince), so when I was old enough I procured a Goldsmith's credit card. The reason I chose this particular card was because I could get it without already having a credit history.
To be honest, I didn't do too badly at first. I thought, "I'll only buy a few hundred dollars worth of clothes, cologne, or whatever to build my credit for bigger things." Yeah, that didn't last long. Soon, I was in debt about waist deep and paying just the minimums (big mistake). It wasn't long until I'd gone into debt for a car.....that was about chest deep. Then, a girl I was dating at the time....well... I decided to go for the neck deep level with an expensive ring!
Needless to say, I was beginning to drown a bit in my choices. At the time, my career path wasn't exactly the most lucrative either. The bills were stacking up a bit every month, so I knew there needed to be some drastic change. It was about this time that I read a passage in the bible that spoke directly to the situation I was in.
Romans 13:8 - Owe no one anything except to love one another, for the one who loves has fulfilled the law.
It hit me like a ton of bricks as I felt like The Lord was telling me to get out of debt and never return to it.
I immediately made the decision to take the steps necessary to break off the ball and chain. And now I can proudly say that I have been debt free from credit cards for about 4 years now. I just finished paying off my car in October of 2011 as well. As Gandalf tells King Theoden in The Lord of the Rings, "Breathe the free air again my friend!"
If you're feeling crushed by the weight of debt, this hub is for you. My heart is to see people set free from this as I was. This is not going to be easy to do, but it will be worth it in the end. It'll take hard work and sacrifice, but almost anything worthwhile normally does. In this hub, I'm going to detail out some action steps to take for the short and long term. Let's take that Debt Monster down together!
Essentials in planning for the war....
The first steps you must take is to recognize you have a problem to begin with. Most people tend to spend more than they're bringing in (sounds a bit like our government doesn't it?). The Debt Monster requires immediate and decisive action, and you need to understand that it's a ruthless enemy who will take you down if you're not properly equipped. Arm yourself for battle, for a battle it will be. Show this monster no mercy, for you shall be shown none in return! This is a fight for freedom!
- If you don't know how to budget, learn quickly. Figure out what your expenses are every month compared to your earnings. Your budget is like your map of the terrain you're about to fight on.
- Take a deep breath and prepare to live without a few things. This could mean some creature comforts. It's only going to hurt for a short time but you'll be thankful in the long run. This is your declaration of war to the Monster.
- If you're married, make sure you're making decisions together. Bounce ideas off of each other, make sure you're realistic about what needs to be cut from your budget.
- Take action, don't just talk about it. March to the drum of financial freedom!
- Don't give into the temptation to renege on some of your decisions. Once you get rid of your creature comforts, it's easy to want to run back to them. Remember you're in a battle you HAVE to win!
How much debt do you have?
Dave Ramsey's Envelope system.
Dave Ramsey's Wisdom
20 GREAT STEPS TO FINANCIAL FREEDOM!
It's time to stand up and be counted. Make sure you're fully prepared to take these steps. Most of these steps I took personally, but some are measures I know that friends of mine have also taken that have helped.
- Stop using your credit cards ASAP! Nowadays, if I can't pay for it by cash or debit....I don't want it typically. That's my whole motto. I've met so many people that can't understand this, but if you don't grasp this quickly, you'll stay where you are. Doing the same thing over and over and expecting different results is insane.
- Don't pay just the minimums on your balance. This one seems obvious, but you'd be amazed at how many people try to just "get by" on paying minimums. The interest rate alone will guarantee you never crawl out of the hole you're in. That keeps you in slavery to the lender. Try to pay double or even triple if you can.
- Get rid of cable and satellite television. Oooooh, did I touch on a nerve here? Trust me I know how hard this one is. If you have to go watch the Super Bowl, go to a restaurant with a tv or a friend's house (The Super Bowl is better watching together anyway man!). You have the potential of saving up to $300 dollars a month.
