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Hey there my lovelies! Today we are discussing money saving tips and how to start paying off your debt. Whether you have a mountain of debt or small payments, it can be stressful to know where to start, and it can feel like you’ll never pay everything off. This blog post is gonna help you know where to start, and get your debt and money saving under control. We live in a society where you feel the need to buy the newest phone, the best clothes, the highest recommended beauty products. Once you get out of that circle, of feeling like you need to buy all the fancy things, you’ll be in a good head space to start saving money and paying off debt.
Get it all organized
The first major tip I have is to get all your debt organized. By this I mean, get a notebook, and write down each credit card you have and how much you owe on each. Write down how much your phone bill is, how much your student loan is, and how much any other bills you have are. Getting it all written out on paper, allows you to see exactly how much you owe, and what needs to be tackled first. It can be easy to push your debt out of your head and say you’ll deal with it one day. This becomes tricky when you want to rent an apartment or lease a car, cause your credit score will reflect what you haven’t been dealing with. If you aren’t sure exactly how much you owe, you can go to each individual site that you have a credit card with, login and then it’ll tell you how much you owe. You can also get a free credit report where you will have everything on paper, and see what you owe.
Cash Envelop Stuffing
Cash envelop stuffing is one of the things I do, that I absolutely love. Cash Envelop Stuffing in a nut shell is where you take out a certain amount of cash each week, every two weeks or every month, You then make separate envelops for gas, grocery shopping, personal, household items, anything that’s not a monthly bill. Separate the cash into each of these envelops and that’s how much you have to spend for the week or two weeks etc. So if you put 100$ a week or every two weeks in the envelop for groceries, that’s all you can spend. Once you have the envelops stuffed, the rest of the money you make will go to paying off your debt and paying your bills. This allows you to save, and not spend fruitlessly. It gives you a certain amount of money to work with, you can learn to coupon and go to sales racks to keep your spending under the limit.
Open a savings account or separate bank account
The next thing to do, is to tackle the money left in your account. Opening up a savings accounts allows you to transfer a certain amount of money to that account and use that to start paying off debt. You can also open up a separate bank account, you would do this for many reasons. One of the main reasons is you don’t want all your money in one account, just in case you lose your debit card, or your account gets temporarily deactivated. If this happens and you only have one account you have no money to pay your bills and you’ll miss you monthly payments.
Tackle the lowest debt first & pay on time
When you are looking at all the debt you owe, you will want to tackle the biggest payment first. Don’t do this, start by tackling the smallest payments firsts. This will allow you to pay off cards and bills one at a time, and will give you the instant gratification of watching the amount you owe go down. Start small and work your way up, you won’t get overwhelmed if you do this and you’ll feel like it’s debt you can handle. The next tip I have is once you start making payments, always, always, always make the monthly payment on time. It’s so important to be diligent during this process and not get over draft fees or late fees and accumulate more debt than you had before. Get a calendar, write down when everything is owed, and hang it somewhere you can see it. This way you know when certain payments are due and you can have the money ready in your account.
Eliminate unnecessary expenses & stop using your credit cards
Before you even start paying off your debt, there are two things you need to do. One, is eliminate unnecessary expenses. Stop getting your morning coffee and make it at home, stop going out to eat and cook at home, stop going clothes shopping and start spending less. Every dollar counts when you are paying off your debt. If you keep spending on things you don’t need, it’ll take you so much longer to pay off your debt than it could. Be a frugal as possible with your spending. The second thing is to stop using your credit cards. Its counter productive to try to pay off your cards while you are still using them. If you need to buy something use the cash in your account. It’s easy to not realize exactly how much your spending when you are swiping a card, that isn’t taking direct money from you. Once you start using the cash you are earning to buy things you’ll be way more careful with what you purchase.
The last tip I have is to not stress out over your debt. The important thing is you are starting the process of tackling what you owe. Don’t get overwhelmed, making a plan and schedule will help with this. Even if you have so much money you owe the main thing is to start, you’ll thank yourself in the long run!