As I mentioned before, I've been trying to get out of some credit card debt for the last couple of years. It's not that much, but it's been lingering along way past its welcome, and this year I became very determined to get rid of it once and for all.
I've been focusing on budgeting better by using many strategies and tips I've either found online, through trial and error, or through others' advice. Just to recap, the ones that have really worked for me are:
1) Transfer balance to a zero percent credit card (Chase). This tip came from my best friend and has helped me to stop the snowball from getting bigger.
2) USE CASH! This tip has, hands down, saved me a lot of money and made budgeting so much less painful. I just take out a certain amount each week, and then I try to see how much of that initial amount I can keep until the next week. If I need something, I will buy it, but I am using my cash now for most purchases other than getting gas. It forces me to be more aware of what I am spending my money on, and it often is the little push that I need to take a minute to find a coupon or use a circular to look at the drugstore sales. For some reason, "I saved 4.00," seems like so much more of an accomplishment when using cash as opposed to plastic, and it feels like buying stuff is more satisfying as well when I'm handing over the cold, hard cash.
3) When buying online, use Ebates. I really like this site, since if you are shopping online, you may as well get a little something back. This site pretty much gives cash back rewards for all the websites I shop at regularly (Drugstore.com, Nordstrom, Sephora, JCrew, QVC, etc.). I recently got a check back for 6.00 all for shopping I would have done anyway. Great site, especially when they have the double cash back from a merchant you would shop with anyway.
4) Use the wallet index card with a summary of your debts in front of your cash. If you have to see that every time you look at your wallet, it's easier to say no to some of those impulse buys. After all, that number would probably be a lot less if I'd made fewer of those over time.
5) Figure out which services you can cut. Only you know which things you can get rid of or cut back on without too much pain. For me, this included cutting my cable and internet to a more basic plan. Is my internet a little slower? Yes. Do I miss On Demand? Yes. But am I miserable with this plan? Not at all. I also was able to cut my phone bill by about 16.00 a month just by calling and asking the person for advice on my plan. This one was completely painless, but now I'll be getting that 16.00 extra instead of Verizon.
6) COSTCO, COSTCO, COSTCO
I cannot say how happy I am that there is finally a Costco nearby. For a yearly fee of 55.00, you can save a lot by shopping at Costo. A few recent examples of me saving money there include buying my coffee only from Costco from now on. A 2.5 pound bag (40 oz.) of good coffee from Costco is 13.49, while a 12 ounce bag of my Starbucks Veranda Blend is about 8.00. So I can pay .33 or .66 an ounce- easy decision. I am now paying HALF of what I used to for coffee and it tastes just as good. I also recently purchased a 4-pack of shave gel there for 7.49 and they are even 20% bigger than the ones from the drugstore. Another sleeper at Costco (pun intended)- the pillows. They were recommended to me, and I picked up a pack of two for less than 11.00. They also are fantastic quality. One more reason to shop at Costco- they are one of the few retail companies that pays a living wage including health benefits to the workers and allows them to unionize. A company that treats their employees with dignity and respect and saves me money- yes, please!
7) Find another way to focus on the indulgences you enjoy buying. For example, I really enjoy buying and trying makeup, beauty products, etc. These purchases probably account for a large proportion of my discretionary spending, and I know that probably won't change no matter how much I want to be better with money. Again, my best friend had a good idea that has worked for me- work on using things up in this category.
There are many benefits to doing a "Use it Up Challenge":
*It forces you to think about the things you do use up (lotions, etc.) and the things you don't but keep purchasing (eye shadows-- I've actually NEVER used one up).
*It's very satisfying to use things up, to think that you got your money's worth and then you can decide if you want to purchase it again or move to on greener pastures.
*It saves money because when you see something you want to buy, you think of all the other ones that you already have and the ones you're trying to use up.
In all honesty, despite the fact that I'm on a "Use it Up" period, I still did make a purchase last night on QVC- A Mally Kit I've had my eye on for some time. But I'll definitely have fun using that one up, and it's a reward for all of the good choices I've been making lately!
8) Reward Yourself- this tip I've seen in many magazines and blogs. No matter how much you want to cut your budget, it will be a miserable experience if you don't reward yourself. One really good idea I've heard is to take out your weekly budget allotment. Anything that you have saved up by the end of the week, put half in the bank or toward your next week's budget, then create a "fun money" fund with the other half for any purchases you would like.
These are my best tips, and in combination, they've helped to keep me motivated and to see the beauty of a good budget!
