Loading ...11 Simple Steps to Living on Less
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Debt is the outcome from living beyond our means and wanting it all now. But if you are serious about getting into the black and living a life that makes you happy, there are some simple ways to get back on track.
Evaluate each and every purchase you make - Even if it is a simple question that runs through your head asking yourself if you really need this.
Track every penny - At least sit down and consciously do this for a good 30 days to see where the money is leaking out. I have found that most of my money leaks when it comes to food (vending machines, fast food)
Balance your checkbook - Personally, I check mine every day or two but the main reason to check it regularly is to keep track of any fraud, over-drafts or mis-applied payments.
Pay your bills the day they come in - I have learned through the years that I would rather have $6 left in the checking account and all the bills paid then 2-3 sitting around and they end up being late because I spent the extra money on going out to eat or some other non-essential.
Get some form of a budget together- even if it is a ‘left-over’ budget that has you paying all the bills first and moving what is left-over to savings. Make sure essential bills are covered with what you bring in.
Lower your expenses - If you can’t cover the bills with what you bring in then it is time to evaluate your needs from cable TV to memberships to group activities that cost money
Look for free alternatives - From borrowing books, music and movies from the library to picking up furniture through freecycle or craigslist as well as finding community activities that are free to get involved in.
Cut up your credit cards - This causes you to stop using them as a crutch and if you do need the card again, it requires a period of time to wait while a new card is delivered to you since you ‘lost’ it.
Stay True - Write down your goals on your calendar or fridge to help you maintain your desire to get out of debt or save towards something special. Re-evaluate this goal regularly to make sure you are on track and if not, determine where you need to adjust.
Make savings a bill - By making savings a bill you are providing for your future self instead of using a credit card which make you borrow from your future self
Set priorities - If you really desire to live on less, then that will mean that you can’t maintain a lifestyle that is above your means. That means sacrifice and delayed gratification.
Just as debt can take you into a depression with the anxiety and frustration, savings and a budget will bring you contentment and more freedom. You will pat yourself on the back for being so smart!!
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Lower your expenses - If you can’t cover the bills with what you bring in then it is time to evaluate your needs from cable TV to memberships to group activities that cost money
December 4th, 2007 at 4:53 pm————-
No cable tv, memberships, or group activities here!
I was just wondering if you use a budget software? And if so which one. Nice post
December 4th, 2007 at 5:41 pm10k~
December 4th, 2007 at 6:53 pmRight now it is just paper and pen. I sit down every week or two and evaluate where I am at and where I want to go. So, no software at this time.
I guess I like the non-techie side of it, it makes it more real to me.
I love this list! Everything I need to do to get myself sorted out financial, and so simply put.
I’m also thrilled to see I’m already doing the majority of them, so I must be on the right track.
December 4th, 2007 at 7:51 pmI use Microsoft Money to track my accounts because it makes pretty graphs that I can easily look at.
I started off with a simple excel spreadsheet because I found that was an easy way to compare numbers and I could get a good visual of when I was in the red or not.
I use the tips you have outlined to manage my debt and they are working well.
December 5th, 2007 at 8:32 amIf you cut up your cards, you can still use them. All you need to know is the cc#, the expiration date, and the security code on the back for ordering things not in person.
December 6th, 2007 at 6:15 amI like the one about make savings a bill. I try to save 10-20% of my gross pay in savings. That includes retirement and emergency fund. If it is easier, you can use just a $ amount each month. I reevaluate my budget every few months and try to find extra cash that i can continue to put into savings, to reach that 20% goal.
December 6th, 2007 at 8:02 pmi just love make savings a bill thats a great budget tip i use the envelope system to budget as i am on a very low income i budget every dollar i pre pay for now for my land line and mobil phones and every time i use my washing machine i put 5 dollars in a jar so that if it needs repairing or if i have to buy another one the cash is in the jar same goes for the fridge its amazing how fast it mounts up and im never tempted to touch the jars the secret is never get behind or in debt its very hard to get in front again staying in front is a grat feeling regards carol from sth australia
December 7th, 2007 at 1:52 pmIt’s wonderful to hear personal experiences of how people budget. A good read.
December 7th, 2007 at 6:03 pm~Dawn
While paying your bills the day they come in is a good idea, you can simplify things even further. Set up recurrent bills (utilities, etc.) for auto-pay by
December 8th, 2007 at 10:05 amyour bank.
Great post and comments. I find it helps to stay busy, busy, busy at home and/or on your job so you don’t have time to even think about blowing money to “reward” yourself. Entertainment activities should be free or very close to it. Become a good cook. Only shop for what you absolutely need. Make do, make do, make do.
December 9th, 2007 at 6:04 pmHow often do you receive income? Add all your expenses for the year (round them up and divide it by the number of times you receive a check in a year. Weekly? Divide by 52. Then you’ll know how much of your check is yours and how much goes to your expenses. Limiting expenses is like following a strict diet. You’ll appreciate having saved resources when you really need them.
December 10th, 2007 at 6:12 amAttitude is everything! You can do this!
How often do you receive income? Add all your expenses for the year (round them up) and divide it by the number of times you receive a check in a year. Weekly? Divide by 52. Then you’ll know how much of your check is yours and how much goes to your expenses. Limiting expenses is like following a strict diet. You’ll appreciate having saved resources when you really need them.
December 10th, 2007 at 6:13 amAttitude is everything! You can do this!
Tracking every penny is definitely important. One potential source of “leaks” could be hidden or unexpected charges on your bills – for example, having to pay nearly $2 every time you call 411! 1-800-Free411 has the same business and residential listings that the phone companies use, but the service is free. You might not use it every day, but it certainly comes in handy when you’re traveling or away from a computer. You’ll have to listen to a short ad (usually about 15 seconds), but hey, you’re probably saving nearly $2 per call!
December 10th, 2007 at 2:31 pmHi Dawn
Okay I know this is an article about living on less, but let’s not forget about insurance. One of the fastest ways to plunge yourself deep into debt is not to be protected by enough insurance. Many people believe that if their employer does not offer health insurance, they are out of luck. But really there are several middle of the road steps they can take, like catastrophe insurance, (high deductable, but lower premiums) or temporary insurance, which gives you great protect but only for a short period of time (usually not longer than a year and a half.) But it is something.
Remember too disability insurance, which protects your income if you become disabled. Your employer might offer some small coverage (like 60 days worth) but if your main source of income is your job, you need to protect that. You can get decent converage for $50 dollars a month. Again get SOMETHING. Ask your employer what they offer and if you can buy extended coverage through their program. No luck? Try your professional association. No professional association? Join one!
And don’t forget renters insurance. This one is a no brainer since it is so cheap (like $20 a month) Contrary to popular belief your landlord isn’t responsible for your personal items (which are worth ALOT more than you think.) Renters even covers your stuff if it is stolen out of your car or while you are on vacation.
Since policies areextremely easy to come by and cost about the price of a pizza per month,there’s little excuse not to get one. You can search online for apolicy but a pretty cool website is Liberty Mutual’s www.youcovered.com
because you can get a free quote without
putting in any personal information.
I’m all for spending less, but not when it comes to insurance. Thanks for the great post!
December 15th, 2007 at 7:36 pm