The other day my hubby texted me (very nicely) and said “are you done spending money?” As I looked at the list I was making of things I forgot to get at the store yesterday, I replied “everything but batteries, sunscreen and a birthday gift.” His text: $15. My text: $20. Him: $16. Me: $21. Him: $7. Me: batteries are at least $10 sunscreen is $9 and a gift?!
So, we wound up going to Costco together and spending $55! Im sure none of you go through this scenario EVER, and that money and finances don’t play any part in any of your arguments, so you can share this to your friend who is telling you about her money problems!
1. Track your spending and start a budget! Just the fear of money management can lead to poor decisions and prevent you from tracking your problems. Face your fear and set up a budget. Track all your expenditures and categorize them in groups. Free online helps and tools are available at http://www.kiplinger.com/ While some items are non-negotiable like a mortgage, there is some wiggle room for groceries and utilities. Sit down and make a budget of everything that goes in and out, tracking every little thing you buy. Keep all your receipts for a month, so you can capture everything. Once you have extra cash, it should go to paying off debt. Have a weekly meeting as a couple to pay bills and make sure you both are on the same page.
2. Don’t tap into a 401(k) to pay the bills. Only if it is an absolute emergency, should you borrow from a 401(k). Take on a part time job (even temporarily) to make up for lost income. Bringing in more money and cutting expenses is really what it comes down to.
3. Face creditors head on. Failing to pay credit card debt can devastate your credit. Call credit card companies and collections agencies to try and negotiate repayment or haggle for the lowest rate. Sometimes creditors will also accept a percentage of the full amount or work with you to set up a reasonable repayment.
4 things you should never do with credit cards.
1. Don’t only make the minimum payment. This stretches out your payment, and thanks to the interest, increases your overall cost.
2. Don’t carry too many cards. Multiple cards make it easier to rack up debt because it’s harder to keep track of your spending. Keep a maximum of two national cards that you can manage carefully: one for major purchases and the other for small purchases that you can pay off every month.
3. Don’t miss payment due dates. You will be charged a late fee and could possibly make your interest go up. If you are against a deadline pay over the phone or set up online banking.
4. Don’t take cash advances. This will make your interest sky-rocket and you will have service fees. Your best bet is to call your monthly bill holders and ask for extra days to pay your bills.
Nick and I are big fans of Dave Ramsey “the financial guru.” He has great ideas that work. You can go to http://www.daveramsey.com/ or get his book Total Money Makeover on Amazon for $12.
Start Savin’ Sista’s!