Relieving Debt: One Expense at a Time

Laurie Childree By Laurie Childree, 27th Oct 2015 | Follow this author | RSS Feed | Short URL http://nut.bz/3imsovbb/
Posted in Wikinut>Money>Debt

Recently I have found myself in debt once again. I have a plan to get out of it. In theory my plan should work, I'll find out for sure as I put it into practice.

Figuring Out the Total

The first thing that I have to do is figure out the total of all my debt. I'll be using it to figure out exactly what I have to do in order to get the rest of the expenses under control.

Must Pay
The rent, lights and phone are the expenses that have to be paid. The Internet is on that list also. My child needs it for school, and I use it for a number of things.

These total an average of $373 a month and are non-negotiable. Anything after that adds stress.

Minimum Payment Trap
Companies set minimum payments in order to earn interest so that they get paid an excessive amount more than the items you purchased cost.

It can take years to pay off a balance with just the minimum payment each month. Paying as much as you can over the minimum reduces the amount of time to pay off the debt, and the amount that you pay in interest charges.

Finding Money

Saving with Checking
I round my purchases up to find money in my checking account each month. I am setting a goal of $100 and once I reach that amount I'll be using it to pay on a debt that is close to being paid off. It'll save me a great deal of money.

Change
I've decided to start pulling cash out for shopping. This means that I will be raising my endurance for my walks to attempt a trip all the way to the bank. I'm not sure how many miles it is, but it'll allow me to get change out for my laundry at the same time.

I'll be using my quarters from purchases for laundry and the small change to pay for prescriptions or treats for us when I fill the jar. My prescriptions are only $1.50 a month which is good. That is easy to find.

Reducing Household Item Expenses
I will be altering my shopping habits back to what they were when I took the time to plan the trips. My coupons will be organized, cash back offers listed, and price comparison done thoroughly.

I can use my second choices for a while until we are back to where we need to be. Using the sales to ensure that I am only buying what we need while it is at the lowest price and combining it with coupons will help.

Cash back for Household purchases
To free up money for paying down debt I will be using the money I get back from purchases to buy other household items instead of taking the money out of my regular budget. This will allow me to use that amount on the debts that I have. The goal is to buy household items for $20 a month and have a little left to get the baby some things.

Clearance Racks
I'll be looking at the clearance racks to find some winter clothing layers. I'll be searching for any other regularly used household items I can find as well.

Over Payments

I am going to adjust my budget with a minimum payment on everything in November because of extra bills. Then in December I will once again budget in overpayments. The goal is to include every bill that qualifies as debt in the ones that get more than the minimum paid.

Problem
Doing it this way the most each one would get is $5 over the minimum.

This means that taking the smallest amount to pay off first would be more ideal. The goal is an additional $20 a month minimum or double the minimum payment whichever I can manage on any given month.

Ideally I'll be able to come up with an extra $100 payment every few months.

Hobby Income

Writing is once again a hobby. I will be using the income to hopefully pay my phone bill for a couple of months and relieve the strain on my bank account.

Conclusion
I hope to get back out of debt within the next five years but it's going to take hard work and determination. We'll make a couple of sacrifices but in the end they will be worth it when we no longer have to worry.

Tags

Debt, Money Management, Money Saving Tips, Money-Conscious

Meet the author

author avatar Laurie Childree
I'm the single mother of an autistic child a published author. I have a wide range of topics that interest me including personal finance, writing, self employment and creative writing.

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Comments

author avatar brendamarie
28th Oct 2015 (#)

sounds like you are doing well with it. I know, how you feel, every penny seems to go to the bills.

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author avatar Laurie Childree
28th Oct 2015 (#)

Thank you brendamarie

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author avatar Fern Mc Costigan
29th Oct 2015 (#)

Take good care my friend!

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author avatar Laurie Childree
30th Oct 2015 (#)

thank you

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