- Get NETFLIX. Costs that fluctuate between $8 to $20 dollars a month. A lot more affordable than cable or satellite and will give you much of what you were watching before in terms of shows and movies. Buy yourself an Apple TV, and get this wirelessly sent to your TV. Heck you could even get an iPad 2 or higher, an iPhone 4S or higher and watch your websites on your tv wirelessly as well.
- Do your own auto repairs and maintenance. I've learned how to do all types of maintenance from oil changes to brake pad and rotor replacements. I've saved hundreds of dollars doing these myself. There are many hubs you can read on these as well.
- Go cut a few lawns. Earn some extra money on the side. Buy or borrow a mower and hit up the neighborhoods on an off day. Fight for your very soul against the debt monster. Beat him down with some freshly cut lawns and more green in your pocket!
- Grow your own food. Not everyone can live on a farm, but you could at least grow some of your own fruits, vegetables, and spices. Ex., Tomatoes, strawberries, bay leaves, etc.
- Listen to Dave Ramsey. I have only heard bits and pieces of what this money guru knows, but I know friends who have canceled out thousands and thousands of dollars in only a few years after following his advice! They've recommended His Total Money Makeover and Financial Peace books. Worth a look if you're serious about getting out of debt.
- Stop Eating Out all the time. Learn how to cook. Most of the recipes you eat at the restaurants you can easily make at home. Set up your house (if possible) for the right setting and mood of relaxation. If you're married or have a girl/boy friend, you can make it a date night and watch a movie through Netflix or a DVD you own.
- Learn to eat smaller portions. Great way to save money and lose weight! I actually did this for a while and gained belt notches. You can save food for the next day or so and eat it again.
- Don't buy name brand. I'm mostly talking about groceries here, but it could work for anything. If your local grocery store makes a generic version of something, buy it. Normally it's almost as good anyway. Usually saves about anywhere from 10 cents to $1.50 off the name brand price.
- Use coupons! Now I'm not talking "Extreme Couponing",like the show. That's flat out obsessive. I'm talking Sunday paper style. Also, you can use the website called Groupon . My wife and I have saved so much money on anything from date nights to dental appointments using coupons.
- Walk more, save gas. I have literally made it routine to walk most places within 15 minutes walking distance. I have even made small grocery runs doing this. Lose belly fat and gain wallet fat!
- If you can, carpool to work. If you have co-workers who work similar schedules week after week, do this. Save gas and money. Chip in at least 5 - 10 bucks a week which is cheaper than what you may normally pay.
- Downgrade your cell phone service. Do this in the most economical way possible as it depends on your use. If you need to, train yourself to use it less. You could even download free texting apps to help with communication. There's also Google Voice and Skype which let you make free phone calls over wifi.
- If you're able to, get prepaid phone service. This depends heavily on where you are and what's offered. Most major carriers such as AT&T have a prepaid option.
- Make gifts for Christmas! The fact that you took time out to make that special card for someone speaks volumes. Look up creative ways to bless someone's life and save money doing it! Pinterest is a great place to start. My wife and I have done this one and it saves us so much money.
- Save every $5 dollar bill. This may sound kind of wild, but put yourself a small tin can aside for an emergency/savings. Any $5 dollar bill you and your spouse have in your pockets, put it into the can. Don't touch it unless absolutely necessary. You will be amazed at how much dough you'll save in just a month's time. I've done this one too.
- Coin jar. I shouldn't have to explain this. I've saved several hundred dollars over 6 months time before. This one is a must.
- Starbucks costs too much! I wanted you to get through all the others before I hit you with the hard one. A $5 "MochaFrappaChaiTeaLattewhatever" five times a week is a little much. Do the math and cut back.
Freedom baby. Freedom.
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This hub was done under the assumption you have a job. If you don't have one, here are a few links that will help you.
Don't lose hope.If you set your mind to it, you can accomplish anything. Have faith that there's a light at the end of the tunnel and be single-minded about accomplishing that goal.
Freedom....a much sweeter word.
Guys, I was able to buy my Wife's $1200 dollar Macbook Air with cash last year. I own my own car, not the bank. I'm free and the fresh air of freedom smells so sweet. I want you to be there with me!
Won't you join me?