Don’t
give up
No matter how large or small your debt is, never give up; always stay focused
on getting out of debt rather than staying in debt. Many people figure
that if they’re in debt so far that they can’t get out,
then what’s the point in trying? A continued spending spree will
not only make your troubles worse but elongate the time it will take
to pay off your bills and get out of debt.
Baby steps
Unless your wealthy Aunt Ethel dies and leaves you a huge chunk of money
or you happen to be holding the winning lottery ticket, you will have
to take baby steps to alleviate your debt. Marathon runners don’t
wake up one morning and decide that they want to knock out over twenty
miles in a day and just do it. Consider a zero balance on your overspending
bills to be your marathon finish line and get warmed up to start your
training.
Get your calculators ready
Start a notebook/computer entry system with your monthly expenses. List
all of your “survival/need” expenses such as rent, utility
bills (electric, gas, water, phone/cell), medical expenses, car expenses/transportation
(gas, oil change, bus pass), education (tuition/books), food/groceries,
and any other expense that you feel is necessary to have in order to
function each month. Add the expenses and label the circled total “need” beside
the number.
Skip down a few lines and list all of your monthly “extra” expenses.
This can include your cable bill, magazine subscriptions, entertainment,
clothing, eating out, and any other expense that you feel you can “live
without” in order to survive. I’m not asking you to cut these
expenses, but to separate them into the two categories. Remember that
everyone’s expenses will look different.
Don’t forget to include your trips to the ATM, morning lattes,
and any other cash item that may not be included in a credit card statement
or receipt of any kind. Add up the expenses of the “extra” category,
circle the number and write “extra” beside it.
A third (and for many, the most important) category should be income.
Write down your monthly net income, your income minus all of those horrible
taxes, union fees, medical allotments, and retirement deductions. You
may only have one source of income or you may have many. If you're a
freelancer or don't have deductions taken out of each check, try to estimate.
Add up your income, circle it and write “income” beside it.
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