Are you up to your eyeballs in debt and feel overwhelmed? Welcome to the club. Most of the USA has more debt than they can handle and most of the of population says they are stressed about money at some point or another during their lives. Many people have made a New Year resolution to pay off debt and stick to a budget but don’t know how or where to start.
Here’s my easiest baby step list for newbies:
1. Read this blog. There are several writers on the Money Blog that come with different perspectives and tips to help you stay motivated and give you ideas.
2. Write down everything you spend for one month. This can be a daunting task if you aren’t detail oriented – I know I’m not and I hate keeping track of things. This is where I’m lucky to have a spouse who loves this stuff, but if you are alone or the one designated, don’t despair, just keep all your receipts, check records, credit card bills and every day or week write down what you spent. In time you’ll categorize the money into things like groceries, fun money and utilities, but if that’s too much for now, just get it written down.
3. Replace one expensive habit with a cheaper one. Like to eat out? Change from dinner to lunch. Have a collecting hobby that takes a lot of cash? Check online auctions, thrift stores, garage sales, and consider asking for your collectibles for gifts rather than purchasing more items yourself.
4. Pay off one small debt completely. Getting something, anything, totally paid off, will make you feel good and get you motivated for the next step.
If you feel you can jump right in and do more, then cut up your credit cards and spend only cash. There’s nothing like only spending what you have to put a stop to the big black spending hole called debt.
More reading from our Money Bloggers
Ten Tips to Save
Five Step to organizing your finances
Can you change your money habits?