How To Enjoy Your Luxuries & Still Pay Off Debt
One of the biggest mistakes that you can make when planning a budget is to only budget for the bare essentials – rent, mortgage, electricity, groceries, car payment, insurance, etc.
Why?
Because you’re not going to stick to a budget like that forever, any more than you are going to stick to a diet of cottage cheese, lettuce and grapefruit forever.
So here is what you are going to do.
First, make a list of ALL the luxuries that you regularly spend money on. Be honest with yourself; look through your credit/debit card purchases from the past few months if you need to job your memory.
Some categories might be:
- Beauty salon
- Restaurants
- Museum visits
- Cable TV
- Movies
- Birthday/Christmas Gifts
- Vacation
- Clothing purchases
- Children’s Toys
- Lunch with co-workers
- Gym membership
- Videogames
This isn’t an exercise in self-torture; I’m not here to force you to look over all of the things that you are giving up.
Here’s what you do now: For every luxury that you love and can’t afford, list a low-cost or no cost alternative.
This actually gets quite fun once you get get going. After all, you are planning out how to do things that you love.
Some examples are:
Beauty salon – either switch to a cheaper salon, or check out local beauty school. They offer VERY low cost services, including haircuts, color, and manicures and pedicures done by their students on specific days. The students are generally operating under the supervision of a teacher. And visit the salon less often. Add a couple of weeks in between your usual visit time.
Museum Visits: Go on free nights.
Gifts: Keep a gift drawer. Scout out really good sales and buy things when they are at a very low price, even months ahead. You’ll never be scrambling at the last minute that way, which tends to lead to paying more than necessary. If money is really tight, make handwritten gift certificates for family members, redeemable for one “get out of chores free” night, one hour of one-on-one time with mom or dad doing whatever the child choses (within reason of course), etc.
Clothes: Consignment stores, thrift stores, and end-of-season sales.
Toys: Children’s consignment stores.
Movies: Matinees, or movie nights at home with the family. Make an event of it; make popcorn, buy a big box of candy (which will cost a tiny fraction of what it would cost at the movie theater.
Gym Membership: Quit the gym if you can’t afford it. Form a walking group with people from work, and walk 20 minutes or more of your lunch hour. Take the stairs at work. Bicycle with friends on weekends. Take the dogs on long walks.
Almost all luxuries have cheaper alternatives. Identifying them and being willing to adjust them up is a good strategy for getting out of debt.
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